Higher Ed: An Underutilized Ability Placement Network

Recently, I read Michael Horn’s Forbes article titled “Disruptive Innovation and Education” in which he writes that the current higher education system is patterned after the once prevailing factory employment model of the industrial age. It’s no surprise that higher education systems have and will continue to adapt to employment models.

Also recently, I listened to Brandon Busteed’s case for the “Educonomy”  in which he points out that the market clearly understands a college education as a pathway to get a “good job”. That should not come as a surprise either. After all, the learner’s (i.e. higher ed’s customer) greatest pain point is to find a best-fit opportunity to utilize what has been learned.

As a Global Career Development Facilitator and entrepreneur in the human services industry what is particularly interesting to me is that both authors can relate to the challenges facing higher ed today but each misses the deeper critical problem in the industry. Michael sheds light on innovation; that is online learning. Brandon sheds light on causation; that is the link between education and long-term success in life and work. However, each seems to miss the critical baked-in assumption in the higher ed business model; that learning quality should be the value proposition delivered to the mass market. In my view, it should not.

The following is my attempt at explaining why placement quality should replace learning quality as the value proposition in higher education.

First, using the job-to-be-done (JTBD) framework , the learner’s JTBD can be labeled as placement quality or as Busteed says “to get a good job”Education then is the learner’s related job-to-be-done (rJTBD) and can be labeled as learning quality in support of reducing/eliminating the learner’s greatest pain point; placement at best-fit.

Considering the long-tail of the market, if we design for learning quality as a key activity (rather than a value proposition) within a larger placement ecosystem THEN the seed for innovative disruption can be planted. I think that higher education disruption will come from an innovative business model utilizing #hrtech to better deliver a value proposition of placement quality and NOT #edtech to better deliver a value proposition of learning quality.

Today, higher education seems to be stuck in a legacy business model that stubbornly keeps learning quality as the JTBD. Therefore, leaders and academics continue to see it as the value proposition. However, the great recession dried up subsidies of an always nonviable value proposition and the error in the business model design is surfacing. As the idiom goes, “the chickens are coming home to roost”.

Let me be clear, learning quality in higher education IS NOT a viable value proposition to serve the masses, the long-tail, those “below-the-line” of elite. The time is now for placement quality to be the value proposition. It is highly monetizable and can subsidize learning quality better than any alternative.

In the coming “talent wars”, which will be fought in the long-tail of markets as well as in the short-head, we need business models that treat higher education institutions as aggregators with distribution-capable nodes in a much larger network; the placement ecosystem. Then and only then, in my opinion, will we be able to define learning quality that integrates purpose (vocational guidance and life-design) with competency (career education and mastery learning) for the masses. We can get back to the personalized academy experience before the industrial age and we can provide it for the masses but it’s going to take a distributed solution to solve what we are failing at–the distribution of dedicated personal assistance to develop and place ability at best-fit.

Again, learning quality unsurprisingly adapts to the prevailing employment model. In the future work will be performed by independent workers (freelancers, independent contractors, consultants and solopreneurs), highly distributed across communities and domains. In fact, independents represented 17.7 million workers in 2013 and are expected to reach 24 million in 2018, a 40% increase. Nearly 10 million households receive at least half of their income from independents today. Based on existing trends, there is expected to be 65 to 70 million independent workers (over 50% of the workforce) by 2022 in the U.S. alone.

As a result, you are starting to see the distribution of learning quality to the relevant edges of pedagogy. If higher ed leaders fail to adapt to a value proposition that is placement quality then, it is my view, they’ll go down as leaders of the most underutilized ability placement network ever created by man.

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Disrupting Human Capital Development and Placement (HCDP)

If you need any evidence that the world needs to rethink human capital development and placement (HCDP), look no further than the typical society in a free enterprise economic system.

Within these societies you tend to find three competing business models in the HCDP space, each with its own profit model. There’s the:

  • service-based “solution shops” meant to deliver learning quality via trained instructors (e.g. higher education)
  • outcome-based businesses meant to deliver employment quality via process (e.g. career services, job boards, agency)
  • member-based facilitated networks meant to deliver life quality via values (e.g. community involvement and interaction)

Developing and placing ability at best-fit is not complicated. We have proven methodologies that are effective. However, developing and placing ability at best fit at best-price at scale is impossible today.

HCDP problems can be boiled down to two key issues. Innovation has been sustaining as opposed to disruptive while business model designs remain largely centralized. For example, higher education offers the value of solving any learning problem for any student but the overhead of that complexity leads to tremendous costs.

The simple fact is that when viewed within the job-to-be-done framework human resources technology is 10 years behind health care technology which is 10 years behind investment technology.

Thankfully, the disruption in healthcare is already happening. For example, Iora Health pairs patients with health coaches who facilitate a care plan based around life goals, not just calling the doctor when they’re in pain. After all, once that happens, it’s typically too late for low-cost preventive care. To that end, Iora assigns its patients a “Worry Score.” The killer app is dedicated personal assistance. The killer API is the human API.

Coordinated collaboration among all stakeholders is a main tenet of reform. HR technology needs to catch up. We need equal parts interoperability, privacy, usability and human capital data infrastructure. Then and only then will we be able to integrate empirical development and intuitive placement to arrive at a satisfactory personalized life design.

We need a closed, interdependent, decentralized and integrated system, one in which different business models use a common platform that allows product and service suppliers to focus on doing a particular job very well for customers. Along the way, distributed facilitators (instructors and referrers) can be empowered to turn what is now expensive development and placement encounters into affordable ones. Again, a common platform is the mechanism by which we can meet the challenges.

It’s no surprise, then, that HCDP needs disruptive innovation to arrive at best-fit. What remains to be seen, though, is how soon that innovation will arrive and what kind of impact it will ultimately have.

Can we innovate soon and if we can what kind of impact do you want to see?

Designing Ability Placement from First Principles

I spend a fair amount of time reading and thinking about disruptive innovation because I need to understand the past failures to place human capital at best-fit. And here’s a great post by Ketan Jhaveri that dissects Elon Musk’s approach to disruptive innovation which is based on reasoning from first principles.

So, here’s the problem: According to Gallup, 53% of American workers are “not engaged” and 19% are “actively disengaged” at work. In The Coming Jobs War, author Jim Clifton writes:

The 53% of not engaged workers are not hostile or disruptive, and they are not troublemakers. They are just there, killing time with little or no concern about customers, productivity, profitability, waste, safety, mission and purpose of the teams, or developing customers. They’re thinking about lunch or their next break. They are essentially “checked out.” Most importantly, these people are not just part of a support staff or sales team. They are also sitting on executive committees.

And then there are the 19% of actively disengaged employees who are there to dismantle and destroy employers. They exhaust managers, they have more on-the-job accidents and because more quality defects, they contribute to “shrinkage” – as theft is politely called, they are sicker, they miss more days, and they quit at a higher rate than engaged employees do. Whatever the engaged do, the actively disengaged seek to undo, and that includes problem solving, innovation, and creating new customers.

I’ve come to realize that designing solutions around first principles might allow for looking at a problem from a more foundational level—where the seed of disruptive innovation can be planted.

Musk is quoted as saying:

“First principles” is a physics way of looking at the world…what that really means is that you boil things down to the most fundamental truths…and then reason up from there…”

The utility about Musk’s approach is that it provides a framework with which to do this. Breaking a problem down to its core components and then building back up from there helps me arrive at very different designs than relying solely on analogs.

The other really nice benefit of reasoning from first principles is that it can get me out of the “it can’t be done” mentality. And that’s especially handy when I’m trying to understand the failures in the human services industry. If I reason by analogy and I can break the problem down to its core first principles, then I can logically state “If all of these things are true, then there’s a problem that can be solved.”

I’ve identified the following first principles that will lead to the improvements we are looking for to place ability at best-fit at scale.

Abundance: Every abundance creates a new scarcity. For example, a wealth of information creates a poverty of attention. Attention can be monetized.

Information: Scarce information wants to be expensive. That is, the price of context is valued at marginal utility—what it’s worth to talent seekers or candidates—the customers. Scarcity can be monetized.

Context: Context is embedded with experience, license, proxy, credential, or reputation and the like and is distributed far down into the long-tail of ability placement markets. Context can be monetized.

Search & Influence: The advice and counsel of a trusted and liked person is always searched for when a placement process decision is important enough. Search and influence can be monetized.

Goodwill: Enlightened self-interest motivates goodwill. There are enough people who want to help others gain a commitment at best-fit in their community* if only to improve their status. Reputation can be monetized.

Less is More: As technology reduces coordination costs it enables more small placements and interactions—monetizable actions, reactions, and transactions—that had been previously dismissed below the economic fringe. In aggregate the monetized value of these small placements exceed that of high-dollar placements.

Business Model Generation: Businesses don’t fail; business models do! Designing around ability development as the value proposition is too risky. It has never been the most viable and sustainable monetized value proposition. Development is merely a key activity—a related job to be done—that plays a supportive role to placement at best-fit—the job to be done for the customer. (Note: Until higher education solution providers make that shift on their business model canvas their innovation will only be sustaining, not disruptive. That is, they are merely rearranging the deck chairs on the Titanic.)

When a problem is broken down to it’s component parts at a fundamental level it becomes possible to see how seemingly disparate themes, when connected, can be part of the solution. Placement Loop is a platform forged from these first principles for solution providers on the supply-side to solve problems for talent seekers and candidates on the demand-side.

Which of these ‘first principles’ resonate with you?

*Community can be defined geographically, by industry or by common interests.

The Enterprise and Placement Improvements

My previous posts titled Evaluating Placement Information (Parts 1 – 3) prompted a request for me to read an article by Don Fornes, CEO of Software Advice which sponsors The New Talent Times blog. I was asked by Software Advice to opine on the article.

The article, titled “The Psychological Profiles of the Dream Team”, was published on BusinessInsider and refers to a commissioned project by Mr. Fornes to analyze the high-performers at his company, to see what drives and motivates them. The research concluded with four distinct personality profiles which describes what makes their top players tick, the management style they respond best to, and how to identify and hire more people like them.

The following is my opinion about the problem the article addresses but in a more expansive view.

First, let’s define the problem. The problem is that an increasing number of people in the world are miserable, hopeless, suffering, and unhappy because they don’t have a good job—one that is a best-fit. The United States is no exception and, in fact, may be the poster child for workplace unhappiness.

Second, in almost all the content relating to ability placement there always seems to be an embedded assumption that we need to rely on the enterprise to make improvements. What if that assumption is wrong? What if the future of work is more about coordinating distributed work activity versus aggregated? Then, as solution providers, I think we need to design for the individual as a work network node, rather than designing for the enterprise as the work center, to realize the improvements we are looking for.

Third, we can look at the financial services industry for an analog to better understand how psychological profiles are used to help place capital at best-fit. After all ability is human capital. My experience tells me that psychological profiling of investors to facilitate the placement of financial capital at best-fit is more art than science. This is because the ongoing decision-making environment is extremely dynamic with very many variables. More specifically, in this space, best-fit knowledge may depend on tacit information held by individuals, distributed in a community network. If you accept this as a constraint and embrace it as such then you’ll be able to see the futility of trying to optimize the art of placing capital at best-fit.

So, in my opinion, psychological profiles can not be relied upon with a high degree of confidence to complete the job-to-be-done successfully. This is not to say that they are not an improvement but rather should be viewed as a sustaining innovation. It is my belief that to make the improvements we are looking for we need disruptive innovation.