Will the Internet Revolutionize Business Education and Research?

Revolutions, whether the overthrow of governments or breakthroughs in technology, are usually visible. The knowledge revolution, though propelled by the twin engines of computer technology and communication technology, is a revolution of minds and ideas rather than of mass and energy. It is nearly invisible and easy to ignore, particularly by those who stand on the seemingly safe shoreline of tradition. This knowledge revolution threatens universities’ advantage in knowledge creation and dissemination. Davis and Botkin paint a bleak picture of the role of schools:

Business, more than government, is instituting the changes in education that are required for the emerging knowledge-based economy. School systems, public and private, are lagging behind the transformation in learning that is evolving outside them, in the private sector at both work and play, with people of all ages. Over the next few decades, the private sector will eclipse the public sector as our predominant educational institution.1

Private-sector intrusion is a real risk for business schools. Cable operators and telecommunications companies are aggressively developing virtual classrooms, often without university involvement.2 Publishers and software houses are developing multimedia products that will substitute for, rather than complement, traditional classroom education. The business school’s own faculty, working independently or as consultants for other entities, represent another serious threat.3 Already there is both an audio- and videotape market for high-profile lecturers, and one can imagine well-known professors marketing and delivering personalized courses from their homes, with or without an institutional affiliation. The new electronic infrastructure also allows the best-known institutions to establish a local electronic presence in new markets.

We now find centers for innovation in management education outside the business school. Bankers Trust is revolutionizing its training environment through collaborative technologies such as Lotus Notes that eliminate formalized training programs. Materials are on-line in the form of self-serve offerings and just-in-time education from office desk-tops. Motorola University uses personal, computer-based virtual reality (VR) technology to teach employees to run assembly lines. Preliminary studies show that the employees assigned to VR training learn faster and make fewer mistakes than those assigned to traditional training, at considerably lower cost.4 Sometimes the innovations are in partnership with faculty or centers at a university. Andersen Consulting is working with Roger Schank, the director of Northwestern University’s Institute for the Learning Sciences, on computer simulations that teach interpersonal and selling skills.5

Interest in company-based universities is also on the rise. Many U.S. companies have had such programs for decades (e.g., General Electric, Motorola, Disney). Sprint’s University of Excellence offers some 750 courses; Motorola University lists 300. Motorola has even formed partnerships with accredited colleges to design work-related degree programs.6 Cemex, a large Mexican-based cement company with international operations, has traditionally sent executives to programs in the United States and the United Kingdom but is now considering its own university focused on Mexican management style. Japanese firms have long trained executives within their own corporate structure.7 In-house programs provide tailored instruction at times and places convenient to the customer and individual participants.

Advancements in information and communications technology will drive additional major changes in business education. In this article, we highlight an emerging intellectual infrastructure for the knowledge revolution and explore the assumptions about education and research that this infrastructure challenges.8 We then draw two scenarios to help us envision opportunities and barriers in business education. We describe two early prototype electronic learning forums. In conclusion, we discuss the barriers to progress and what is required to lower them. Although we focus on the business school, there are many of the same drivers and barriers in corporate education programs, training centers, and corporate R&D groups.

A Global Infrastructure

The emerging infrastructure will so fundamentally change the rules of supply and demand that a new economic order will result. During the past thirty months, a version of the U.S. National Information Infrastructure arrived in the guise of an ungainly, unreliable, and perhaps unmanageable World Wide Web.9 The Web lets almost anyone, at a modest cost, publish information accessible to others anywhere in the world. Based on Internet protocols, this universal information repository allows grade school students to look at live pictures from the space shuttle or accompany a robot into a live volcano. From our offices in Texas and Dublin, we can examine the information technology plan of Singapore, build electronic enterprises with colleagues in Australia and Finland, or communicate with each other by Internet phone. Located behind security firewalls, companies can use public networks (the Internet and the Web) to provide a secure private communications infrastructure (an “intranet”).10

Commercial interest in the Internet is high and continues to grow. In August 1994, the Commercial Sites Index had several hundred listings of businesses on the Web. Eighteen months later, there were more than 22,000; at its current growth rate, the list will double in about eight months. By February 1996, more than 360 banks had sites on the Web, with half located outside the United States. Internet Solutions estimated that, on 12 February 1996, there were more than 50 million people with some form of access to the Internet and more than 400,000 Web sites, a fourfold increase in just six months.11

To many, the Internet technologies resemble the personal computer revolution of the early 1980s, which transformed information management. But, unlike the personal computer, this technology arrives with a built-in distribution channel. Netscape Communications, a new entrant in the information technology industry, released, marketed, sold, and distributed its product, a user interface for the World Wide Web, in little more than a day — using as its prime distribution channel the very product it was replacing. Future “information appliances” will identify the software required to process a given piece of information — say, a spreadsheet — and retrieve it from the Net without human intervention. The existence of this hyper-channel for the distribution of knowledge-based products will have far-reaching consequences.12

Some predict that education on demand to homes, schools, and workplaces is going to be a vastly bigger business than entertainment on demand.13 There are some early indicators. In the summer of 1994, an undergraduate at the University of Alabama offered a course about the Internet to Internet subscribers. Each day for six weeks, 62,000 students in 77 countries received a short Roadmap lecture or tutorial and assignments.14 At Los Alamos National Laboratory is another harbinger of the new intellectual infrastructure. A physicist there maintains a database of working papers for scientists in high-energy physics and related fields. Each day, his system automatically fulfills 20,000 requests for preprints.15.

Scenarios for a New Intellectual Infrastructure

Harnessing the emerging electronic infrastructure will require that the business education establishment make radical changes. Implementing a radical change, in turn, requires a shared vision of the future of business education. A vision can ground the discussion and begin to reveal institutional obstacles. Scenario planning can help illuminate the uncertain path.16

Underlying Assumptions about Education

An important element of scenario planning is identifying the assumptions that will characterize the new environment:

• Virtual Learning Communities. Students’ need to interact physically with each other and with a teacher will decrease as electronic spaces begin to supplant physical classrooms.17 Among the advantages will be lowered costs (for travel and classrooms), greater convenience, security, and flexibility, and the ability to ignore time differences and geographic distance.18 Students learning in virtual communities will also have the advantage of being grouped by homogeneity of interests and intellect, while benefiting from heterogeneity of cultural background and previous experiences.
• Pull Rather than Push. Instructors will do less structuring of course content as students take greater control of their own education and as the need for personalized learning grows. In addition, an instructor’s role as expert will shift to facilitator or coach.19
• Lifelong Learning. Where once schools provided a discrete, career-spanning set of concepts and tools, now they will build the skills and motivation for lifelong learning.20
• Just-in-Time Rather than Just-in-Case Education. Knowledge, according to Davis and Botkin, “is doubling about every seven years, and in technical fields in particular, half of what students learn in their first year of college is obsolete by the time they graduate.”21 Rather than providing education to students in advance — “just in case” they need it — schools will give them the skills to achieve education “just in time” to apply to the task at hand. Executive education will likely move fastest to the education-on-demand model.22
• Demonstrated Skills versus Certification. Certification will increasingly be pushed aside by demonstrated skills or work products. In knowledge-based industries, increasingly, work will be observable after the fact. Similarly, skills will be readily tested through automated schemes, such as evaluating perfomance via simulation or virtual reality.
• Nonuniversity Certification. Even as certification becomes less important, it will no longer be the sole providence of universities or professional associations. For-profit organizations will increasingly provide certification in specific skill areas.
• Global Disaggregation. Education, like many other knowledge-based processes, will be disaggregated throughout the world.23 Institutions or students will borrow or pay for components of education from global providers.
• Global Collaboration. Both students and faculty will work closely with peers worldwide. Faculty will have more opportunities to share materials; students will work with people of varying cultural backgrounds.24
• Open Competition. Students will be able to compare, almost first-hand, educational offerings across institutions in considerable detail. Already, in one of our classes, parents or prospective employers can watch an individual student’s progress and even participate in class.
• Visual Rather than Textual. Written language developed, not that long ago in human evolution, as an efficient alternative to drawing pictures. But our mental processes are much better equipped to deal with pictures and spatial relationships than with text or audio.25 The emerging visual information systems will let us once again leverage our ability to process images.
• Simulation. Students will learn not by memorization but by doing, albeit in a simulated environment. Students at Carnegie-Mellon University and the MIT Sloan School use a simulation of a live trading room with links to real-time data feeds from Reuters to the stock, money, and options markets; the trading environment is linked to schools in Tokyo and Mexico City.26
• University and Business Together. A global highway will provide a low transaction-cost vehicle for linking students with mentors, project sponsors, or prospective employers. It will also enhance interaction between professors and practitioners.
• Context and Concept. Historically, theory and conceptual framework have come together with business applications only in assignment questions, examples in texts, case studies, visiting speakers, projects, and the like. In a hypertext world, students will be able to move directly between real-world application and conceptual underpinnings. For instance, an electronic business’s payment scheme will provide links to information on the particular scheme and, from there, to its conceptual underpinnings.27

A Revolution in Learning

Although there is little debate about many of our assumptions, there has been slight progress toward a new vision for business education. Scenario planning can spur the emergence of such a vision.

One scenario is relatively easy to identify — the status quo. This scenario portrays incremental change within a traditional paradigm of classroom-based education, with no changes in the reward system. Some will enthusiastically defend that incremental model, which has served us adequately for decades. Time may vindicate them. But, based on our understanding of the technological and intellectual opportunities now available, the changing requirements of business customers, and some experimentation with new approaches, we believe strongly that “business as usual” is a recipe for failure and an open invitation to nontraditional competition.

Business schools must seek an alternative vision. Our scenario is not intended to be that vision but, rather, a stimulus for thought.

Tara Rogers, consultant for the World Wide Group, is currently on an airplane over the Atlantic ocean. With little notice, Rogers has been summoned to England. But, because of electronic communications, her travels have little adverse impact on her participation in an executive MBA program.

An hour before touchdown at Gatwick, Rogers is awakened by the plane’s passenger comfort system. After freshening up, she begins work on a project for her executive MBA program. Course material, stored on the World Wide Web, is now accessible almost any time and place. Intelligent agents, built into her personal assistant computer and linked to the university server, remind her of upcoming course commitments. Classroom sessions are becoming less frequent; students prefer asynchronous electronic discussion over several days or participation in on-line tutorials. Also, there are no syllabi with detailed outlines for each classroom or virtual session. Rather, courses change as the students reveal problems, issues, and topics during discussions or competency tests and as new material becomes available. Exams are personalized for each student’s learning objectives.

Video-conferencing allows Rogers to participate in classroom and discussion group sessions without being physically present. A tiny camera provides an image of her face to her classmates. As students speak in class, their images appear on a wall at the front of the classroom and on lap-top screens. Students can make their facial images available to any student in the class who wishes to establish a one-on-one connection. A keyboard permits students to send messages back and forth and to read their university mail or anything else encountered on the Net.

The powerful personal assistants that most students carry challenges traditional educational assumptions, but the outcomes are not always desirable. One of Rogers’s professors complained of undergraduates sending e-mail messages to friends during class, playing video games, disfiguring the professor’s electronic image, and searching global databases for information to discredit the lecture. Once Rogers invited an executive to join the class by videoconference to reveal that the scheme described in a case, which the instructor endorsed with some enthusiasm, had later gone awry.

Students are not alone in their creative exploitation of this new technology. Faculty sometimes arrive at class in electronic form — from home, office, car, or conference site. There is no technical reason why an instructor can’t run a class session from a golf cart, and Rogers knows one colleague who regularly participates from similar venues — with his camera “in for repairs.” For most executive MBA students, however, the ability to participate without being physically on campus has been the program’s key attraction.

Attending class electronically has forever changed the dynamics of the classroom. In Rogers’s class, as many as half the students come to class electronically; two or three have never been seen in person after the first week. Electronic participation can be evaluated, but not as reliably as physical attendance. Participants can come late to the session, electronically, say a few words, and then leave unnoticed. Those not in attendance, theoretically at least, can go back later and look at the electronic archive, but without the ability to interact. In some urban universities with limited space, entire courses are conducted outside of the classroom walls.

Business cases have long fueled classroom discussions, but both the discussions and the cases have now taken on new forms. Professors around the world are able to distribute cases electronically at little cost to other professors. An e-mail message from Rogers’s instructor reveals that he has just discovered a new case and is assigning it for the following week’s class. Rogers pulls up the case from the university server and finds that it includes video segments of interviews with executives, marketing materials, current financial reports, and even an opportunity to use some tools and systems described in the case. The case also includes electronic links to databases about the company, links to competitors’ Web pages, demonstrations of products, and so on. The Web sites included in these cases are constantly changing, so Rogers can, with a little extra effort, bring information to the discussion that the instructor very likely doesn’t know before class. In preparing for case discussion, Rogers sometimes develops exhibits that she can call up to support her arguments.

“Air time,” long a valued commodity in quality MBA classrooms, has become even more revered as the quality of student comments and evidence improves. That, coupled with the external resources that can now be brought into the classroom, reduces the instructors’ own air time. Last year’s class created electronic bulletin boards for some of the cases, often drawing on similar bulletin boards run by students at other schools. As the faculty member embellishes his summary points, Rogers or another student is annotating the handout and loading it on the server. Such bulletin boards, accessible throughout the world, include the kind of information that has previously been available only from the case teaching notes. Professors use this technology to discuss how they will use a case.

Rogers is pleased that “chalk and talk” classes, with their emphasis on one-way lecturing, are among the first casualties of the revolution in education. Rogers uses self-paced learning tutorials with built-in expert facilitators for such courses as statistics and introductory finance. Virtual reality modules let students fly through visual representations of data as statistical analyses are demonstrated. The intelligent agent leads students to the appropriate statistic for a given problem and informs them if the data are appropriate, given the assumptions of the particular statistic. Rogers sometimes misses the human interaction but welcomes the opportunity to move at her own speed and to digress into interesting areas.

Among those competing in the education marketplace are the old textbook publishers, software houses, and a menagerie of movie and video game producers. Some materials used in Rogers’s program are free, or nearly free, as professors provide cases and tutorial materials in exchange for visibility. For other materials, the original author (often a faculty member) is compensated based on the frequency of access.28

Rogers’s firm gave her the opportunity to attend either a tailored in-house MBA program or, if accepted, one of the world’s top ten executive MBA programs. Well-known business schools have expanded into distance learning, which has significantly decreased the demand for local graduate and executive education programs. A geographically fragmented industry has suddenly concentrated; advances in communications make it possible for businesses to reach out to the top ten executive educational programs rather than settle for the top thirty program in their own backyard. With the exception of short “in residence” periods, neither students nor faculty are required to leave their offices.

Underlying Assumptions about Research

The new intellectual infrastructure will also transform how we create and publish original knowledge and how we evaluate researchers. Again, it is difficult to predict the exact changes, but we see dramatic possibilities. Our second scenario is based on the education assumptions as well as the following assumptions:

• An Open Process. The peer review process will become more open. Journals will give authors access to information about manuscripts under review and allow them to assess the quality of individual reviewers much more readily.29 Automated indexing systems will immediately bring articles to the attention of interested researchers, consultants, or executives. Colleagues’ new publications will be available on acceptance. Reputations will be earned, or lost, more quickly. Journals will routinely publish data along with findings, thus fueling replication or reanalysis. Plagiarism will be easily detected.
• Articles, not Journals. Archival journal issues, usually a collection of unrelated articles, will become irrelevant as individual articles are published after they clear the reviewing and editing process. Journals will sell individual articles by access and by subscription.
• Access Rather than Citations. Citations to previous work, long an important, if faulty, element for evaluating scholarship will be challenged by direct access to the articles themselves. The number of universities, countries, companies, and even well-known individuals accessing or linking to an article may be a surrogate for quality, and sophisticated programs will be developed for analyzing them.
• Living Scholarship. Existing journals will face a hard choice between replicating their current, paper-based archival scheme in electronic form or allowing interactive links to other works within their publications. In the latter model, the works, which we describe here as “living documents,” will perish as links grow stale. Mechanisms and rewards will ensure that publications are updated or retired to archival status.
• Researcher as Maintainer. Researchers will be responsible for maintaining research that they did years ago or for allowing it to deteriorate in quality. A researcher’s vita will no longer be a historical record of past accomplishment, but a public interface to living scholarship.
• Tracking and Longitudinal Traces. While researchers have had limited data available — say, a customer’s purchase decision — they will now have detailed data on, for instance, the steps that a customer takes in purchasing a product from a catalog. The massive amounts of transaction data available will be time stamped, thus permitting analysis over time. Longitudinal, process-oriented research will replace much of today’s point-in-time, outcome-focused studies. Business research will be based on real-time or near real-time happenings.

• Library as Distributor. Research libraries once built collections that paralleled one another, then made them available to local users. In the future, they will be singular repositories for their local institutions’ publications. Rather than being global collectors and local distributors, they will become local collectors and global distributors.

The following scenario illustrates many of our assumptions.

A Revolution in Knowledge Creation

While checking his morning e-mail, Professor Michael Smith is pleased to see a note, sent the previous afternoon, informing him that a journal has accepted the third revision of his “IT Outsourcing Revisited” article for publication. Another message from an indexing service informs him of a new paper of interest. He is amused to discover it is his own outsourcing article, published just a few hours earlier. He calls it up from the journal’s Web site and scans the abstract. Because his university library is a subscriber to the journal, he can look at the article without paying for it. As an author, he is also authorized to examine the data reports on the number of people who have already looked at the article. He notices that there have already been ten accesses, including one from EDS and another from Nokia. He tracks down the EDS source and is gratified to see that his paper has been added to a “What’s Hot in Outsourcing” index that EDS maintains for its consultants, customers, and prospective customers. Smith updates his on-line résumé, authorizing a link so that future viewers of his résumé can also look at the current access data.

Smith’s next message is less inspiring — a disgruntled reader pointing out a problem in one of Smith’s older pieces. In the past, journals were archived in research libraries, where they remained unchanged. But living Web documents are considerably more volatile. Simple errors, typographic and otherwise, can be quickly repaired before they are inaccurately cited. But links within the paper are not dependable. Links are to a single server with a unique address that, from time to time, changes. Worse, the server may cease operating or remove the material that is the source of the original citation. One of Smith’s colleagues had based a major piece of research on a study later discredited for plagiarism and removed from a journal’s server.

Smith feels at times like a 1980s maintenance programmer as he seeks to keep his links updated, his material current with recent thinking, and his on-line article logs an accurate reflection of all the updates. He has already allowed two papers to lapse into the archival “tombs” reserved for unmaintained papers, but they weigh heavily on his sense of professional responsibility.

Smith calls up the home page for the MIS Quarterly to check on the status of his most recent submission. Only one review has thus far been returned, but it is generally positive. The editor’s log notes that an automated reminder was sent a few days before to the other two reviewers. Although he cannot determine the reviewers’ identities, he can look at their past performance. He is disappointed to see that one has a history of slow turnarounds.

Two Electronic Learning Forums

After raising assumptions and writing scenarios, our next step is to construct a prototype based on the assumptions and scenarios. During the past year, we have been involved in creating such prototypes. The initiatives, though still crude, provide an interesting perspective on the knowledge revolution.

ISWorld Net

ISWorld Net attempts to create a repository of learning resources and a new intellectual infrastructure.30 It has a presence on the World Wide Web as well as on a listserv, ISWorld.31 Most subscribers are information systems faculty. The discussion list is intended as a relatively low-volume (two or three messages a day), high-subscription communication channel. Another listserv, ISWNet, provides a higher-volume communication vehicle for 50 people who have thus far volunteered to help build ISWorld Net and another 120 who follow its activities. We anticipate adding channels for video-conferencing, synchronous and asynchronous bulletin boards, and lectures from distinguished speakers. The current ISWorld Net presence on the Web, though rudimentary, provides information on research areas, teaching and learning (e.g., an index of cases), and a repository of other information (e.g., a faculty directory).

The electronic commerce course page, for instance, has its own discussion list of some 100 faculty; five editors assemble course syllabi, articles, case studies, and books. The page is “one-stop shopping” for faculty teaching an electronic commerce course. Students, who also use the page, help to structure it. Essentially, the page is a distribution channel for teaching materials, as well as a meeting place for faculty and students. When a case is released for publication, it can be announced on the list immediately; participants can access it on the Web and, perhaps the next day, benefit from an interview with the case writer broadcast over the list.

One assumption of ISWorld Net’s supporters is that each participant will contribute. For instance, a professor in Nova Scotia maintains a page of links to various information systems departments; a professor in New Zealand maintains a file of discussion lists. To succeed, this approach requires that most of the responsibilities be small and easy to fulfill, and that individuals be held accountable.32

Global Virtual Teams

The second initiative focuses on virtual peer-to-peer learning. Since 1993, master’s degree students worldwide who are studying global IT management have joined a prototype exercise on virtual teamwork.33 The experiment is based on two premises: (1) that fast-paced learning occurs in teams, and (2) that the best way to learn virtual teaming and global networking skills is by working on a project that requires them. In 1993, 120 master’s students from 15 universities learned skills for collaborating in globally dispersed, ad hoc teams. Teams consisted of students from different countries, sometimes separated by as much as 16 hours. Students learned first-hand the challenges of communicating with people in countries that have poor technological infrastructures. They developed comparative country analyses on information technology, discussed global management cases, completed team project assignments on multinational companies, and developed proposals for starting new products or new businesses. Learning depended on the students’ attitudes toward the new forum, their ability to socialize, their cultural sensitivity, and the depth of their previous experiences.

In 1995, the prototype was scaled up to include 250 master’s students from 20 universities around the world. Each student was assigned to a three- to five-member global virtual team and was the only team member from his or her university. The members never met face to face. The teams, on average, had fourteen-hour time differences between the most geographically distant members. They communicated using e-mail and other Internet communication resources. The teams developed a business plan for an Internet-related business, including the financing and staffing requirements. Practitioners from Nokia, Sterling Information Systems, and Digital Equipment Corporation judged the proposals and picked the most innovative and thoroughly researched plan. The exercise demonstrated that students can learn in a virtual collaborative setting; many students were convinced that this was more effective than face-to-face learning teams. ]

In 1996, the two virtual organizations — ISWorld Net and the global teams — will be brought together. The assignment for students participating in the global teams exercise will be to create a module for ISWorld Net.

Barriers to Progress

It seems clear that nothing will protect the business school from being swept into the current of technologically driven change. In fact, as the examples and scenarios in this paper suggest, the soil is crumbling around us.

The promotion and tenure system itself is an almost insurmountable barrier to rapid change. In North America, candidates for tenure continue, as they have for decades, to be reviewed based on publication in archival scholarly journals that take three to five years to publish articles. While businesses constantly shorten cycles of product-introduction and production cycles, the gestation time for published business research, at least in one prominent journal, increased over three decades from thirteen to thirty-three months.34 Faced with fast-paced change in their business environments, businesspeople naturally question the timeliness, if not the relevance, of research contributions.

Furthermore, within the business school at least, there is an assumption that research concerned with learning or pedagogy is, almost by definition, inferior work that must be relegated to second- or third-tier journals.35 Similarly, with few exceptions, teaching is judged by students watching the instructor in a classroom. Faculty teaching loads are based on teaching a class in a traditional setting. Resources for pedagogical development are in short supply, and innovations are almost invariably constrained by the prevailing paradigm of the traditional classroom.

Skeptics will argue, first, that our predictions are technology-centric and, second, that new media have done little to increase students’ learning. We would respond that many of the skeptics’ studies are flawed.36 Some studies have found differences among students’ receptiveness to new learning environments.37 It is not yet clear what kinds of innovations in learning can have the greatest impact on the greatest number of learners.

Faculty reskilling is also a significant issue. To contribute to this revolution, one must participate in it. An emerging set of Internet tools will make such participation more likely and less frustrating. Once faculty are connected, the Web itself is a marvelous facilitator for reskilling.38

Conclusion

Many people find solace in the durability of the university. One of our deans enjoys pointing out that, of the sixty-six institutions from the fifteenth century that still exist, sixty-two are universities. But that durability may provide false security. The business school’s journey into the turbulent waters of the knowledge age will be difficult. When the storm is over, the boat will still be there. But some of the sailors will be lost, perhaps run over by the speedboats of innovative and adaptive private-sector entrepreneurs.

Business schools — particularly nondegree executive programs — are vulnerable. Surviving institutions will likely have the strongest brand names, be able to provide both scale and scope, and have the most flexible faculty.39 Institutions should already be reexamining inflexible, outdated reward systems. The inflexibility of traditional universities, however, suggests that nontraditional educational suppliers may be best positioned to exploit the lucrative market for business education in an electronic world.