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Moocs Teach Corporations About New Opportunities Signals for Strategists

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Moocs Teach Corporations About New Opportunities Signals for Strategists SIGNALS for strategists ASSIVE online open courses (MOOCs) MOOCs Mhave received a lot of attention over the last two years for their potential to disrupt higher education. Though they are not yet well known in the corporate sector, MOOCs are teach about to have a major impact there as well. Companies are starting to employ MOOCs in areas ranging from recruiting and training to corporations marketing and branding. A massive online open course—or MOOC—is an online learning experience open about new for all to attend for free. MOOCs can accom- modate—and often attract—a huge number of students globally. Although the term MOOC opportunities was coined some years earlier, the modern era of MOOCs began in the fall of 2011, when an online Stanford University course in artificial intelligence attracted 160,000 students.1 This eye-popping response led, within about six months, to the foundation of Udacity and Coursera, two for-profit MOOC compa- nies, and edX, a non-profit MOOC venture of Harvard University and Massachusetts Institute of Technology (MIT). Dozens of other prestigious higher-education institutions, such as Princeton University, Stanford, and Georgia Institute of Technology, are now involved in one or more MOOC ventures. MOOCs teach corporations about new opportunities Signals for strategists Institutions of higher learning, shapers of Backed by investors, education policy, and investors expect MOOCs MOOC providers pivot to to change the economics of higher educa- the corporate market tion and make elite educational experiences available to an unlimited number of students. The education technology (ed tech) sector MOOCs are not only disrupting higher received over $1.5 billion in venture capital education, though. In an effort to establish (VC) investment in 2012 and the first half of sustainable business models, MOOC providers 2013.6 Of this, just $100 million has gone to are developing offerings aimed at the corpo- MOOC ventures over the last 24 months— rate sector. Corporations are starting to use not including a $60 million investment by MOOCs to lower the cost of employee train- MIT and Harvard in edX. But much ed tech ing, build talent pipelines and identify job can- investment is aimed at the K-12 and specialty didates with demonstrable skills, and get closer training markets, whereas MOOCs are target- to prospects and customers. In a world where ing higher education and now the corporate many companies are plagued by skills short- sector. Consider these recent actions by ages on the one hand2 and struggling to gain MOOC providers: deeper insights about customers on the other, MOOCs are beginning to play a role in corpo- • To meet the needs of employers, Coursera rate learning (a $70 billion market),3 recruiting and edX are now selling certificates that (also a $70 billion market),4 and even digital verify that a student has completed a marketing (a $50 billion market).5 particular course. MOOCs are a technology, a source of educational material, and an approach to • Udacity formed the Open Education pedagogy. While online learning is not new, Alliance with corporate members to cre- MOOCs are credited with making valuable ate courses on technology skills desired educational content freely available while by employers. providing a superior learning experience that is interactive, convenient, and more attractive • Coursera is developing an offering to match 7 than “traditional” online platforms. MOOCs students seeking jobs with employers. are also spurring innovation in pedagogy by using social networks to enable peer coaching, • Udemy introduced a platform that enables and analytics to support “adaptive learning,” organizations to create and offer their own in which learning experiences are automati- courses to employees. cally tailored to the strengths and weaknesses of each student. Researchers are even testing • edX is licensing its academic courses artificial intelligence-powered systems that to corporations. automatically grade essays. MOOCs mar- MOOCs came to prominence as disrupt- ried with analytics have the potential to offer ers of higher education. MOOC providers are insights into the wants and needs of learners, now aggressively pursuing opportunities in the employees, and even customers. corporate sector as well. 2 MOOCs teach corporations about new opportunities Signals for strategists Companies are partnered with Khan Academy to create embracing MOOCs BetterMoneyHabits.com, a cobranded MOOC to educate consumers on personal finance. Clients are beginning to embrace MOOCs Personal genetic analysis company 23andMe, for a range of purposes, including corporate in collaboration with Udacity, developed a col- training, recruiting, and even marketing. lege-level online class on genetics—which inci- MOOCs can expand corporate train- dentally increases awareness of 23andMe, and ing options. Yahoo is reimbursing employees perhaps demand for genetic analysis services.12 for the cost of verified course-completion MOOC providers—none of which cur- certificates from Coursera. Online retailer rently has more than a few dozen employees— 1-800-Flowers announced it will create an are dwarfed by their clients, which are often online education portal on the Udemy plat- large companies or even national governments. form for its network of independent florists. edX recently announced, for instance, that its The portal will offer a mix of general business open source platform was adopted by both the courses and custom-developed coursers on French Ministry of Higher Education13 and a topics specific to the floral industry.8 Tenaris, a consortium of Chinese universities. This sug- global manufacturer of steel, has licensed edX’s gests an opportunity for third parties to help software platform and course materials for its MOOC providers and their clients in a variety employee learning program.9 of ways, from updating learning strategy and MOOCs offer a new recruiting model. operations to integrating MOOC technology AT&T, Intuit, Google, and others are work- with enterprise systems. ing with Udacity to develop courses to teach college students and recent graduates the Conclusion skills demanded by clients and build a pipe- line of qualified talent. Facebook, Twitter, and The corporate sector is just starting to feel other employers are working with Coursera the impact of MOOCs. It is not possible to to reach out to students who perform well on know for sure how MOOC business models certain courses.10 will evolve and which providers will thrive. Education platforms have become new But MOOCs clearly fill a need for learners and marketing and branding channels. SAP employers and are likely to become an impor- developed the openSAP MOOC platform to tant element of the corporate learning and educate its ecosystem of developers and part- development and recruiting landscape. ners on SAP technologies.11 Bank of America 3 MOOCs teach corporations about new opportunities Signals for strategists Endnotes 1. Tamar Lewin, “Instruction for masses 8. Press release, “BloomNet® selects Udemy knocks down campus walls,” New York to launch a world-class online education Times, March 4, 2012, http://www.nytimes. platform,” Wall Street Journal, October com/2012/03/05/education/moocs-large- 30, 2013, http://online.wsj.com/article/ courses-open-to-all-topple-campus-walls.html. PR-CO-20131030-912463.html?dsk=y#!. 2. William D. Eggers and John Hagel, Brawn 9. Patrick Cavallario, “Global steel manu- from brains: Talent, policy and the future of facturer Tenaris adopts edX platform for American competitiveness, Deloitte University employee training,” edX, Tuesday, Press, September 27, 2012, http://dupress. November 12, 2013, https://www.edx. com/articles/brawn-from-brains-talent- org/blog/global-steel-manufacturer-tenaris- policy-and-the-future-of-american-com- adopts, accessed December 16, 2013. petitiveness/, accessed December 15, 2013. 10. Jones-Bey, Coursera and your career. 3. Karen O’Leonard, The Corporate Learning 11. openSAP, “About openSAP,” https:// Factbook, Bersin by Deloitte, January 22, 2013. open.sap.com/about/opensap, ac- 4. Josh Bersin, “Corporate recruiting explodes: cessed December 16, 2013. A new breed of service providers,” Forbes, 12. Matthew Cook, “Introducing tales from the May 23, 2013, http://www.forbes.com/sites/ genome on Udacity,” the 23 and me blog, joshbersin/2013/05/23/corporate-recruitment- September 17, 2013, http://blog.23andme.com/ transformed-new-breed-of-service-providers/. news/introducing-tales-from-the-genome- 5. Don Willmott, “IAB: Digital ad spend on-udacity/, accessed December 16, 2013. surpassed $20B in first half of 2013,” ad 13. Press release, “edX to work with French exchanger, October 9, 2013, http://www. Ministry of Higher Education to create adexchanger.com/data-nugget/iab-digital-ad- national online learning portal,” edX, spending-surpasses-20-billion-in-the-first- October 3, 2013, https://www.edx.org/alert/ half-of-2013/, accessed December 16, 2013. edx-work-french-ministry-higher/1179, 6. CB Insights, 2013 ed tech investment snapshot: accessed December 16, 2013. Deal activity ticks up but venture capital 14. Press release, “edX open source platform funding down 26%, July 25, 2013, http://www. chosen to power China’s new online education cbinsights.com/blog/trends/ed-tech-2013-ven- portal,” edX, October 10, 2013, https://www. ture-capital, accessed December 16, 2013. edx.org/alert/edx-open-source-platform- 7. Lal Jones-Bey, Coursera and your career, chosen/1188, accessed December 16, 2013. Coursera
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