Disrupting Class
How Disruptive Innovation Will Change
the Way the World Learns
Michael B. Horn | mhorn@christenseninstitute.org | Twitter: @christenseninst
Review of disruptive
innovation
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Clayton christensen institute
Disruption = affordability, accessibility
Past and present examples
Yesterday
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GM
Dept. Stores
State universities
Digital Equipment
Delta
JP Morgan
Xerox
IBM
Cullinet
AT&T
Sony DiskMan
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Today
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Toyota
Wal-Mart
Community colleges
Dell
Southwest Airlines
Fidelity
Canon
Microsoft
Oracle
Cingular
Apple iPod
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Disruption of Toyota
From hyundaiusa.com May 5, 2013
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CLAYTON CHRISTENSEN INSTITUTE
Disruption = affordability, accessibility
Past, present, and future examples
Yesterday
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GM
Dept. Stores
State universities
Digital Equipment
Delta
JP Morgan
Xerox
IBM
Cullinet
AT&T
Sony DiskMan
@christenseninst
Today
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Tomorrow
Toyota
• Chery
Wal-Mart • Internet retail
Community colleges
• Online universities
Dell
• Smart phones
Southwest Airlines
• Air taxis
Fidelity
• ETFs
Canon
• Zink
Microsoft • Linux
Oracle
• Salesforce.com
Cingular
• Skype
Apple iPod • Smart phones
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How does disruptive
innovation relate to
K12 education?
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Online learning is gaining adoption
Substitution calculation indicates online learning is growing disruptively
50% of all high school
courses online by 2019
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The rise of K-12 blended learning
Definition of blended learning
A formal education program in which a student learns at least in part
through online learning, with some element of student control over
time, place, path and/or pace
at least in part in a supervised brick-and-mortar location away from
home (such as school).
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The modalities along each student’s learning path within a course or
subject are connected to provide an integrated learning experience.
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Emerging blended-learning models
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Companies appear to have 3 options
1. Sell to educators in existing system
2. Sell to educators in sustaining innovation blendedlearning models
3. Sell to educators in disruptive innovation blendedlearning models
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The decision matters
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Disruption is not a technology problem
Different Measure
of Performance
Performance
Tabletop Radios,
Floor-standing TVs
Time
Path taken by
vacuum tube
manufacturers
Portable TVs
Pocket radios
Hearing aids
Time
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Systems disrupt systems
Appliance Stores
Performance
Different Measure
of Performance
RCA, Zenith
Component suppliers
Discount retailers
Time
Sony, Panasonic
Component suppliers
Time
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Option 1: Selling to
educators in existing
system
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Blended Learning is not…
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Sustaining the chalkboard
Performance
There has been a long history of selling technology to enhance the current classroom
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Time
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Option 2: Selling to
educators in
sustaining innovation
blended-learning
models
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Clayton christensen institute
Disruption isn’t so straightforward
Different Measure
of Performance
Performance
Tabletop Radios,
Floor-standing TVs
Time
Path taken by
vacuum tube
manufacturers
Portable TVs
Pocket radios
Hearing aids
Time
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The theory of hybrids
Performance
Competing on design, Tesla $100,000
reliability, and
performance on the
California Freeway
Prius Hybrid
Performance
Time
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Peapod: Are there
customers that would
love
a car that won’t go
Time
far, and won’t go fast?
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Performance
The theory of hybrids
The metric of
performance
changes
Performance
Time
Smartphones
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Time
The disruptive technology
doesn’t invade and reform
the existing system.
Rather, new measures of
Performance entice customers
into the new system
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The theory of hybrids
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How to spot a hybrid
1. It includes both the old and new technology; pure disruption
doesn’t offer old in full form
2. It targets existing users, not nonconsumers
3. It tries to do the job of existing technology
4. It is less foolproof than a disruptive innovation; does not
reduce level of wealth and/or expertise to purchase and
operate it
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Emerging blended-learning models
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Station Rotation Model
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How to spot a hybrid
Measuring
itself against
traditional
value
proposition
Traditional
PLUS online
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Core
subjects,
mainstream
students
Requires
expertise in
both
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Station Rotation Model
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Lab Rotation Model
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Flipped Classroom Model
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Option 3: Selling to
educators in
disruptive innovation
blended-learning
models
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Prime examples of nonconsumption
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Credit recovery
Drop outs
AP/advanced courses
Scheduling conflicts
Home-schooled and homebound
students
Small, rural, urban schools
Unit recovery
Disaster preparedness
Tutoring
Developing countries
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Professional development
Pre-K
After school
In the home
Incarcerated youth
In-school suspension
School bus commute
Summer school
Teacher absenteeism
Migrant worker families
Foreign languages
Budget cuts and teacher shortages are an opportunity, not a threat.
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Individual Rotation Model: Carpe Diem
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Carpe Diem
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Carpe Diem
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Flex Model
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A La Carte Model
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Enriched Virtual model
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The pluses and
minuses of targeting
disruption
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C
Disruptive
The markets appear either saturated or small
Sustaining
Districts
Trad’l quality metrics
“No Excuses”
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C
Districts
Core academics
Nonconsumption
Charters
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New value propositions
Like all disruptions, disruptive blended-learning models deliver different value
Individualization
Productivity
Traditional
Classroom
Disrupted
Classroom
Access, Equity
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CLAYTON CHRISTENSEN INSTITUTE
Disrupting Class
How Disruptive Innovation
Will Change the Way the
World Learns
Michael B. Horn
mhorn@christenseninstitute.org
Twitter: @christenseninst
@christenseninst
Private enterprise &
public education
@christenseninst
Clayton christensen institute
High-level conclusions
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For-profits not inherently good or evil
Far fewer inherent differences between for-profits and nonprofits than many assume
Differences between for-profits stem from corporate
structure, where for-profits have owners and non-profits
don’t
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Easier for for-profits to attract capital, scale, and possibly talent
Easier for for-profits to focus
Non-profits can remain rooted in a community in absence of market
Incentives matter. Policies must encourage smart demand
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Clayton christensen institute
For-profits not
inherently good or
evil
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Clayton christensen institute
Sustaining vs. Disruptive Innovation
Performance
Incumbents dominate sustaining battles
60% margin on
$500,000
45% margin on
$250,000
Performance
Time
40% margin  20% margin
on $2,000
Time
Entrants typically win at disruption
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Understanding how users experience life
“The customer rarely buys what the
company thinks it is selling him.”
Peter Drucker
If a customer won’t pay them to do something, over time
they won’t do it. Will chase their incentives and do what
they are paid to do—not much more and not much less
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Far fewer differences
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What is a business model?
And why does it lock us in?
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
PROCESSES:
REVENUE FORMULA:
Assets & fixed cost structure,
and the margins & velocity
required to cover them
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Ways of working together to
address recurrent tasks in a
consistent way: training,
development, manufacturing,
budgeting, planning, etc.
CLAYTON CHRISTENSEN INSTITUTE
What is a business model?
And why does it lock us in?
RESOURCES:
THE VALUE PROPOSITION:
People, technology, products,
facilities, equipment, brands,
and cash that are required to
change.
Will
fight
deliver this
value
proposition to
the targeted
customers
fundamentally
challenges
A product that helps customers
do more effectively,
conveniently
& affordably
a job don’t
Business
units
they’ve been trying to do
a new order that
how they make moneyPROCESSES:
REVENUE FORMULA:
Ways of working together to
Assets & fixed cost structure,
address recurrent tasks in a
and the margins & velocity
consistent way: training,
But required
non-profits
have
business
models,
too,
and will do the same
to cover them
development, manufacturing,
budgeting, planning, etc.
# christenseninst
CLAYTON CHRISTENSEN INSTITUTE
High-level conclusions
•
•
For-profits not inherently good or evil
Far fewer inherent differences between for-profits and nonprofits than many assume
•
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Non-profits aren’t always virtuous
Non-profits have business models, too
For-profits won’t cut corners if customers will punish them for doing so
In public education, historically, neither for-profits nor non-profits have actually saved
the taxpayer much money because of policy  There is some sense in which they are
all public entities because publicly funded
@christenseninst
Clayton christensen institute
High-level conclusions
•
•
•
For-profits not inherently good or evil
Far fewer inherent differences between for-profits and nonprofits than many assume
Differences between for-profits stem from corporate
structure, where for-profits have owners and non-profits
don’t
•
•
•
•
Easier for for-profits to attract capital, scale, and possibly talent
Easier for for-profits to focus
Non-profits can remain rooted in a community in absence of market
Incentives matter. Policies must encourage smart demand
@christenseninst
Clayton christensen institute