Background:
Mature industries are often targets for disruptive innovation. Mature industries often reach a level of little to no incremental innovation and become very risk averse to changes in their business model – because "it has worked well so far". Consider some of the recent disruptive innovations such as Uber and other ride sharing companies, Airbnb and other accommodation sharing companies, Amazon and other web-based retailers, new streaming services that bypass traditional cable television distribution models. The list goes on and on.
Higher education is a mature industry. The higher education "business model" has remained largely unchanged for decades. Although there are private companies who have entered what was traditionally a publically financed market, these companies largely follow the traditional business model.
Higher education in the United States has come under increasing scrutiny as the tuition rates have risen significantly faster than the general rate of inflation. Low interest borrowing subsidized and managed by the Federal Government has allowed students to take on increasingly unsustainable debt. Meanwhile, the employment landscape continues to change dramatically, and large gaps have opened between the knowledge and skills employers offer and the focus of degrees offered by higher education. Increasingly, employers are of the opinion that even graduates with degrees that match the needs of the employer are inadequately prepared for success. The inflation in wage rates has been at or lower than the rate of general inflation creating a situation where even when graduates get a job, the compensation they receive is insufficient for them to service their student loan debt without significant sacrifices in their standard of living.
These challenges are creating increasing levels of dissatisfaction with the current higher education model from virtually every stakeholder in the process. Parents are increasingly concerned with the cost and the outcomes for their children should they pursue a degree. Employers are dissatisfied both with the focus of degrees that do not match their needs and the perception that graduates are not prepared to enter the job market effectively and contribute to the success of the organizations hiring them. Students are dissatisfied because they are graduating with significant debt with degrees for which there is no market. Taxpayers are increasingly reluctant to support ever increasing costs of the public institutions. Faculty are dissatisfied as the growth in administrative staff has vastly outpaced the growth or investment in faculty. Administrators are frustrated at the perceived overregulation of higher education by the Federal Government. In short, higher education is ripe for disruptive innovation.
That disruption has begun, but in diverse areas. "Open Source" learning platforms that deliver high quality, low cost education has grown in popularity. Students can basically "assemble their own" education – but won’t have a traditional degree from an accredited institution. Parents and employers are advocating for trade schools that graduate students in 2 years or so with knowledge and skills that make the students employable at earnings rates that allow them to succeed – and avoid the large levels of student debt. Employers are increasing their in-house educational offerings to precisely match their knowledge and skill requirements.
Assignment:
Considering all of these factors, prepare a proposal for disruptive innovation that a new entrepreneurial company could launch that would satisfy – or better satisfy – the stakeholders in the higher education process and create an opportunity for a fast scaling business.
Your proposal should be in the form of a letter to potential investors. Your proposal should address each of the points of concern:
Cost
Investment of time
Program output poorly matched to market requirements.
Growth strategy. For example, you could start by focusing on one market (say Marketing) and then extend/scale into additional markets (Finance, Law, Medicine, etc.). Discuss how your model allows or rapid expansion.
Your proposal should meet the following format requirements:
Minimum of 3 pages
Double spaced
12 Point Font.
1-inch margins bottom, top, left, and right.
No spelling or grammatical errors
Professional language
All sources cited in APA citation format on a references page (this is in addition to the 3-page body of the assignment.
Submit through the Assignment Link by 11:59PM on the due date.