In an office complex in California’s Mountain View on the fringes of Silicon Valley is Coursera — a $300 million+ start-up trying to bring about a new age in education.
The university as we know it is ripe for innovation by the disruptive use of new technologies. Online learning groups like edX and Udacity emerged as providers of free education to the masses but have evolved into colossal entities that are on the cusp of rivalling the traditional degree and providing the same boost to careers.
As they scramble to understand emerging threats, universities and business schools are being forced to evolve their content to be delivered in blended forms – accessible from both classrooms and smart devices. Wharton, Stanford and INSEAD have all invested heavily digital tech.
“Industries are moving quickly and people are looking for effective ways to stay current, get promoted or switch careers. Online courses can play a big role here,” says Julia Stiglitz, head of business development at Coursera. The non-profit's Bay Area headquarters – nestled with disruptors like LinkedIn and Adobe – contrast with the historic scenery found at US universities such as Harvard and Yale.
Julia says recruiters are increasingly recognizing online programs like Moocs, or massive open online courses, on people’s résumés.
Mooc providers once offered a range of courses lasting only a few weeks but Moocs are now being bundled into longer modules and are incorporating certificates and industry projects akin to internships. These are starting to be recognized by both employers and universities as full-fat qualifications.
The numbers bear Julia out. A recent survey of 400 US employers by Duke University and research group RTI International found that 57% said they could see their organization using Moocs for recruitment. And three-quarters said job applicants taking relevant Moocs would be perceived positively in hiring decisions.
Alexandria Walton Radford, a program director at RTI International and the study’s director, says that there’s a way to go before most employers know about Moocs – but once they learn of them, they see the potential.
Across the Atlantic in Europe, it is a similar story. Mike Feerick, CEO and founder of Ireland-based Mooc provider Alison, says: “The market simply has to go this way; it’s where the market is.” When we speak he is gearing up for St Patrick’s Day celebrations.
The Irish for-profit education company has much to celebrate: it is signing up more than 200,000 new learners to its service each month, Mike says, with total users now at five million.
Alison’s goal is to create a scalable and sustainable business that can drive the costs of education and training as close as possible to zero – opening up access to the masses.
“Anything that is ‘need’ to have on Alison is free; anything that is ‘nice’ to have is paid [for],” Mike says. Physical parchments and more sophisticated validation solutions of courses incur changes.
This is the next stage in the evolution of Mooc developers. As well as driving revenues, paid-for accreditation is gaining ground with employers across the globe.
In a poll of 1,000 UK employers last year by distance learning specialist the Open University nearly half said additional education is the number-one reason they would offer salary increase or promotion – and gaining education with free online courses was the third most common thing the employers looked for.
Keith Zimmerman, director of students at the OU, says that such part-time study can impact careers – whether offering a boost or setting out a new path.
Recent research by the Career Advisory Board found that 87% of 500 US hiring managers are likely to consider non-traditional “micro-credentials”, or specialized certificates awarded by reputable educational institutions, as proof of skill mastery.
“Verified certificates and professional education are part of edX’s portfolio approach to becoming self-sustaining,” says Nancy Moss, director of communications at edX, a non-profit Mooc platform founded by Harvard University and MIT.
Close to 95% of edX courses offer a verified certificate, she says, with many of its users looking for new jobs.
Employment prospects are increasingly the priority. Mooc platforms which offer paid-for certificates encourage students to post them on networking sites such as LinkedIn to whet recruiters’ appetites.
EdX also works with organizations like LaunchCode – a non-profit that puts people into paid technology apprenticeships – to help train students and place them into new careers.
At the other end of the spectrum, learning technology groups are keen to tap into the lucrative corporate training market, in which big businesses such as Microsoft and Accenture have paid to have their employees update their knowledge online.
For senior professionals trying to climb the greasy pole, such programs may provide an edge.
Nancy says that university-level courses will always be central to the edX mission, but also that the group has expanded into professional education – study for those looking to advance their careers.
Udacity, the Mooc platform that had amassed 1.6 million users last year, runs a business unit that has signed up Google, Facebook and Capital One, the financial services group.
It has expanded with a series of “nanodegree” programs – courses offered when corporate partners build and recognize specific programs geared toward employment at their companies.
AT&T, the telecoms corporation, was the first to offer such a degree and it paid Udacity $3 million to develop a series of programs. “Earning this credential will soon become a key part of AT&T’s training and talent acquisition model,” says Scott Smith, senior VP of human resources operations at the firm.
Scott says that he hopes the model will soon be recognized by other employers. This is already happening. Coursera has partnered with tech companies including Instagram and Snapdeal to expand its range of fee-paying business courses and to offer industry placements.
About 50% Coursera’s 12 million users are utilizing its courses to advance their careers, says Julia. “Helping people accelerate their career[s] by learning new skills is a major way that we hope to impact the lives of our learners.”
FutureLearn, the UK-based Mooc platform that is funded by the OU, has developed courses with organizations including the UK government, the International Association for Contract and Commercial Management, and the British Film Institute.
But Simon Nelson, CEO of the group, makes clear his focus is on providing access to academic learning: “FutureLearn’s mission is to widen access to learning for everyone by providing free, online courses from some of the best universities.”
If this should worry traditional education institutions – and it should – most are loathe to admit so in public.
Geoff Garrett, Wharton’s dean, says: “The sheer magic of unique face-to-face interactions with wonderful professors and students, joining an extraordinary family of alumni, access to superb career management and executive coaching – you can’t get any of that online.”
A raft of business schools have opted to partner with tech start-ups to deliver Moocs as a taster to their expensive postgraduate programs. They see Moocs as a tool to more broadly offer management training – and to reach new global audiences.
Behind the scenes, however, frustration is brewing. The speed with which Mooc developers have forced traditional educators to alter their structures has been rapid.
Jean-François Fiorina, associate dean of Grenoble École de Management, says that business education is facing a "revolution": "The teaching methods of tomorrow are being tested today.”
What is more, while universities have faced the ignominy of budget cuts, tech groups have harvested massive war chests to expand. EdX last year had been funded with $90 million; Coursera has raised a total of $85 million; Udacity has raised $58 million.
The Mooc developers all say they are here to work with universities and not to put them out of business.
However, when asked how important such partnerships were, Alison’s chief Mike offered a view that is widely shared in the education community: “No[t] at all important. They are the unnecessary middle-men selling a product that is past its sell-by date.”