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XXXX	
  e-­‐learning	
  
Presenta.on	
  by	
  Ta.ana	
  Zalan,	
  PhD	
  
Associate	
  Professor	
  –	
  Management,	
  
American	
  University	
  in	
  Dubai	
  
tzalan@aud.edu	
  
Linkedin	
  page	
  	
  
1	
  March	
  2016	
  	
  
	
  
Is	
  digital	
  disrup.on	
  coming	
  to	
  
the	
  university	
  near	
  you?	
  	
  
Presenta.on	
  by	
  Ta.ana	
  Zalan,	
  MA,	
  MBA,	
  PhD,	
  AFAIM	
  
Associate	
  Professor	
  –	
  Management,	
  
American	
  University	
  in	
  Dubai	
  
tzalan@aud.edu	
  
1	
  March	
  2016,	
  AUD,	
  Dubai	
  
	
  
A	
  VERY	
  Short	
  Quiz	
  
•  The	
  tradi.onal	
  university	
  will	
  disappear	
  in	
  a	
  decade.	
  True	
  or	
  False?	
  	
  
•  MOOC	
  is	
  an	
  acronym	
  which	
  means….	
  
•  Coursera	
  is	
  …(pick	
  as	
  many	
  as	
  are	
  applicable)	
  
A.  A	
  university	
  
B.  An	
  online	
  pla[orm	
  
C.  A	
  popular	
  management	
  book	
  
D.  Same	
  as	
  Blackboard	
  
E.  An	
  edtech	
  company	
  
F.  None	
  of	
  the	
  above	
  
	
  
•  A	
  flipped	
  classroom	
  is	
  ….	
  (pick	
  as	
  many	
  are	
  applicable)	
  	
  
A.  A	
  classroom	
  without	
  the	
  professor	
  
B.  A	
  classroom	
  without	
  the	
  students	
  
C.  A	
  classroom	
  without	
  the	
  lecture	
  
D.  A	
  classroom	
  where	
  students	
  do	
  pre-­‐readings	
  before	
  class	
  and	
  discuss	
  the	
  material	
  in	
  class	
  
E.  A	
  classroom	
  where	
  the	
  students	
  do	
  not	
  do	
  any	
  work	
  	
  
	
  
•  E-­‐learning	
  is	
  inferior	
  to	
  face-­‐to-­‐face	
  learning.	
  True	
  or	
  False?	
  	
  
3	
  
My	
  long	
  online	
  journey	
  
	
  
•  Started	
  in	
  academia	
  in	
  the	
  early	
  2000s,	
  on	
  comple.on	
  of	
  my	
  PhD	
  in	
  
interna.onal	
  strategy	
  from	
  Flinders	
  University	
  (Australia).	
  
•  Joined	
  the	
  University	
  of	
  Melbourne	
  straight	
  aaer	
  (2003),	
  taught	
  in	
  UG	
  and	
  
PG	
  programs.	
  
•  Lea	
  the	
  UoM	
  (2007)	
  to	
  join	
  IGSB,	
  University	
  of	
  South	
  Australia,	
  taught	
  in	
  
the	
  MBA	
  program	
  (Strategic	
  Management,	
  Corporate	
  Strategy,	
  
Entrepreneurship	
  &	
  Innova.on).	
  
•  Started	
  teaching	
  online	
  at	
  the	
  IGSB	
  in	
  2008.	
  
•  In	
  early	
  2014	
  moved	
  to	
  Torrens	
  University	
  Australia,	
  a	
  start-­‐up	
  university	
  
owned	
  by	
  Laureate	
  Interna.onal	
  (PBC),	
  the	
  largest	
  private	
  higher	
  ed	
  
provider.	
  
•  Was	
  one	
  of	
  the	
  first	
  senior	
  academics	
  and	
  MBA	
  Program	
  Director.	
  TUA	
  
runs	
  F2F	
  and	
  fully	
  online	
  degrees.	
  	
  
•  Joined	
  AUD	
  in	
  August	
  2015.	
  	
  
•  Audited	
  several	
  MOOCs,	
  including	
  	
  Learning	
  How	
  	
  to	
  Learn,	
  the	
  largest	
  /	
  
most	
  popular	
  MOOC	
  on	
  Coursera.	
  
•  Post	
  regularly	
  on	
  LinkedIn	
  on	
  issues	
  related	
  to	
  e-­‐learning.	
  	
  
•  Currently	
  researching	
  barriers	
  to,	
  and	
  enablers	
  of	
  e-­‐learning	
  adop.on	
  in	
  
the	
  UAE	
  and	
  am	
  generally	
  interested	
  in	
  all	
  things	
  digital	
  and	
  
entrepreneurial.	
  	
  
	
  
4	
  
Agenda	
  
•  What’s	
  wrong	
  with	
  the	
  current	
  higher	
  educa.on	
  system	
  
•  Digital	
  disrup.on	
  in	
  the	
  higher	
  educa.on	
  industry	
  
•  The	
  benefits	
  of	
  e-­‐learning	
  
•  Meet	
  the	
  disruptors	
  and	
  incumbents:	
  
–  MOOCs	
  
–  New	
  entrants	
  
–  Incumbents’	
  response	
  
•  The	
  economics	
  of	
  e-­‐learning	
  and	
  MOOCs	
  
•  Online	
  MBA	
  
•  The	
  future	
  of	
  the	
  university	
  	
  
	
  
	
   5	
  
•  “The	
  cost	
  disease”	
  (Baumol	
  &	
  Bowen,	
  1966)	
  =>	
  leads	
  to	
  higher	
  
costs	
  of	
  educa.on	
  
•  A	
  report	
  by	
  HSBC	
  (2014)	
  	
  found	
  the	
  UAE	
  to	
  offer	
  the	
  sixth	
  most	
  expensive	
  
educa.on	
  globally	
  at	
  $30,472,	
  coming	
  ahead	
  of	
  Canada	
  ($29,947)	
  and	
  France	
  
($16,777).	
  	
  
	
  
•  Student	
  debt	
  -­‐	
  $1	
  trillion	
  in	
  the	
  U.S.	
  alone,	
  or	
  $25,000	
  per	
  
student	
  (more	
  than	
  credit	
  card	
  debt)	
  
•  67%	
  	
  of	
  parents	
  in	
  the	
  UAE	
  simply	
  do	
  not	
  have	
  adequate	
  funds	
  to	
  meet	
  
the	
  aspira.ons	
  they	
  have	
  for	
  their	
  children’s	
  higher	
  educa.on	
  (HSBC,	
  2014)	
  	
  
	
  
•  More	
  educa.on	
  does	
  not	
  mean	
  bexer	
  job	
  outcomes.	
  
	
  
•  Poor	
  learning	
  outcomes	
  for	
  students,	
  as	
  a	
  consequence	
  of	
  a	
  lack	
  
of	
  lack	
  personaliza.on	
  and	
  flexibility	
  
	
  
	
  
	
  
	
  
	
  
The	
  modern	
  higher	
  ed	
  system	
  is	
  plagued	
  with	
  inefficiencies	
  
6	
  
The	
  costs	
  of	
  higher	
  educa7on	
  
have	
  been	
  rising…	
  
..and	
  are	
  projected	
  to	
  increase	
  even	
  
further	
  
Source:	
  hJp://
www.wellsfargoadvantagefunds.com	
  
Costs	
  based	
  on	
  2008-­‐2009	
  es.mate	
  of	
  average	
  
tui.on	
  and	
  room	
  and	
  board	
  in	
  current	
  dollars	
  for	
  
four-­‐year	
  public	
  and	
  private	
  universi.es	
  according	
  
to	
  the	
  2008	
  Trends	
  in	
  College	
  Pricing,	
  published	
  by	
  
the	
  College	
  Board.	
  Projected	
  pricing	
  assumes	
  a	
  6%	
  
annual	
  rate	
  of	
  increase	
  in	
  college	
  costs.	
   7	
  
Clayton christensen institute@christenseninst	
  
What	
  do	
  college	
  students	
  learn?	
  
•  Study	
  of	
  2,300	
  undergraduates	
  at	
  two	
  dozen	
  
universi.es	
  who	
  took	
  the	
  Collegiate	
  Learning	
  
Assessment	
  
•  45%	
  demonstrated	
  no	
  gains	
  in	
  cri.cal	
  thinking,	
  
analy.cal	
  reasoning,	
  and	
  wrixen	
  communica.ons	
  
during	
  first	
  two	
  years	
  
•  32%	
  did	
  not	
  typically	
  take	
  courses	
  with	
  more	
  than	
  40	
  
pages	
  of	
  reading	
  per	
  week	
  
•  50%	
  did	
  not	
  take	
  a	
  single	
  course	
  in	
  which	
  they	
  wrote	
  
more	
  than	
  20	
  pages	
  
The	
  quality	
  of	
  higher	
  educa7on?	
  	
  
Source:	
  Arum	
  &	
  Roksa	
  (2010)	
  quoted	
  in	
  Clayton	
  Christensen	
  InsWtute	
  (n.d.)	
  	
  	
  
CLAYTON CHRISTENSEN INSTITUTE#	
  christenseninst	
  
•  3.6	
  million	
  job	
  openings	
  for	
  which	
  
employers	
  say	
  they	
  can’t	
  find	
  qualified	
  
employees	
  
•  49%	
  of	
  US	
  employers	
  struggle	
  to	
  fill	
  
vacant	
  jobs	
  because	
  of	
  lack	
  of	
  talent,	
  
compared	
  to	
  34%	
  globally	
  
•  The	
  signaling	
  effect	
  of	
  a	
  college	
  degree	
  
appears	
  to	
  be	
  an	
  imprecise	
  
encapsula.on	
  of	
  one’s	
  skills	
  for	
  the	
  
knowledge	
  economy	
  of	
  the	
  .mes.	
  	
  
•  McKinsey	
  analysts	
  es.mate	
  that	
  the	
  
number	
  of	
  skillsets	
  needed	
  in	
  the	
  
workforce	
  has	
  increased	
  rapidly	
  from	
  
178	
  in	
  September	
  2009	
  to	
  924	
  in	
  June	
  
2012	
  	
  
The	
  job	
  mismatch	
  paradox	
  
Clayton christensen institute@christenseninst	
  
48%	
  of	
  employed	
  U.S.	
  college	
  graduates	
  are	
  in	
  jobs	
  
that	
  don’t	
  require	
  a	
  four-­‐year	
  degree	
  
42%	
  of	
  visual	
  and	
  performing	
  arts	
  students	
  said	
  
college	
  didn’t	
  prep	
  them	
  for	
  employment	
  
The	
  average	
  2013	
  college	
  graduate	
  will	
  owe	
  $35,200	
  
in	
  debt	
  (and	
  will	
  likely	
  be	
  paying	
  it	
  off	
  in	
  a	
  job	
  they	
  
hate)	
  
Six	
  .mes	
  as	
  many	
  graduates	
  are	
  working	
  in	
  retail	
  or	
  
hospitality	
  as	
  had	
  originally	
  planned	
  –	
  they’re	
  
becoming	
  waiters,	
  Gap	
  salespeople	
  and	
  baristas,	
  
because	
  it’s	
  the	
  only	
  work	
  they	
  could	
  find	
  
284,000	
  of	
  college	
  graduates	
  (37,000	
  of	
  those	
  have	
  
advanced	
  degrees	
  like	
  JD’s	
  or	
  PhD’s)	
  will	
  be	
  working	
  
minimum	
  wage	
  jobs	
  –	
  like	
  flipping	
  burgers	
  
75%	
  of	
  people	
  say	
  they	
  aren’t	
  living	
  up	
  to	
  their	
  
crea.ve	
  poten.al	
  
Source:	
  McKinsey	
  (2012)	
  
And	
  we	
  already	
  know	
  that	
  studies	
  from	
  Gallup	
  and	
  Deloixe	
  show	
  that	
  70-­‐80%	
  of	
  workers	
  
are	
  ac.vely	
  disengaged	
  and	
  don’t	
  enjoy	
  the	
  work	
  they	
  do	
  
Voice	
  of	
  the	
  US	
  college	
  graduate	
  
Source:	
  Hirt	
  &	
  WillmoJ	
  (2014)	
  Strategic	
  principles	
  for	
  compeWng	
  in	
  the	
  digital	
  age,	
  McKinsey	
  &	
  Company,	
  May.	
  	
  
But	
  digital	
  disrup7on	
  is	
  eventually	
  coming	
  to	
  higher	
  educa7on…	
  
11	
  
12	
  
Time
Performance
Performance that customers can
utilise and absorb
Range of
performance that
customers can
utilise
1	
  
2	
  
3	
  
3	
  
Disrup.ve	
  innova.ons	
  –	
  	
  
New	
  entrants	
  almost	
  always	
  win	
  	
  
Incumbents	
  nearly	
  always	
  
win	
  in	
  sustaining	
  
innova.ons	
  
hxps://www.youtube.com/watch?v=qDrMAzCHFUU	
  
	
  
Sustaining	
  vs	
  disrup7ve	
  innova7ons	
  (Clayton	
  Christensen)	
  	
  
13	
  
•  We	
  dis.nguish	
  between	
  
–  Sustaining	
  innova,ons	
  –	
  new	
  and	
  improved	
  products	
  aimed	
  at	
  our	
  exis.ng,	
  high-­‐margin	
  
customers;	
  
–  Disrup,ve	
  innova,ons	
  –	
  innova.ons	
  that	
  are	
  inferior	
  to	
  the	
  current	
  offering,	
  but	
  offer	
  features	
  
that	
  customers	
  value	
  (affordability	
  +	
  flexibility),	
  or	
  are	
  targe.ng	
  non-­‐consumers.	
  
•  In	
  every	
  market	
  there	
  is	
  a	
  rate	
  of	
  improvement	
  in	
  performance	
  that	
  customers	
  
can	
  u.lize	
  or	
  absorb.	
  
•  In	
  every	
  market	
  there	
  is	
  a	
  dis.nctly	
  different	
  trajectory	
  of	
  improvement	
  that	
  
innova.ng	
  companies	
  provide	
  as	
  they	
  introduce	
  new	
  and	
  improved	
  products.	
  	
  
•  The	
  pace	
  of	
  technological	
  progress	
  almost	
  always	
  outstrips	
  the	
  ability	
  of	
  
customers	
  in	
  any	
  given	
  .er	
  of	
  the	
  market	
  to	
  use	
  it	
  .	
  
•  Once	
  the	
  disrup.ve	
  product	
  gains	
  a	
  foothold	
  in	
  new	
  or	
  low-­‐end	
  markets,	
  the	
  
improvement	
  cycle	
  begins:	
  
–  The	
  pace	
  of	
  technological	
  progress	
  outstrips	
  customers’	
  ability	
  to	
  use	
  it…	
  
–  The	
  previously	
  not-­‐good-­‐enough	
  technology	
  eventually	
  improves	
  enough	
  to	
  
intersect	
  with	
  the	
  needs	
  of	
  more	
  demanding	
  customers…	
  
–  Disruptors	
  are	
  on	
  a	
  path	
  that	
  will	
  ul.mately	
  crush	
  the	
  incumbents.	
  
•  Disrup.ons	
  paralyze	
  industry	
  leaders	
  as	
  their	
  resource	
  alloca.on	
  processes	
  are	
  
geared	
  toward	
  suppor.ng	
  sustaining	
  innova.ons.	
  	
  
How	
  disrup7ve	
  innova7on	
  works	
  	
  
Clayton christensen institute@christenseninst	
  
•  Is	
  the	
  innova.on	
  targe.ng	
  people	
  who	
  are	
  non-­‐consumers	
  or	
  overserved	
  
by	
  exis.ng	
  products?	
  
•  Is	
  the	
  innova.on	
  not	
  as	
  good	
  as	
  exis.ng	
  products	
  as	
  judged	
  by	
  historical	
  
measures	
  of	
  performance?	
  
•  Is	
  the	
  innova.on	
  simpler	
  to	
  use,	
  more	
  convenient,	
  and	
  more	
  affordable?	
  
•  Is	
  there	
  a	
  technology	
  enabler	
  that	
  can	
  carry	
  the	
  new	
  value	
  proposi.on	
  up-­‐
market?	
  
•  Is	
  the	
  technology	
  paired	
  with	
  a	
  business	
  model	
  innova.on	
  that	
  allows	
  it	
  to	
  
be	
  sustainable?	
  
•  Are	
  exis.ng	
  providers	
  mo.vated	
  to	
  ignore	
  the	
  new	
  innova.on	
  and	
  not	
  
threatened	
  at	
  the	
  outset?	
  
How	
  to	
  spot	
  a	
  disrup7ve	
  innova7on	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
CLAYTON CHRISTENSEN INSTITUTE@christenseninst	
  
Industries	
  without	
  an	
  upwardly	
  scalable	
  technology	
  are	
  not	
  disrupted	
  
Where	
  does	
  disrup7on	
  not	
  apply?	
  	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
Subs7tu7on	
  in	
  higher	
  ed	
  is	
  following	
  the	
  S-­‐curve	
  of	
  adop7on	
  
16	
  
CLAYTON CHRISTENSEN INSTITUTE@christenseninst	
  
Personaliza7on	
  
Data	
  and	
  Feedback	
  
Factory	
  	
  -­‐	
  the	
  current	
  model	
  
based	
  on	
  standardiza7on	
  
Teacher	
  effec7veness	
  
Cost	
  control	
  	
  
Poten7al	
  benefits	
  of	
  e-­‐learning	
  
vs	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
CLAYTON CHRISTENSEN INSTITUTE#	
  christenseninst	
  
Student	
  achievement	
  in	
  online	
  
courses	
  when	
  administered	
  by	
  
faculty	
  in	
  core	
  
4.6	
  
Student	
  achievement	
  in	
  
tradi.onal	
  classes	
  taught	
  
by	
  faculty	
  in	
  core	
  
5.6	
  
Student	
  achievement	
  in	
  online	
  
courses	
  when	
  administered	
  by	
  
focused	
  online	
  faculty	
  
5.7	
  
Another	
  analysis	
  of	
  over	
  1000	
  studies	
  of	
  online-­‐course	
  results	
  conducted	
  by	
  US’	
  
Department	
  of	
  Educa.on	
  found	
  that	
  people	
  who	
  complete	
  such	
  courses	
  do	
  bexer	
  on	
  
average	
  than	
  students	
  in	
  face-­‐to-­‐face	
  instruc.on.	
  
But:	
  students	
  need	
  to	
  be	
  mo7vated	
  self-­‐starters!!!	
  
Sound	
  learning	
  design	
  boosts	
  student	
  outcomes	
  	
  
Sources:	
  Clayton	
  Christensen	
  
Ins.tute	
  (n.d.),	
  USDE	
  
CLAYTON CHRISTENSEN INSTITUTE@christenseninst	
  
Deliver	
  content	
  	
  to	
  
students	
  
Tes.ng	
  &	
  
assessment	
  
Progress	
  to	
  next	
  grade,	
  
subject,	
  or	
  body	
  of	
  
material	
  
Receive	
  results	
  
Fixed-­‐7me,	
  variable	
  learning	
  in	
  tradi7onal	
  universi7es	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
CLAYTON CHRISTENSEN INSTITUTE@christenseninst	
  
Offer	
  learning	
  
experiences	
  to	
  
students	
  
Tes.ng	
  &	
  
assessment	
  
Receive	
  real-­‐.me	
  
interac.ve	
  feedback	
  
Progress	
  to	
  next	
  body	
  
of	
  material	
  
Learning	
  is	
  fixed	
  and	
  7me	
  is	
  variable	
  
The	
  new	
  model	
  -­‐	
  Competency-­‐based	
  learning	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
Meet	
  the	
  disruptors	
  -­‐	
  the	
  avalanche	
  of	
  MOOCs…	
  
21	
  
Private	
  equity	
  and	
  venture	
  capital	
  are	
  increasingly	
  inves7ng	
  in	
  
higher	
  educa7on	
  …	
  
22	
  
And	
  other	
  new	
  kids	
  on	
  the	
  block	
  	
  
23	
  
[In	
  April	
  2015]	
  Linkedin	
  made	
  a	
  surprise	
  
purchase	
  of	
  the	
  online	
  learning	
  website	
  
Lynda.com	
  for	
  a	
  cool	
  $1.5	
  billion.	
  While	
  
many	
  in	
  the	
  tech	
  industry	
  scratched	
  
their	
  heads	
  over	
  the	
  acquisiWon,	
  I	
  want	
  
to	
  tell	
  you	
  firsthand	
  why	
  this	
  is	
  not	
  only	
  
a	
  smart	
  fit,	
  but	
  a	
  great	
  purchase	
  as	
  well	
  
(Owsinski	
  /	
  Forbes)	
  
The	
  Economist	
  Group	
  launched	
  
Learning.ly,	
  a	
  catalog	
  of	
  proprietary	
  
online	
  courses,	
  on	
  January	
  12,	
  2016.	
  
The	
  pla[orm	
  offers	
  professional	
  
development	
  courses	
  curated	
  by	
  the	
  
staff	
  of	
  The	
  Economist	
  and	
  taught	
  by	
  
experts	
  from	
  different	
  fields.	
  	
  
How	
  incumbents	
  are	
  responding	
  
hxps://www.youtube.com/watch?list=PLl2dezBNo_BkaJhG2IWePTtSA58MF8Xx-­‐
&v=M2jgSXP0ra4	
  
hxps://www.youtube.com/watch?
v=zihmiLx3Xlk&list=PLl2dezBNo_BkaJhG2IWePTtSA58MF8Xx-­‐&index=2	
  
	
  
Georgia	
  Tech	
  on	
  the	
  Need	
  for	
  OMS	
  
The	
  Georgia	
  Ins7tute	
  of	
  Technology,	
  Udacity	
  and	
  AT&T	
  have	
  teamed	
  up	
  to	
  offer	
  
the	
  first	
  accredited	
  Master	
  of	
  Science	
  in	
  Computer	
  Science	
  that	
  students	
  can	
  earn	
  
exclusively	
  through	
  the	
  Massive	
  Open	
  Online	
  Course	
  (MOOC)	
  delivery	
  format	
  and	
  
for	
  a	
  frac.on	
  of	
  the	
  cost	
  of	
  tradi.onal,	
  on-­‐campus	
  programs.	
  
This	
  collabora.on—informally	
  dubbed	
  "OMS	
  CS"	
  to	
  account	
  for	
  the	
  new	
  delivery	
  
method—brings	
  together	
  leaders	
  in	
  educa.on,	
  MOOCs	
  and	
  industry	
  to	
  apply	
  the	
  
disrup.ve	
  power	
  of	
  massively	
  open	
  online	
  teaching	
  to	
  widen	
  the	
  pipeline	
  of	
  high-­‐
quality,	
  educated	
  talent	
  needed	
  in	
  computer	
  science	
  fields.	
  
	
  
Accredited.	
  Affordable.	
  Accessible.	
  
"I	
  had	
  been	
  searching	
  for	
  the	
  right	
  degree	
  program	
  for	
  years.	
  It's	
  hard	
  to	
  find	
  a	
  
high-­‐quality	
  master's	
  program	
  that	
  I	
  could	
  do	
  while	
  keeping	
  my	
  full-­‐Wme	
  job.	
  The	
  
incepWon	
  of	
  OMS	
  CS	
  was	
  like	
  the	
  answer	
  to	
  prayer.	
  It	
  has	
  exceeded	
  my	
  
expectaWons."	
  -­‐Yeeling	
  Lam,	
  December	
  2015	
  graduate	
  of	
  OMS	
  CS	
  
24	
  
CLAYTON CHRISTENSEN INSTITUTE#	
  christenseninst	
  
Is	
  the	
  allure	
  of	
  the	
  F2F	
  full-­‐7me	
  MBA	
  diminishing?	
  
An	
  MBA	
  from	
  a	
  mid-­‐ranking	
  school	
  is	
  no	
  longer	
  the	
  investment	
  it	
  once	
  was.	
  In	
  2010	
  the	
  average	
  tui.on	
  
fee	
  charged	
  by	
  American	
  ins.tu.ons	
  ranked	
  within	
  our	
  top	
  100,	
  but	
  outside	
  of	
  the	
  top	
  15,	
  was	
  
$81,911	
  for	
  the	
  full	
  two	
  years.	
  The	
  average	
  basic	
  salary	
  of	
  those	
  schools’	
  freshly-­‐minted	
  MBAs	
  was	
  
$81,178	
  a	
  year.	
  Five	
  years	
  ago	
  tui.on	
  at	
  the	
  same	
  cohort	
  of	
  schools	
  was	
  nearly	
  $22,000	
  cheaper—
$60,247—while	
  the	
  average	
  salary,	
  $78,442,	
  was	
  barely	
  less	
  than	
  today’s.	
  This	
  price	
  rise	
  comes	
  at	
  a	
  
.me	
  when	
  enrolment	
  is	
  falling;	
  for	
  American	
  mid-­‐level	
  schools	
  it	
  is	
  down	
  20%	
  over	
  the	
  decade	
  
—	
  “Trouble	
  in	
  The	
  Middle,”	
  The	
  Economist,	
  October	
  15,	
  2011	
  
	
  
Dr	
  Gino	
  Mar.ni,	
  a	
  senior	
  director	
  with	
  GlaxoSmithKline	
  is	
  studying	
  for	
  an	
  MBA	
  with	
  
Liverpool	
  University.	
  Being	
  an	
  excep.onally	
  busy	
  man	
  –	
  he	
  runs	
  a	
  scien.fic	
  support	
  group	
  
in	
  the	
  company’s	
  Essex	
  development	
  laboratories	
  and	
  has	
  a	
  family	
  –	
  he	
  cannot	
  spare	
  the	
  
.me	
  to	
  axend	
  lectures	
  or	
  summer	
  schools.	
  	
  (The	
  Times,	
  26	
  Nov,	
  2008)	
  
	
  
U.S.	
  News	
  &	
  World	
  Report	
  had	
  commented	
  that	
  “while	
  the	
  quality	
  of	
  online	
  M.B.A.	
  degrees	
  
lea	
  much	
  to	
  be	
  desired	
  during	
  their	
  early	
  days,	
  their	
  axributes	
  have	
  steadily	
  improved	
  over	
  
the	
  past	
  few	
  years,	
  as	
  have	
  their	
  pedigrees”.	
  	
  
	
  
The	
  dean	
  of	
  the	
  Columbia	
  University	
  Business	
  School	
  was	
  quoted	
  as	
  saying,	
  “I	
  think	
  people	
  
will	
  look	
  at	
  different	
  formats	
  .	
  .	
  .	
  I	
  think	
  people	
  may	
  want	
  to	
  get	
  an	
  MBA	
  in	
  a	
  slightly	
  
different	
  way”.	
  	
  
	
  
Source:	
  Driving	
  towards	
  a	
  disrupWon?	
  HBS	
  #9-­‐612-­‐101	
  	
  
CLAYTON CHRISTENSEN INSTITUTE#	
  christenseninst	
  
Performance
Time
Time
DifferentMeasure
ofPerformance
$150,000	
  !!!	
  
Part-­‐.me	
  MBA	
  
Online	
  “Garbage”	
  
2-­‐year	
  MBA	
  
Corporate	
  Universi.es:	
  
Compe.ng	
  against	
  
nonconsump.on	
  
Help	
  me	
  solve	
  this	
  problem	
  
Teach	
  me	
  what	
  I	
  need	
  to	
  know	
  to	
  become	
  
a	
  great	
  manager	
  
Give	
  me	
  the	
  creden.als	
  I	
  need	
  to	
  get	
  the	
  
next,	
  more	
  lucra.ve	
  job	
  
Help	
  me	
  switch	
  careers	
  
Help	
  me	
  join	
  a	
  pres.gious	
  network	
  
• 	
  Brand	
  
• 	
  Connec.ons	
  
Harvard	
  Business	
  School	
  is	
  being	
  disrupted!	
  	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
The	
  economics	
  of	
  e-­‐learning	
  –	
  example	
  of	
  HBS’	
  MBA	
  program	
  	
  	
  
Cost	
  item	
  	
   $$$	
  
Tui.on,	
  not	
  including	
  fees	
  for	
  materials	
  	
   $51,200	
  
Courses	
  /	
  year	
   10	
  
Sessions	
  /	
  course	
   28	
  
Hours	
  /	
  session	
   1.33	
  
Tui.on/class-­‐hr/student	
   $137.1	
  
Students	
  /	
  class	
   90	
  
Tui.on	
  revenues	
  /	
  class/hr	
   $12,342.85	
  
Major	
  costs	
   $$$	
  
Professor	
   ???	
  
Facili.es	
  	
  -­‐	
  really	
  nice	
  ones!!!	
   ???	
  
Admin	
  and	
  support	
  staff	
  (5:1	
  professor	
  ra.o)	
  	
   ???	
  
27	
  
Source:	
  Driving	
  towards	
  a	
  disrupWon?	
  HBS	
  #9-­‐612-­‐101	
  	
  
Tradi7onal	
  university	
  costs	
  	
  
Need	
  for	
  for	
  physical	
  proximity	
  
Adding	
  students	
  is	
  expensive—they	
  
require	
  more	
  buildings	
  and	
  instructors—
and	
  so	
  a	
  university’s	
  marginal	
  cost	
  of	
  
produc.on	
  is	
  high.	
  That	
  means	
  that	
  even	
  
in	
  a	
  compe..ve	
  market,	
  where	
  price	
  
converges	
  towards	
  marginal	
  cost,	
  
modern	
  educa.on	
  is	
  dear.	
  
Difficult	
  to	
  raise	
  produc7vity	
  
University	
  lecturers	
  can	
  teach	
  at	
  most	
  a	
  
few	
  hundred	
  students	
  each	
  semester—
the	
  maximum	
  that	
  can	
  be	
  squeezed	
  into	
  
lecture	
  halls	
  and	
  exam-­‐marking	
  rosters.	
  	
  
Because	
  it	
  is	
  so	
  labor	
  intensive	
  higher	
  
educa.on	
  relies	
  on	
  large	
  numbers	
  of	
  
instructors	
  paid	
  rela.vely	
  modest	
  
salaries.	
  
E-­‐learning	
  /MOOC	
  
Classic	
  	
  informa7on	
  goods	
  
High	
  fixed	
  costs	
  of	
  produc.on	
  and	
  rock-­‐
boxom	
  marginal	
  costs	
  of	
  reproduc.on	
  -­‐	
  
teaching	
  addi.onal	
  students	
  is	
  virtually	
  free.	
  
...as	
  prices	
  converge	
  towards	
  marginal	
  cost,	
  
there	
  will	
  be	
  lixle	
  scope	
  for	
  undercu•ng	
  the	
  
compe..on.	
  Instead	
  MOOCs	
  are	
  likely	
  to	
  
compete	
  on	
  quality…Higher	
  produc.on	
  costs	
  
are	
  a	
  small	
  price	
  to	
  pay	
  to	
  axract	
  much	
  
greater	
  numbers	
  of	
  students.	
  	
  
Winner-­‐take-­‐all	
  dynamic	
  	
  
The	
  best	
  pla[orms	
  axract	
  the	
  most	
  
customers	
  and	
  profit	
  handsomely	
  as	
  a	
  result.	
  	
  
	
  
See	
  more	
  at:	
  
hxp://marginalrevolu.on.com/marginalrevolu.on/2014/02/
the-­‐economics-­‐of-­‐online-­‐
educa.on.html#sthash.HkYJK37w.dpuf	
  
The	
  rise	
  of	
  e-­‐learning	
  may	
  upend	
  the	
  economics	
  of	
  higher	
  educa7on	
  	
  
28	
  
What	
  will	
  ensue	
  is	
  moun7ng	
  price	
  compe77on!	
  	
  	
  
Bifurca7on	
  of	
  higher	
  educa7on…	
  and	
  ensuing	
  price	
  compe77on	
  	
  
Two	
  quotes	
  by	
  Clayton	
  Christensen:	
  
	
  
“Some	
  [universi.es]	
  will	
  survive.	
  Most	
  will	
  evolve	
  hybrid	
  
models,	
  in	
  which	
  universi.es	
  licence	
  some	
  courses	
  from	
  
an	
  online	
  provider	
  like	
  Coursera	
  but	
  then	
  provide	
  more	
  
specialized	
  courses	
  in	
  person.	
  Hybrids	
  are	
  actually	
  a	
  
principle	
  regardless	
  of	
  industry.	
  If	
  you	
  want	
  to	
  use	
  a	
  new	
  
technology	
  in	
  a	
  mainstream	
  exis.ng	
  market,	
  it	
  has	
  to	
  be	
  a	
  
hybrid.”	
  
hxp://www.businessinsider.com.au/clay-­‐christensen-­‐
higher-­‐educa.on-­‐on-­‐the-­‐edge-­‐2013-­‐2	
  
	
  
“Historically	
  there	
  has	
  never	
  been	
  compe..on	
  on	
  the	
  
basis	
  of	
  price.	
  For	
  online	
  universi.es,	
  like	
  Liverpool	
  and	
  
the	
  University	
  of	
  Phoenix,	
  if	
  prices	
  drop	
  by	
  60%	
  they	
  s.ll	
  
make	
  money.	
  But	
  for	
  the	
  vast	
  majority	
  of	
  tradi.onal	
  
universi.es,	
  if	
  the	
  prices	
  fall	
  by	
  10%	
  they	
  are	
  bankrupt;	
  
they	
  have	
  no	
  wriggle	
  room.	
  So	
  I'd	
  be	
  very	
  surprised	
  if	
  in	
  
ten	
  years	
  we	
  don't	
  see	
  hundreds	
  of	
  universi.es	
  in	
  
bankruptcy”.	
  
hxp://www.economist.com/whichmba/clayton-­‐
christensen-­‐s.ll-­‐disrup.ve	
  
	
  
Buyervalue
Relative cost
High
Low
LowHigh
University	
  	
  
of	
  Phoenix	
  
Harvard	
  University	
  
A	
  
tradi.onal	
  
university	
  	
  
13	
   29	
  
Is	
  this	
  good	
  enough?	
  –	
  You	
  judge!	
  (see	
  Christensen’s	
  lecture	
  on	
  innova.on	
  
at	
  U	
  of	
  Phoenix)	
  hxps://www.youtube.com/watch?v=VmbSpTJXozk	
  
	
  
Percep.ons	
  of	
  online	
  degrees	
  has	
  changed	
  as	
  top-­‐ranked	
  schools	
  have	
  
started	
  offering	
  more	
  distance	
  educa.on	
  op.ons	
  and	
  MOOCs.	
  	
  
	
  
New	
  avenues	
  and	
  associated	
  credenWals	
  will	
  conWnue	
  to	
  open	
  up…	
  When	
  MOOCs	
  
burst	
  onto	
  the	
  scene,	
  companies	
  were	
  skepWcal.	
  Now,	
  they	
  are	
  accepted	
  by	
  
employers	
  from	
  Accenture	
  to	
  Amazon	
  to	
  Google	
  and	
  Goldman	
  Sachs.	
  Companies	
  are	
  
re-­‐examining	
  their	
  hiring	
  pracWces.	
  	
  
	
   	
  Anant	
  Agarwal,	
  edX	
  CEO	
  and	
  professor	
  at	
  MIT	
  
	
  
	
  
In	
  the	
  past	
  couple	
  of	
  years	
  schools	
  like	
  MIT,	
  Stanford,	
  Duke	
  and	
  Johns	
  Hopkins	
  have	
  
joined	
  the	
  online	
  educaWon	
  landscape.	
  It	
  elevates	
  the	
  concept	
  of	
  online	
  higher	
  ed.	
  
Just	
  by	
  their	
  parWcipaWon	
  the	
  category	
  is	
  liled.	
  
Cullen,	
  managing	
  director	
  at	
  Infinia	
  DC	
  (brand	
  consultant	
  for	
  colleges	
  and	
  
universi.es)	
  	
  
Employers	
  are	
  embracing	
  e-­‐learning	
  degrees	
  
30	
  
Imagine	
  if	
  you	
  aJended	
  your	
  next	
  finance	
  class	
  in	
  a	
  virtual	
  reality	
  through	
  
3D	
  goggles.	
  	
  
Or	
  if	
  you	
  networked	
  with	
  alumni	
  through	
  an	
  avatar	
  of	
  your	
  likeness	
  
projected	
  onto	
  your	
  laptop.	
  
Or	
  if	
  your	
  strategy	
  professor	
  beamed	
  live	
  feedback	
  to	
  your	
  tablet	
  device	
  
during	
  a	
  heated	
  case	
  study.	
  
•  Some	
  of	
  these	
  innova.ons	
  may	
  seem	
  outlandish	
  to	
  MBAs	
  
who	
  have	
  spent	
  their	
  semesters	
  learning	
  around	
  bricks	
  
rather	
  than	
  clicks.	
  But	
  as	
  the	
  world’s	
  top	
  business	
  schools	
  
begin	
  to	
  harness	
  the	
  power	
  of	
  innova.on,	
  such	
  whizzy	
  
technologies	
  are	
  closer	
  to	
  becoming	
  a	
  reality.	
  
•  Top	
  schools	
  are	
  inves.ng	
  heavily	
  in	
  in-­‐house	
  learning	
  
technologies	
  and	
  some	
  are	
  compe.ng	
  with	
  the	
  likes	
  of	
  
Coursera,	
  edX	
  or	
  Udacity.	
  
•  But	
  now	
  schools	
  are	
  exploring	
  eccentric	
  tech	
  tools	
  such	
  as	
  
Second	
  Life,	
  robo.cs	
  and	
  ar.ficial	
  intelligence.	
  	
  
	
  
Exo7c	
  technologies	
  are	
  becoming	
  a	
  reality	
  in	
  e-­‐learning…	
  	
  
31	
  
Source:	
  BusinessBecause,	
  2016	
  
•  The	
  future	
  of	
  higher	
  educa.on	
  is	
  blended	
  learning.	
  	
  
•  Likewise,	
  the	
  future	
  of	
  MBA	
  /	
  b-­‐school	
  programs	
  is	
  blended	
  
learning,	
  flexibility	
  and	
  customiza.on.	
  
•  Learning	
  is	
  life-­‐long,	
  with	
  MOOCs	
  and	
  the	
  like	
  filling	
  in	
  the	
  gap	
  
for	
  short,	
  on-­‐demand,	
  just-­‐in-­‐.me,	
  inexpensive	
  courses.	
  	
  
•  Universi.es	
  will	
  need	
  to	
  carve	
  unique	
  strategic	
  posi.ons.	
  
•  “Me	
  too”	
  ins.tu.ons	
  will	
  be	
  displaced	
  by	
  MOOCs	
  (and	
  similar	
  
pla[orms)	
  which	
  are	
  close	
  subs.tutes.	
  	
  
•  Top	
  universi.es	
  will	
  survive	
  the	
  disrup.on,	
  and	
  their	
  best	
  bet	
  
might	
  be	
  to	
  preserve	
  exclusivity	
  –	
  but	
  they,	
  too,	
  will	
  need	
  to	
  
change	
  and	
  embrace	
  the	
  disrup.on!	
  Harvard,	
  Wharton	
  and	
  
GeorgiaTech	
  are	
  prime	
  examples	
  that	
  this	
  is	
  feasible.	
  
	
  
The	
  Future	
  of	
  higher	
  educa7on	
  and	
  learning	
  	
  
32	
  
CLAYTON CHRISTENSEN INSTITUTE@christenseninst	
  
Unit	
  of	
  
accredita.on:	
  
The	
  ins.tu.on	
  
Unit	
  of	
  
accredita.on:	
  
the	
  course	
  
A	
  different	
  type	
  
of	
  university	
  
Standards:	
  
thru	
  course	
  
acceptance	
  	
  	
  
How	
  future	
  universi7es	
  may	
  look	
  like	
  
Source:	
  Clayton	
  Christensen	
  Ins.tute	
  (n.d.)	
  	
  
CLAYTON CHRISTENSEN INSTITUTE@christenseninst	
  
Benefits	
  of	
  blended	
  
learning	
  for	
  teachers	
  
	
  
1.  Eager	
  students	
  
2.  Bexer	
  informa.on	
  
3.  Team	
  teaching	
  
4.  Extended	
  .me	
  with	
  students	
  
5.  Individualized	
  PD	
  plans	
  
6.  Mo.vate	
  hard	
  to	
  reach	
  kids	
  
7.  More	
  leadership	
  roles	
  
8.  More	
  earning	
  power	
  
9.  Focus	
  on	
  deeper	
  learning	
  
10.  New	
  op.ons	
  to	
  teach	
  at	
  
home	
  
Source:	
  Digital	
  Learning	
  Now!	
  
And	
  what’s	
  in	
  there	
  for	
  professors?	
  	
  
Thank	
  you!	
  	
  
Ques.ons?	
  	
  

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Is digital disruption coming to the university near you?

  • 1. XXXX  e-­‐learning   Presenta.on  by  Ta.ana  Zalan,  PhD   Associate  Professor  –  Management,   American  University  in  Dubai   tzalan@aud.edu   Linkedin  page     1  March  2016      
  • 2. Is  digital  disrup.on  coming  to   the  university  near  you?     Presenta.on  by  Ta.ana  Zalan,  MA,  MBA,  PhD,  AFAIM   Associate  Professor  –  Management,   American  University  in  Dubai   tzalan@aud.edu   1  March  2016,  AUD,  Dubai    
  • 3. A  VERY  Short  Quiz   •  The  tradi.onal  university  will  disappear  in  a  decade.  True  or  False?     •  MOOC  is  an  acronym  which  means….   •  Coursera  is  …(pick  as  many  as  are  applicable)   A.  A  university   B.  An  online  pla[orm   C.  A  popular  management  book   D.  Same  as  Blackboard   E.  An  edtech  company   F.  None  of  the  above     •  A  flipped  classroom  is  ….  (pick  as  many  are  applicable)     A.  A  classroom  without  the  professor   B.  A  classroom  without  the  students   C.  A  classroom  without  the  lecture   D.  A  classroom  where  students  do  pre-­‐readings  before  class  and  discuss  the  material  in  class   E.  A  classroom  where  the  students  do  not  do  any  work       •  E-­‐learning  is  inferior  to  face-­‐to-­‐face  learning.  True  or  False?     3  
  • 4. My  long  online  journey     •  Started  in  academia  in  the  early  2000s,  on  comple.on  of  my  PhD  in   interna.onal  strategy  from  Flinders  University  (Australia).   •  Joined  the  University  of  Melbourne  straight  aaer  (2003),  taught  in  UG  and   PG  programs.   •  Lea  the  UoM  (2007)  to  join  IGSB,  University  of  South  Australia,  taught  in   the  MBA  program  (Strategic  Management,  Corporate  Strategy,   Entrepreneurship  &  Innova.on).   •  Started  teaching  online  at  the  IGSB  in  2008.   •  In  early  2014  moved  to  Torrens  University  Australia,  a  start-­‐up  university   owned  by  Laureate  Interna.onal  (PBC),  the  largest  private  higher  ed   provider.   •  Was  one  of  the  first  senior  academics  and  MBA  Program  Director.  TUA   runs  F2F  and  fully  online  degrees.     •  Joined  AUD  in  August  2015.     •  Audited  several  MOOCs,  including    Learning  How    to  Learn,  the  largest  /   most  popular  MOOC  on  Coursera.   •  Post  regularly  on  LinkedIn  on  issues  related  to  e-­‐learning.     •  Currently  researching  barriers  to,  and  enablers  of  e-­‐learning  adop.on  in   the  UAE  and  am  generally  interested  in  all  things  digital  and   entrepreneurial.       4  
  • 5. Agenda   •  What’s  wrong  with  the  current  higher  educa.on  system   •  Digital  disrup.on  in  the  higher  educa.on  industry   •  The  benefits  of  e-­‐learning   •  Meet  the  disruptors  and  incumbents:   –  MOOCs   –  New  entrants   –  Incumbents’  response   •  The  economics  of  e-­‐learning  and  MOOCs   •  Online  MBA   •  The  future  of  the  university         5  
  • 6. •  “The  cost  disease”  (Baumol  &  Bowen,  1966)  =>  leads  to  higher   costs  of  educa.on   •  A  report  by  HSBC  (2014)    found  the  UAE  to  offer  the  sixth  most  expensive   educa.on  globally  at  $30,472,  coming  ahead  of  Canada  ($29,947)  and  France   ($16,777).       •  Student  debt  -­‐  $1  trillion  in  the  U.S.  alone,  or  $25,000  per   student  (more  than  credit  card  debt)   •  67%    of  parents  in  the  UAE  simply  do  not  have  adequate  funds  to  meet   the  aspira.ons  they  have  for  their  children’s  higher  educa.on  (HSBC,  2014)       •  More  educa.on  does  not  mean  bexer  job  outcomes.     •  Poor  learning  outcomes  for  students,  as  a  consequence  of  a  lack   of  lack  personaliza.on  and  flexibility             The  modern  higher  ed  system  is  plagued  with  inefficiencies   6  
  • 7. The  costs  of  higher  educa7on   have  been  rising…   ..and  are  projected  to  increase  even   further   Source:  hJp:// www.wellsfargoadvantagefunds.com   Costs  based  on  2008-­‐2009  es.mate  of  average   tui.on  and  room  and  board  in  current  dollars  for   four-­‐year  public  and  private  universi.es  according   to  the  2008  Trends  in  College  Pricing,  published  by   the  College  Board.  Projected  pricing  assumes  a  6%   annual  rate  of  increase  in  college  costs.   7  
  • 8. Clayton christensen institute@christenseninst   What  do  college  students  learn?   •  Study  of  2,300  undergraduates  at  two  dozen   universi.es  who  took  the  Collegiate  Learning   Assessment   •  45%  demonstrated  no  gains  in  cri.cal  thinking,   analy.cal  reasoning,  and  wrixen  communica.ons   during  first  two  years   •  32%  did  not  typically  take  courses  with  more  than  40   pages  of  reading  per  week   •  50%  did  not  take  a  single  course  in  which  they  wrote   more  than  20  pages   The  quality  of  higher  educa7on?     Source:  Arum  &  Roksa  (2010)  quoted  in  Clayton  Christensen  InsWtute  (n.d.)      
  • 9. CLAYTON CHRISTENSEN INSTITUTE#  christenseninst   •  3.6  million  job  openings  for  which   employers  say  they  can’t  find  qualified   employees   •  49%  of  US  employers  struggle  to  fill   vacant  jobs  because  of  lack  of  talent,   compared  to  34%  globally   •  The  signaling  effect  of  a  college  degree   appears  to  be  an  imprecise   encapsula.on  of  one’s  skills  for  the   knowledge  economy  of  the  .mes.     •  McKinsey  analysts  es.mate  that  the   number  of  skillsets  needed  in  the   workforce  has  increased  rapidly  from   178  in  September  2009  to  924  in  June   2012     The  job  mismatch  paradox  
  • 10. Clayton christensen institute@christenseninst   48%  of  employed  U.S.  college  graduates  are  in  jobs   that  don’t  require  a  four-­‐year  degree   42%  of  visual  and  performing  arts  students  said   college  didn’t  prep  them  for  employment   The  average  2013  college  graduate  will  owe  $35,200   in  debt  (and  will  likely  be  paying  it  off  in  a  job  they   hate)   Six  .mes  as  many  graduates  are  working  in  retail  or   hospitality  as  had  originally  planned  –  they’re   becoming  waiters,  Gap  salespeople  and  baristas,   because  it’s  the  only  work  they  could  find   284,000  of  college  graduates  (37,000  of  those  have   advanced  degrees  like  JD’s  or  PhD’s)  will  be  working   minimum  wage  jobs  –  like  flipping  burgers   75%  of  people  say  they  aren’t  living  up  to  their   crea.ve  poten.al   Source:  McKinsey  (2012)   And  we  already  know  that  studies  from  Gallup  and  Deloixe  show  that  70-­‐80%  of  workers   are  ac.vely  disengaged  and  don’t  enjoy  the  work  they  do   Voice  of  the  US  college  graduate  
  • 11. Source:  Hirt  &  WillmoJ  (2014)  Strategic  principles  for  compeWng  in  the  digital  age,  McKinsey  &  Company,  May.     But  digital  disrup7on  is  eventually  coming  to  higher  educa7on…   11  
  • 12. 12   Time Performance Performance that customers can utilise and absorb Range of performance that customers can utilise 1   2   3   3   Disrup.ve  innova.ons  –     New  entrants  almost  always  win     Incumbents  nearly  always   win  in  sustaining   innova.ons   hxps://www.youtube.com/watch?v=qDrMAzCHFUU     Sustaining  vs  disrup7ve  innova7ons  (Clayton  Christensen)    
  • 13. 13   •  We  dis.nguish  between   –  Sustaining  innova,ons  –  new  and  improved  products  aimed  at  our  exis.ng,  high-­‐margin   customers;   –  Disrup,ve  innova,ons  –  innova.ons  that  are  inferior  to  the  current  offering,  but  offer  features   that  customers  value  (affordability  +  flexibility),  or  are  targe.ng  non-­‐consumers.   •  In  every  market  there  is  a  rate  of  improvement  in  performance  that  customers   can  u.lize  or  absorb.   •  In  every  market  there  is  a  dis.nctly  different  trajectory  of  improvement  that   innova.ng  companies  provide  as  they  introduce  new  and  improved  products.     •  The  pace  of  technological  progress  almost  always  outstrips  the  ability  of   customers  in  any  given  .er  of  the  market  to  use  it  .   •  Once  the  disrup.ve  product  gains  a  foothold  in  new  or  low-­‐end  markets,  the   improvement  cycle  begins:   –  The  pace  of  technological  progress  outstrips  customers’  ability  to  use  it…   –  The  previously  not-­‐good-­‐enough  technology  eventually  improves  enough  to   intersect  with  the  needs  of  more  demanding  customers…   –  Disruptors  are  on  a  path  that  will  ul.mately  crush  the  incumbents.   •  Disrup.ons  paralyze  industry  leaders  as  their  resource  alloca.on  processes  are   geared  toward  suppor.ng  sustaining  innova.ons.     How  disrup7ve  innova7on  works    
  • 14. Clayton christensen institute@christenseninst   •  Is  the  innova.on  targe.ng  people  who  are  non-­‐consumers  or  overserved   by  exis.ng  products?   •  Is  the  innova.on  not  as  good  as  exis.ng  products  as  judged  by  historical   measures  of  performance?   •  Is  the  innova.on  simpler  to  use,  more  convenient,  and  more  affordable?   •  Is  there  a  technology  enabler  that  can  carry  the  new  value  proposi.on  up-­‐ market?   •  Is  the  technology  paired  with  a  business  model  innova.on  that  allows  it  to   be  sustainable?   •  Are  exis.ng  providers  mo.vated  to  ignore  the  new  innova.on  and  not   threatened  at  the  outset?   How  to  spot  a  disrup7ve  innova7on   Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 15. CLAYTON CHRISTENSEN INSTITUTE@christenseninst   Industries  without  an  upwardly  scalable  technology  are  not  disrupted   Where  does  disrup7on  not  apply?     Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 16. Subs7tu7on  in  higher  ed  is  following  the  S-­‐curve  of  adop7on   16  
  • 17. CLAYTON CHRISTENSEN INSTITUTE@christenseninst   Personaliza7on   Data  and  Feedback   Factory    -­‐  the  current  model   based  on  standardiza7on   Teacher  effec7veness   Cost  control     Poten7al  benefits  of  e-­‐learning   vs   Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 18. CLAYTON CHRISTENSEN INSTITUTE#  christenseninst   Student  achievement  in  online   courses  when  administered  by   faculty  in  core   4.6   Student  achievement  in   tradi.onal  classes  taught   by  faculty  in  core   5.6   Student  achievement  in  online   courses  when  administered  by   focused  online  faculty   5.7   Another  analysis  of  over  1000  studies  of  online-­‐course  results  conducted  by  US’   Department  of  Educa.on  found  that  people  who  complete  such  courses  do  bexer  on   average  than  students  in  face-­‐to-­‐face  instruc.on.   But:  students  need  to  be  mo7vated  self-­‐starters!!!   Sound  learning  design  boosts  student  outcomes     Sources:  Clayton  Christensen   Ins.tute  (n.d.),  USDE  
  • 19. CLAYTON CHRISTENSEN INSTITUTE@christenseninst   Deliver  content    to   students   Tes.ng  &   assessment   Progress  to  next  grade,   subject,  or  body  of   material   Receive  results   Fixed-­‐7me,  variable  learning  in  tradi7onal  universi7es   Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 20. CLAYTON CHRISTENSEN INSTITUTE@christenseninst   Offer  learning   experiences  to   students   Tes.ng  &   assessment   Receive  real-­‐.me   interac.ve  feedback   Progress  to  next  body   of  material   Learning  is  fixed  and  7me  is  variable   The  new  model  -­‐  Competency-­‐based  learning   Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 21. Meet  the  disruptors  -­‐  the  avalanche  of  MOOCs…   21  
  • 22. Private  equity  and  venture  capital  are  increasingly  inves7ng  in   higher  educa7on  …   22  
  • 23. And  other  new  kids  on  the  block     23   [In  April  2015]  Linkedin  made  a  surprise   purchase  of  the  online  learning  website   Lynda.com  for  a  cool  $1.5  billion.  While   many  in  the  tech  industry  scratched   their  heads  over  the  acquisiWon,  I  want   to  tell  you  firsthand  why  this  is  not  only   a  smart  fit,  but  a  great  purchase  as  well   (Owsinski  /  Forbes)   The  Economist  Group  launched   Learning.ly,  a  catalog  of  proprietary   online  courses,  on  January  12,  2016.   The  pla[orm  offers  professional   development  courses  curated  by  the   staff  of  The  Economist  and  taught  by   experts  from  different  fields.    
  • 24. How  incumbents  are  responding   hxps://www.youtube.com/watch?list=PLl2dezBNo_BkaJhG2IWePTtSA58MF8Xx-­‐ &v=M2jgSXP0ra4   hxps://www.youtube.com/watch? v=zihmiLx3Xlk&list=PLl2dezBNo_BkaJhG2IWePTtSA58MF8Xx-­‐&index=2     Georgia  Tech  on  the  Need  for  OMS   The  Georgia  Ins7tute  of  Technology,  Udacity  and  AT&T  have  teamed  up  to  offer   the  first  accredited  Master  of  Science  in  Computer  Science  that  students  can  earn   exclusively  through  the  Massive  Open  Online  Course  (MOOC)  delivery  format  and   for  a  frac.on  of  the  cost  of  tradi.onal,  on-­‐campus  programs.   This  collabora.on—informally  dubbed  "OMS  CS"  to  account  for  the  new  delivery   method—brings  together  leaders  in  educa.on,  MOOCs  and  industry  to  apply  the   disrup.ve  power  of  massively  open  online  teaching  to  widen  the  pipeline  of  high-­‐ quality,  educated  talent  needed  in  computer  science  fields.     Accredited.  Affordable.  Accessible.   "I  had  been  searching  for  the  right  degree  program  for  years.  It's  hard  to  find  a   high-­‐quality  master's  program  that  I  could  do  while  keeping  my  full-­‐Wme  job.  The   incepWon  of  OMS  CS  was  like  the  answer  to  prayer.  It  has  exceeded  my   expectaWons."  -­‐Yeeling  Lam,  December  2015  graduate  of  OMS  CS   24  
  • 25. CLAYTON CHRISTENSEN INSTITUTE#  christenseninst   Is  the  allure  of  the  F2F  full-­‐7me  MBA  diminishing?   An  MBA  from  a  mid-­‐ranking  school  is  no  longer  the  investment  it  once  was.  In  2010  the  average  tui.on   fee  charged  by  American  ins.tu.ons  ranked  within  our  top  100,  but  outside  of  the  top  15,  was   $81,911  for  the  full  two  years.  The  average  basic  salary  of  those  schools’  freshly-­‐minted  MBAs  was   $81,178  a  year.  Five  years  ago  tui.on  at  the  same  cohort  of  schools  was  nearly  $22,000  cheaper— $60,247—while  the  average  salary,  $78,442,  was  barely  less  than  today’s.  This  price  rise  comes  at  a   .me  when  enrolment  is  falling;  for  American  mid-­‐level  schools  it  is  down  20%  over  the  decade   —  “Trouble  in  The  Middle,”  The  Economist,  October  15,  2011     Dr  Gino  Mar.ni,  a  senior  director  with  GlaxoSmithKline  is  studying  for  an  MBA  with   Liverpool  University.  Being  an  excep.onally  busy  man  –  he  runs  a  scien.fic  support  group   in  the  company’s  Essex  development  laboratories  and  has  a  family  –  he  cannot  spare  the   .me  to  axend  lectures  or  summer  schools.    (The  Times,  26  Nov,  2008)     U.S.  News  &  World  Report  had  commented  that  “while  the  quality  of  online  M.B.A.  degrees   lea  much  to  be  desired  during  their  early  days,  their  axributes  have  steadily  improved  over   the  past  few  years,  as  have  their  pedigrees”.       The  dean  of  the  Columbia  University  Business  School  was  quoted  as  saying,  “I  think  people   will  look  at  different  formats  .  .  .  I  think  people  may  want  to  get  an  MBA  in  a  slightly   different  way”.       Source:  Driving  towards  a  disrupWon?  HBS  #9-­‐612-­‐101    
  • 26. CLAYTON CHRISTENSEN INSTITUTE#  christenseninst   Performance Time Time DifferentMeasure ofPerformance $150,000  !!!   Part-­‐.me  MBA   Online  “Garbage”   2-­‐year  MBA   Corporate  Universi.es:   Compe.ng  against   nonconsump.on   Help  me  solve  this  problem   Teach  me  what  I  need  to  know  to  become   a  great  manager   Give  me  the  creden.als  I  need  to  get  the   next,  more  lucra.ve  job   Help  me  switch  careers   Help  me  join  a  pres.gious  network   •   Brand   •   Connec.ons   Harvard  Business  School  is  being  disrupted!     Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 27. The  economics  of  e-­‐learning  –  example  of  HBS’  MBA  program       Cost  item     $$$   Tui.on,  not  including  fees  for  materials     $51,200   Courses  /  year   10   Sessions  /  course   28   Hours  /  session   1.33   Tui.on/class-­‐hr/student   $137.1   Students  /  class   90   Tui.on  revenues  /  class/hr   $12,342.85   Major  costs   $$$   Professor   ???   Facili.es    -­‐  really  nice  ones!!!   ???   Admin  and  support  staff  (5:1  professor  ra.o)     ???   27   Source:  Driving  towards  a  disrupWon?  HBS  #9-­‐612-­‐101    
  • 28. Tradi7onal  university  costs     Need  for  for  physical  proximity   Adding  students  is  expensive—they   require  more  buildings  and  instructors— and  so  a  university’s  marginal  cost  of   produc.on  is  high.  That  means  that  even   in  a  compe..ve  market,  where  price   converges  towards  marginal  cost,   modern  educa.on  is  dear.   Difficult  to  raise  produc7vity   University  lecturers  can  teach  at  most  a   few  hundred  students  each  semester— the  maximum  that  can  be  squeezed  into   lecture  halls  and  exam-­‐marking  rosters.     Because  it  is  so  labor  intensive  higher   educa.on  relies  on  large  numbers  of   instructors  paid  rela.vely  modest   salaries.   E-­‐learning  /MOOC   Classic    informa7on  goods   High  fixed  costs  of  produc.on  and  rock-­‐ boxom  marginal  costs  of  reproduc.on  -­‐   teaching  addi.onal  students  is  virtually  free.   ...as  prices  converge  towards  marginal  cost,   there  will  be  lixle  scope  for  undercu•ng  the   compe..on.  Instead  MOOCs  are  likely  to   compete  on  quality…Higher  produc.on  costs   are  a  small  price  to  pay  to  axract  much   greater  numbers  of  students.     Winner-­‐take-­‐all  dynamic     The  best  pla[orms  axract  the  most   customers  and  profit  handsomely  as  a  result.       See  more  at:   hxp://marginalrevolu.on.com/marginalrevolu.on/2014/02/ the-­‐economics-­‐of-­‐online-­‐ educa.on.html#sthash.HkYJK37w.dpuf   The  rise  of  e-­‐learning  may  upend  the  economics  of  higher  educa7on     28   What  will  ensue  is  moun7ng  price  compe77on!      
  • 29. Bifurca7on  of  higher  educa7on…  and  ensuing  price  compe77on     Two  quotes  by  Clayton  Christensen:     “Some  [universi.es]  will  survive.  Most  will  evolve  hybrid   models,  in  which  universi.es  licence  some  courses  from   an  online  provider  like  Coursera  but  then  provide  more   specialized  courses  in  person.  Hybrids  are  actually  a   principle  regardless  of  industry.  If  you  want  to  use  a  new   technology  in  a  mainstream  exis.ng  market,  it  has  to  be  a   hybrid.”   hxp://www.businessinsider.com.au/clay-­‐christensen-­‐ higher-­‐educa.on-­‐on-­‐the-­‐edge-­‐2013-­‐2     “Historically  there  has  never  been  compe..on  on  the   basis  of  price.  For  online  universi.es,  like  Liverpool  and   the  University  of  Phoenix,  if  prices  drop  by  60%  they  s.ll   make  money.  But  for  the  vast  majority  of  tradi.onal   universi.es,  if  the  prices  fall  by  10%  they  are  bankrupt;   they  have  no  wriggle  room.  So  I'd  be  very  surprised  if  in   ten  years  we  don't  see  hundreds  of  universi.es  in   bankruptcy”.   hxp://www.economist.com/whichmba/clayton-­‐ christensen-­‐s.ll-­‐disrup.ve     Buyervalue Relative cost High Low LowHigh University     of  Phoenix   Harvard  University   A   tradi.onal   university     13   29  
  • 30. Is  this  good  enough?  –  You  judge!  (see  Christensen’s  lecture  on  innova.on   at  U  of  Phoenix)  hxps://www.youtube.com/watch?v=VmbSpTJXozk     Percep.ons  of  online  degrees  has  changed  as  top-­‐ranked  schools  have   started  offering  more  distance  educa.on  op.ons  and  MOOCs.       New  avenues  and  associated  credenWals  will  conWnue  to  open  up…  When  MOOCs   burst  onto  the  scene,  companies  were  skepWcal.  Now,  they  are  accepted  by   employers  from  Accenture  to  Amazon  to  Google  and  Goldman  Sachs.  Companies  are   re-­‐examining  their  hiring  pracWces.        Anant  Agarwal,  edX  CEO  and  professor  at  MIT       In  the  past  couple  of  years  schools  like  MIT,  Stanford,  Duke  and  Johns  Hopkins  have   joined  the  online  educaWon  landscape.  It  elevates  the  concept  of  online  higher  ed.   Just  by  their  parWcipaWon  the  category  is  liled.   Cullen,  managing  director  at  Infinia  DC  (brand  consultant  for  colleges  and   universi.es)     Employers  are  embracing  e-­‐learning  degrees   30  
  • 31. Imagine  if  you  aJended  your  next  finance  class  in  a  virtual  reality  through   3D  goggles.     Or  if  you  networked  with  alumni  through  an  avatar  of  your  likeness   projected  onto  your  laptop.   Or  if  your  strategy  professor  beamed  live  feedback  to  your  tablet  device   during  a  heated  case  study.   •  Some  of  these  innova.ons  may  seem  outlandish  to  MBAs   who  have  spent  their  semesters  learning  around  bricks   rather  than  clicks.  But  as  the  world’s  top  business  schools   begin  to  harness  the  power  of  innova.on,  such  whizzy   technologies  are  closer  to  becoming  a  reality.   •  Top  schools  are  inves.ng  heavily  in  in-­‐house  learning   technologies  and  some  are  compe.ng  with  the  likes  of   Coursera,  edX  or  Udacity.   •  But  now  schools  are  exploring  eccentric  tech  tools  such  as   Second  Life,  robo.cs  and  ar.ficial  intelligence.       Exo7c  technologies  are  becoming  a  reality  in  e-­‐learning…     31   Source:  BusinessBecause,  2016  
  • 32. •  The  future  of  higher  educa.on  is  blended  learning.     •  Likewise,  the  future  of  MBA  /  b-­‐school  programs  is  blended   learning,  flexibility  and  customiza.on.   •  Learning  is  life-­‐long,  with  MOOCs  and  the  like  filling  in  the  gap   for  short,  on-­‐demand,  just-­‐in-­‐.me,  inexpensive  courses.     •  Universi.es  will  need  to  carve  unique  strategic  posi.ons.   •  “Me  too”  ins.tu.ons  will  be  displaced  by  MOOCs  (and  similar   pla[orms)  which  are  close  subs.tutes.     •  Top  universi.es  will  survive  the  disrup.on,  and  their  best  bet   might  be  to  preserve  exclusivity  –  but  they,  too,  will  need  to   change  and  embrace  the  disrup.on!  Harvard,  Wharton  and   GeorgiaTech  are  prime  examples  that  this  is  feasible.     The  Future  of  higher  educa7on  and  learning     32  
  • 33. CLAYTON CHRISTENSEN INSTITUTE@christenseninst   Unit  of   accredita.on:   The  ins.tu.on   Unit  of   accredita.on:   the  course   A  different  type   of  university   Standards:   thru  course   acceptance       How  future  universi7es  may  look  like   Source:  Clayton  Christensen  Ins.tute  (n.d.)    
  • 34. CLAYTON CHRISTENSEN INSTITUTE@christenseninst   Benefits  of  blended   learning  for  teachers     1.  Eager  students   2.  Bexer  informa.on   3.  Team  teaching   4.  Extended  .me  with  students   5.  Individualized  PD  plans   6.  Mo.vate  hard  to  reach  kids   7.  More  leadership  roles   8.  More  earning  power   9.  Focus  on  deeper  learning   10.  New  op.ons  to  teach  at   home   Source:  Digital  Learning  Now!   And  what’s  in  there  for  professors?    
  • 35. Thank  you!     Ques.ons?