by John Rubino
To understand how close many U.S. universities are to catastrophic failure, let’s start with the story of Robert (not his real name, but all the rest is true).
He’s 19, a freshman at a state university, a smart kid with eclectic interests but no sense of what he wants to be when he grows up. His favorite class, which he had to battle to get into, is an upper-level creative writing seminar taught by a successful author in which six students, all serious about the subject, submit original work and critique it each week. He’s also taking “computer science as a career” taught by a disgruntled professor who shows lots of videos while never missing a chance to tell the class how little he cares about the subject, and weight lifting, which operates on the honor system; Robert promises to lift weights and the school promises to give him an A.
What’s notable about this menu is that the two fluff courses cost the same as the much more serious and harder-to-duplicate creative writing seminar. Robert’s parents, appalled by the difference between his tuition bills and theirs of two decades ago, are aware of the varying amounts of quality and value they’re getting for the big checks they’re writing. And they’re responding like consumers. They’re looking into local community colleges that offer intro courses in core requirements like psych and sociology for much less, with the resulting credits being transferable to most four-year colleges. They’re researching online schools that also offer cheap, transferable credits for low-level coursework taken from home. And they’ve signed Robert up for an online “health coaching” program that will make him a certified health coach (at worst a nice, unusual resume filler) while generating nearly a full year of credits that several colleges in the region will accept. The idea is for Robert to gobble up a bunch of cheap credits and then transfer to a four-year bricks-and-mortar university for his last couple of years, thus acquiring a degree from a name-brand school for far less than four years of full-price tuition.
Variations on Robert’s theme are happening everywhere, as a combination of technology and sticker shock leads increasingly well-informed parents and students to distinguish between the truly-valuable offerings of mainstream universities and commodity courses and activities that can be had elsewhere for a fraction of the price. The result: a tsunami of creative destruction is bearing down on U.S. higher education.
Wired magazine recently interviewed author and consultant Clayton Christensen, who puts some theoretical meat on the bones of this assertion. In the first part of the interview he explains the concept of disruptive innovation, through which big, complacent organizations are crushed by smaller competitors making low-end, cheap products that gobble up markets from below. Think cheap Japanese cars destroying the US auto industry, steel mini-mills bankrupting Big Steel, and so on. Now it’s Big Education’s turn:
Howe: If you had to list some industries right now that are either in a state of disruptive crisis or will be soon, what would they be?
Christensen: Journalism, certainly, and publishing broadly. Anything supported by advertising. That all of this is being disrupted is now beyond question. And then I think higher education is just on the edge of the crevasse. Generally, universities are doing very well financially, so they don’t feel from the data that their world is going to collapse. But I think even five years from now these enterprises are going to be in real trouble.
Howe: Why is higher education vulnerable?
Christensen: The availability of online learning. It will take root in its simplest applications, then just get better and better. You know, Harvard Business School doesn’t teach accounting anymore, because there’s a guy out of BYU whose online accounting course is so good. He is extraordinary, and our accounting faculty, on average, is average.
Howe: What happens to all our institutions of advanced learning?
Christensen: Some will survive. Most will evolve hybrid models, in which universities license some courses from an online provider like Coursera but then provide more-specialized courses in person.
“Some will survive”…that’s a nice, understated way of saying that many won’t survive. And those that don’t will be the ones that have spent fortunes on non-academic fluff like state-of-the-art rec centers and NFL-caliber football stadiums, while assigning grad students to teach amphitheater 101 classes – all while raising tuition by 10 percent a year to levels that force students to graduate with tens of thousands of dollars of debt and highly uncertain job prospects. Those schools will be caught between the best, truly-valuable universities and junior colleges, online classes and “alternative” programs with transferable credits. The space in between won’t generate enough revenue to support their bloated costs.
Academia will become an even tougher place for generic Ph.D.s, while turning into a candy store for creative entrepreneurs. So whether this is a good or bad thing depends on where you are in the academic food chain. The typical history major from a mid-range school will be unemployed and default on his loans. The undistinguished academic administrator will be fired and, like a mediocre newspaper editor, find zero new openings available. Entrepreneurs with solutions to the problems of cost, access, and quality will be the Mark Zuckerbergs and Steve Jobs of the next decade. Kids with parents able to shop aggressively and creatively will get good, cheap educations.
In other words, capitalism will work its usual magic and when the dust clears US higher ed will have been transformed from dysfunctional overpriced to consumer-driven, varied and highly-advanced. With a lot of pain and casualties along the way. To which parents like Robert’s would say, “bring it on, the sooner the better.”
Originally posted to Market Daily News. Used here with permission.