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Schools Are Spending Too Much On Tech To Do The Wrong Things Faster


The hue and cry about education being overcommercialized is a long-standing theme in the modern world. After all, one of the foundational pillars of development and human resource cultivation should not be given into the hands of greedy capitalists (sarcasm?). Especially in Asia, high population density has caused tremendous pressure on the educational infrastructure and has led to private schools catering to the educational requirements of those who can afford them.

Whether or not education should be commercialized is an argument for another day. The fact remains that the conventional education system is in dire need of disruption and most ed-tech startups do not resemble the big company that will do so in the future. The reason I believe this is outlined in the next few paragraphs.

Management Productivity vs Operational Productivity

In 1990, Paul Strassmann wrote a book named ‘The Business Value of Computers’. In it, Strassmann, who later went on to become the CIO at The Pentagon, analyzed the money that a group of businesses, all the way from the not-so-successful ones to the very successful ones, spent on information technology as a function of their revenue.

What he unearthed was an extremely counterintuitive result. The proportional outlay was similar for most businesses (at 2% of revenue), implying that success was independent of expenditure on IT. Curious, he dug a little deeper to see how these businesses spent their money.

What he found has been represented in a simplified form in the graph below:

Successful businesses spent the majority of their money on driving operational productivity, while the not-so-successful ones splurged on tools that boost management productivity.

When I came across this analysis back in the final year of high-school (it was used by Steve Jobs in a talk at MIT Sloan School of Management in 1992), I realized that even the best schools in India spent very little on operational productivity. Almost every technology application that was used in educational institutions dealt with finances, payroll, tracking attendance, compliance, and other similar things. No services were being used to do the one thing schools are supposed to do: to teach better. Notice that all the examples I cited are management productivity tools, while a tool that actually helps teachers and schools improve the learning process will be an operational productivity tool.

Elite schools in India and Asia, in general, have bonded very well with technology when it comes to managing the details of running an educational enterprise. However, it turns out that if our schools want to help students learn better, they need to take a leaf out of the corporate world’s book.

Parallel Ecosystem

A wide range of ed-tech startups have sprung up in the Indian landscape in the past decade. Some of them, most notably Byju’s, have raised huge amounts of money at skyrocketing valuations and have built large content libraries that are specific to the curriculums mandated by the various Indian education boards.

However, a stark observation that I find personally discomforting is that none of the major Indian ed-tech players have tried to integrate their offerings with the conventional schooling system. These companies, giants in their own right, are happy to form parallel learning ecosystems that can at best replace the after-school tuitions that students take in the evenings. Companies that have wanted to approach schools in a B2B setup are largely vendors of specialized educational hardware, an obsolete offering in a time when smartphone penetration has risen dramatically. One almost begins to wonder out loud: where are the educational platforms that schools can use? When cloud computing has so dramatically impacted enterprise software, why do our schools still install hardware gimmicks and smart boards?

I do not have anything against the ed-tech companies of today, except that I am firmly of the opinion that the big disruptive ed-tech startup hasn’t arrived yet. As Elon Musk put it, Online education in 2018 is like a poor copy of its offline counterpart, when what the world really needs are tools and platforms that can augment conventional learning to the point that it becomes distinct from its unevolved form of the pre-internet era.

Now, to the controversial headline.

Schools today are spending their IT budgets on buying ERP software that helps them with tracking and documentation, or learning management systems (LMS) that, in essence, provide a platform to push PDF assignments to students. This is insanity.

At Bicycle, we are building a tool named Loop, which we believe can check all the right boxes for improving teaching in our schools. Loop is a data-analytics platform that offers a quizzing app that pushes customized adaptive homework to students. This homework can be set by the teachers using a drag-and-drop interface to select topics and subtopics they tested. The idea is to save teachers the trouble of creating and correcting assignments and analyzing the data collected from the students’ attempts on the quizzes to pinpoint learning gaps for every student in a given class. Using homework for this purpose seemed to be a natural choice since the feedback loops can be made extremely tight and data collection can be as frequent as 3–4 times a week instead of having to wait for weeks-long test cycles or worse, examinations that are eons apart.

Tools that drive operational productivity for schools will be the future of education if we want the system to evolve into a more efficient and personalized experience. Multiple notable companies are working on similar projects, and the likes of Panorama Education and Junyo have made significantly well-received products.

Technology cannot replace humans, and online platforms will not replace our teachers. Startups will merely provide them with tools to do things that were previously impossible, and extend their human limits. That is the right approach towards building an ed-tech company, as well as running a school. Unless school administrators grasp the power of technology-enabled tools and create demand in a market that has been traditionally hard to crack, ed-tech startups will continue to flock towards safer pastures and all students will get are more video libraries behind paywalls.

To all those people who run schools: please open up to ed-tech tools. The possibilities are endless.


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