Academic Upstarts

The latest book from Clay Christensen and his team, authors of The Innovator’s Dilemma and others, is Disrupting Class, where they examine education. Tom Haskins reviews the book and provides his own perspectives in Part 1, Part 2, Part 3 and finally his own assessment on the value of college diplomas.

Tom thinks that the value of a diploma will decrease because knowledge in one field will not be enough for a generation facing multiple job changes and that the economies of scale offered by physical institutions will no longer be as obvious as they were in an industrial, fossil-fuel driven economy. I agree with Tom, and have discussed the challenges faced by universities, most recently in Moving the Ivory Tower to the Web: Part 1 and Part 2:

This is the same problem facing established academic institutions. Current revenues rest with the old way of doing business – students in classes. Going to the new Web model threatens those who make their living with the old model. Therefore leaders in the old hesitate because they are tied to their existing revenue streams. They cannot put the new inside the old. The answer is to locate the new outside of the old infrastructure and let the new unit go after customers who are not served by the current model. This way institutions can hold onto the value of their existing business for as long as possible while building up new capabilities with a different business model.

Furthermore, I would venture that many online universities are not real upstarts in this business, they are just variations on the same theme. Take local Meritus University for instance. An online BBA costs $36,000 for tuition and electronic documentation fees, compared to the average tuition at a Canadian university of $20,000 for four years. Customers pay a premium for the convenience of space and time. This model is not a great threat to traditional universities as it only targets those willing to pay more for flexibility. It may be a threat to more expensive US colleges though and that may be their target market. Still, it isn’t disruptive.

An example of the changing landscape is that participation rates in free learning programs are increasing, witnessed by over 700 members in Work Literacy and over 2,000 in Connectivism & Connected Knowledge. No one is making any money on these, except for the few students registered through the university for CCK08. This is a disruptive model of semi-academic courses being provided to mostly non-consumers (people who would not have paid for it anyway). At this time, these offerings are no real challenge to the existing structure, but acceptance of these programs may prepare the way for an upstart.

The challenge for academia will be in finding where the potential revenue is moving in the new value chain. For example, I give away all of my content on this website, because I know that my revenue is generated through consulting. This has been clear to me ever since I started. The blog helps me learn and connect and raises my profile on the Web. Charging for my content wouldn’t make any sense. Free generates the fees. How will universities be able to meet the challenge of more free content? Would they be able to compete with free tuition, even if it’s not as good? How about free accreditation?

I have some ideas about some new business models, which I’ve discussed with people such as Rob Paterson, and I’m sure that there are other people looking at this challenge as well.

6 Responses to “Academic Upstarts”

  1. Guy Boulet

    Last Friday I attended a presentation on Problem Based Learning applied to an undergraduate program. The main goal was to teach students how to find, analyse and report information rather than simply providing them with pre-digested content.

    This resulted in a subtantial increase in retention, from around 50% to 80%, but the best outcome has probably been that students graduating from this program had a significant advantage on the labour market. Employers indicated that the graduates from this university were more proactive and overal more efficient than others because they were not limited to the content that they were taught about. The fact that they were taught to build their own knowledge was a real advantage.

    In my mind, this is the university of the future, and the future is now. It is time that faculty stop thinking that what they teach is gospel. The role of faculty staff must shift from teacher to tutor. Students must be guided, not taught in order to better prepare them for the reality of the workplace.

  2. Daniel Lemire

    In Canada, most universities are publicly funded. This means that the “old diploma” model can remain in place quite a long time because we collectively bear its cost.

    Probably over my life time, we shall see some evolution, but it will be slow.

    What could move students and the systems, is a clear signal sent by the employers. However, in my experience, the employers want U. of Toronto, or McGill graduates, and they simply do not care to know what the students learned. They just want to make sure that the fellows are smart enough to learn and adapt. Unfortunately, this applies to young graduates as well as older ones.

    Change will come, but it will be slow.

  3. Tom Haskins

    Harold: Thanks for the links! To follow up on Guy’s comment first – during the twelve years I taught college, I used a problem-based approach. That gave me four ways to approach new material: 1) here’s a problem, let’s figure out how to solve it 2) here’s a solution, let’s see what kinds of problems it solves 3) here’s a situation, let’s determine what the problem is so we can solve it 4) here’s a solution that’s causing other problems, let’s figure out what the real problem is that’s not getting solved yet.

    As the students and I used this problem-based approach, it became obvious to us that the university administration and other faculty were not solving problems in their situations. Otherwise they would solve the problems of the 50% drop out rate, soaring tuition rates, widespread anxiety disorders among students, and negligible retention of what was taught. As I explored this issue with other faculty members, it only resonated with those instructors who empathized with their students, remembered what it was like to not know the material at all, and realized what a difference it makes to show respect to the students. Those that were devoted to being right, in control and admired for their superior expertise – could not get the value of using a problem based approach in their professional life.

    As I’ve been thinking a lot about disrupting higher-ed, I agree with Daniel’s assessment of how slow most disruptions coming into play will be: free content, problem-based teaching, online 24/7 delivery, etc. As you said Harold, they are not real upstarts. The one disruption that may take hold much faster is serving the non-consumers who dropped out of college or never applied.

  4. Allan

    These online schools will never threaten the traditional universities unless they establish a reputation for being just as rigorous.


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