Predictably whiney incumbents

When phonograph records were invented, symphony orchestras thought the sound was so bad that it posed no threat to their ticket sales and concert attendance. "Who'd want one of those pieces of junk", said the concert master as he tuned his violin with panache. When AM radio came along, the tonal range was so pitiful that it appeared as no competition to everything with better sound quality. When portable transistor radios made it possible to walk around with tinny sound coming through an earphone, it too was presumed to be too bad to be worth anything to the mass market. No one expected the very bad invention to evolve into an industry standard by getting better and better.

My model for giving college dropouts a second chance is going to look bad at first also. In my Executive Summary, I predicted seven different objections that incumbents will raise against my approach. Since the submittal deadline, I've thought of a few more. The chorus of dissidents I'm expecting include the dropouts parents, college advisors, student services counselors, faculty, and college administrators. They're all convinced that preparation for effective roles in the next economy requires a college degree, content delivered by authoritative faculty members, textbooks published for use in college courses and frequent tests administered by watchdogs to catch the cheaters.

Here's some of the whining I expect to hear once this value proposition becomes available:

• This cannot be worth the time it takes to complete the process since it offers no diploma or transcript of grades.
• Students won't walk away with any useful knowledge or skills since there are no faculty to instruct them correctly.
• Enrollees won't have a clue how well they're doing since there are no tests to study for or texts to memorize.
• This won't prepare anyone for employment in corporations that reward compliance with authority figures and policies.

All they're really saying is that they are right about how things have always been done around here. They're like the mystified citizen seeing his/her first automobile and figuring it won't get down the road since there's no horse hitched up to it. When a disruptive innovation moves the goal posts, the new play action makes no sense to the referees, scorekeepers, fans, coaches or players of the tried and true ways to win. Game changers are not incremental improvements or respectful of legacy practices. They make do without the essentials of the previous paradigm to make a bigger and better difference in the long run. In the beginning, they only have to be good enough for those non-consumers who are put at a disadvantage by the incumbent product/service mix. My model for giving college dropouts a second chance will do just that.

Eliminating the weak

Any large public university implements shared governance practices through the use of over 400 standing committees. In his recent book: Saving Alma Mater: a rescue plan for America’s Public Universities ,the former President of Miami University, James C. Garland, has recognized several patterns in this widespread practice:

1. Those faculty members recognized as exceptional researchers and/or teachers rarely serve on any these 400+ committees
2. Those faculty who want to appear cooperative are eager to sit on those committees indefinitely in order to compensate, in part, for their lack of research and/or teaching talent
3. Effective committees thrive on participants who prepare extensively for each meeting and take their membership responsibilities seriously (much like the approaches taken by exceptional researchers and teachers to all their work)
4. Most committee members do a disservice to the committees they sit on, but furiously object to more effective governance models as violation of their right to participate in administrative decision making
5. Universities find they can add more committees but not eliminate more than few, resulting in a growing number of committees that mostly do a disservice at great expense
6. Decisions to eliminate weak performing departments, degree programs, faculty members or standing committees cannot be made by committees populated with those who would be eliminated.

Earlier in this insightful book, Garland notes how legislative attempts to curtail cost increases or to improve access of higher ed backfire. The "one size fits all" approach does more harm than good to those in need of the intervention. Costs go up for them and their access declines. To solve this problem, he recommends the introduction of market mechanisms, competitive dynamics and responsiveness to small niches of customers. This will eliminate the weak components without waiting for committees to make those decisions. It will become obvious what the marketplace dictates to cut back on or to eliminate entirely. The market will then be a final arbitrer in what can be financially viable, self sustaining and most valuable for the public getting served.

As I see the complex system of higher ed perpetuating itself, I predict that "eliminating the weak" will backfire like those well-intentioned legislative maneuvers. The real problem here involves the nature of the pervasive weakness, where the weakness comes from and how much of the system is actually weak. Higher ed is not strong enough in the right way to utilize the marketplace to eliminate weak performing departments, degree programs, faculty members or standing committees. Higher ed can only be eliminated altogether if "eliminating the weak" gets adopted, like those committee members deciding to eliminate their own jobs.

The best of strong systems are resilient and sustainable. They benefit from the paradox of being "strong in a weak way" where weakness is a kind of strength. Weak strength makes for flexibility, spontaneity and serendipity. Strong strength makes for reliability, consistency and determination. In combination, the two kinds of strength yield a robust breed of responsiveness to changing environments, also known as "buffering the core technology with a requisite variety of response capabilities".

These strong systems do not have committees, assigned jobs or administrative departments. They discover an erratic and unpredictable supply of tasks, problems and issues to address. The people adopt roles in the moment and then change roles often. They think of themselves as avatars of their own invention rather than identifying with a rigid reputation or personnel file of qualifications. They are individually responsive to situations which makes for system-wide responsiveness. They quickly remediate breakdowns in cooperation resulting from free riders, threatened turfs or battles between constituencies. There are developmental pathways and support systems for any weakness to become a strength of both kinds. There's lots more to get done besides the daily routines in order to keep the overall system resilient, responsive and resourceful.

Within this frame of reference, most institutions of higher ed comprise a pervasively weak system. The pathological dynamism breeds the obvious weakness in departments, degree programs, faculty members and standing committees. It's structured to have the problems it endures with finances, internal conflicts, cultural stagnation, costly participation in governance and the rest. When it attacks weakness within its ranks, it is misdiagnosing the symptom of its own pervasive weakness. It's trusting it's "weak way of seeing" that is guaranteed to find weakness and remain blind to strong, sustainable and resilient responses.

Funeral for higher ed

Yesterday, the students at CU Boulder held a mock funeral as if all of higher ed is dying. They constructed a coffin and many protest signs with ingenious commentary like "higher ed is too young to die". They will take their demonstration to the state legislature in Denver later this week in hopes of turning the tide against the students who are drowning in soaring cost increases.

Over the past week, I've been reading the best book ever by a college President: Saving Alma Mater: a rescue plan for America’s Public Universities by James C. Garland. I gained a lot of new insights into the reasons that legislative funding is declining, costs are soaring and innovations are getting shot down. Garland agrees with my own writing about the business model in higher ed being broken. Yet he understands why it cannot be fixed better than I have. In the book he proposes the elimination of state subsidies, the distribution of state funding as scholarships to students and the introduction of competitive pressures into the decisions of public colleges.

I especially enjoyed Garland's understanding of faculty committee incompetence, inevitable conflicts with administrations and the impossibility of any college President fulfilling all of the position's responsibilities. He opened my eyes to the huge cost and predictable avoidance of tough decisions that are endemic to participatory decision making. All these details speak to problems with academic bureaucracies, administrative hierarchies and subsidized enterprises.

James Garland is optimistic that a change to a competitive business model could revise decision making, priorities and spending within a public university. He sees private universities as far better managed and worth emulating. He anticipates the end of state subsidies will force the faculty to agree to cutting weak departments, degree programs and faculty members. He hopes the empowerment of students to "vote with their wallets" will improve the quality of teaching, relevance of course requirements and utility of capital expenditures.

I am more convinced, however, by his thorough explanations for the declines in the present situation. It seems more likely that stagnation, stubbornness and self pity will predominate the varied reactions among faculty and administration as they face their deteriorating situations. See students marching with a coffin on their shoulders on the local TV new last night seemed like a perfect picture of the prognosis for higher ed in the coming decade.

Spaces surrounding higher ed

Most institutions of higher ed go to great lengths to improve the completion rate of its enrollment. The institutions are neither callous, cynical or indifferent. Here's a list of some of the ways they try to catch students before they fall out of college:

1. Remediate their reading and writing skills if they are below college level competencies
2. Provide freshman courses in study skills and other practices for success in college
3. Accommodate changing majors if their first choice proved to be too stressful, demanding or boring
4. Allow failing grades to be replaced by taking the course again with a different instructor
5. Make arrangements to change roommates or living quarters if the current accommodation is counter productive
6. Provide RA's, TA's, peer mentors and tutors to work with students on issues haunting them
7. Offer athletic facilities and other amenities for reducing stress and taking minds off of school work
8. Provide professional counseling if problems with anxiety, sleep loss, depression are getting worse
9. Offer financial aid if the burden of making tuition and fee payments becomes unmanageable
10. Allow changing to part time enrollment to lower the cost per semester and to provide additional income
11. Allow students to take more than the 2 or 4 years to complete the degree program
12. Permit students to go on academic leave to sort out what they really want and to gain a different perspective

In spite of all these efforts, 1.2 million students become new college dropouts each year. Perhaps it's not higher ed's problem. What-if the community around higher ed helped out here. The higher ed space is surrounded by other spaces that it dances with and feeds. The 1.2 million is an insignificant space compared to it's competition for attention, resources and responsive solutions. This picture has been a source of inspiration for my development of a model to give college dropouts a second chance.

Each of the surrounding spaces except the dropouts already give money to the higher ed space. Each benefits from the knowledge, skills and credentials that higher ed puts into their own spaces. Each could not do what they do without college educations un

der the current range of post secondary educational alternatives. All are in a position to get impacted by the college dropout problem directly or indirectly. If the dropouts were not stigmatized as "losers lacking in self discipline", each of the surrounding spaces could help alleviate the problem one way or another.

Leveraging your empathy for the learners

When we already know the material we're going to present, our minds become free to know the learners. We can spend time understanding them in ways they understand themselves. We can prepare to speak their minds and picture them in ways that induce more learning. This cultivated ability to empathize with the learners can be leveraged into more effective instructional designs, learner experiences and disruptive value propositions.

When I've spent time "learning the learners", here's some of what I've discovered:

• There's a range of different expectations about what I will do for them, with them and in spite of them. Some are cynical and expecting the worst. Others are optimistic and trusting me to provide exceptional value.
• There are lurking fears about who this may get off to a great start but end up disappointing them. Some are afraid this will be over the heads, moving too fast to keep up or too basic to be of any use.
• There are those who want to be told the facts, methods and guiding principles. Others want to understand why this approach makes sense, how it compares to others and when it's not applicable.
• Some learners assume classroom experiences are done to get the grade and nothing else. Others expect to apply what they learn in other classes and then later in life. Some organize their efforts to prepare for the test while the others prepare to enrich their understanding.

When we understand these kinds of variables, there are two ways to mention them to the learners. One way belittles them by saying "I know what you're thinking" and implying "How could you be so stupid?". The other opens their closed minds by saying "Some of you share these concerns" and implying "You want to get the most out of this investment you're making". The first approach is manipulative and attempts to control the learners. The second approach is empathetic and relates respectfully with the learners.

This same contrast occurs in the formulation of disruptive value propositions, innovative educations products and new business models. The first lacks empathy for the learners and pushes the product in their faces. The attempts to deliver the product backfire. The other leverages the empathy for the learners and creates demand for them to inquire into, explore further and realize for themselves the value in this offering. The effects on the learners are enduring, mutually beneficial and significant.

Disrupting the value proposition

Whenever a significant new technology comes along, it's human nature to overreact. Andy Kessler tells some wonderful anecdotes about the furor over steam, electric, gasoline and nuclear power  sources in his book How We Got Here. We act like the technology will be disruptive of the previous mode of existence. There's lots of evidence that we're currently immersed in that overreaction to the technologies of online learning. It's not wrong to think there will be sweeping changes associated with online access, searchable archived content, immersive digital environments and free tools for self expression. It's wrong to think the technologies will drive the change.

The two disruptive business models for higher education I've proposed are not defined by online learning. Both the service based and peer based learning could be enhanced by online experiences. Yet both were generated by the kinds of subsequent employment the graduates will find and the kinds of learning best suited toward those objectives. They revise the "strategy canvas" in search of "blue ocean market space" as Kim and Mauborgne advised us to pursue in Blue Ocean Strategy. These models also seek out "bowling alley" niches for Crossing the Chasm (Geoffrey Moore). They also demonstrate Mastering the Hype Cycle (Fenn & Raskino) by rebounding after the overreaction fizzles out.

I've become convinced that Clayton Christensen's model of disruptive innovation gets it right. The technology is not itself disruptive. The new value proposition made easier with the technology moves the goal posts. There are non-consumers of existing business models who can be served by something new that is good enough for starters. There are jobs they are getting done with difficulty or not getting done at all with the current offerings. The disruptive value proposition helps them get their jobs done at last or done faster, better and/or cheaper. The value is experienced "in the eyes of the beholder", not the eyes of the technologists, inventors or promoters.  The new business model delivers that intangible value. It uses tangible products, services and technologies as a means toward the end of delivering that intangible value.

To come up with disruptive value propositions, we need to think of the end user in their own contexts. We need to empathize with their plight, feel their pain and walk in their moccasins. When we see the jobs they are trying to get done, the tools become useful in their context. We see how to best apply them without overreacting to the obvious benefits of the new technology. We change our orientation so that we're "selling holes, not electric drills".

Making college affordable

As Karl Kapp recently explored in The Higher Education Bubble Continues to Grow, most colleges are mimicking Wall Street's flawed strategy of self-serving financial schemes. Colleges cannot slow the runaway inflation which results in soaring costs, declining value and under-served students. These colleges are conforming to a single contaminated business model, much like the health care providers that Clayton Christensen has analyzed. The "significant" differences between colleges amount to mere superficial variations in course offerings, campus activities and financial aid resources. The financial crisis is shared by nearly all institutions of higher education. As I recently explored on my other blog, the reasons the costs are soaring out of sight are not even on their radars.

I expect four different business models will emerge from the widespread collapse of over-priced academic institutions. Each constitutes an exit strategy from the stampede headed for the precipice. Two exits develop sustaining innovations which maintain the use of college campuses and classroom contacts with students. The other two introduce disruptive innovations which change the game of "getting a college education". All four innovations make college more affordable while redefining and differentiating their value propositions. Each new business model will need to "circle its wagons" to defend itself against contamination by the other three innovations.

Academic credentials providers
Only one of the four new business models will continue to offer degrees and transcripts from accredited institutions. This exit strategy is the least affordable alternative, though cost reductions can be achieved. This sustaining innovation only serves the sciences, engineering programs and technical disciplines. This model views undergraduate education as a certification process for grad school. The credentials earned remain within academia. Every student is required to progress through the same obstacle courses, get over the same hurdles and exhibit the same competencies. The factory model for the production of uniform outputs can be better utilized to make the educational and matriculation processes more efficient and cost effective. Presentations by pricey faculty members can be archived for download as the open courseware movement has already initiated. Personal contact with undergrad students can be handled by low cost grad students who are "learning by teaching". The faculty will continue to be devoted to academic research, publishing and grant seeking. Much of the students' testing and lab work will migrate into game environments where learners proceed at their own pace, self-remediating flaws in their perception, understanding or execution.  Cost savings will also be realized by the elimination of the "cruise ship" amenities and their accompanying layers of bureaucracy.

College experience providers
One other business model will sustain the use of college classrooms and campuses. It does not credential the advancement to grad school or support academic research. It values the quality of teaching and relating to students over subject matter expertise. It provides the enrollment with high quality college experiences and utilizes liberal arts and humanities curricula toward that end. It serves those college students looking to mature, separate from their family systems,  find themselves, and/or get experience with mating -- while living on campus. It expects there will be no connection between what students study in college and their subsequent employment. There is no need for grades or other academic credentials. The subject matter gets used to cultivate their ability to critique, problem solve, change frames of reference, perceive subtleties and express themselves. The instructors function as mentors, coaches, guides and sounding boards for the students' personal development. There remains a parallel staff of RA's, counselors, activity sponsors etc. for the rich variety of "student life" offerings. Cost savings are realized by the elimination of academic tenure, committees, research, libraries and administration. This labor model can be delivered entirely by part time "adjuncts" who exude a passion for teaching and cultivating individual students. These faculty members will write recommendation letters for the students they know very well upon graduation and job seeking. These students will have also assembled portfolios, verified by faculty members -- that reveal abilities that could contribute to an employer's objectives.

Service learning providers
The first of the two disruptive innovations utilizes a service learning paradigm. This business model serves those going into service careers. The process of apprenticeship, on-the-job training and action learning cultivates the needed skills and awareness. This "game-changer" will evacuate most community college and 4-year classrooms that pretend to prepare students to serve others by listening to lectures and taking tests on textbooks.  It delivers hands-on practice for subsequent work that will involves hands-on practices. While academia discredits this innovation as inferior  "vocational training" or "trade school", it redefines quality in "unacademic ways". Much like business recruiting and promotion efforts, this model relies on role play, in-basket and other "immersion in simulated situations" to qualify individuals. It's not what they say they know, but rather how effectively they "walk the talk" that counts. This model will deliver students who can get the job done, handle the responsibility effectively and respond to unfamiliar situations impressively. This innovation will frame academia as merely preparing students to be hypocrites who only "talk the talk" and look good on paper. Cost savings will be realized by the elimination of classrooms, campuses, textbooks and the academic administration.

Peer learning providers
The other of the two disruptive innovations utilizes a peer learning paradigm. This business model serves those going into professions that initiate projects, work with clients, collaborate with colleagues and create new solutions together. Learning from interactions with peers cultivates the core skill sets for collaborating. Getting an education from peers provides of sense of getting along with others more easily, gaining trust in others, getting others to feel understood and getting common ground established at the beginning. Learners get accustomed to making a difference by listening, appreciating differences and relying on others. They will become clear about the value they offer others and many other dimensions of "entrepreneurial literacy". They will get a sense of "how and why it pays to know this" which will set them up to prosper in the world of free lancing on call and working with virtual teams. These educations can emerge from mutual investments in sweat equity. Very little, if any, money will change hands -- much like the transition from the Wall Street to Main Street playbook of the next generation global economy. The cost savings, compared to other three business models is staggering, like the growing abundance of free online content and freemium offerings that are disrupting newspapers, radio/ television broadcasters and conventional advertisers.

Disrupted college advising
At the center of these four exit strategies will be a new space. Instead of admissions advisers and college recruiters, we will find the likes of optometrists or travel agents for each seeker of a higher education. Students will come to get the equivalent of a new eyeglass prescription or a travel itinerary. They'll get help sorting out all these options to arrive that the best personal fit. Those that show signs of continuing dependency on authority figures, expert content and formal instruction -- will favor the sustaining innovations. Those revealing confidence, independence and self-direction will favor the disruptive alternatives. Those with no idea what they want to study will find the "college experience" emphasis will serve them best. Those with their sights set on grad school will favor the academic model that continues to issue diplomas and grade transcripts. Those who are inclined to make the same difference in different people's lives everyday will be advised to explore the service learning model. Those who expect to co-create new solutions with varieties of projects, collaborators and clientele will favor the peer learning model.

Higher quality for less money?

How could it be possible that a disruptive upgrade to higher ed could be both cheaper and higher quality? It's easy to imagine once our minds are outside the academic box. Here's four ideas for how the higher quality could could be achieved routinely.

Expanded purpose space: When we're in a space to contribute and get value from where the purpose is clear and encompassing, we naturally act more resourceful. We take initiative and personal responsibility to get results. We look after others and see things all the way through. This is the opposite of how we act when we've lost sight of the mission, worry about wasting our time and suspect we've been bamboozled. We wait for things to happen, expect others to take responsibility, and go through the motions regardless of producing any results. If educators and learners share a space with expansive purpose, the outcomes will be much higher quality than what goes on in most college courses now.

Congruent with cognitive neuroscience; When we work with our brains, our brains are far more productive and capable of learning. We balance strenuous challenges with mental relaxation. We give our brains time to catch on and catch up with new information. We get plenty of exercise to provide plenty of oxygen and rest to make new neural connections. This obviously contrasts with the familiar sight of sleep-deprived college students who are stressed out by workload, deadlines, tests and grades. When educators and learners are both using their brains optimally, their creative problem solving, empathy for others, and productive conversations are far more likely.

Taught by peers: When we teach what we already know, we suddenly understand it better and want to learn more about it and with it. When others learn from us instead of some far-advanced expert, the material seems far more accessible, interesting and useful. This goes against the very expensive model of getting taught by faculty who get professionally rewarded for becoming more abstract, dense and boring. When everyone is contributing to the educating of each other, the cost comes down and the value soars.

Anecdotal feedback: When we get told how we're good, unique, valuable and resourceful, we become more oriented. We get a better idea what to expect of ourselves, how to contribute and what we can do to make a difference effectively. This undermines the system of objective test scores, numeric grades, and college transcripts that shows everyone how they compare on the same scales. When educators and learners both know where they stand with each other, the quality of contributions to each others' lives will exceed current expectations and experiences by a long shot.

These are not costly innovations. They are simply game changers that can reliably provide higher quality educational experiences and outcomes for less money.

Get past feeling intimidated

When envisioning innovations that could scale to be a significant game changer, it's easy to become intimidated by the incumbent system. The way things have always been done has become huge and very capable of squashing any little start-up. It's practices are culturally accepted and unquestioned by a majority of customers, journalists and opinion leaders. It's legacy gives it momentum to continue doing what it has always done. There is usually a long history of its own failed reforms, change efforts and attempts as enterprise transformation that prove it will never change. All that can add up to a self-defeating attitude among those hoping to innovate outside the box.

There are several reasons to take heart and dismiss the intimidating evidence. Incumbent systems:

• are like battleships that cannot change direction with either spontaneity and maneuverability --  they cannot zig zag, turn on a dime or reverse their position
• have so much on their minds they see any startup as a spec on the windshield -- not a real concern like the full agendas they have for their next three big meetings
• rely on historical data like a car that stays on the road by watching the rear view mirror where "a bend in the road is the end of their road" they did not see coming
• have been right about their predicting the appearance of more "white swans", they believe their own narrative fallacies and dismiss any "black swans" on the horizon
• offer job security to people who don't rock the boat or call attention to themselves -- in spite of the evidence that those people are clueless and incompetent
• make strategic decisions within the parameters of their industry structure and the crowded space of rivals playing the same game
• assume sustaining innovations are good enough to get by and justify passing up opportunities to reinvent themselves

All these patterns create lots of space, freedom and maneuverability for innovating outside the box that constrains the incumbents.

Profiting from incumbents' sustaining innovations

During the dozen years I taught college, I witnessed a large number of sustaining innovations adopted campus-wide. The blackboards changed over to white boards while the overhead projectors got replaced by ceiling mounted video projectors. Numerous classrooms were retrofitted as computer labs. The library installed a broadband WiFi signal. Registration moved from long lines in the student union to online registration, wait lists and cashiering. Faculty created websites for each class taught outside the newly acquired LMS. Departments launched threaded discussion lists for internal bickering and resolution of contentious issues. Students were issued passes for the light rail trains that stopped at the campus every 10 minutes during the day and early evening. The list goes on.

Sustaining innovations like these keep the customers satisfied and the exceptional talent on the payroll. It appears to both constituencies that their personal commitments are not misguided by their own naivete or misled by deceptive claims. The institution is keeping up with the changing times and responding to opportunities to provide better experiences for the faculty and students. Adopting these innovations contributes to the longevity of the institution.  It makes lots of sense for colleges and universities to invest in sustaining innovations and scan the horizon for additional ones to pursue.

Sustaining innovations can be go either way as I've explored in MIT's OCW program done right and their TEAL program done wrong. When sustaining innovations are done wrong by an incumbent, the opportunities to innovate outside the academic box gain traction. The customers complain loudly and feel dis-served. The value proposition no longer works for them. The front line providers of the service take the brunt of the gripes and lose their own job satisfaction in the process. It suddenly looks misguided to remain loyal to the innovative institution. The demand for something new and really better grows from these seeds.

I'm familiar with four ways that incumbent enterprises bungle their precious opportunities to adopt sustaining innovations:

1. Picking the low hanging fruit, making the thing that's too good already even better
2. Over-selling the benefits, pedaling vaporware, over-promising and under-delivering
3. Providing the form of an improvement without the follow thru, making a show of the acquisition
4. Fueling the growing frustrations, neglecting major sore points, creating scandals by insensitivity to the level of pain

Any of these missteps are signs of the time to innovate outside the academic box. The market is ripe and the institutions are shooting themselves in the foot.

Leveraging an incumbent's sustainability

It's easy to assume that colleges and universities will be around forever. They've endured the phenomenal changes when the Medieval era was replaced by the Renaissance. They've existed under monarchies, dictatorships and democracies. They've continued to do what they do while we have advanced technologies beyond the wildest imaginations of visionaries a century ago. Academia appears very resilient and sustainable, like a climax formation of a hardwood forest on a mountainside that benefits from uphill runoff. The quantity and magnitude of changes during the long history of academic institutions have not disrupted their perpetual existence thus far.

Yet it's possible that this strength is academia's greatest weakness. It happens in ecosystems as I explored in The collapse of efficient forests. The sustainability may be achieved by a loss of redundancy, diversity and inefficiencies which enable radical adaptations and innovations. The system may become overly-dependent on particular environmental conditions that rarely fluctuate or disappear. The system may become extremely close-coupled -- which then transmits devastation throughout it's boundaries without buffers, disconnects or barriers. The adaptation to ongoing favorable conditions may become very short-sighted, presumptuous and susceptible to unforeseen developments.

If academia has gone this route, we would be hearing proclamations from college administrations and faculty like:

• "Students are not customers and should not expect to be served"
• "Instructions cannot be learned appropriately without instructors certified in the field of study"
• "Legitimacy of preparations cannot be proven without diplomas and grade transcripts"
• "Knowledge cannot be advanced unless it's achieved by professional authorities, experts and empiricists"

These statements assert that colleges and universities will be around forever. They assume academia will continue to be as sustainable and resilient as it has always been. They depend on students remaining as passive, ignorant and dependent on authorities as always. They presume that expertise will continue to be scarce while ignorance remains abundant. They reflect a close-coupled efficiency for the perpetual production of assignments, tests, grades and diplomas.

As I see it, very sustainable academia has left the door wide open to innovators outside the box to assume:

• Students are customers and should expect to be served
• Instructions can be learned appropriately without instructors certified in the field of study thanks to archiving expertise online, tutoring via webcams, and other e-learning approaches.
• Legitimacy of preparations can be proven without diplomas and grade transcripts as games, simulations and immersive scenarios become proving grounds for competencies
• Knowledge can be advanced by breakthrough insights into personal experiences, creative mash-ups and chaotic changes without the reductionist outlooks of professional authorities, experts and empiricists

Understanding the academic box

This week I've been making delightful progress on the chapter I'm proposing for a book on PLEs and on a framework for resolving conflicts with collaborative networks. Meanwhile, I've wanted to get back to the exploration I started here on higher ed innovations outside the academic box. First lets better understand how the academic box functions.

The academic box is an incumbent system that has proven to be very resilient and adaptable amidst dramatic upheavals in technologies, societies and governance. Academia is much like the consistent use of horse drawn carts and riders on horseback that endured from antiquity through the 1930's.

Incumbent systems develop sustaining innovations to compete with rivals, maintain their appeal to customers and fit in with contextual changes. Like the introduction of horseshoes, livery stables and burlap bags for horse feed, academia has incorporated many sustaining innovations such as parking garages, televised sporting events, and online course registration.

Incumbent systems are very complex and defiant of simplistic efforts to fix, change or redirect them. They demonstrate staggering amounts of momentum in their persistent direction that outsiders misperceive as "stagnant" or a "lacking responsiveness". The prolonged use of horses included fields of grain, feed and straw storage, shipments to stables, manufacture of bridles and saddles, iron smelting, horseshoe fabrication, manure recycling, enterprises that supplied fresh horses for long-distance travelers, training in horsemanship and much more. A change to lighter-weight fire wagons would not disrupt that very complex system. Likewise the introduction of campus IT departments, email accounts and course websites would not disrupt academia.

Incumbent systems are predicated on self preservation. They serve themselves first rather than serving special cases, needs or constituencies. They cannot embrace changes that weaken their chances of survival or undermine their stability. The system for the perpetual use of horses could not respond to business people who wanted their Pony Express messages delivered as fast as a telegraph signal, military who wanted their battlefield motive power to be as sturdy as a tank or carriage drivers who wanted to neglect managing feed supplies, manure, horseshoes and breeding.

Incumbent systems revolve around a central premise or strategy driver that organizes most activities without getting questioned. members of the system who defy that premise are instinctively shunned and stabbed in the back. They appear dangerous, demonic or traitorous to those devoted to the unquestioned premise. Like the highly suspicious inventors of steam and gasoline powered vehicles in the heyday of horse drawn carriages, anyone assuming academia is antiquated is presumed to have a screw loose by those inside the academic box.

As we'll explore in the next posts, all these dynamics of incumbent systems set-up innovating outside the box superbly.

Innovating outside the academic box

Last Friday I read the recent conference papers from what I had hoped was a breakthrough in college teaching methods. As I read through the papers, I felt the enthusiasm of each team of authors who had successfully generated more classroom engagement and enduring insights among their students. I was fascinated by the different approaches explored to inquiry based learning that revealed considerable creativity by the faculty. My initial reaction was very positive.

Upon further reflection, I realized how every every innovation was no different from my own previous creativity in college  classrooms or from any mentioned in the countless books I've read. They were, essentially, reinventing the wheel.

I then empathized with the authors of these conference papers as doing the best they could under their circumstances. I imagined that everyone of them was highly constrained in four different ways:

• Each faculty member was torn between improving their teaching methods and their usual tenure seeking, publishing, citation gathering, and committee assignment obligations
• Most of their students would be sitting in their classrooms expecting to be taught and graded, dependent on the presumed expert faculty to make wise choices for them
• The time slots available for meeting together in classrooms, labs, theater spaces, etc were highly regimented in duration and frequency
• The system that had enrolled the students and pays the faculty was designed, not to educate, but to qualify, certify and matriculate each enrollee based on their "academic performance" as indicated by the grades received

This constraint environment would induce "reinventing the wheel". Thinking outside the box would necessitate being outside the constraint environment. No amount of personal initiative, dedication or creative talent could overcome the limitations shared by everyone one of them. No better management, leadership or incentive structure could change the ways they are walled in.

Later that day, I saw how easy it would be to provide higher quality higher ed at a lower cost by educating students outside that pervasive academic box. I'll share where that thinking lead in the coming posts here.

On track for my endgame

Over the weekend I was rereading a 2003 book that applies game theory to business models: The Slow Pace of Fast Change / Bhaskar Chakravorti. The book suggests that we formulate an endgame that appears plausible to us when we consider the choices of those who will make the change to our value proposition. Chakravorti's expertise in game theory enables him to frame the challenge of a start-up in terms of disrupting a self-reinforcing equilibrium and creating a middle game to move to a new equilibrium. As I shared these ideas with an entrepreneur yesterday, I reframed the challenge this way:

The status quo is a large crowd of people who have gotten on a bandwagon. No one wants to be the first to get off the bandwagon or be the only one who is no longer on the bandwagon. It's human nature to stick together on the bandwagon even when it no longer serves our personal interests. Yet as soon as enough people have jumped off the wagon, that same human nature will follow the herd to the next equilibrium/ bandwagon.

This book gave me a way to revisit the big picture of all I've been exploring on this blog for the last six months. Here are the main components of the endgame I'm successfully pursuing:

• There will be a next economy to replace the industrialized, oil-dependent, market-driven mess that is currently being resuscitated by the G20, World Bank, and economic stimulus programs around the globe. The next economy is misperceived by the governments, corporations and investors as a failure of leadership, reversion to medieval practices and loss of wealth. The sustainable, resilient, natural, small, networked, collaborative, altruistic economy does not make sense to incumbents players.
• There will be a disruptive innovation to higher ed that will prepare it's "customers" for that next economy. Traditional colleges cannot do better than new course offerings in social entrepreneurship, green technologies and network science because their structures, strategies and policies are predicated on the legacy economy. The life long, self-taught, social and informal learning appears undisciplined, impossible to grade, unrelated to authoritative knowledge and unworthy of diplomas.
• The migration into this disruptive innovation calls for a disruptive approach to college advising. The current practitioners guide applicants into the current offerings that prepare students for the previous economy. This new approach to advising will provide a preview of the next economy and the educational experiences that prepare for it. The departure from authoritative guidance and repression of self expression will make it clear what lies ahead. The parallels with social networking spaces, user content generation and collaborative projects will become obvious to the applicants.
• Success in the replacement college system requires self starters who can self-structure their own learning and responding to other learners. This capability get impaired by emotional baggage. The practice of innovative college advising needs "baggage handling" as a core competency to transition its clients out of the damage they experienced in their toxic family systems, dysfunctional classroom schooling and mismanaged employment experiences.

The innovative advising will initially upgrade the college choices of a few applicants and their parents who are currently framed as misfits and likely dropouts of higher ed in its present form. Their successful experiences with learning on their own and together will generate stories that get shared with others. As conventional colleges devolve and the next economy shows signs of emergence, a mass migration off the old bandwagon is likely. This end game appears plausible to me.

Overview of disrupting higher ed

Thus far, I've explored the main facets of the sustaining innovation side to the changes in higher ed I'm foreseeing. I have over 200 pages of notes that explore the other disruptive innovation side. That would be WTMI (way too much information) to write up. Happily, Slideshare now accommodates slide shows with recorded narration. I'm currently exploring that possibility for condensing my 200+ pages of notes while making them more sticky, immersive and actionable. The idea of posting "podcasts with pictures" on this blog appeals to me greatly.

Another facet of disrupting higher ed I have yet to mention is the college advising piece. The current generation of college applicants falls into a frenzy about getting into "the best schools" as soon as they enter high school. There's a new cadre of "admissions advisors" who assume college is unquestionably good. They only question whether students are good enough to get in where they want. They work on finding a good fit with good schools as if diplomas are valuable, school reputations rock the business world and life long income streams are a result of where you went to school. It would disrupt their revenue stream to question the value of college educations, to critique the quality of college outcomes or to anticipate the disruption/migrations like I am.

I expect college advising will become the centerpiece of these disrupted institutions. Applicants will need to understand the shattering of the old business model and the transformation of the separate value propositions. Students will also need help deciding if the sustaining side is right for them. Those that fit the Gen Y's, gamers or digital natives stereotypes will likely find their path on the disruptive side of the four migrations. I've been accumulating strategies for how that advising would best be done and how to launch a "good enough" startup this year.

My Google Analytics reports tell me the most read post on this blog for the past several months has been Resolving emotional baggage. I've realized that is a crucial piece of my disrupted approach to college advising. The metaphor of "emotional baggage" provides a powerful model for liberating college applicants and students from their personal past history. Every imaginable problem that comes up for them can be cleared up easily. My next series of blog posts will reveal how the full spectrum of baggage issues can get turned around into valuable resources with a minimum of fuss.

Disrupting academic credentials

There is only one occasion in my career where my diplomas and college transcripts from Carnegie-Mellon and UCLA played a pivotal role in hiring me: when I got an adjunct teaching position for the local four year college. My applications to work as a consultant, media developer and trainer valued what I could do more than what I had done or where I went to college.

Academicians stick to their own kind of proof of value when assessing employment candidates. They want to see the grades earned by the people they are going to grade and give the job of grading others. Violent gangs evaluate membership candidates by proof that they have already murdered someone. Any closed system can only use its own rules to rule out, rule on and overrule issues before them. A closed system cannot question or change its own rules without assuming that would destroy the foundation of the institution.

Academic credentials appear ripe for disruption to me. They are consistently poor predictors of job performance, other than the "jobs" of post graduate studies and PhD candidacies. I previously explored expectation that credentials will get disrupted in my much-read post: Goodbye college diplomas. I've pondered how new credentials will get transformed in each of the four migrations away from the institutional morass. Here's a synopsis of what I'm foreseeing:

• The problems getting solved by students in disruptive residential college experiences would best be served by individual "personnel files". These could provide a combination of portfolios and individual recognition. Letters of recommendation from faculty members and athletic coaches would be added routinely. Likewise, student leaders in charge of activities could add notes of accommodation and qualification. These would serve as valuable credentials for seeking administrative, sales, or community outreach positions where the work processes will get learned on the job. The determination qualifications would be revealed by the portfolio and letters, rather than course lists and grades or a diploma.
• Budding professionals in varied apprenticeships need certificates to verify individual competencies. Much like the tests given for operating particular equipment or utilizing specialized software programs, professionals need to qualified one skill-set at a time. Exams can get developed to test how well they diagnose a complex situation, respond to conflicting demands, and nurture ongoing relationships. Granulizing these credentials also serves the likely scenarios of frequent career changes or free lance work in varied capacities.
• Instigators of the next economy will need proof of having made a significant difference in individual lives. There could a website where beneficiaries of their "community service" could log in and post comments, photos, podcasts and videos of the work accomplished. The free ranging students could read/ watch/ listen to this "user generated content" from the people they have been caring for, helping out and assisting change their lives. Other students could check out the public portion to know about someone they are working with, get inspirations for how to make more of a difference, and gain insights on how to have more positive effects on other people.
• Students pursuing scientific and technological disciplines can continue to benefit from transcripts and diplomas. Their studies are so complex that changing careers is unlikely. Their eventual work in research labs, product development or academia can be estimated in advance by their school work. This portion of higher ed can continue as is, like analog wall clocks and AM radios.

As it comes time for this massive disruption to occur, the value of college educations will decline in the minds of the students and their parents. The only reason to go to college will be to get a diploma. Their commitment to school work will decline and cheating will increase. The use of college to make friends and party will overtake the ambition to get enduring value from the coursework, faculty and academic rigors. The market dis-served by institutions of higher ed will be ripe for "good enough" replacement credentials.

Misguided business model innovations

Institutions of higher ed are very susceptible to fall into every conceivable pitfall on the path to business model innovation. Here's a few of those upgrades that can easily tarnish quality, reputation, credibility and trust in the institution:

1. Reducing expenses: . One way colleges have cut costs is to replace tenured faculty with part time adjuncts. This offers dramatic savings on payroll expenses like health care, vacation/sick pay, and contribution to retirement programs. The pay per hour, student or course is also significantly lower by cutting back on tenure track professors. Colleges can also close satellite campuses, art galleries, and other amenities that detract from driving down the cost of tuition or student fees.
2. Generating additional revenue: Colleges can invest in what they hope will yield greater long term revenue from alumni, research grants and legislative funding. They may boost the reputation and rankings of their schools by spending large sums on NCAA sports competition, recruiting scholarships, athletic facilities, and coaches that get their school significant print and media coverage. They may invest in honors programs to attract the top ranked students who can be expected to make names for themselves and let some the glitter fall on their alma mater. They may also invest in dormitory upgrades and recreation facilities for the students who will become satisfied alumni making donations and bequeathing their estates to that institution where they experienced "the best years of their life".
3. Expanding the product line: Schools can easily add additional academic departments, degree programs, new courses and sections of an over-enrolled course. An academic system, including the textbook publishers, can produce additional courses of study without making structural changes. Offering greater selection is presumed to keep their customers satisfied, just as automakers, software developers and consumer product companies have taken for granted. "Servicing the sale" can get added by additional counseling, activity and student support offices, programs and personnel.
4. Appeasing the enrollment: Institutions may showcase their attempts at being innovative to appear progressive to the students. New technologies provide enticing opportunities to cast off the image of bureaucratic stagnation, stodgy faculty or falling behind the changing times. Responding to student complaints may result in added services to deal with campus security, parking, computer labs, off-hours building access, parental visits, etc.

On the surface, there's nothing wrong with these improvements. That's why academic institutions take the bait. These changes appear to be sustaining innovations that invest wisely in the future of the campus and the community of scholars. Here's how these well-intended changes will get indicted as clueless, inadequate and misguided once the disruptive innovations to higher ed come to town: These upgrades:

• serve the existing customers who want the institution to persist and who oppose disruptive innovations too.
• fail to recognize and respond to the non consumers who dropped out, who were denied access trying to get in or who got a diploma without a useful education.
• improve classroom delivery of educational experiences on a schedule dictated by the registrar's office.
• fail to improve the 24/7 delivery through handhelds, the discovery of each individual learner's context or the open source approaches to continual education
• maintain the cultural norms of printed words, learned authorities, and published research
• bemoan the erosion superior academic credentials and published expertise emerging from digital cloud computing applications

Can higher ed change its business model?

In many of his recent writings on business model innovation, Clayton Christensen has helped us see how incumbent institutions have no concept of their own business model, value proposition or the jobs that their customers are getting done. He also suggests that successful products and services do not migrate toward commodization, loss of differentiation and erosion of gross margins from aspiring to be the low-cost provider. Rather, he sees a migration from solution shop to value-added processes to precision mechanisms for delivering reliable results. This evolutionary pattern also resembles the democratization of power into the hands of end users and localization of formerly centralized service providers.

As I reflected on this cultural blind-spot in large institutions that cannot see their own business models, I made connections to several other familiar patterns:

1. Top down authority structures expect conformity to the chain of command. There is no need to think for oneself about whatever concerns the upper executive level of management.
2. Hierarchies hold members accountable for policy compliance while neglecting incompetence demonstrated in job performance, customer service or internal cooperation metrics.
3. Bureaucracies are designed as machines that perform efficiently, consistently and perpetually at great expense of innovation, learning and changing with the times
4. Inevitable turf battles (over budgeting, staff reassignment and use of shared resources) between department necessitate defensive maneuvers like "empire building", "fortress mentalities" and "silo formation".
5. Group norms dominate the interpersonal dynamics within vertical silos which spawns the scapegoating of those who rock the boat, toot their own horn or deviate from the stifling consensus known as groupthink.
6. Top executives rise to their level of incompetence where no further promotions are forthcoming, which makes it advantageous to surround themselves with sycophants who tell them what they want to hear, dismiss news of external changes and downplay those with more competence, perspective and foresight.
7. The human side of organizations, that have grown huge to realize economies of scale, do great injustice their their employees by maintaining imbalances like overpaid/under worked, over qualified/under utilized, overworked/underpaid, and over utilized/under recognized differences between colleagues.

With these patterns functioning robustly in most institutions of higher ed, it's no wonder they have no concept of their own business model, value proposition or the jobs that their customers are getting done. They are operating with tunnel vision outlooks, under the gun of top-down pressures and a full plate of obligatory duties. There's is no attempt to become more valuable to the institution or each other. The system rewards acting selfishly to advance up the ladder while the institution acts on instincts of self preservation.

Recently, I've been listening to over twenty podcasts created by Paul Miller on cloud computing, the semantic web and the disruption of higher ed. Two interviews, in particular, have given me hope about ways institutions of higher ed can change their business model. Chris Geith at Michigan State University and Steve Carson at M.I.T. are both fluent in business models. They sound like the marketing partner in a SAAS startup pitching their business logic to potential customers. They speak of their value propositions as if its perfectly natural and expected.

Both Geith and Carson span many academic silos in their jobs. They function in consulting roles that aid individuals into the horizontal space between silos and between institutions. Their institutions both serve a global community of scholars and industry consortiums. They are also providing added value within their institutions. Fellow employees are their customers who need to be listened to and worked with in order to serve those vertical departmental jobs getting done. In short, these two "silo spanners" defy all seven patterns I enumerated above. They operate in a different culture within academia that spawns pilot programs and business model innovations -- one faculty member or department chair at a time. If these pioneering efforts become separate entities outside the ivy covered walls, business models for higher ed could get transformed. The existing model would eventually get cannibalized by the success of the outside entity that redefined the value proposition of higher ed.

Consumer advocacy in higher ed

Customer driven businesses do not need governmental inspectors, oversight or recourse systems for customer complaints. Enterprises that serve customers discover what to improve that adds value to the exchange which then generates loyalty, buzz and an increased volume of purchases. No oversight committee had to tell amazon.com to set up product ratings and reviews or secure payment systems. Likewise, customer driven businesses already appear as advocates for the customer. They help buyers get what they want, not what they get told they should desire according to spin-doctored advertising. They help customers to solve personal problems, to get their particular jobs done and to get changes accomplished with less effort. The solutions get delivered to the customer instead of insisting they come to the centralized location. Customer driven businesses are usually two steps ahead of their rivals, proactively upgrading their user interface, customer experience and support system for added help, diagnostics and services.

Most institutions of higher ed is not customer driven. They are either driven by internal performance metrics or quality standards. They show no sign of comprehending what their customers are trying to accomplish, solve, resolve or change. They appear to exploit the captive market for prestigious diplomas that acquire glamour from higher prices. They fail to address the "service issues" like dropping out before graduation, mid winter depression, loss of retention/motivation and the uselessness of course content in job settings. Higher ed appears to need governmental watchdogs, inspectors and audits.

Most consumer protection interventions backfire. Onsite inspectors in banking, airline safety or food production get bribed or lulled into complacency. Most periodic audits in pharmaceutical manufacture, mining and workplace safety cause a flurry of clean-up efforts to pass inspection free of "red flags". The push for consumer advocacy results in a push back from those offenders who do not want to get caught and have no concept of the customers' experience.

Indirect strategies to realize consumer protections prove to be far more effective. Rather than go after the institutions, it works to cultivate sophisticated consumers. By addressing those who are already interested in changes, the intervention encounters open minds, willingness to explore further options and follow through on implementation. The customers can vote with the feet and wallets. They send a message loud and clear to incumbent institutions by changing what they buy and reject. The function as their own advocates in "game-changing" ways. They expose the shortcomings of enterprises that fail to align themselves with customer driven premises. The change comes about without costly governmental interference or inspections.

Government funding of an intervention in consumer advocacy would best be spent helping college applicants and enrolled students become more savvy. When "buyers of diplomas" act more selective, discerning, cautious, and suspicious, pressure will be put on institutions to improve. Whenever customers act with increased self-respect, they get more respect from their product and service providers. When demands for more solutions, support and authentic value get put on the table by the buyers, the enterprise can work a better deal or walk away from the market. It becomes a clear choice for the institution whether to gain or lose ground based on their own response. They really see the opportunity to serve parents, college students, and their eventual employers.

Lowering the cost of college

It's not possible to lower the cost of college by making a direct attack on the problem of soaring tuition rates. Several books over the last decade has made it perfectly clear what not to do:

Gary Hamel and C.K. Prahalad gave us the concepts of core competency and denominator management. Competing for the Future explains how improving the quarterly earnings figures by taking assets off the balance sheet ultimately backfires. An enterprise's ability to innovate and sustain it's value to customers looks bad to those who only monitor the financial metrics. Outsourcing looks like a good idea to accountants, financial analysts and stockholders. Their short sighted interests kill the goose that lays the golden eggs. The core competency gets sold off and leaves an empty shell that cannot increase value for the customers, improve their experiences or pass on cost savings.

W. Chan Kim and Renee Mauborgne advised getting out of red oceans of contested market space where industry rivalries control spending and strategy. Blue Ocean Strategy calls for making the competition irrelevant by creating strategy innovations that serve uncontested market spaces. The existing value propositions cannot provide cost savings to customers because survival depends on advertising, added features and full service offerings that necessitate subsidizing unprofitable components.

Clayton Christensen reiterates those pieces of advice in The Innovator's Prescription while adding several more warnings about flawed approaches to innovative cost reductions:

• Don't expect to arrive at cost reductions by consensus or democratic voting among vested interests in the incumbent enterprise
• Don't leave it to the discretion of people in charge of each profit center to adopt changed business models
• Don't maintain disjointed solution shops where productive value-added processes get burdened with massive shared overhead expenses
• Don't expect customers already being served to identify any jobs not getting done or opportunities to serve nonconsumers

The Obama administration aspires to make college affordable. Yet the Federal government cannot lower the soaring tuition rates or revise the business models that colleges deploy. Legislative initiatives can reduce the cost to individuals by providing funds. This amounts to throwing money at the problem and subsidizing the intransigent institutions. The Obama administration has also intended to "invest in the middle class" to foster the long term health of the domestic and global economies. The middle class can be compared to the core competency of an economy that breeds subsequent innovations. The Obama administration has also launched several initiatives to increase the amount and quality of innovations that get developed in the near term. This may lead to the identification of uncontested market spaces and creative revisions to strategy mixes, business models and value propositions.

It's becoming clear to me how governments can intervene in the cost of college indirectly. The Federal government already provides consumer protection services and advocacy. The safeguarding of consumers from exploitation, abuse and danger -- raises the bar on an industry. Quality standards get set higher by orchestrating what customers expect and demand. New market space gets defined by helping customers see what is missing, unfair, exorbitant and excessive. Providers get put in the position of meeting the new demand or appearing obsolete. I'll further explore how this could play out in the market for college educations tomorrow.