Posted by: crudbasher | August 24, 2012

What Comes After Disaggregation?

One of the big themes I have blogged about in the last year or so is this trend I have identified called Disaggregation. I define disaggregation as the reorganization of society by the Internet, from geographically based constructs to idea based constructs. You may not have heard of this term much but I know you have seen the effects. Every time you see a company outsourcing a piece of it’s operation, you are seeing disaggregation. While I don’t want to get into a moral discussion about outsourcing, I believe it is an inevitable side effect of economics.

A business is always looking at it’s costs in order to keep them low enough to make a profit while keeping their prices attractive. If you competitors are reducing their costs, you pretty much have to do the same. A business is comprised of various functions. If a part is information technology based, it can usually be done remotely. Thus outsourcing moves company functions overseas. Many times it’s cheaper to just buy a service from another company than to maintain the service internally.

787 Parts (cc) niallkennedy

I don’t think we have seen the end of disaggregation. In fact I think it’s just getting started. Information based economic functions will migrate around the world in search of the best climate for business. Boeing is a good example of this with their new 787 airliner. Boeing tried a new approach where they designed much of the plane but then farmed out a lot of the detailed design work to their suppliers. It was a very disaggregated design process. It was pretty ahead of it’s time and there were several years of delays as Boeing tried to make it work. In the end, they brought some of the design and production back in house but I believe this sort of thing will be perfected.

When you split up manufacturing into separate companies, you get a situation where the same supplier can be working for many competing companies. For example, BF Goodrich works for pretty much every airplane company. These suppliers focus on their areas of expertise and offer their services to whoever wants them. This also means that the workforce becomes disaggregated. When developing a product you might need designers for only the first part of the process, so you hire a design company temporarily. The days of an employee working their whole career in one company are over.

Higher Education

So let’s look at Higher Education. A university is composed of many discrete units, only some of which are devoted to actual teaching. They offer a complete package from enrollment, housing, curriculum, finance, recreation, food and credentialing. You would think that by having everything in one place it would be more efficient but that’s not the case. By disaggregating into individual suppliers, manufacturing has become more efficient because each supplier can spread their overhead over multiple customers. A company then can buy as much of a service as they need so there is no waste. A university though has to do every piece itself. Not only that but their physical infrastructure stands empty more than half the time (if you count overnight).

So can we disaggregate the university? You can if it’s online. Students can stay at home (takes care of housing, recreation and food). The university provides the curriculum. These days there are many cloud based LMS systems the university doesn’t even have to write their own anymore. No buildings are required, no stadiums, no campus in fact. I have said many times that all you really need is a teacher and a student willing to learn. This is what universities have left to sell. Great teachers and compelling curriculum will bring in the students.

Even the functions of a class such as assessment, lesson presentation and projects can be split up. I imagine there will arise institutions that do nothing else but credential people. (ie Western Governors University (more) ). This could be very attractive to schools with valuable names. Imagine a Harvard Assessment Company that just does assessment for other schools. Even the curriculum will be split up. Universities will offer single classes and students will create their own degree paths. Imagine every student with a unique skill set tailored to their natural abilities! That’s the sort of world we are moving towards.

So what comes after Disaggregation? For the answer let’s look at Lego.

(cc) Dunechaser

I built Lego like crazy when I was a kid. I loved the possibilities of what I could make. You dump out the pieces and let your imagination run wild. Our information based society is splitting up into Lego pieces. What used to be a company or university is becoming loose associations of pieces. This is necessary because in a rapidly changing world you must adapt quickly to changes. You must resize your workforce as needed, and take on and offload capabilities. The name of the game is reconfiguration.

A side effect of disaggregating universities is that new players can start using those resources too. For example let’s say a large company (like Apple) launches a new product. They could hire curriculum design companies, assessment companies, content creator companies, rent an online teaching platform and put together a temporary university to teach about their new product. They could award a certification and then those people would have an advantage in getting jobs using the product. It’s a whole new revenue stream for every company. Once the product has finished launching, they can just dissolve the university. It’s all modular, disaggregated and temporary.

Universities have no exclusive claim on teaching people things. They are monolithic in an age of modularity. They are unchanging in a rapidly changing world. The Education Stormfront will catch up to them soon.

As always I welcome your thoughts!!

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