OPMs — Sensible university partnership model or outsourcing of core capability?
Online Program Management (OPMs) design, run and market online education programs for institutions, typically in a revenue or profit share arrangement. In today’s competitive higher education market, more schools are turning to online education to meet student expectations, enhance the student experience and provide alternate paths to new markets, revenue and growth.
There’s no doubt that OPM-University partnerships have delivered many benefits for both parties over the years, especially for institutions who’ve struggled to take the ‘online leap’ alone.
The appeal of OPMs is two-fold. First, they provide services that historically lay outside the competency of traditional universities (who are geared towards face-to-face education). Second, OPMs typically bear the upfront costs of setting up the program. For institutions, this represents the opportunity to create a new revenue stream at limited cost to themselves.
Five companies reportedly control about half of the $1.1 billion OPM market in the US: 2U, Academic Partnerships, Bisk, Pearson Embanet and Wiley Education Solutions.
However, as online and blended learning becomes more integrated into the standard university delivery model and student experience, is there a danger that institutions are outsourcing future core core capabilities?
All OPM’s are not the same. Recent research has identified a range of different OPM models developing as the market matures and as institutions become more targeted in their product and market development strategies.
Differentiation in the market. OPMs differ across dimensions such as business model, range of services and scope of programs they deliver. For example, 2U focuses on US-based graduate programs, principally works with ‘brand-name’ universities, and offers small class sizes, often with a ‘hybrid’ model (for instance, sourcing practical placements for degrees in nursing and social work). Recently, 2U diversified into short courses with the acquisition of South Africa-based GetSmarter.
New competitors entering. The OPM industry is a fast growing space with new entrants launching around the world almost every week. MOOC providers such as Coursera and FutureLearn are also expanding into this space, partnering with universities to offer online degrees.
Evolving business models. OPMs almost always operate on a tuition-splitting basis, but a new OPM model is emerging, based on a flat fee for services. Examples include Noodle.
Case study: Orbis Education
Orbis Education works with academic and healthcare partners to provide hybrid courses combining online, face-to-face, and experiential learning. For academic partners, Orbis can provide off-campus training facilities, assistance with online course design, online prerequisite courses, and clinical training opportunities. For healthcare providers, Orbis advertises the benefit of gaining access to a talent pipeline that is already familiar with the organisation.
In next week’s Deep Dive, we investigate innovations in Student Management Systems.
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