Entrant firms with modular online-learning courses should consider targeting students from highly supportive families before they try to serve disadvantaged youth. Here’s why:
When a new market coalesces, companies develop highly integrated products that, while not good enough, come closer to satisfying customer’s needs than any of their competitors (see Michael Horn’s article, “Is the technology ‘ready’ for blended learning?” and Clayton Christensen’s book, Innovator’s Solution). True to form, many schools today are turning to single providers for the full suite of online-learning solutions they need, because the technology is not good enough yet to allow them to cobble together products from multiple providers very easily. The pattern is that integration precedes modularity, and modularity begins first among the lowest tier with the least demanding needs.
But over time, the technology improves and eventually overshoots the functionality and reliability that customers in lower tiers of the market can use. When that happens, customers in the lower tiers are satisfied with the technology and start measuring it on a different basis. Instead of new and improved features, the ability to plug and play different modular components becomes more important. This precipitates an evolution to modular architecture across the industry.
Christensen said that this dis-integration of the industry “begins at the bottom of the market, where functional overshoot occurs first, and then moves inexorably to affect the higher tiers.”
I have observed that the first signs of unbundling in the K-12 school market are appearing among students with highly supportive, involved families. A growing number of parents are choosing to home-school their children and use the neighborhood school only to participate on a sports team or club. My friend Erin has her daughter do online learning at home and ride her bike to school only for band practice.
Other parents are paying for their students to take online courses for specific subjects that are unavailable or inferior at the brick-and-mortar school. For example, my friend Elaine is using online modules for core academic instruction and then sending her kids to school only for the project-based learning time.
Still others are opting for other forms of Enriched-Virtual blended learning, such as teaching their kids from home Monday through Thursday each week and then sending them to school to have fun with their friends on Fridays.
There’s a strong argument for suspecting that supportive, highly involved families will be first to demand modularity from schools. They are most overserved by the long suite of services, guidance, and programming that the typical comprehensive high school offers. As soon as they find themselves with a laptop, Internet access, and a few great (often free) courses, they discover that they’re overserved by a completely integrated, comprehensive, brick-and-mortar school.
The opposite is true for disadvantaged youth, who I suspect are among the highest tier of the market in terms of performance needs. In his book Sweating the Small Stuff, David Whitman shows that disadvantaged youth prosper most when schools backward integrate to become even more comprehensive. They often need breakfast, lunch, and dinner, healthcare, sometimes even a place to sleep at night. If the trend of the erosion of the family unit continues, more and more kids will need increasingly integrated school environments. The phenomenon of unbundling school (see Unschooling Rules by Clark Aldrich) will not begin with them or perhaps ever reach them.
As further evidence that they constitute the top tier of the market, disadvantaged youth are the highest “profit” population for schools to serve, not only in terms of commanding the most grant and supplemental funding (such as Title I and special education), but also in terms of commanding the most cache. The most respected nonprofits and charter schools are those that fight to close the achievement gap for the disadvantaged, not those that target youth who already have lots of support.
Entrant firms with modular online-learning courses should focus their strategy on serving students from supportive families first. Those in the higher tier will not be turning to custom on-campus/off-campus learning playlists any time soon.