Is Disruptive Innovation Arriving to Business Schools ?

Business School in Harvard

One of the big questions facing educators at the current time is, should business schools enter the field of online education? It is easy to argue, yes of course they should. Yet business schools have been grappling with this question for a variety of reasons. One of the top performers among business schools, the revered Harvard Business School has struggled with this topic just like the rest, according to Jerry Useem (2014) writing for the New York Times. This is the case even though Harvard Business School is ironically renowned for its excellence with regard to the subject of business strategy. As explained by Useem:

“If any institution is equipped to handle questions of strategy it is Harvard Business School, whose professors have coined so much of the strategic lexicon used in classrooms and boardrooms…. Competitive advantage. Disruptive innovation. The value chain.”

Yet gaining agreement among the esteemed professors regarding whether Harvard Business School should offer online education and if so, how, was not possible, it turned out. That’s not to say that the problem is not challenging – it is. After all online teaching could lead to the reduction in value of on-site courses, but the other choice is failing to survive. Looking at models of offering online instruction, considering the work of Porter it might be argued that online courses should be developed but that these should be produced in such a way that does not devalue the current strategy. Meanwhile, equally admired academic, Clayton Christensen suggests that the only way to survive is through disruptive innovation. This suggests that courses need to be developed cheaply and simply and need to be online. In the end Harvard Business School can be seen to have undertaken the Porter approach, developing a “pre-MBA” which is available online. The programme is named HBX. Clearly this does not compete with the main event, a Harvard Business School MBA. Rather, it is a new product line which helps students develop readiness for the Harvard programme. Christensen has been said to argue that this is not a disruptive innovation.

One way in which Christensen and Porter have been found to agree is in the problem in thinking that technology is the strategy. As explained, because a lot of people sign up does not necessarily validate an approach – after all it could still be undermining the main product of Harvard Business School. Christensen explains the problem by pointing out that disruption commonly impacts the top end of the market last. Of course, Harvard Business School can only be argued to be at the top end of the market. However, Christensen has also estimated that bankruptcy is the likely outcome for approximately half of the universities in the United States.

In developing HBX the dean provided six guiding principles. These included that the programme needed to be economically self-sustaining, not a substitute for the MBA programme, and it should copy the discussion-based style of learning. This was argued to be challenging to achieve online. But this is what Harvard is reported to do. At Harvard lectures are not an approach utilised. Rather, the students sit in tiers and take part in discussion with the professor. How to achieve this online was clearly going to be difficult, since it would involve replicating a social approach in static content. However, the digital approach has achieved this and students that take part see the location and name of other students on a map when they take part. They then get a video clip and boxes popping up on the screen. Students respond to what is asked in the box, and are latter quizzed on what they learned to gauge competence. Live forums are also used.

Even the students have disagreed on the online approach taken by Harvard, according to its dean, Nitin Nohria. There is a belief that there is insufficient separation and disruption in the new approach, which of course, Porter has disagreed with. Porter believes that a company’s activities should complement one another, while Christensen argues that these reinforcements of one another become liabilities, it is claimed. It is yet to be seen which approach will be likely to be more successful in business school education in the longer term. Will it be the disruption advocated by Christensen or the complementary but different strategy proposed by Porter? Meanwhile, while these issues are debated, MOOCs continue to put business education online, and may perhaps steal market share. Time will tell.