The 'Disruption' of Higher Education

SMITH BRAIN TRUST — Are today's colleges going the way of Blockbuster after the rise of Netflix and streaming video? Things might not be quite so dire. But Henry C. Lucas, Jr., chair of the Department of Decision, Operations and Information Technologies at the University of Maryland's Robert H. Smith School of Business, argues that college leaders need to act more quickly than they have so far if don't want to be swept aside by emerging technologies — but, rather, take advantage of them.

Lucas is both a participant in and analyst of the online digital education revolution. He created the Smith School's first Massive Open Online Course (MOOC), on Disruptive Technologies, and he has taught from the start in the school's online MBA program, which launched in January 2014.

"I became a convert because I saw the possibility of creating a quality product," Lucas says. "Before I taught those courses, I assumed that online education had to be inferior. Once I came to understand the technology, I saw that it was possible to create the same quality of education online as in a classroom."

All things considered, Lucas says, "I would rather have students physically in the room with me, but we are opening up a whole new market and new opportunities for students who might otherwise not be able to take our courses."

Lucas's new book, Technology and the Disruption of Higher Education: Saving the American University, published Oct. 30, 2015, recounts his own experiences with online education and is intended to serve as a wake-up call for traditional educators. "What I'm trying to do is convince people that this technology is not something they can ignore," he says — much as some traditionalist professors might wish they could.

The traditional university's challenges are hardly a secret: Tuition keeps rising (1,200 percent since 1978, versus 300 percent for other goods), student debt is ballooning, and, for public universities, support from legislatures is on the decline. Staff numbers grow faster than the number of people directly involved in teaching, and infrastructure, including gyms and dorms, grow pricier.

Online courses can, on the one hand, help to reverse some of these trends. But they also challenge virtually every aspect of the modern university. Numerous traditional universities (including the Smith School) are offering online variants of their traditional courses, which means geographic barriers to competition are breaking down. Most MOOCs don't generate course credit, so they don't compete directly with universities — but that could change. Then there is the model represented by Project Minerva, built from the ground up around the idea of online education, and therefore lacking many of the overhead costs that traditional universities bear (from dorms to sports teams).

One question up in the air is how valuable students will judge in-person interaction with professors, and how essential it turns out to be in producing rich educational outcomes. If it turns out to be nonessential, the news will be "grim indeed" for traditional universities, Lucas says. But he doubts students will entirely forgo the chance for face-to-face interaction, and believes such experiences can be rich.

So one scenario is that higher education will remain largely recognizable to people familiar with its current form. Even in that case, Lucas thinks that the "flipped classroom" is the way of the future. In a flipped classroom, the professor uses class time to solve problems and help student think through issues raised in lectures watched on video. "My expectation (and hope)," Lucas writes, "is that within five years, we shall witness the end of the large lecture course."

Harvard professor Clayton Christensen has predicted that as many as half of all colleges could go bankrupt within 15 years. Lucas is not so pessimistic, but also foresees a shakeout. Here, in Lucas's view, are some risks and opportunities faced by five key stakeholders, as the online revolution proceeds:  

First-Tier Universities:

Opportunities: A chance to expand the brand globally; to generate revenue from content, contribute to raising the global level of education; and to use campus resources more efficiently (teaching more students in fewer buildings, for example).

Risks: High investment costs to create online materials; competition from peers and start-up universities in the online space (both at the program and individual-course level); bidding wars over star MOOC professors. 

Regional Universities:

Opportunities: A chance to supplement course offerings with material from the world's top faculty; possibility of developing and concentrating distinctive faculty-expertise niches, to stand out in a crowded marketplace.

Risks: Competition across the board from MOOCs, start-up universities, and traditional schools with greater intellectual and financial resources. Schools in this category will face the highest likelihood of closing.

Start-up Universities:

Opportunities: Building a new kind of university with a fraction of the overhead of the traditional university.

Risks: Establishing a brand and a reputation for quality; attracting talented faculty and students; no built-in alumni network.

Students:

Opportunities: More flexibility; savings from not having to live on campus; nearly unlimited course offerings; chance to visit multiple satellite branches of a university in some cases — perhaps located around the world.

Risks: Must assume more responsibility for one's education; uncertainty whether online courses offer better learning outcomes than traditional courses; lost opportunities for in-person networking; shift to "outcomes-based" evaluations might be unsettling.

Professors:

Opportunities: Using new content from outside experts adds value to classes; flipped classrooms allow for greater engagement with students.

Risks: The learning curve related to adapting to new technologies; the potential of being demoted, effectively, to the status of teaching assistants for star content producers from other universities; decreased need for PhD faculty.

"Schools that will fare the best will be content creators rather than content consumers," Lucas writes. Regardless of how the technological revolution shakes out, it seems inescapable to Lucas that there will be somewhat less demand in the future for tenured research faculty, and that some campuses will find themselves closing "marginal" departments. There will be greater pressure to keep the lid on costs associated with staff, buildings and other infrastructure.

So far, he thinks the Smith School is ahead of many peers in handling the disruption. "I am very pleased that the University of Maryland was an early adopter of MOOCs, and very proud that the business school was able to create an online MBA," he says. He recalls, when the Smith School's first cohort of online students was making one of its required visits to the campus, speaking with a woman who had a six-month old at home. "She said there was no way she could do this if we didn't offer an online program," Lucas says. Given the chance to take MBA courses in a way that fit into her life, "there was no stopping her," he adds.

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