Traditional higher academia has largely remained immune to major changes for centuries. No wonder many in higher academia are unable to comprehend the magnitude of the emerging changes brought about by the Internet, let alone be prepared for it. The disruption is now on the horizon and most academic institutions are not yet ready for it. How is this disruption happening? What does it mean for the existing university system?

Students join a traditional academic institution primarily for three broad reasons: (i) gaining knowledge and skills, (ii) getting certified for the same for a job, and (iii) learning social skills and networking. The institution’s power derives from its position as a gatekeeper and facilitator to students aiming to fulfil these needs at its premises in a bundled manner. This value proposition offered by traditional academic institutions is getting unbundled leading to disruption in academia. On the one hand, rapid developments in technology and market forces are shifting power away from traditional institutions, on the other hand traditional higher academia continues to operate as before with minimum changes. The key assets—the faculty—continue being produced and evaluated in the same traditional manner, leading to resistance to change, making institutions increasingly out of sync with the market.

The unprecedented disruption is happening in all the three dimensions of the value proposition. It started with online courses, in particular MOOCs (massive open online courses). Freedom from time and space constraints allowed by the Internet has led to an explosion in online course offerings with many new players from outside traditional academia offering courses affordably, sometimes even for free. The process has just started. As virtual reality and mixed reality technologies improve and become widely available, it will accelerate.

Earlier, an institution required many faculty members to teach classes due to the physical limitations of a classroom; going forward it will need very few teachers to teach popular courses to thousands of students simultaneously. Therefore, while there would be a reduction in demand for teachers who teach mainstream popular courses, the demand for faculty teaching niche courses would increase. This “long-tail effect” in education would be visible due to the aggregation of demand for niche courses across regions leading to enough students to justify their development. Therefore, we will see more diversity in research issues addressed in Ph.D. programmes and more diversity in teaching interests to address teaching demands in the new context. All this is likely to increase the proportion of practitioners getting involved in teaching. In addition, the large size of students taking classes online would require different course management techniques, and new categories of jobs are already appearing to support development and management of online courses.

The ability to award certificates recognised and valued by the industry is a key source of power for academic institutions. Traditional academic institutions are providing certificates to students who take their courses offline and online. While new online players are also offering certificates, they are not as credible. And this is likely to change in two ways. First, new entrants and online course distributors offering online certificates will gain credibility over time and start competing successfully with traditional institutions. Second, certificates are valuable because of who offers them. There is no reason why credible persons or entities cannot offer certificates to students independent of academic institutions. Further, the courses taken by a student leading to such a certificate need not be from the same institution. One may find a student take courses from multiple institutions and then get certified by a different entity. If recognised by the industry, such unbundled certificates would give a body blow to the power of traditional academic institutions.

The third need of students fulfilled by traditional academic institutions is gaining social skills and access to closed networks. New players and methods will appear to satisfy this need of students as well. For example, students enrolling in specific certificate programmes online might have the option of meeting other students at a physical location for a few days to interact intensely through social and educational activities. This is happening in some online programmes currently organised by traditional academic institutions. If we expand this concept to unbundled certificate programmes that provide the option of physical meetings of participants, then meeting the same persons and/or different persons more intensely on multiple occasions may lead to wider networking opportunities. Perhaps new real estate offerings allowing students to stay as a community, socialise, and entertain while taking online classes from multiple sources for unbundled certificates would come up, leading to richer friendships and more networking opportunities overall.

If one looks at the overall higher education landscape, the disruption in the form of unbundling of higher education has already started. It will lead to a more democratised context where merit and responsiveness to market needs would be paramount. While top ranked educational institutions may survive largely unharmed, others may not be so fortunate. For them, the time to reinvent is now.

Views are personal. The author is associate dean for digital transformation, e-learning, and marketing, and associate professor of marketing at the Indian School of Business.

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