Wednesday, January 23, 2013

MBA Propheteer #1: Global disruptive innovation in graduate management education

Philip Powell, Kelley Direct Faculty Chair
Philip Powell, Faculty Chair of
 Kelley Direct

I sit at a privileged seat in the history of higher education.  I lead Kelley Direct – the first and largest online MBA program founded by a top-ranked business school. This affords my colleagues and me a unique opportunity to anticipate and answer unresolved questions in online MBA education.

A recent lazy moment watching television inspired action.

Episodes of the reality TV show Airline on the Lifetime Network detail Southwest Airlines’ daily successes and challenges in providing service to travelers.  Lessons in management, operations, product design, and customer service naturally reveal themselves through compelling experiences and perspectives.
Southwest revolutionized the delivery of air travel.  If stories from Southwest are so interesting, then why not excerpts from my experiences leading Kelley Direct?  A large crowd follows business education, and Kelley Direct sparked a product revolution that rivals what Southwest accomplished. This means there’s much to discuss on any given day in this world of virtual business and “virtual business education.”  From concept to reality, you now read my first entry in a blog that I hope becomes a hub of thought, debate and ideas in the b-school world – a place where discussions sparked portend the newest challenges and opportunities for MBA programs.  Forward projection of a future vision for the MBA thus inspires the blog’s name: MBA Propheteer.

But first, who are we and why do we think we’re qualified to moderate such a dialogue?

Started in 1999 with just 14 students, the online Kelley Direct portfolio at the Indiana University Kelley School of Business now serves over 1000 graduate business students. These students are served by 51 tenure track faculty members who formally reside within – and hold full teaching rosters at – the Kelley School. And we are most proud of our 1900 Kelley Direct alumni worldwide.

Our students lay waste to the myth that online MBA students are not on par with their residential MBA peers.  Most students work in Fortune 500 companies (Intel, Proctor & Gamble, Lockheed-Martin, General Motors, etc.) and a sizable percentage are active duty service members.  The average student comes into Kelley Direct earning $77,000 annually and graduates earning $106,000, a raise of 36%.  Two-thirds enjoy a promotion during their studies.  The market values the Kelley School’s online MBA as well as it does its nationally ranked residential MBA.

Fourteen years ago, Kelley Direct drove global disruptive innovation in graduate management education – and continues to push the envelope.  By definition, disruptive innovation implies a product with better access and lower cost.  Mimicry of a traditional in-residence experience does not achieve this.  Rather, an online MBA program must organically adapt its design to the reality of work, management, and leadership within virtual organizations.  The bounded reality of the traditional classroom must be abandoned.

Online learning presents new opportunities and threats.  Faculty must improve how they teach and schools must reconfigure their academic programs.  Technology empowers students.  If we educators do not deliver value, someone in the market will make us obsolete.  We face a new and unprecedented level of accountability.  This is the ultimate disruption that foreshadows change in MBA education.

I want to tell the story that is this disruption … and hope you’ll join in the conversation.

Got a comment?  I love ‘em…. Comment below or tweet me at @philiptpowell or @KelleyDirect

By Phil Powell, Faculty Chair of Kelley Direct

Next up: The online MBA is not distance education.

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