1Copyright Clayton M. Christensen
Disrupting Class:How Disruptive Innovation Will
Change the Way the World Learns
Michael B. HornMarch 5, 2010
2Copyright Clayton M. Christensen
Sustaining and Disruptive InnovationsP
erfo
rman
ce
Time
Performance that customers
can utilize or absorb
Pace of
Technological
Progress
Sustaining innovations
Incumbents nearly always win
3Copyright Clayton M. Christensen
Disruptive Innovations create asymmetric competition
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Disruptive
Innovations:
Competing against
non-consumption
Per
form
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Time
Sustaining innovations
Incumbents nearly always win
60% on$500,000
45% on$250,000
40% on $2,000
20%
Performance that customers
can utilize or absorb
Entrants nearly always win
Pace of performance
improvement
4Copyright Clayton M. Christensen
Disruption in business models has been the dominant historical mechanism for making things more
affordable and accessible
Today• Toyota• Wal-Mart• Dell• Southwest Airlines• Fidelity• Canon• Microsoft• Oracle• Cingular• Community colleges• Apple iPod
Yesterday• Ford• Dept. Stores• Digital Eqpt.• Delta• JP Morgan• Xerox• IBM• Cullinet• AT&T• State universities• Sony DiskMan
5
Disruption of Toyota
Copyright Innosight Institute, Inc.
6Copyright Clayton M. Christensen
Disruption in business models has been the dominant historical mechanism for making things more
affordable and accessible
Today• Toyota• Wal-Mart• Dell• Southwest Airlines• Fidelity• Canon• Microsoft• Oracle• Cingular• Community colleges• Apple iPod
Yesterday• Ford• Dept. Stores• Digital Eqpt.• Delta• JP Morgan• Xerox• IBM• Cullinet• AT&T• State universities• Sony DiskMan
Tomorrow• Chery• Internet retail• RIM Blackberry• Air taxis• ETFs• Zink• Linux• Salesforce.com• Skype• Online universities• Cell Phones
Copyright Clayton M. Christensen 11Non
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Pocket radios
Portable TVs
Hearing aids
Tabletop Radios, Floor-standing TVs
Path taken byvacuum tube
manufacturers
Expensive failure results when disruption is framed in technological rather than business model terms
Proprietary,interdependent architectures:
Microsoft Windows;
Apple products
Different Systems Architectures
02/14/10 Copyright Clayton M. Christensen 5
Modular, open architectures
Linux; Dell PCs
Customization is very expensive
Customization is straightforward
9Copyright Innosight Institute, Inc.
We all learn differently• Multiple intelligences- Linguistic, Mathematical, Kinesthetic
• Motivations/interests• Learning Styles- Visual, aural, playful, deliberate
• Depends on subject/domain• Research in practice- Scientific Learning- CAST/Universal Design for Learning- K12, Inc.- All Kinds of Minds- Renzulli Learning
• Talents- “Giftedness” is fluid
• Aptitudes• Different paces- Fast, medium, slow
• Ongoing neuroscience research
- fMRI scans
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Copyright Clayton M. Christensen
Conflicting mandates in the way we must teachvs.
The way students must learnNeed for customization for differences in how we learn
Stan
dard
ization !! L
earn
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Sty
les
Pac
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f L
earn
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Mu
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nte
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s
Interdependencies in the teaching infrastructure
Temporal
Lateral
Physical
Hierarchical Cu
stom
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!!
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Copyright Clayton M. Christensen
Historically, most schools have “crammed” computer-based learning into the blue space
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Core curriculum
Path taken bymost schools,
foundations and education software
companies
Copyright Innosight Institute, Inc. 14
Prime examples of non-consumption
Looming budget cuts and teacher shortages are an opportunity, not a threat
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Copyright Innosight Institute, Inc.
School boards have been moving “up-market” to focus limited resources in the “new” trajectory of improvement
Time
Imp
ort
ance
o
f p
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Time
German
Statistics
Psychology
Economics
Math
Science
English language & literature
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Copyright Clayton M. Christensen
Perfect opportunity to implement online learning disruptively
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Computer-based
learning: Compete
against non-
consumption
Po
litic
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of
pro
gra
m
Time
German
Statistics
Psychology
EconomicsEnglish language & literature
Science
Math
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Copyright Clayton M. Christensen
The substitution of one thing for another always follows an S-curve
pattern
% new
% new% old
.001
.0001
.01
0.1
1.0
10.0
09 11070503 13 15
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Copyright Clayton M. Christensen
Online learning gaining adoption
Enrollments up from 45,000 in 2000 to 1,000,000 in 2007
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Predictably improving
Copyright Innosight Institute, Inc.
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Copyright Innosight Institute, Inc.
What are public schools doing?
• 46 states have some form of online learning initiative
• 27 states have supplemental state-led programs– FLVS, Idaho Digital Learning Academy, MVU– At least 7 have 10K+ enrollments
• Districts increasingly getting into the game– Serving nonconsumers: drop-out recovery, credit
recovery, advanced courses, home-schoolers 16
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Copyright Innosight Institute, Inc.
Practical implications• Autonomous• Self-sustaining funding• Not beholden by the old metrics
• Seat time Mastery/Performance-based
• Student: teacher ratio
• Teacher certification
• Human resources pipeline and professional development
• Broadband/wireless infrastructure• Portal/Based on usage and what works• Treatment and use of data
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Copyright Clayton M. Christensen
Disrupting Class:How Disruptive Innovation Will
Change the Way the World Learns
Michael B. HornMarch 5, 2010
Copyright Clayton M. Christensen 7
Centralization followed by decentralization: Computing
Copyright Clayton M. Christensen 8
The decentralization that follows centralizationis only beginning in education
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Copyright Clayton M. Christensen
PROCESSES:
Ways of working together to address recurrent tasks in a
consistent way: training, development, manufacturing,
budgeting, planning, etc.
Why does an organizational model lock us in?
REVENUE FORMULA:
Assets & fixed cost structure, and the margins & velocity
required to cover them
THE VALUE PROPOSITION:
A product that helps customers do more effectively, conveniently & affordably a job they’ve been trying to do
RESOURCES:
People, technology, products, facilities, equipment, brands, and cash that are required to deliver this value proposition
to the targeted customers
24
Copyright Clayton M. Christensen
PROCESSES:
Ways of working together to address recurrent tasks in a
consistent way: training, development, manufacturing,
budgeting, planning, etc.
PROFIT FORMULA:
Assets & fixed cost structure, and the margins & velocity
required to cover them
THE VALUE PROPOSITION:
A product that helps customers do more effectively, conveniently & affordably a job they’ve been trying to do
RESOURCES:
People, technology, products, facilities, equipment, brands, and cash that are required to deliver this value proposition
to the targeted customersBusiness units don’t evolve.Corporations do.
25
Copyright Clayton M. Christensen
When launching disruptions, autonomy is key
Improve performance of each component
Lev
el o
f ch
ange
VP VP VP VP
Autonomous
VP VP VP VP
Heavyweight
VP VP VP VP
Lightweight
VP VP VP VPFunctional
Product architecture: What are the components, and which ones interface with others?
Organizational model in which product is used
Change the specifications for how components must fit together
Copyright Clayton M. Christensen
• Manufacturing• Food services• Medical procedures• Instruction• Textbooks; education software today
Value-adding process
businesses
• Telecomm• Insurance• EBay• D-Life • Education software tomorrow
Facilitated- network
businesses
Transforming the content model
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Copyright Clayton M. ChristensenNon-c
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Path taken byEducational
software developers
The instructional materials business historically has been a value-adding process business
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Copyright Clayton M. Christensen
Stages in instructional disruption
Diff
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Teacher-led courses
Diff
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Online courses
Tutoring tools
Little
Extensive
Degree of c
ustomiza
tion
Teacher-led
monolithic instruction
Online learning
Student-centric learning facilitated user networks
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Copyright Clayton M. Christensen
Student-centric software will be a facilitated-network business
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Per
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Modules
Custom classes
Tutoring
Facilitated Network: parents, teachers, students, entrepreneurs
Copyright Clayton M. Christensen
Assessment in today’s monolithic system
Deliver content to students Testing & assessment Progress to next grade, subject,or body of material
Receive results
31
Copyright Clayton M. ChristensenCopyright Clayton M. Christensen
How should assessment work?
Deliver content to students Testing & assessment
Progress to next grade, subject,or body of material
Receive real-time interactive feedback
32
Copyright Clayton M. Christensen
When education is not delivered in an intrinsically motivating way,
prosperity is an enemy to education
Why do we need to innovate?
33
Copyright Innosight Institute, Inc.
A case study of successful innovation in education:
The Florida Virtual School
• Start small
• Break the mold grant for $200K
• What should it look like?
• Unconstrained by old assumptions; what can we do with
this new medium? What is true in this world?
• Experiment and learn from failure
• Puzzle: who will want to use this?
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Copyright Innosight Institute, Inc.
Key policies emerge• Autonomous organization
– Established in 2000 as independent educational entity
– New value proposition
– Freedom to create its rules and procedures and enter into agreements with providers, hold patents, etc. as need be to fulfill its mission
• Funding– Initially a line-item allocation
– In 2003, self-sustaining model established• FL funding formula
• Seat time Mastery
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Copyright Innosight Institute, Inc.
FLVS growth