These are heady days for digital higher education. For advocates of all-things-digital, myself included, it appears we’ve earned our permanent place at the table. Whether fully online, blended or a supplementing classroom education, digital higher ed is now a strategic issue for colleges and universities. Online enrolment continues to experience double-digit growth. Investors are once again lining up to fund new companies in educational technology and media. Not a week goes by without a breathless article being written about “revolution” or “disruption” in higher education brought on by the onslaught of technology. If David Noble were still with us, he’d be one unhappy camper.

But there are very significant obstacles standing in the way of higher education fully leveraging technology for purposes of instruction. We’ve yet to address these head-on.

My pessimism, if that’s what it is, stems not from our lack of knowledge about how students learn; we already know far more than we apply. And it’s not because of the limits of technology; higher ed trails other sectors in its use of available technology. The obstacle is organizational or, in the language of business, our “business model”.

Le Modèle D’Entreprise: An Ill-Fit

The opportunities made possible by technology for improving learning and productivity in higher education are in many respects at odds with the established business model of higher education. They don’t fit together well.

Our business model includes such matters as how we fund our institutions (tuition, public funds, endowments, etc), the kinds of resources we acquire and from whom, how we reward talent and the kinds of talent we seek out, our notions of what constitutes a “great university”, what we choose to outsource and what we do in-house, and how we compete for funds, prestige and students. Although the business model of higher education is one of the more complex in existence, the majority of colleges and universities in North America, other than proprietary colleges, are remarkably consistent in these and other respects.

Please: To note that the institution of higher education has a business model does not suggest that it is a business, or that it should be more business-like. This is a common misunderstanding (example of the misunderstanding). Every organization has a business model, whether it’s IBM or Greenpeace. Even Mother Teresa’s organization, Missionaries of Charity,  has a business model.

Consider, for example, social media. There is a great deal of excitement about the use of social media in higher education. But outside of marketing and community engagement, it proves an awkward fit in higher ed – particularly when we attempt to integrate it into our instructional model. While social media is particularly well suited to facilitating open-ended exchanges between people – with no clear or prescribed beginning and end – higher education has clear boundaries (e.g. course duration) and largely predetermined objectives (e.g. a fixed and standard set of assessments). Social media is user-generated and leaderless; that’s what makes it so compelling. On the other hand, higher education is top-down and instructor-directed. Social media thrives when there are thousands, if not millions, of users within a single, overarching community. A high volume of users provides online communities with enough activity and content to ensure that each user finds what and who they want with sufficient frequency. Twitter and Linked In have well over 100 million users. Higher education instruction typically restricts participation to a single class (e.g. average of 40 students per course).

Consider rich media. Since the dawn of digital education, pundits have dreamt about the potential to provide every student with access to brilliant digital content that thoughtfully merges the best software, subject-matter knowledge, and pedagogy. Unfortunately, this vision crashes headfirst with conventional notions about the role of academics in teaching (which would be radically reduced when rich media takes centre stage), how we finance course development and to what level, and how reputation for both academics and institutions relies so heavily on subject-matter knowledge. It’s not accidental that rich media is largely limited to K12 and corporate learning contexts; they have different business models that better enable the use of this kind of content.

Matching Technology with the Right Business Model

This is not to suggest that social media and rich media can’t be used in higher education. They can, and they are. But the business model used by the vast majority of institutions will, on average, make their use less effective, more complicated, take longer to achieve, and cost more. No amount of talk at conferences or online communities about what we in higher education “ought” or “should” do will change this. Business models are the structures in which we work; they frame the possibilities.

There’s a theoretical basis to this view. Christensen’s study of disruptive innovation contends that organizations need to match new technologies with the right business model in order to fully leverage its potential. By simply dropping a new technology into the structure and constraints of the existing, traditional business model, we dramatically weaken its capacity to increase value. We need to align the technology with an enabling business model.

Much of what constitutes technology in higher education has, to date, been successful precisely because it doesn’t challenge the existing business model. The core value proposition of the LMS, for example, is that it allows instructors with minimal technical skills to create and manage web-based courses with limited assistance. In this respect, the design of the technology mirrors and ultimately reinforces the organizational model of classroom education in which the Instructor serves as a one-person operation. For the institution, this ensures that the LMS does not disrupt the existing and deeply embedded organization of roles and responsibilities within the institution, which in turn reduces costly reorganizational changes, as well as blow back from academics that are accustomed to working with high levels of autonomy.

To significantly improve the value of instructional technology and media for instruction in higher education we need start looking more closely at how our institutions operate. It’s not the technology that will limit us. And it’s certainly not a lack of research into how college students learn best. It’s something much more difficult – our business model.

Related articles by Keith Hampson

The LMS: It’s Not All About You

Minding the Gap: Instructional Technology and Pedagogy

OESP’s and (Non) Disruptive Innovation


  1. There is one pocket of influence, maybe two, which exist in most institutions which function upon a different business model than that of the institution as a whole; those are the School of Business; and potentially the School of Engineering.

    In turning out graduates (particularily MBAs) with entrepreneurial skills to innovate business and engineering successfully, it should be possible for the institution as a whole to recognize the necessity of reconfiguring its own business model such that Staff and Faculty are incentivized for the kinds of creative and innovative thinking and projects which will increase the reputation of the institution. (Maybe this is how some schools came to adopt the free courseware MOOC idea?).

    I think the use of social media and the use of educational technology will make their most alarming inroads into the classical business models of higher ed as they percolate up through the curriculum into the practices of the institution itself.

    Thanks for the posting!


  2. Thanks for the notes, Laura. I think you’re absolutely right about incentives. We need to be absolutely clear (and honest) about how incentives are currently handled in higher ed. People will do great things (and new things), given the opportunity and the right reasons.


  3. Interesting ideas. Do you have further content on “brilliant digital content that thoughtfully merges the best software, subject-matter knowledge, and pedagogy” ? Thanks


  4. Thanks for the note, Louis.
    Here are a few links that may be of use (let me know).


  5. There are some of us who absolutely agree, and have actually come up with a solution to the problem. But instead of overhauling the “business model” we start with a single course whose idea is to change the roll of the student from “information consumer” to “inventor”.

    We are currently developing a new kind of class that puts the students at the center, and aims at making students implement solutions to the problems they themselves face. One single class is enough to get the ball rolling because it is designed to “develop and maintain itself” and even spawn offsprings. It is aimed at triggering a change in the mindset of the students. Many of the details that we have worked out so far, have already been tested by the professor who is actually going to run it. You can find the summary of the current plan (and our Facebook group) for 1 week at this address:

    I’d be happy to hear some feedback!


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