The soul of innovation

This thought that tech architecture might be rooted in something other than way cool technology or wealth creation rolls around in my mind all the time. It informed the due diligence methodology I recently proposed for IEEE’s Global Humanitarian Technology Conference. It also relates to my memoir project covering my experience and insights as a tech entrepreneur over a couple decades and multiple markets and domains.

My “first-born” was Cenquest where I was first to bring branded, accredited degrees online. As this post will discuss, Cenquest illustrates my first efforts at building and operating a venture-backed startup from a frame defined by my communitarian heritage. The impetus for addressing it now is the recent GAO (the U.S. Government Accountability Office) report about the industry that emerged out of my work–Online Program Management, or OPM.

GAO is responding to requests from Senator Elizabeth Warren and others. The core concern, also often covered by public policy think tanks such as The Century Foundation (TCF) and New America, is tuition share. The consensus among these organizations is that this now-standard revenue model for OPMs is disguising incentive compensation for employees who are using hard-sell tactics to sign up students for programs they cannot afford.

Just last November, The Wall Street Journal published a detailed study of the academic partnership between USC for its Master’s in Social Work and 2U (the public company generally credited with creating the industry–and yes, this will be an important component of my memoir). When I first read it I wondered if I should even claim market pioneer status. That’s how awful the impact has been. Social workers do not make very much money and all too many graduates–a significant number of them women of color–are buried under horrifying student loan debt.

My next thought was, well I would never have done that deal. Indeed, I had been protesting to my contacts at TCF that tuition share had a different purpose that was neither deceitful nor designed to push degree programs that just wouldn’t be worth it to grads. That was not an easy soul-searching exercise but it took me back to the heart and soul of Cenquest. I had the sense that the OPM industry was missing that part of what I had built over seven years with close to 80 employees and advisors, thousands of matriculating students served, 8 academic partners, and a wealth of lessons learned.

With the WSJ expose and now the GAO report, it seems a good time to discuss what set us apart. I will cover more of the details in later posts but this one introduces the model that I used to craft the organizational and tech architectures. It is patterned on positioning strategy as originally conceived in the advertising industry–Placing a brand promise at the center and reinforcing it through decisions cutting across marketing, product, partners, and more. I have delivered a version relating to startups in multiple capstone and entrepreneurship classes. It is an important organizing and alignment tool that often is missed when a geek, fixated on a cool new technology or a difficult technical problem, is the founder.

Below is my model for Cenquest. It begins with my market vision at the center, effectively, the stake we were claiming in the higher education ecosystem. The inner ring of circles are core building blocks of the business but it is the language characterizing each that matters most, for it reveals the influences and reinforcements of the market vision.

Cenquest business model, June 2022, L Reimer, all rights reserved

I placed high-quality instructional design at the heart of my vision. “To Learn You Must Dance” relates to our origin story–the time I taught ethics to the road crew of a state highway department. The problem I had to fix was a curriculum wholly unsuited for a very diverse mix of learning styles and sophistication, from right-of-way lawyers to the road crew. Developed by an ethics consultant, it contemplated classrooms or lecture halls with rows and rows of desks and him at the front doing most of the talking. I created new and more robust exercises including one I called “take a stand.” I incorporated physical movement to help participants experience ethical dilemmas in their bodies. Watching them respond to the exercise over the more than 40 times I taught that program struck me as dance-like.

This experience produced my aha moment, that to democratize access to higher education, it was critical to employ instructional design that worked for any learning style. I was concurrently teaching as an adjunct professor of law, experimenting with interdisciplinary curriculum design. This first-hand experience told me that graduate school professors were deep domain/subject matter experts and not instructional design-savvy.

Students Are the Customers

The great promise of constructing the technology backbone by which graduate schools could deliver online programs was to use our expertise in interactive, multimedia production to fill that gap. We accessed studies in cognitive psychology and neurology on how the brain works to create our own course development methodology and platform. Understanding the sensitivity of supplying instructional design support to established academicians, we went to great lengths to engage professors from our partners in this process. We would kick off each partnership by hosting the program directors and key faculty in our offices, a full schedule of giving them insider visibility to our team and how we worked. I also launched an initiative in which professors on sabbatical and post-doc researchers could be in residence, helping our instructional design team gain deeper understanding and respect for academic processes.

Why tuition share as a revenue model? It struck me as an important statement of alignment with partner schools in the service of our shared customers, the students. We indirectly proved the importance of this concept when one of our partners insisted on a fee-for-service arrangement. I think we still delivered good work product but it was clear that the professors were our customers and we had no connection to students. The Chronicle of Higher Education recently noted the underlying issue that made this shift in customer-orientation a challenge for us. See, “Why the Science of Teaching is Often Ignored,” Beth McMurtrie, January 3, 2022. E.g., “Some of the bottlenecks are a product of the structures and systems of higher education, in which faculty members are given few incentives for, if not actively discouraged from, improving their teaching.”

How Tuition Share Became a Problem

I still have the copy of a prospectus for Cenquest that was circulated and found its way into the hands of the individuals who have claimed the status of OPM market pioneer. The prospectus didn’t cover this idea of “to learn you must dance.” We did describe our focus on instructional design excellence but without the heart and soul that informed every choice, the prospectus was a record of business “parts.” Sort of like you go to a business parts store and pick components off the shelf as a linear process. In this case, subsequent OPM entrepreneurs had guidance from us on what those parts would be but they didn’t have the scoop on why.

The answer to that initial “why” matters. Origin stories matter. When they are ignored or forgotten, each component is far more vulnerable to abuse. I believe that is what has happened to this industry. If you launch such a company because you sense you can make a lot of money, that drives execution and soul is backed out of the architecture. Tuition share is just another revenue model when it is de-linked from a market vision of democratized access to higher education through web-enabled instructional design excellence. As TCF and others have pointed out, this form of tuition share morphs into incentive compensation that practically begs OPMs to engage in aggressive marketing tactics.

The GAO has sent recommendations to Richard Cordray, the US Department of Education’s Chief Operating Officer for Student Financial Aid. They are good recommendations that call for increased scrutiny of the services covered within tuition share arrangements. The Department of Education seems inclined to move forward in agreement. But there is much more to do to fix this industry and make it truly work for the benefit of students.

I once believed I had no choice but to move on from the work I had done at Cenquest but now I cannot help weighing in. After all, we had programs in the works that might have made an online social work degree program accessible without excessive student debt. And maybe, just maybe, The Chronicle of Higher Education could have been touting examples of exponential improvements in learning impacts, even at the highest levels of higher education.

Stay tuned and please let me know if you have comments, suggestions, or ideas that build on that model I included above.

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