Keep calm and reduce churn: What will the new education business models look like?


Education researcher and blogger Damon Whitten posted an excellent analysis of the reasons for tutor churn in the tertiary sector on his blog the other day.

When I read it, something went ping in my brain. I couldn’t stop thinking about it. I posted an immediate summary here and then an extended rant about the topic here.

Each time I started writing, I wanted to get to this idea of new business models. Each time I failed and got sidetracked on all the other things floating around in my head related to this.

Anyway… here’s the thing I wanted to get to. It amounts to a set of untested assumptions about the future of education and education business models:

  1. If we are going to address the tutor churn issue as well as a whole lot of other systemic issues in education we’re going to need some new education business models.
  2. These new business models will disrupt the existing system to an order of magnitude equivalent to the disruption experienced by the music and film industries in recent years.
  3. The rolling out of these new business models will mean that the existing institutions and the people they employ will either evolve or whither away.
  4. New institutions built around new business models will emerge and threaten the status quo.
  5. Government funding agencies will wield a double edged sword of requiring real, sustainable, and measurable education outcomes from learners on the one hand, and the continued drive for increasing cost efficiencies, on the other.
  6. The only way to continue to achieve increasing cost efficiencies in education will be to leverage educational technologies that use the internet’s ability to massively scale without massively increasing costs. Anyone’s business model will need to take this into account.
  7. The way forward will be patchy to start with, but it will effectively shift the focus of education (and power) away from institutions towards learners and… something. This something could be teachers. But it could also be teaching delivery platforms where learners engage with content. Or a combination of both. Whatever the scenario, the institutions will become less powerful (just like the record labels have).

I don’t have any apocalyptic end point or anything like that. In fact, I think that the outcome  for many learners is going to be better with increased choices over educational pathways. However, there will be losers. And the old business model may co-exist alongside the new ones for a long time.

So what can you do about all this?

There are several responses:

  1. Be the ostrich: this isn’t an option if you’re reading here. But for many people and organisations the default response will be to bury their heads in the sand.
  2. Watch and observe: At least if you’re self aware enough to notice what’s happening you can still just wait and see how it all pans out. But you need to be ready for the opportunities that may present themselves along the way.
  3. Upskill and or cross-skill: You will need a new skill set to survive. However, you don’t know what that is yet. Luckily this doesn’t matter. Just get involved in some kind of training anyway. Extend your expertise in the same area. Develop your expertise in a new area. It doesn’t matter. This is because the underpinning skill that you’re trying to develop is learning how to learn new stuff.
  4. Foster strategic partnerships in order to collaborate: This requires some serious thinking. Who can you work with where you can genuinely create wins for both parties? From an organisational perspective, this could involve partnering with a larger organisation who can subsidise your over heads in some way. E.g. would a corporate partner provide free or cheap rooms for your face-to-face training because of some benefit to them (like you’re training their people).
  5. Unpack how really effective online business models work. For example, have a look at how TradeMe, Spotify, or iTunes works… how do the transactions occur? How is value created? What is the revenue model?
    • In iTunes, music listeners purchase digital copies of the songs they like. The artist records this once, but can sell it again and again. iTunes takes a cut. Could you produce digital education products that would qualify for a portion of the government’s education spend?
    • With Spotify, it’s a subscription model. Would anyone subscribe to your teaching? Could you run an education business on a subscription model? This business model certainly works for your mobile phone provider.
  6. Experiment with online education and assessment platforms. There are a lot of different ways of doing education online. Many of the tools to do this are free or cheap now, e.g. YouTube. Have a look at what others are doing, like Sal Khan at the Kahn Academy.  Or check out Pathways Awarua – the fantastic home grown NZ online platform we used to get our NCALNE (Voc) training online as part of a strategic partnership and collaboration. There are plenty of other platforms out there that you can play with – either as a learner or a developer.
  7. Look for better ways of quality assuring tutors and organisations. I’ve been thinking about this one for several years. I would not like to be responsible for adding to the already large burden on tutors. However, I know from my professional development work with hundreds of tutors over the past 10 years that it is possible to identify the kind of profile that a better tutor is likely to have. I written about this before here, here, and here with regards to the kinds of tutors that we work with. A logical extension of this would be to set up a voluntary, opt in, registration for foundations tutors along these lines. The ones who meet (or are working towards) the criteria could gain a tutor-specific quality mark. Where an organisation could show all the tutors met the profile, the organisation could also gain the quality mark. This would give tutors higher status if they are career tutors with more experience and better qualifications. Something like this is an inevitable development given our current trajectory. It’s just a matter of who does it and how well.

Author: Graeme Smith

Education, technology, design. Also making cool stuff...

2 thoughts

  1. Very good. I like options 2-7. They are the future – in some configuration or another.

    But as soon as its hits 5:00 I’m going option one.

Leave a Reply