Education Leaders Could Learn Sideways From Sectors Further Ahead

First published in Forbes Leadership July 24, 2017. Most leaders never learn that predictive modeling is a false prophet in fast-changing industries, the siren that lulls them to sleep even as their companies smash on the rocks of outdated assumptions.

But for the few willing to kick addiction to false certainties and grapple with the many rich qualitative approaches to anticipating change, one of the best is “learning sideways,” that is, absorbing the shape and pace of change from analogous industries which are further down the road.

A great example of this is offered by Benjamin Vedrenne-Cloquet, co-founder of the annual EdTechXEurope education innovation conference, who was previously Head of Strategy, Business Development and Ventures for Time Warner, EMEA

In an interview with forbes.com he expanded on how media-entertainment industry evolution is helpful in understanding what’s coming next in the education sector, and how fast.

For example, he says, “five years ago when people were talking about MOOCs, (Massive Open Online Courses) there was a lot of criticism: ‘content is poor, student engagement is low, it’s for developing countries because they can’t access good universities…’”

“I remember at the time, coming from the media industry, that’s exactly what people had been saying when YouTube came out: ‘It’s poor content in the TV industry, it will never rate, it will never work.’”

As with YouTube so with MOOCs, the content quality may be variable, but access is ubiquitous. Therein a groundswell of adoption. And there goes the industry neighborhood.

Says Vedrenne-Cloquet: “In fact, MOOCs were a formidable marketing platform for digital education, because suddenly mass populations were accessing digital education. It was a turning point.”

Coursera and EdX are now surpassing even Oxford and Cambridge in terms of internet search, he says.

Coursera vs Oxford Cambridge
Internet searches, Coursera vs. Oxford and Cambridge Universities. Pic: EdTechXEurope

“Everything media executives didn’t see coming in terms of what was happening and how to react to it, the same is now happening in education, ” says Vedrenne-Cloquet.

“When digization starts, that creates a profusion of new forms of content, which creates confusion because the customer is a bit lost and established providers are losing market share.

“So there is suddenly a need for more curation, personalization, and customization. This is where ‘platforms’ come in, to organize and curate that content.

You suddenly have a shift of power between traditional content providers or publishers, and platforms which are aggregators and distributors.

“These aggregators use ‘programatic curation’ that is adaptive learning software that tailors content to the audiences, and ‘social curation,’ leveraging social communities and social networks, to recommend and distribute content,” he says.

This is what happened in the music industry (Spotify), in the TV industry (YouTube and Netflix), and the publishing business (Amazon). Now in education this is becoming visible with the mainstreaming of the Coursera and EdX platforms.

Overall, the education industry’s digital vortex has been relatively slow in coming compared with other tech-disrupted industries because significant positions held by large institutions, government bodies, and national budgets have protected incumbents from rapid consumer-choice adoption.

The brand protection of long-established universities has also so far been a frictional force in consumer adoption of alternatives.

But, again following the media and publishing industry precedents, Vedrenne-Cloquet suggests established university and executive education providers will likewise fall to winner-take-all platforms, and will be effectively forced to throw in their lot with them.

EdTechXEurope EdTech China
EdTech investment in China already dwarfs rest of world. Pic: EdTechXEurope

Moreover, the brand protection that Western education institutions have enjoyed in Asia and the Middle East is fast dissipating. Homegrown options are gaining legitimacy, not least on the back of massive international investment.

For example, China has 9,500 EdTech companies and is attracting 30-40% of global education investor money. Vedrenne-Cloquet is partner at Ibis Capital, which invests in the region.

Speaking to global opportunity, the annual EdTechXEurope conference and education industry event week in London has in five short years established pre-eminence in the worldwide EdTech calendar, and is itself globalizing. EdTechAsia takes place in Singapore in October, and new conferences are planned in Africa (Cape Town) and South America (Buenos Aires) in 2018.

Planning as Learning in the Transit Sector

Strategic Foresight Methods and Approaches

Remix Lets Planners Learn With Visual Data

“After releasing their first tool, a simple, gamified bus route mapper then called Transitmix in 2014, they began working with planners. In essence, they were designing the data visualization tools the planners wanted, but didn’t have.

“You can think of Remix as a video game for planners, which is leading to better public transit service.

More: The Small Startup That’s Helping Hundreds Of Cities Visualize The Future

How Oxford Helps Leaders Face The Complex And Uncertain Future

First published at Forbes.com Leadership. Turbulent-Uncertain-Novel-Ambiguous (TUNA) is the acronym an Oxford University Executive Education program uses instead of the more familiar VUCA—volatile, uncertain, complex, ambiguous. But either way we understand the problem: The external environment changes rapidly and unpredictably, making leaders look silly. What worked yesterday won’t work tomorrow.

As TUNA pressures warp previously steady-state industries, executives respond by trying to predict the future, grappling with early-warning signals or trying to identify market or technology trends.

The five-day Oxford Scenarios Programme (OSP) offers a different path.

“At Oxford we try really hard to try to get through the futurology that’s out there, and (instead) power people who have resources and agency to do things better,” says Dr Angela Wilkinson, who teaches the program along with Saïd School Professor Rafael Ramirez.

Scenario Planning is a method of direction-finding and strategy formation that defines itself by non-prediction.  Scenarios are integrated narratives of how the future may unfold, with always two or more in a set. This avoids the brittleness of a singularly predicted future—which the unpredictable world will surely make nonsense of.

The OSP accepts about 40 delegates and—fairly unusually for executive education—also hosts two or three organizations as real-world “proto-clients,” providing live client situations for the delegates to work on .

Dr Angela Wilkinson leads a scenario planning workshop
Dr Angela Wilkinson leads a scenario planning workshop.

In the next program, April 25-29, 2016, the proto-clients are: a University (not Oxford) trying to manage faculty field research in the new era of geo-political risk; an FMCG ice-cream company concerned millennials aren’t buying its products; and a scholarly professional body struggling with how digitalization is eroding its centralized authority and journal-based business model.

“These live cases give the program a ‘clinical-research feel,’” says Wilkinson. “We used to use some form of a generalized case, like Harvard Business School cases. But that doesn’t prepare the delegates for what they are going to encounter in their organizations.

“Live clients reflect the ambiguity of the scenario planning reality they will find themselves in, how messy and difficult it is.”

The clients present their business situation late on Monday, and are then interviewed over dinner by the assigned delegate teams. Midweek there is a check-in teleconference lasting 1-2 hours during which the teams test their evolving framework. A half-day on Friday is given to client presentation and discussion of the implications.

For executives that don’t have a spare week and approaching £6,000 (about $8,400) to spend at Oxford’s Egrove Park executive education facility in England, co-incidentally Ramirez and Wilkinson have just published a book, Strategic Reframing: The Oxford Scenario Planning Approach (Oxford University Press, 2016)  written to broaden access to the philosophy and methods of the Oxford Scenario Planning Approach (OSPA).

Strategic Reframing, OUP, 2016
Strategic Reframing, The Oxford Scenario Planning Approach. Oxford University Press, 2016

“Reframing” in the title refers to leaders’ mental frames—sometimes called mental models, or paradigms—that scenario planning targets. A key problem, arguably the key problem in successfully managing a TUNA world is “frame rigidity,” when a leader’s mental model is not wide enough or flexible enough to perceive (or to take seriously) all the alternative, plausible outcomes that matter.

Scenario planning invites multiple framings of an uncertain situation, making leaders more aware and conscious of the legacy frame they have unconsciously been using to make sense of the world.

According to Strategic Reframing: “Reframing occurs in the process of scenario planning when alternative scenarios describing future contextual environments are contrasted to reveal, test, and redefine the official future (given frame).

“By rehearsing actions with these alternative frames, new and better options for action can be identified and contribute to a re-perception of the present situation.”

Wilkinson is an alumna of renown planning office at Royal Dutch Shell and currently Head of Strategic Foresight at the OECD in Paris, where she describes her remit as “leading a project to upgrade it (strategic foresight).

“The OECD, like most organizations, is strongly oriented to ‘evidence-based policy.’ If you can’t quantify it, it can’t go in the conversation,” she says.

But if you just stick to the numbers you can end up ‘not learning’ because you just stick with the stuff you can measure as opposed to the stuff that’s important —which requires you to exercise judgment.

“Quantitative, evidence-based policy served us well in he last maybe 10 or 20 years before the financial crisis, when everybody thought everything was very steady state.

“You can manage by numbers but you can’t lead by them. Quality of judgment, of intervention, needs a more systemic understanding of why things happen, and are connected to each other.”

“The numbers matter, but so do the narratives,” says Wilkinson.

CEOs Make Room For Bold And Beautiful In HBS Business Of Entertainment Course

First published forbes.com Leadership. Harvard Business School Professor Anita Elberse has a decade of research charting the great rise in power top-tier celebrities have in entertainment, both in commanding ever-higher pay and as moguls in their own right able to dictate the terms of engagement and define new business models for themselves.

If stars are becoming power brokers of their industries, it makes sense to get them into the mix of a business school course that looks at strategies for success in the entertainment industry.

Last year when HBS executive education ran its four-day Business of Entertainment, Media and Sports (BEMS) course, basketball star Dwyane Wade was a student delegate, alongside other stars who have sought anonymity. In 2014, linebacker Brandon Marshall and supermodel Karlie Kloss were in the class.

Dwayne Wade, Anita Elberse, and Brandon Marshall at Harvard Business School, 2015. Picture: HBS
Dwyane Wade, Anita Elberse, and Brandon Marshall at Harvard Business School, 2015. Source: HBS

When I interviewed Elberse for Forbes.com last week, she said: “If you compare the world of entertainment now with the world of entertainment 25 years ago, you see that some individual stars can get things done now and can wield an influence now that they couldn’t in the past.”

Superstars are getting smarter about how much new-found power they have, but knowing how to best use it is what brings people like Wade into the HBS classroom.

“They want to know how they can best monetize their brand enterprise and leverage their influence.”

Says Elberse: “If you want to understand the world of entertainment you cannot just have people from the big (conventional entertainment industry) companies, in a room, and have them try to figure out what’s the future.

“You have to also incorporate the perspective of people like Wade or Kloss, and get an understanding of what it is they want to achieve and how they want to achieve it. Because increasingly they are shaping this space.”

“That’s why we are keen to have these people in the room”.

Source

This is an arrangement that is obviously also valuable to the standard agents, managers, and entertainment executives the course attracts, who get to hear the perspectives of talent from the very source.

Executive Education always justifies its value in part by who else is in the room—the cross fertilization, networking value proposition.  Other than sourcing the perspectives of star talent, BEMS carefully assembles a classroom of executives across the worlds of film, television, music, book publishing, sports, and allied sectors.

Following the famous HBS “case method,” where learning is achieved by close study of past real-world situations (a pedagogic style b-schools learned from law schools), the BEMS program uses cases studies of stars who have flexed their power, for example the HBS Beyoncé Case, which looks at the company Sunday’s Super Bowl halftime show star built around her brand, that sits outside the traditional record label structure.

Case Studies in the Business of Entertainment, Media, and Sports program, 2015
Case Studies in the Business of Entertainment, Media, and Sports program, 2015. Source: Anita Elberse

The BEMS program also pivots on Elberse’s other main research theme: the rise of blockbuster economics in the entertainment industry.

“Increasingly companies, and even individuals, have to make bigger bets in order to stand out in this space. So this is where you get film studios making ‘tentpole films’ or record labels spending an insane amount of money to try to market someone’s album,” says Elberse.

“That creates a new competitive environment in which there is increasingly a difference between companies that have scale and can do those things and companies that cannot—which are increasingly locked out of that space.

“Increasingly these markets are winner-take-all where a few people at the top get all the rewards and are increasingly powerful.”

The winner-take-all distribution pattern, which can manifest in situations where variables are able to scale far beyond what would be expected in a Gaussian “normal distribution” curve, is a topic well known to statisticians, and it was Nassim Taleb who most clearly brought it to a business audience in The Black Swan where he says: “Intellectual, scientific, and artistic activities belong to the province of ‘Extremistan,’ where there is a severe concentration of success  with a very small number of winners claiming a large share of the pot.”

Blockbusters

Elberse, in her book Blockbusters, tells the story of how Alan Horn in 1999, new in his role as president and chief operating officer of Warner Bros., singled out four or five event films among his annual output of more than 20, and steered a disproportionately large portion of production and marketing budget to them.

Making big-budget movies and lavishly marketing them was not new; what was novel when Horn did it was building an entire strategy on selective disproportionate budget allocation.

The recent wall-to-wall tsunami of media during the launch week of Star Wars 7 is the poster event for this approach.

Blockbusters contrasts this strategy, which was wildly successful for Warner Bros., with that of Jeff Zucker, CEO of NBC’s Television Group and NBC Universal in 2007, who pursued the opposite strategy: placing a larger number of smaller bets and guarding against deep investment on any single project.

“During Zucker’s tenure, NBC fell from its perch as the highest-rated television network to fourth place, behind its three broadcast rivals—ABC, CBS, and FOX—a demise once unthinkable.”

Talent

Blockbuster strategies almost always go hand-in-hand with eye-popping investments in top creative talent, which is how these two themes of the BEMS course come together.

According to Blockbusters “The focus on star talent now extends into virtually all sectors of the entertainment industry. A Spanish businessman single-handedly raised the bar for investments in A-list talent in the world of soccer. Bringing a show-business mentality to his renowned soccer club, Real Madrid’s president, Florentino Pérez, started pursuing what he called his ‘galácticos’ strategy, a reference to the star power of the players he sought to recruit.”

The celebrity pay scales and tsunami marketing budget required of a ‘galácticos’ strategy puts huge pressure on the business models of studios, record labels, and sports teams, and flies in the face of conventional business logic which says spread rather than concentrate risk, and limit investment to a level that won’t break the bank.

Yet not doing ‘galácticos’ appears an even surer route to failure, not only inside but also outside entertainment. One need only think of the many that have fallen or can’t now get into the industries where Uber, Twitter, AirBnB, and Facebook are winner-take-all. Such is the pressure on studio executives and other leadership decision makers in managing the strategic economics of ‘Extremistan,’ of which the entertainment industry is a core province.

Not one to undersell itself, Harvard’s marketing for the BEMS course tells paying executives they will learn to “assess different strategies, including when to bet on a blockbuster versus a number of smaller ‘plays’”; “discover when it pays to bet on A-list talent”; and “evaluate the effectiveness of strategies that play to the value of star talent.”

Broker

Meanwhile, crossing both themes of star empowerment and blockbuster economics is the not-insignificant matter of digital technology evolution.

The entertainment industry is ground zero for digital disruption because so much of the product can move in digital form, and because social media allows stars and fans to disintermediate the corporate broker.

The program has case studies on Facebook and BuzzFeed, among various players that are changing the way either stars or producers can market and distribute content.

The big question currently facing entertainment companies is how digital technology will affect their bets on blockbusters and superstars. Does it increase or decrease the power of talent? Does it make the blockbuster strategy obsolete, or even more necessary?

Elberse in Blockbusters says “Some industry insiders have suggested that digital technology will spell the end of blockbusters—and, with that, the effectiveness of blockbuster strategies. Is the rise of online distribution channels a sign that soon the ‘old’ rules of the entertainment business will no longer apply?

“Looking at the popularity of sites such as YouTube that democratize content production and distribution, one might be tempted to conclude that a ‘yes’ is the only right answer.

“But a closer look reveals that the reality isn’t quite so simple. In fact, in today’s markets where, thanks to the Internet, buyers have easy access to millions and millions of titles, the principles of the blockbuster strategy may be more applicable than ever before.”

Her conclusion: “There are fundamental laws of consumer behavior that explain the strategy’s enduring appeal—the kinds of laws everyone with an interest in the entertainment industry should be aware of, in other words. The blockbuster strategy’s continuing importance to the success of entertainment companies is made abundantly clear in the enormous amounts of data that online channels generate.”

Hospitality

BEMS runs June 1-4, 2016 at Harvard Business School, taught by HBS faculty, Anita Elberse, Kristin Mugford, and Felix Oberholzer-Gee who is also Chair of the Harvard MBA Program.

Cost is $9,000 including residential hospitality which would hardly trouble the likes of Taylor Swift or Peyton Manning, or the Bertelsman board, but may give pause to the average company sponsor particularly as two of the days are half-days.

But tuition spend notwithstanding, HBS anticipates a full class of 75-80 delegates, and turning many hopefuls away. Selective admissions allows HBS to curate the class—selecting for seniority and influence, and for balance across entertainment sectors, including film, television, music, nightlife, fashion, publishing, sports, and the performing arts.

A Harvard Executive Education spokesman would not reveal what percentage of applicants is likely to be rejected, or was rejected last year. (By way of possible comparison, the full-time HBS MBA rejects seven out of every eight applicants.)

So who are the celebrities earmarked to be BEMS students 2016? Elberse knows already, mostly, and she has also signed a celebrity guest speaker—but she won’t give Forbes.com any names.

To a certain extent this is understandable: “In 2014, when word got out that Sir Alex Ferguson was coming to speak, people were lined up outside the Harvard Executive Education building and down the road. We had to call security! This doesn’t normally happen in executive education, not even at Harvard Business School,” she says.