A Cavalier Attitude to Business and Technology

I was kind of in shock night.

Ten days ago, the Board of Visitors at the University of Virginia summarily dumped the school’s popular president, Teresa Sullivan, based on mysterious “philosophical differences.”  The move threw the university into turmoil.  The Board refuses to disclose its reasons, so speculation is rampant.  Initial reports pointed to donors affiliated with Darden, UVa’s business school, who pushed for more “strategic dynamism” modeled on private businesses. Now, the Cavalier Daily, the student newspaper at the University of Virginia, has obtained internal Board emails through FOIA requests.  Several of them made reference to online education initiatives at competing universities.  The gist was that top-flight schools such as UVa “need to have [online] strategies or will be left behind,” and that massive-scale online courses offer a cost-reduction path out of the severe financial pressures facing many universities, especially public ones.

I’m in shock because I teach at a top business school (Wharton), and I’m soon leading a massive online open course (MOOC) on one of those new platforms (Coursera).  And what I’m hearing from the UVa cabal is an enormous misunderstanding of both business and technology.  Did we cause this?  If these accomplished, knowledgeable people could get things so very wrong, who else will do the same?

The point about business is pretty simple. The image of the visionary CEO who relentless turns the company on a dime to implement his (it’s inevitably a he) decisive leadership is a fantasy.  Yes, companies have bosses and hierarchies and management structures and salaries and performance reviews and all that… but do you really think everyone in a major enterprise jumps the moment the CEO gives a command?

I remember well a conversation I once had with the CEO of a Fortune 200 company going through difficult times. He and his leadership team understood exactly the market changes undermining their legacy business, and had a good turnaround strategy.  Yet he kept getting beaten up in the press for being clueless about what was happening.  The problem was going from vision and strategy to implementation by tens of thousands of employees used to the old ways.  And the more times a CEO goes to the well to promote dramatic changes, the harder it is to get employees to go along.

Sure, the best business leaders have vision, but they know they can’t implement it just by issuing edicts from the top.   There has to be a reservoir of trust, and a set of structures and incentives that work for the whole organization.  Corporate culture and capabilities also play an important role. Narcissistic leaders who fall in love with disruptive change for its own sake tend to kill the long-nurtured strengths that make great companies great.

These are hard lessons to appreciate.  That’s one reason (not the only one) that people pay so much to get MBAs at places like Wharton: to learn how to lead. If top universities can’t grok business because they aren’t businesses themselves, why do so many future corporate leaders compete so hard to spend two years there?  Think about it.

The point about technology is more subtle but has broader implications beyond higher education.

Stewart Brand had it right, some thirty years ago: information wants to be free…and also valuable.  Connected technology radically commoditizes and shares everything it can.  The price of anything reducible to software or hardware trends inexorably toward zero.  And yet, crucially, that makes the price of everything else trend toward infinity.  The sources of true differentiation, value, and human insight shrink as the means of spreading their influence grow.  And that magnifies their worth.  The process is like the death throes of a sun: exhaustion, followed by a catastrophic supernova radiating a shock wave across the vastness of space, leaving and immensely dense neutron star.  The output is both bigger and smaller than the input.

Consider a college course.  A random professor standing at the front of a lecture hall reading through slides is as much a legacy of artificial scarcities as waiting in a teller line before 3pm to make a bank withdrawal.  Duke professor and education innovator Cathy Davison is right when she says that if professors aren’t doing better than computer screens, they should replace us.  But as Davidson emphasizes, the implication is not that face-to-face education will or should go away.  Ultimately, it realigns to focus on the things that computer screens can’t do.  To paraphrase Kevin Kelly, technology eventually gets what technology wants. And we get to be more human.  School becomes more about true learning and collaboration and less about rote knowledge transfer.

I’m not saying the process is easy or quick, or always bending toward improvement.  It’s ludicrous to take the few dozen free massively open online courses (MOOCs) available so far from elite universities or their faculty and say it’s game over for higher education as we know it.  None of these MOOCs give college credit, business models are uncertain, dropout rates are high, quality is uneven, and most of the offerings (mine included I’m sure) deviate only slightly from the structure of a traditional course.  They aren’t a threat to anyone in their current form.  They may fail utterly, like a previous generation of online university ventures (Fathom, Cardean) a decade ago.

Indeed, whomever is running UVa in ten years may take pride that the school didn’t go down the blind alley of MOOCs.  Who knows. Who cares? The MOOCs aren’t nearly as important as what they represent: massive scale of some aspects of knowledge dissemination, free flow of information, and rapid pedagogical experimentation.  These factors echo the reasons why businesses can, at least some of the time, out-innovate other kinds of organizations: they can go from small to big, they can fail, and their leaders can learn from experience.  A bit of that evolutionary pressure would indeed be helpful in education.  That’s very different from the caricatured image of business that seems to drive those now running UVa.

Back to why I’m in shock.  Personally, I’m teaching a MOOC for reasons that have nothing to do with saving money.  I want to be a disruptor rather than disrupted. Everyone in the world interested in what I’m teaching should have access to my courses.  There is a tremendous learning opportunity for faculty — and teaching is fundamentally about learning.  It will make the in-person courses I teach at Wharton better. And I just can’t conceive of a better way to get to the transformative version 2.0 and beyond than shipping the crappy 1.0 version.  But when I hear what I’m doing, and what my school teaches, invoked to justify conclusions I abhor, it shakes my confidence.  I hope what we’re hearing at UVa is a transient misunderstanding; I fear not.

Higher education is the increasingly rare field where the U.S. still leads the world, and it benefits all the world that sends us their students benefits.  Moreover, wherever it happens (and much of it emphatically won’t be in structured university programs) great education is absolutely vital to the advancement of humanity in the 21st century, along every dimension.  All the more important that understand correctly how business and technology can contribute.