Read Disrupting Class: How Disruptive Innovation Will Change the Way the World Learns text version

How Disruptive Innovation Will Change the Way the World Learns

Disrupting Class:

[email protected]

10/15/09 Copyright Clayton M. Christensen 1

Michael B. Horn December 3, 2009

Sustaining and Disruptive Innovations

f ce o logical Pa no h Tec ress g Pro

Incumbents nearly always win

Performance

i usta S

ni

inno ng

s tion va

t customers Performance tha sorb can utilize or ab

Time 10/15/09 Copyright Clayton M. Christensen 2

Disruptive Innovations create asymmetric competition

Performance

Incumbents nearly always win

ns 60% on vatio no $500,000 ng i n i stain Su

45% on $250,000

r ma erfo fp ace o ement P ov impr

nce

Different measure Of Performance

t customers Performance tha sorb can utilize or ab

Time

ers um ns g co n- umin s No ns sion co cca 10/15/09 o

s: ovation st Inn ruptive eting again - Dis on Comp nsumption N non-co or

40% 20% on $2,000

Entrants nearly always win

Copyright Clayton M. Christensen

Time

3

Disruption in business models has been the dominant historical mechanism for making things more affordable and accessible Yesterday · Ford · Dept. Stores · Digital Eqpt. · Delta · JP Morgan · Xerox · IBM · Cullinet · AT&T · State universities · Sony DiskMan · · · · · · · · · · · · Today Toyota Wal-Mart Dell Southwest Airlines Fidelity Canon Microsoft Oracle Cingular Community colleges Apple iPod

Copyright Clayton M. Christensen 4

Disruption of Toyota

Copyright Innosight Institute, Inc.

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Disruption in business models has been the dominant historical mechanism for making things more affordable and accessible Tomorrow Yesterday · Today · Ford · Chery · Toyota · Wal-Mart · Dept. Stores · Internet retail · Dell · Digital Eqpt. · RIM Blackberry · Southwest Airlines · Air taxis · Delta · Fidelity · JP Morgan · ETFs · Canon · Xerox · Zink · Microsoft · IBM · Linux · Oracle · Cullinet · Salesforce.com · Cingular · AT&T · Skype · State universities · Community colleges · Online universities · Apple iPod ·11/05/09 DiskMan Sony · Cell Phones 10 Copyright Clayton M. Christensen

Centralization followed by decentralization: Computing

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Copyright Clayton M. Christensen

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The decentralization that follows centralization is only beginning in education

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Copyright Clayton M. Christensen

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Important characteristics of Disruption

· Takes root in a new ring because it is better than nothing, or basis of competition has shifted to convenience and customization · Customers or applications get pulled into the new ring or adopt the low-end solution when performance of the product or service becomes good enough to do the job. The disruptive technology does not "invade" the inner circle · Recessions often accelerate the disruptive devolution of an industry · Customers rarely go back toward the middle

12/02/09 Copyright Clayton M. Christensen 9

Expensive failure results when disruption is framed in technological rather than business model terms

Performance

Tabletop Radios, Floor-standing TVs

Different measure Of Performance

Path taken by vacuum tube manufacturers

Time

Portable TVs

r so r me su on ing -c on sum ns N n sio co cca 11/05/09 o on Hearing aids N

Pocket radios

Time

Copyright Clayton M. Christensen 11

The pursuit of revenue and differentiation in sustaining competition amongst similar business models generally adds cost

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Copyright Clayton M. Christensen

5

Costs in higher education

Endowment

Dollars

u Ann

8% se = ~ crea ion in u it nual t An

o al C

st

se re a Inc

% ~1 0 =

Endowment

Time 10/15/09 Copyright Clayton M. Christensen 12

Understanding how users experience life

"The customer rarely buys what the company thinks it is selling him" - Peter Drucker

© Clayton M. Christensen 2

Three levels in the architecture of a job

What is the fundamental job or problem the customer is facing? This includes its political, functional, emotional and social dimensions.

­ What are the experiences in purchase and use which, if all provided, would sum up to nailing the job perfectly? - What are the product attributes, technologies, features, etc. that are

needed to provide these experiences?

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Disruption of general-purpose products happens on job-by-job basis

Performance

Different measure Of Performance

· Unload this stuff ns atio ovcar n · Find the right i ng i n in Susta or buy a home · Sell · Find the right job, or the right employees · Kill commuting time productively · Become well-informed · Unwind at the end of the day

nce r ma rfo of pe nt Pace ve Help Major Metropolitan Newspapers me me: o impr

m su n -co ming n No nsu sions co cca 10/15/2009 o

s: ovation st Inn uptive ting again - Disr on Compe nsumption N or non-co s er

Craig's List AutoTrader.com Realtor.com Monster.com Metro; Blackberry

Time

15

Time

CNN.com Copyright Clayton M. Christensen Unwind at the end of the day

The Harvard Business School is being disrupted

Performance

Incumbents nearly always win

A r MB 2-yea

$150,000 !!

Different measure Of Performance

A e MB tim Parte arbag eG n-lin O Help me solve this problem

Teach me what I need to know to become a great manager Give me the credentials I need to get the next, more lucrative job Help me switch careers Help me join a prestigiousTime network · Brand

Copyright Clayton M. Christensen

Time

su on ing -c on sum ns N n sio co cca 10/15/2009 o

s: versitie t ni rate U ng agains rpo n- C o ti No Compe nsumption r so er non-co m

· Connections

16

So what should the Harvard Business School Do?

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Disruption is facilitated when historically valuable (and expensive) expertise becomes commoditized

Performance

Experimentation & problem-solving

Pattern Recognition

Rules-Based

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Focus on a job to be done defines proper integration vs. inefficient integration

· Ikea · iPod / iTunes · Best Buy-Geek Squad vs. vs. vs. Levitz Furniture Kazaa Costco Doctor's office

· Take Care-Walgreens vs.

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Copyright Clayton M. Christensen

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Focus on product categories leads to feature proliferation and undifferentiated products

Toyota Chevrolet

Sienna Avalon Camry Corolla 4-Runner Uplander Impala Malibu Cobalt Trailblazer

Tundra Colorado Tacoma Avalanche

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Who are our customers? What jobs do they hire institutions of higher education to do? Which elements of our presently integrated system are actually tangential to their job-tobe-done? Which ones must be integrated into the core experience?

12/02/09 Copyright Clayton M. Christensen 15

We all learn differently

· Multiple intelligences

- Linguistic, Mathematical, Kinesthetic

· Talents

- "Giftedness" is fluid

· Motivations/interests · Learning Styles

- Visual, aural, playful, deliberate

· Aptitudes · Different paces

- Fast, medium, slow

· Depends on subject/domain · Research in practice

- Scientific Learning - Universal Design for Learning/CAST - K12, Inc. - All Kinds of Minds

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· Ongoing cognitive science research

- fMRI scans

Copyright Clayton M. Christensen 22

The right product architecture depends upon the basis of competition

IBM Mainframes, Microsoft Windows

Performance

Compete by improving functionality & reliability

t en nd pe rde

s ure t tec i rch a

et pri o Pr

e int , ary

Mo

o lar du

es ur ct ite h arc n pe

Compete by improving speed, responsiveness and customization

Dell PCs, Linux

Copyright Clayton M. Christensen Time 14

11/05/09

Conflicting mandates in the way we must teach vs. The way students must learn

Interdependencies in the teaching infrastructure Need for customization for differences in how we learn

Multiple Intelligences

Temporal Lateral Physical Hierarchical

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Copyright Clayton M. Christensen 24

Paces of Learning

Standardization !!

Customization !!

Learning Styles

Historically, most schools have "crammed" computerbased learning into the blue space

Performance

Core curriculum

Different measure Of Performance

Path taken by most schools, foundations and education software companies Time

r so g r me min s su on onsu asion -c on c occ N

on N

Time

Copyright Clayton M. Christensen 25

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The substitution of one thing for another always follows an S-curve pattern

% new % old

% new

10.0

1.0

0.1

.01

.001 .0001

03

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05

07

09

11

13

15

26

Online learning gaining adoption

Enrollments up from 45,000 in 2000 to 1,000,000 in 2007

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Why does an organizational model lock us in?

THE VALUE PROPOSITION: A product that helps customers do more effectively, conveniently & affordably a job they've been trying to do RESOURCES: People, technology, products, facilities, equipment, brands, and cash that are required to deliver this value proposition to the targeted customers

PROCESSES: REVENUE FORMULA: Assets & fixed cost structure, and the margins & velocity required to cover them

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Ways of working together to address recurrent tasks in a consistent way: training, development, manufacturing, budgeting, planning, etc.

28

Copyright Clayton M. Christensen

THE VALUE PROPOSITION: A product that helps customers do more effectively, conveniently & affordably a job they've been trying to do

RESOURCES: People, technology, products, facilities, equipment, brands, and cash that are required to deliver this value proposition to the targeted customers

Business units don't evolve. Corporations do.

PROFIT FORMULA: Assets & fixed cost structure, and the margins & velocity required to cover them

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PROCESSES: Ways of working together to address recurrent tasks in a consistent way: training, development, manufacturing, budgeting, planning, etc.

29

Copyright Clayton M. Christensen

When launching disruptions, autonomy is key

Autonomous

Organizational model in which product is used Product architecture: What are the components, and which ones interface with others? Change the specifications for how components must fit together Improve performance of each component

10/15/09 Copyright Clayton M. Christensen

VP

VP

VP

VP

Heavyweight

VP VP VP VP

Level of change

Lightweight

VP VP VP VP

Functional

VP VP VP VP

30

How Disruptive Innovation Will Change the Way the World Learns

Disrupting Class:

[email protected]

Michael B. Horn October 16, 2009

10/15/09

Copyright Clayton M. Christensen 31

What are states doing?

· 44 states have some form of online learning initiative · 32 states have supplemental state-led programs

­ FLVS, Idaho Digital Learning Academy, MVU ­ 4 of these have 10K+ enrollments ­ Over a quarter grew by over 50% last year

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Policy implications

· Autonomous · Self-sustaining funding · Not beholden by the old metrics

· Seat time Mastery/Performance-based · Student: teacher ratio · Teacher certification

· Human resources pipeline and professional development · Broadband/wireless infrastructure · Portal/Based on usage and what works · Treatment and use of data

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Transforming the content model

Value-adding process businesses Facilitatednetwork businesses

· Manufacturing · Food services · Medical procedures · Instruction · Textbooks; education software today

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· Telecomm · Insurance · EBay · D-Life · Education software tomorrow

Copyright Clayton M. Christensen

The instructional materials business historically has been a value-adding process business

Performance

Different measure Of Performance

Path taken by Educational software developers

Time

r so g er um umin ns s on ons asio -c c on c 10/15/09 oc N

on N

Time

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Stages in instructional disruption

Little

t iza ion

Performance

D

Extensive

Different measure Of Performance

Different measure Of Performance

ee gr e

o

to us fc

m

Tea

es cours ed her-l c

s ourse c nline O

Teacher-led monolithic instruction

Online learning

Tu

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ls g too torin

Student-centric learning facilitated user networks Copyright Clayton M. Christensen 36

Student-centric software will be a facilitated-network business

Performance

Different measure Of Performance

Custom classes

Modules

r so g er um umin ns s on ons asio -c c on c 10/15/09 oc N on N

Tutoring Facilitated Network: parents, Time teachers, students, entrepreneurs

Copyright Clayton M. Christensen 37

Assessment in today's monolithic system

Deliver content to students

Testing & assessment

Progress to next grade, subject, or body of material

Receive results

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Copyright Clayton M. Christensen

How should assessment work?

Deliver content to students

Testing & assessment

Receive real-time interactive feedback

Progress to next grade, subject, or body of material

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Copyright Clayton M. Christensen 39

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