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Last week I wrote a piece where I hypothesized that the way to understand online learning and business schools is through the lens of brands. I argued that for top business schools, online education is about defending and evolving their brand positions, and about leveraging existing brands to scale. In this post, I look a bit deeper into what U.S. business schools with global brands are doing in online education.
The overall picture is that top business schools seem to be aggressively entering the online space. Business schools, in fact, seem to run ahead of their home institutions in their commitment to exploring new models for online learning. It will be interesting if business schools end up being the catalyst for highly selective traditional institutions to prioritize online education more strongly.
The manner in which top business schools enter the online market can be divided into three main strategies. They are 1) do it ourselves, 2) work with a partner and 3) go MOOC. These strategies are not mutually exclusive. Some highly ranked business schools do all three at once.
Strategy No. 1: Do It Ourselves
The most famous example of a "go our own way" approach is Harvard Business School, or HBX. @HarvardHBX has developed their own learning platform for self-paced asynchronous courses, as well as a purpose-built studio and platform for synchronous sessions.
HBX took the approach to controlling the full stack of the online learning experience, from admissions to platform to content. Bharat Anand, Harvard's new vice provost for advances in learning and the driving force behind HBX when he was at HBS, describes the development of this strategy in his excellent 2016 book, The Content Trap. According to Anand, HBX decided that it needed to build its own learning platforms, as existing technologies did not allow engagement at scale.
HBX now has 10 self-paced online programs, priced between $950 and $1,500. The two HBX Live programs carry a price point between $3,500 and $4,800. At HBS, these 12 online programs represent only about 15 percent of the 77 programs that the school offers. So there is lots of room for HBS to grow HBX.
The much more common business school variant of the "do it ourselves" strategy is to offer online learning programs that use existing learning platforms, but to keep everything else in-house. Business schools will run their online learning programs on learning platforms such as Canvas or NovoEd. They will do the course development (instructional design), student recruitment and support, and course facilitation on their own.
Examples of this approach are the online Corporate Innovation and Personal Leadership certificates developed by the Stanford Graduate School of Business. These nondegree programs are immersive, high quality and led by Stanford faculty. They provide a Stanford learning experience without a full graduate degree, are priced at $19,000 each and take a year to complete. On the other end of the time and cost scale, the Stanford Graduate School of Business has a wide range of self-paced eight-week online courses, each priced at $995. An example is XINE249: Building Business Models, one of 14 courses in this format. At this point, almost a third (30 percent) of the school's nondegree programs are offered online.
Strategy No. 2: Work With a Partner
I was surprised in my research to see so many top business schools working with a partner online program management company. OPM companies position themselves as online education enablers. They derisk the entry into the market by providing the up-front capital and the services need to create and market online programs. In return, the OPM takes a significant share of revenues, ranging from one-half to three-quarters.
Why should business schools with the best brands agree to give up such a large proportion of all revenues? Shouldn't top-ranked business schools be in a good position to do online learning all on their own?
The answer seems to be a combination of risk, return and speed to market.
Working with a partner such as Emeritus, 2U or Noodle enables business schools to experiment with online learning without losing focus on their core programs. The marketing and outreach capabilities of OPM providers to generate leads and enrollments for online programs, particularly in digital marketing, will almost always be more sophisticated than that of institutions of higher education. OPM providers are able to reach potential students who are interested in certificates and other nondegree credentials in the emerging markets of South and East Asia, Africa, the Middle East, and South America. OPM companies can also build relationships with companies outside of the U.S. that are interested in having their employees get access to the top thinkers at U.S. business schools.
The OPM partner model in online education for brand-name business schools can be found in both full degree programs and in nondegree certificates and credentials. On the degree side, the OPM with the biggest footprint in elite graduate business education is clearly 2U. The online M.B.A. programs at UNC's Kenan-Flagler Business School and at Rice's Jones School of Business are prominent examples.
There is even more action on the nondegree side of partnerships between top business schools and OPMs to launch online programs. Columbia Business School has 21 nondegree online programs, 13 of which are self-paced and eight of which are moderated. These programs range in price from $900 to $3,750. Even with all these online programs, they represent less than 40 percent of all executive and professional programs that CBS offers.
What is interesting about Columbia Business School is how many of their nondegree online programs have been created with an OPM partner. Fully eight of the 21 Columbia online programs are done with Emeritus. Emeritus is much less known in the OPM space than companies such as 2U, but they have quietly built partnerships with Columbia, MIT, Dartmouth (Tuck), Penn (Wharton) and Berkeley (Haas) to launch online nondegree programs.
I expect that the competition in the next few years among OPM providers to partner with highly ranked business schools to create alternative credential online programs will be fierce. Where a top business school can offer only so many variants on an M.B.A. (part-time, executive, etc.), there is really no end to the number of specialized nondegree programs that they can offer.
These nondegree programs can leverage the global brand of the business school without the limitations of physical space or even (in the case of self-paced courses) faculty time. The biggest news in the online learning space of the last few years was probably 2U's acquisition of GetSmarter in 2017. This is a strong signal that 2U plans to go after the nondegree space. I expect other OPMs to follow with alacrity.
Strategy No. 3: Go MOOC
Open online learning seems to be a significant part of the online education portfolio of top business schools. This again may come as a surprise. Why would a top business school give away an online course, or charge very little for a certificate, when so many global learners seem willing to pay thousands of dollars for one of their nondegree credentials?
The answer, I think, is that MOOCs serve a different function than the other nondegree online programs that are described above. For higher-priced online programs at elite business schools, the learner is buying not only access to content but entry into a network. This network includes the core business school faculty (at the highest price points) or high-level industry professionals who facilitate some of these courses (at moderate price points). The network is also the other learners enrolled in the programs. The non-MOOC online programs are at a human scale that enables these network bonds to solidify. The learner not only gets a credential from an elite business school, evidence that they have competence in a certain skill, but also a network that they can draw on as they ascend through their careers.
In a MOOC, the value proposition for the learner is the credential that demonstrates that they have invested time in learning the content. That this content was developed from a top business school matters. The brand of the school is a signal of the relevancy and freshness of the content. Learners who complete a MOOC and get a certificate show themselves to be curious self-starters. They are self-improvers.
The audience for a higher-priced online credential and that for a MOOC credential is not the same. Or at least, the credentials are not fungible. They are different things. Business schools are learning that launching a MOOC with similar content as a smaller moderated online program does not cannibalize the number of people who will pay for the latter. If anything, a MOOC can drive awareness of a higher-intensity but smaller-scale online program, the program that provides the network. MOOCs are about content dissemination, scale and awareness. Smaller online courses are about meaningful credentials for career advancement.
At my institution we have made available two amazing low-cost online professional certificate programs on the edX platform: Leading Innovation With Vijay Govindarajan and Retail and Omnichannel Management. I hope that you check them out.
The biggest player in the elite business school MOOC space is Wharton. I count over 30 Wharton MOOCs on the Coursera platform. I recommend that every business school dean, and anyone who is thinking they might want to be a dean, spend two minutes and 53 seconds listening to Wharton's Dean Geoffrey Garrett on why his school is investing so aggressively in the open online learning space.
What other lenses might we use to make sense of the online learning picture at top business schools?
What trends and developments in online education have you observed in the world of graduate business education?
Do you buy my hypothesis that business schools are leading indicators to where highly selective colleges and universities may go with online education in the future?
Where do you go to learn about the intersection between business education and online learning?
