Why You Should Root for College to Go Online

By Clayton Christensen and Henry Eyring

If tuition costs slow their fierce rise, it will be because we figure out how to take some elements of college and put them online. How's that going? Slowly. Very slowly.

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In early August, Apollo Group, parent company of the University of Phoenix, made an acquisition that is small compared to the billion-dollar deals common to high-tech industries. Apollo paid less than $100 million to acquire Carnegie Learning, a provider of computer-based math tutorials. Such technology acquisitions are rare in higher education, to say the least. Yet this seemingly small deal is a signal of disruptive revolution in higher education.

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Carnegie Learning is the creation of computer and cognitive scientists from Carnegie Mellon University. Their math tutorials draw from cutting-edge research about the way students learn and what motivates them to succeed academically. These scientists have created adaptive computer tutorials that meet students at their individual level of understanding and help them advance via the kinds of exercises they personally find most engaging and effective. The personalization and sophistication is hard for even an expert human tutor to match. It is a powerful, affordable adjunct to classroom instruction, as manifest by Carnegie Learner's user base of more than 600,000 secondary students in over 3,000 schools nationwide.

Some of Apollo's potential uses of this software are immediately apparent. It will prove a boon to the hundreds of thousands of University of Phoenix students who take math courses in almost all of its programs of study. Also, the underlying learning and computer science technology are likely to be applied to math-related courses, such as those in economics, finance, and accounting that the University of Phoenix offers its undergraduate business and MBA students.

Full-time faculty members must not only assent to online learning, they should lead it.

Then there are the strategic marketing possibilities. The secondary school students who have come to value and rely on Carnegie Learning's math tutorials are future college students. They might not think now of the University of Phoenix for college. But Sony discovered something interesting about the teenagers who bought its inexpensive pocket-size transistor radios and Walkman cassette tape players: they grew up to be faithful consumers of its larger stereos and television sets. Initially, Magnavox and RCA didn't worry about the low-profit-margin products for kids. In hindsight, they should have.

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In other high tech industries, the market leaders would be scrambling to put together similar deals. But don't expect to see that happening immediately in higher education. Part of the problem is a cash crunch. One hundred million dollars is hard to come by in higher education these days, when some state governments are cutting appropriations to their flagship institutions by that amount, and when risk-free interest rates of next to nothing deflate the cushion of even a multi-billion-dollar endowment.

Yet lack of funding isn't the only reason that the traditional universities and colleges aren't responding with their own strategic acquisitions. In all industries it's hard to convince successful incumbents that innovations at the low end of the market really matter. That was true even for Sony's Akio Morita, whose top executives didn't like his Walkman, which had no recording capability; it seemed smarter to focus on more-sophisticated products for the high end of the consumer electronics market. Regard for tradition and academic freedom make it particularly hard to undertake apparently low-quality innovations in higher education. But that's true to varying degrees in all industries. Whether the business is computers chips or steel, successful incumbents have difficulty responding to disruptive technologies, often until it's too late.

Meanwhile, for-profit educators will continue to invest in and improve upon disruptive technologies such as computer-adaptive tutorials. Attempts to stop them through regulation them will be no more fruitful than were trade sanctions against the Japanese electronics and automobile manufacturers. Regulation will slow the for-profits for a time, but they'll adapt. They'll invest even more in innovations that hold the potential to re-level the competitive playing field.

Physical campuses and prestige will always matter at the top end of the higher education market, so the most elite traditional institutions will survive competitive disruption. Many of them are developing their own sophisticated online education capabilities. MIT, with its OpenCourseWare initiative, and Cornell, with its profitable e-Cornell subsidiary, are only two of the most visible examples. Harvard, Stanford, and other elite institutions have been investing millions in online learning technology and curriculum for years.

The future of online education at these prestigious schools won't involve abandoning the traditional classroom. But students will spend less time in the classroom, in favor of learning through personalized tutorials such as those produced by Carnegie Learning. They will also learn more from one another, through the application of social media technologies to defined learning objectives. Students who prepare for class via these technologies have much better learning experiences when they get to the classroom.

The leading universities and colleges have seen the potential in this kind of this mix of online and face-to-face learning, and they are investing in it via internal development rather than external acquisition. As the technology matures and the proper balance and integration with the classroom experience emerges, Harvard and its peers will be leaders in online education, just as they are in traditional instruction and scholarship. For them, online learning will be a sustaining innovation, rather than a disruptive one.

The real disruptive threat is to the hundreds of institutions that emulate the elite few at the top. Many of them lack the prestige to hold off for-profit competition and the money that the elites can spend on online curriculum. But their challenge isn't fundamentally one of money: online tutorials don't have to be expensive to be effective, as the open-to-all Khan Academy has shown. The much greater challenge for traditional universities and colleges is changing their teaching traditions. Full-time faculty members must not only assent to the inclusion of online learning in the curriculum, they should lead it. Even profit-driven consumer electronics companies tend to respond too slowly to disruptive innovation. Faculty-led institutions need all the time they can get.

Notwithstanding the tough economy, now is the time to invest in online learning innovation. "Made-in-Japan" once meant "cheap." Will the majority of traditional universities and colleges be ready when "online education" means "high-quality learning?"

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http://www.theatlantic.com/business/archive/2011/09/why-you-should-root-for-college-to-go-online/244834/