I went to a conference sponsored by UBTech a few weeks ago. It was advertised as a “national summit on technology and leadership in higher education” and had a tag line of “Your future is being determined. Be there.” Not surprisingly, many of the sessions were focused on “disruptive innovation,” the idea that new technologies are disrupting the traditional university.
The keynote speaker on the second day of the conference was Richard Baraniuk, a professor at Rice University and founder of OpenStax, a company dedicated to developing text books that are given to students for free. The company has so far published two online text books, most notably, one for a standard College Physics class. Baraniuk talked a lot about disruption and what that will mean for colleges and universities and suggested that we all go out and read the work of the creator of the theory of disruptive innovation, Clayton Christensen. Looking at Christensen’s own summary of disruptive innovation, I was struck by the fact that Baraniuk neglected to discuss one of the major components of the theory. That is, Baraniuk never mentioned the fact that disruptive innovation happens at the “bottom of the market.” While companies are focused on providing quality products or services at high cost to their most sophisticated customers (sustaining innovations), other companies come into the market to provide cheaper, lower quality products or services to customers who traditionally have not been able to afford those products or services (disruptive innovations). It’s an interesting omission since when I’ve heard proponents of these ideas talk about their application to higher education, they have insisted that quality will not suffer. Another interesting insight from Baraniuk’s presentation came when someone asked about the cost of creating these “free” text books and Baraniuk answered that each one costs about a million dollars to develop. When I looked into the business model of OpenStax, I found that their initial funding comes from a series of foundations (the Bill and Melinda Gates Foundation, the William and Flora Hewett Foundation, etc.). Of course, that isn’t sustainable so OpenStax also provides premium services and content to supplement the free versions of their text books. For example, they have created an iPad version of their College Physics text that costs $4.95. That, of course, is significantly cheaper than a traditional text book but the question remains whether students will pay even that small amount when a free version of the text exists. Other “free” text book publishers, such as Flat World Knowledge, have stopped providing a free version and instead, have had to focus on low-cost texts. This model of text book delivery would still be much more affordable for the student than the traditional model but I think it remains to be seen whether it will be financially viable. It seems to me that to make it work, someone will have to come up with a disruptive innovation in funding models, perhaps something like crowd-funding?
Less than a week after I came back from the conference, The New Yorker published historian Jill Lepore’s critique of the theory of disruptive innovation. The gist of her critique is that the theory has been applied to industries that are very different than the manufacturing industries that Christensen initially studied. And, she says, the theory doesn’t even work particularly well with those manufacturing industries because Christensen’s methods were lacking–he cherry-picked examples, he ignored potential complexities in causation, he arbitrarily chose time frames that would artificially support his claims, and so on. In other words, she says the theory doesn’t work very well to explain how businesses succeed and fail. I am most interested in Christensen’s claims that his theory has predictive value, that is, that it can help us to determine which companies will succeed and which will fail. As an educator, this would help me to figure out how to deal with the disruptive innovations that higher education is facing. Unfortunately for me, the record is pretty clear that this theory hasn’t been very useful as a predictive tool so far. For example, in 2007, he predicted that Apple would fail with the iPhone. We know that this prediction was incredibly wrong. In addition, in 2000, he started the Disruptive Growth Fund, a fund which used his theory to determine which companies to invest in. The fund was liquidated a year later because it lost significantly more money than the NASDAQ average during that time. A Tribune writer quipped that “the only thing the fund ever disrupted was the financial security of its investors.” Ouch.
Christensen hasn’t written a formal response to Lepore’s article but he did give this really weird interview to Business Week. I was particularly interested in his response to the lack of predictive value of the theory. First, he says that he was not advising the guy who was running the Disruptive Growth Fund so you can’t claim that it is a failure of the theory. Regarding the iPhone, he says that he labeled it as a sustaining innovation (doomed to fail) against Nokia’s smart phone instead of labeling it as a disruptive innovation (destined to succeed) against the laptop. That definitely sounds like predicting the future after it has already happened. But this explanation brings up one of the things that has confused me most about the theory. One of his main examples involves the hard disk drive industry. I don’t know anything about the business of that industry but I certainly know something about the technology. It seems weird to me that he would label the reduction in size of hard drives as “new technology.” It seems to me that to go from a 3.5in hard drive to a 2.5in hard drive is an incremental improvement in the technology, a tweak, (a sustaining innovation?) rather than a disruptive innovation. Perhaps he explains his methodology for categorizing innovations in his books, which I have not read, but I haven’t been able to find such an explanation so I sort of doubt it exists. If we don’t have a method for this categorization, and we categorize innovations after the fact, how can the theory help us to understand what has happened in the past or what will happen in the future?
And that leads me back to higher education. One of the hot topics at the conference was MOOCs, those massive open online courses that gained popularity a few years ago, especially after the publication of The Innovative University, Christensen’s co-authored book applying disruptive innovation theory to higher education. The idea of a MOOC is that an expert in a particular field records a bunch of lectures about her field of expertise and makes that content available online for all who want to take the course. There are assignments that may be evaluated by others taking the course. There may be credentials (certificates, badges, etc.) that are given to those who successfully complete the course. Sometimes, the student has to pay to receive the credentials but the cost is minimal. Some of these MOOCs have had thousands, even hundreds of thousands, of students. I was one of the 58,000 people who signed up for the Introduction to Artificial Intelligence course offered by Sebastian Thrun and Peter Norvig a few years ago. Like most of those who started the course, I didn’t finish it. I just wanted to see how it worked. There was a lot of text to read. There were some recorded lectures. There were assignments to complete on my own. There were discussion boards where I could discuss the assignments with other students. Other than this interaction with the other students, it felt like a correspondence course from the 1970s. Christensen has labeled this kind of online delivery a disruptive innovation. And perhaps it is. But lecture-based education (“sage on the stage”) has been criticized as old-fashioned by many. It seems to me that the very idea of a MOOC relies on the idea of a “sage on the stage.” In fact, much online education is developed and delivered in that manner. Why would this kind of education be cutting edge if it’s delivered via the Internet and old-fashioned if it’s delivered face-to-face?
I don’t know where any of this will lead us in higher education. But the conference was interesting because it prompted some new thinking for me in the area of disruptive innovation as well as in several other areas. I’m looking forward to continuing these conversations at PSU during Faculty Week in August when Ann McClellan and I will lead a discussion on the ideas and technologies we heard about at the conference.