Published on 2016/09/07

A Primer on the Present and Future of Alternative Credentials

The EvoLLLution | A Primer on the Present and Future of Alternative Credentials
Alternative credentials will not replace degrees but are strongly following the disruptive innovation process outlined by Clayton Christensen.

Galvanize. HackReactor. General Assembly. Udemy. HackBright. CodingHouse. Udacity. Coursera.

If you do not recognize these names, then you have been missing the excitement over alternative credentials. This is a list of companies that offer not just courses and certificates but also bootcamps, MOOCs, nanodegrees, microcertificates and other additions to the education lexicon. Students earn new types of credentials, considered alternatives to traditional degrees offered by mainstream colleges and universities.

The Origins of Alternative Credentials

It is not easy to pinpoint the precise origin in time of alternative credentials. Postsecondary certificates, professional certificates, university extension courses, etc. have long coexisted with universities and colleges. However, over the last few years, we have seen the growth of high-profile, venture-backed companies who have taken the game to a different level.

Today, the phrase “alternative credentials” includes digital badges, MOOC certificates, nanodegrees, bootcamp certificates, professional certifications and other types of qualifications offered by organizations outside academe.

Why Now?

This surge of interest in alternative credentials is fueled by the public dissatisfaction with the rising cost of college coupled with the low graduation rates and low employment rates for those who do graduate. There is a skills gap between graduates seeking employment and available jobs, particularly in the technology sector. Venture-backed startups have responded to this problem with a new educational product: a form of skills training.

In contrast to a two-year MS degree in computer science or software engineering at an average cost of $30,000 to $120,000, alternative-credential training programs are short (three to six months) and attractively priced ($1,000-$15,000, often with a money-back guarantee). They’re narrowly focused on the job market, and with encouraging employment rates.

The government, perceiving the value of coding camps to address the skills gap, has been very supportive. You will find different and often disruptive instructional models and business models in these institutions. This innovation is outside established educational institutions.

Who Is Enrolling and Why?

These programs, particularly tech-focused programs, attract a mix of participants: college graduates facing unemployment, early-career graduates looking for a career shift to improve their earning capacity, international students willing to spend the duration of their three-month tourist visa on obtaining state-of-the-art tech skills, and older adults seeking retooling, to name a few.

Instruction is face-to-face and in small groups, far removed from mind-numbing power-point lectures in college classrooms. It is typically project-based and highly interactive, with industry experts serving as mentors rather than academic faculty. Many programs cater to the job demand in the technology industry, directly bridging the skills gap by teaching coding, software engineering and data science.

Credentials are earned in some of the better programs by working with industry-specific projects developed by employers with corporate partners, providing networking opportunities with potential employers. Participants work long hours in teams that simulate a real work environment, and gain just enough knowledge to develop competencies that are aligned with jobs in the industry. The pace is fast and furious, the technologies are state-of-the-art and the group dynamics supportive.

What Next for Alternative Credentials?

Is this phenomenon going to take over the world of education, rendering degrees meaningless? Of course, the answer is yes and no.

Yes: participants with a BA degree, enrolled in a full-stack engineer bootcamp, have rejected a traditional MA degree in favor of the bootcamp’s credentials. As alternative credentials grow and employer confidence in them grows, yes, these credentials will undermine the value of mediocre undergraduate degrees.

However, the answer is also no. They will not render all degrees meaningless. Rather, I am optimistic that universities will respond to this market call, as they are already starting to do, and will adapt and adopt.

The growth and proliferation of alternative credentials will impact universities and colleges. The government is now offering student financial aid for programs that are working with universities to offer alternative credentials. The success of such programs sends a strong message to universities and colleges that their degree offerings are out of sync with employment opportunities in the real world. Universities should rethink their educational offerings along two important dimensions.

First, the content needs to be updated to align with the skills needed for today’s employment market in order to prepare undergraduates to take their place in the workforce. An agile and responsive curriculum would truly benefit our college graduates. Second, instructional methods in college classrooms need a complete overhaul, with fewer lectures and more project-based work, team work, problem solving, and real-world activities. The good news is that there are a few universities moving along this trajectory, most famously Georgia Tech, WGU and SNHU, but it is time for everyone to examine their programs with a new lens.

Alternative credentials are following Clayton Christensen’s disruptive innovation process. According to this framework, innovative services take root and gather support in simple applications at the bottom of the market and then “relentlessly move upmarket, eventually displacing established competitors.”

It will be fascinating to watch their progress—a journey that can only benefit all of us.

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