Oscar Munoz, CEO of United Airlines, recently sent an email to customers focused on Actions Speaking Louder than Words. Here were two key sentences from his communication:
“It happened because our corporate policies were placed ahead of our shared values. Our procedures got in the way of our employees doing what they know is right.”
“Fixing that problem starts now with changing how we fly, serve and respect our customers. This is a turning point for all of us here at United—and as CEO, it’s my responsibility to make sure that we learn from this experience and redouble our efforts to put our customers at the center of everything we do.”
Why does it take a major disruption to make the customers the center of everything a major corporation does, when the customers are the reason they are in business?
Take this recent New York Times article on ESPN, for example. “The Worldwide Leader in Sports” ESPN laid off scores of journalists and on-air talent. ESPN is by far the biggest and most powerful entity in the sports media industry, and it has felt the sting as viewers turn away from traditional ways of consuming live sports.
The network has lost more than 10 million subscribers over the past several years. At the same time, the cost of broadcasting major sports has continued to rise.
“They’ve decided one way to do this is to change their approach to content and rely more heavily on digital; this has enabled them to let go of a big chunk of their talent base.”
Why does it take a disruption of millions of subscribers leaving and massive layoffs for a leader in sports to decide that content and digital are driving modern business?
The first week of April, Ralph Lauren announced it would be closing its Fifth Avenue Store in New York saving $140 million a year. The company announced restructuring plans last year, laying off 8% of its staff and closing 50 stores to save $180 million to $220 million a year. There is a retail bubble and it’s bursting.
Why is retail being so crazily disrupted when Amazon’s unbroken 20-year streak of double-digit revenue growth shows no sign of slowing this year, helped by an influx of online shoppers who are abandoning stores?
The mentality of “if we just wait long enough, people will realize the value of what we do,” won’t cut it in today’s competitive digital landscape. We’re heading into summer and a new fiscal year—it’s time to reboot and rethink strategy. If you had two priorities for consideration, here’s what I’d recommend:
Your CMO should be leading the design-thinking about your product. For those who won’t acknowledge that degrees are a product, let’s address that. Whatever we call what we promote or sell, your CMO should be involved in and leading these discussions. Your CMO should have dashboards, reporting and a team of data nerds with numbers doing predictive analytics on what the consumers are going to demand.
Bring in a team of people who can lead your brand, product and ideas into the next paradigm. If you don’t have a CMO, hire one or a great consultant. If you don’t think you have money to do this, think about the scenarios above. If you have the right team in place, give them some lofty goals, authority and autonomy to drive strategy for your institution and expect them to contribute.
Reality Check: It’s Already Happening
Through leadership of the Provost and Vice-Provost for Digital Learning, Columbia College Chicago is creating a retail course model to be offered to current students, prospective students and topic enthusiasts. UnManned Safety Institute wrote the first 400-page textbook on Unmanned Vehicle Safety (much of which addresses Drones) and is currently working with high schools and colleges across the US on promotion of this certificate to prepare future generations for the reality and changes of the use of unmanned vehicles.
If your institution is stuck in a pro-textbook, traditional delivery paradigm—be that marketing, recruitment or degree program—look to companies like Pearson to see where that led. How would their current state look if they had anticipated disruption?
Your product is only as good as the way the consumer wants to purchase it. Everything that you do from product, price and promotion should be driven by a digital-first paradigm. That is relevant to content, price, channel and delivery mechanism.
Reality Check: It’s Already Happening
Northwestern University’s Masters in Sound Arts programs are creating podcasts to connect with prospective students with content that is relevant and interesting to them. They’re promoting their brand with a digital-first mindset and engaging prospective students with an inbound approach to marketing.
This will be the key to future success in a complex world that is largely unknown. Having the people in place who can anticipate these challenges and strategies to address the reality will be key to the long-term success of your programs, degrees and institutions. If you wish to further engage in a discussion on disruption in EDU, contact me to keep the conversation going.