The barbarians are at the gate! Of universities, moats and disruption!

In this one, I would like to look at the competitive advantages that colleges/universities have on each component and how close (or distant) the online threat is on each of them. Borrowing from the terminology of value investing, universities have moats around their “educational castles” and the online barbarians (at least as seen by the members of the educational establishment) are trying to breach the establishment. Since so much of this debate comes from one side of this divide or the other,  I decided that it would be good to try to look at both sides. In the table below, I take a look at each piece of the bundle, what colleges/universities bring as a competitive advantage on that piece and the challenges faced by online disruptors.

Bundled item	The “University” Moat is deepest at	The Online Challenge
Screening	More selective” schools that have reputations based on long histories and tradition. It is also self-perpetuating, since your selectivity allows them to attract the best students who burnish their reputations further.  In softer disciplines, where it is difficult, if not impossible, for an outsider to observe output or make judgments on quality.	Online entities have a "chicken & egg" problem, since they need good reputations to be selective and need to be selective to generate those reputations.  However, they may have a much better chance of breaking through  (a) if they can team up with an entity that has a reputation (a university like Stanford/MIT or a pure screener like the College Board) or (b) in areas where the skill sets of graduates are measurable and observable. (Engineering, software coding etc.) (c) in disciplines where there is a common certification exam (accounting, law).
Structuring	Colleges that help students create customized study or degree programs, built around their interests and objectives.	Online education is currently chaotic when it comes to structuring. While course offerings proliferate, guidance for novices on structuring & sequencing these courses is limited or non-existent.
Classes	Colleges that offer classes that are well taught by “star” faculty and built around interaction, group learning, individualized feedback and informative grading systems (that measure learning and not attendance/memorization) have an edge.	Online classes are often too passive, focused on delivering content and mechanized testing/grading. Creating more interactive, dynamic online classes as well as hybrid variations, which are online much of the time, but have in-person meeting components, may help bridge the gap.
The Network	Colleges that create networks among students that continue long after they graduate, augmented by small group networks such as sororities/ fraternities and campus clubs/activities.	Fostering close networks when your interactions are all online is more difficult ( but as Facebook and Linkedin's success show, it is not impossible) and serendipitous contact (like the ones you have on the college green with strangers) is very limited.
Career Advice/ Placement	Colleges that provide career guidance early in college life, followed by access to good placement services (with exclusive and privileged access to prized employers) .	Getting employers to trust your “products” as much as they trust established institutions (colleges & universities) will take time, though it should be easier in professions where the proof of competence can be tested.
Entertainment	Colleges with strong sports teams and cultural activities on campus.	Entertainment options online are getting richer but it will be difficult to match the real thing. Online universities don't have basketball teams or play bowl games.
Education	Colleges that try to students how to learn & prepare them for life.	Same challenge, but magnified because you are restricted to do this online.

1. Worksheet for the University side (on how to make the moat deeper) (Download as pdf file)
2. Worksheet for the Online disruptor side (on how to get across the moat) (Download as pdf file)

I believe that change is coming to education but that it will come in stages and be under-the-surface. The first to feel the heat (if they have not already) will be colleges that have loose or non-existent screens, mechanized degree programs, content-heavy but learning-light classes and nonexistent networks. As they fall prey to online or alternative education systems, it is an open question as to how schools further up the food chain will react. I won’t claim to know the mindset of faculty/administrators at the top schools but my interactions with them suggest that many of them will, for the most part, resist change (especially if it inconveniences them) and argue that there is no chance that their civilized citadels will fall to the barbarians. But they are fooling themselves, since the disruptors have the luxury of being able to experiment, with nothing to lose, until they find the weapons that work. It is only a matter of time!