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The e-Learning Hype Cycle
   
 (Click here to see the Hype Cycle Graph & to read the original article.)

Contributions below include:

James Dowling, Results Based Leadership
David Wilson, eLearnity
Godfrey Parkin, Mindrise
James Howe, Usertech/Canterbury
Carol Resor
Mariusz Mirecki, Lingua Nova

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The Hype Cycle represents the product of Investor/Buyer Confusion multiplied
by Spending. In the early stages, the eLearning value proposition was crystal clear - reduce costs and improve profits. Then things became less clear - develop skills, create intangible value, invest in the future. Where did the reduce costs go - it went into the enterprise level investment that was necessary to support supplier costs not buyer needs. At the peak, the fog burned off from the force of squeezing dollars and in clear view, stood two things: Buyers were investing in skills without strategy; and
suppliers were confusing investors. Buyers and investors retreated and all
of the energy in the system slid down the bell shaped curve.

There is not difference here from what happened with Sales Force Automation,
Customer Relationship Management, Enterprise Resource Planning and other IT
Bricks disguised as Life Saving Rings. Buyers with too much money and too little guidance drove up the market pricing it out of range for mid-cap companies and drive those customers off of suppliers' radar screens.

The problem now is how to pump energy into the system. Where will it come from? If the Skillsoft-SmartFocre merger ends up as a 1 + 1 = 1/2 like AOL-TimeWarner and so many others, there won't be any investor money. If suppliers continue to feed off the operational/supervisory end of the productivity chain, they will need to drop prices and prove their payback cases. The reaction that will push Hype out of its trough will come from a catalyst, not from pouring more energy into the system.

Jim Collins book, Good to Great describes catalytic events as does Malcom Gladwell's book The Tipping Point. At the same time, these books provide some clues about what will catalyze eLearning. Executive Leadership has become much more introspective in the past year. They are looking to their assets and in particular to their intangible assets which includes organization knowledge and capabilities. They are investing in Values, Culture and Leadership. When they make the connection between Leadership
and Results, they will be in a position to revisit broad and rapid learning and learning reinforcement. Leaner organizations and urgency will make LMS and LCMS irrelevant if those technologies do not assess Level 5 Return on Investment in Education. Without LMS or LCMS, and more clearly with ASP delivery models, eLearning will emerge as the only practical way to reinforce and sustain learning. However, eLearning will need a new name.

CEO's and CFO's don't want their peers to hear that they are investing in eLearning but they do want everyone to know the new and creative ways that they are executing strategy. Creative ways of driving the boardroom-resident energy towards the front line will re-start the eLearning reaction in the marketplace.

James F. Dowling
Results-Based Leadership, Inc.
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Read your hype-cycle article which I though was interesting. I've done similar analysis myself and a number of conference presentation sessions on the seeming poor state of the market and trying to pick apart hype and anti-hype from the substance. As well as using the Gartner curve I've also been using the geoffrey moore CHASM analogy as well. See attached article from earlier in the year. Specific comments:

1. We're not at the bottom. Whilst corporate activity is recovering, the vendors are still struggling. With the difficulties raising (affordable) cash, this will lead to more casualties in the short term.

2. Whilst demand-side is now early majority, supply-side is still largely adopter. Lots of consolidation to come and need for real alpha players.

3. One of the biggest issues is now the uncertainty of the market itself. "Even if I want to spend money, who do I bet on?"

4. Your perspective is naturally very US centric. Europe is feeling the pain as well and has some parallel problems but the depth of the trough is not as big because the height of the peak wasn't as high. But what was an 18-month delay behind the US in 2000 is probably only a 6-9 month delay now. The cycles are moving closer to sync.

David Wilson, Managing Director
eLearnity - Independent e-learning analysis & advice
http://www.elearnity.com
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Fascinating article. I think the curve illustrates the mood of investors in the industry, but has little to do with the health of e-learning itself. As any innovation becomes assimilated into our daily lives it tends to become invisible, not because the hype gets "found out" but because we become blasé about the reality. The more invisible it is, the healthier it is (think e-mail, credit cards, electricity).

We have to differentiate between the financial performance of the major players (nearly all of them technology vendors) and the educational performance of the medium. E-learning is no longer regarded with excitement by corporate or academic educators. Nor is it not regarded with skepticism or fear. The number of learners engaged in e-learning continues to soar, and there can hardly be a company that does not have an e-learning strategy that is a lot less naïve that it was last year.

The fact that e-learning buyers have become more informed, more discerning, and more assertive has obviously brought great pain to those trying to create markets for tools and content that have failed to keep up with changing expectations. I would expect the e-learning technology vendors curve to just keep on crashing while the more relevant curve (acceptance, utility, and effectiveness of e-learning) soars.
Three things are driving this:

1) The realization that you don't need e-learning-specialized tools to create and deploy dynamic communication-rich e-learning experiences. The open systems technologies (databases, Web servers, and simple authoring tools for HTML, JavaScript etc.) already exist in most companies and cost very little.

2) The growing understanding that e-learning is not an isolated specialist area in a company, but an integral part of the corporate nervous system. E-learning has to be intimately connected with all of the knowledge flows throughout the business, as well as capable of integrating seamlessly with the knowledge flow systems of business partners, suppliers, and customers.

3) The imminent arrival on the e-learning scene of database-driven ERP juggernauts like SAP and PeopleSoft, who may make the current batch of LMS vendors and their associated initiatives like SCORM simply irrelevant. Does that wipe out the curve completely, or do we add the new players to it and call it a revival?

Godfrey Parkin
President
MindRise
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To reflect accurately on the recent "hype curve," however, one must look back much further than 1996. Since the advent of the telegraph, people have been "learning" through electronic means. If you stretch your line back to the 1840's, therefore, you'd probably see a very slow and steady rise in e-Learning penetration, with periodic blips triggered by the advent of film/slide projectors, radio, television (remember what the Learning Channel was supposed to do for adult learning?); followed by IIS (no; not Microsoft's server, I'm talking about IBM's Interactive Instructional System for mainframes in the early '70's), interactive videodisc, CD-ROMs (almost infinite bandwidth, by the way), and then lately the Internet. I suspect this latest "blip" was more exaggerated than previous ones because of all the VC money (as one of your guests alluded), as people equated the Internet with the second coming - but it too has retreated back to normal growth patterns.

Will penetration increase during the supposed upcoming period of enlightenment? Not as much as (or at the angle) your chart would appear to indicate, I'm afraid. Not as long as the e-Learning "industry" focuses more on infrastructure than content; not as long as companies equate Flash with value; not as long as people treat asynchronous learning opportunities the way they treat home-exercise equipment (you know, the laundry rack in the basement).

We as an industry have been much too preoccupied with building and hyping "Learning in a Box solutions," and filling them with measurable, but basically meaningless objects - LMS's, Learning Objects (whatever the heck those really are), SCORM compliancy - things that register, track, score, conform; but have little if anything to do with fostering wisdom. When we do provide content, more often than not it's mundane, overly simplified, undemanding, humorless, or simply a showcase for "gee, look what I can do" visuals.

Corporations are complicit in all this, of course. They will buy something around which they can wrap their arms, but won't dedicate the management time to facilitate or augment its use, let alone verify its value to the organization. They will settle for simply transferring hardcopy to a website, and consider it e-Learning. They won't allow fun, because it isn't the way "business" operates, or they're (unfortunately, rightly) afraid of offending someone.

And, of course people ultimately choose their own path. If ordinary folks were clamoring for the chance to learn online, our respective businesses would be booming! But learning (like anything else of value) requires commitment - and e-Learning (even the synchronous virtual classroom variety) requires a level of discipline not regularly exhibited in organization-man - or even in personal pursuits, any more than it was when educational courses were made available on film-strips or cable TV.

Want to know why Apollo Group (and some similar Higher-Ed-oriented e-Learning companies are bucking the trend (i.e., showing a regular profit)? I believe it's because the customer gets something very tangible in return for slogging through the process - a degree/diploma/credit-hours. You don't find that relationship within the corporation.

Too pessimistic? More realistic, I think. But, personally, I'm optimistic! Development of teaching materials for electronic delivery is fascinating, exhilarating, challenging, humbling, and highly educational in its own right. What to learn something in depth yourself? Try developing a self-paced course about it, in which you must not only determine and focus on the core tenets, but also deal with (and anticipate) a myriad of misconceptions and inconsistencies, and present it all in a manner that will encourage people to "stay tuned."

James D. Howe
Chief Technology Officer
Usertech/Canterbury Corp.
www.usertechcanterbury.com

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In the past, the elearning industry's greatest mistake has been refusing to see the differences between classroom learning and learning through technology. They've treated elearning as an electronic clone of classroom learning. As elearning instructors, we've mistakenly tried to teach the same ways despite the physical and technological differences. We're only now realizing how to take advantage of the elearning technology.

For example, instead of entirely replacing a classroom experience (typically how elearning ROI is measured), we're realizing that CBT/WBT types of elearning can enhance classroom learning. CBT/WBT

1. ensures participants come with prerequisite knowledge through online
pre-assessments and preparatory elearning modules taken before the class date,

2. provides work-life examples through media-rich, interactive simulations during class,

3. measures knowledge gained from class through post-assessments, and

4. offers 24X7 post-class support and "as needed" help through focused elearning modules.

Distance learning, a far more sophisticated form of elearning, has radically expanded educational horizons. Access to to education at all levels, for all people, has been greatly improved. Although distance learning has improved access for learners who live in remote locations, it's also helped people who are too busy to travel back and forth to
schools/colleges/universities.

Even better, elearning supports the learning process by encouraging collaboration and review. Distance learning helps students overcome their reluctance to participate in class and helps them review content through written responses. Students who are too shy or intimidated to talk in a classroom may more easily contribute to discussions or ask questions through written chats and emails. Instructors also "force" students to review course material by asking for written responses to content or questions --
responses which are usually shared with peers instead of only with the teacher. Students can't hide in the back row any longer and still pass a class. Grades for classes taught through distance learning are based primarily on participation.

As long as teachers and learners are technologically prepared, elearning still has great potential.

-- Carol Resor
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I strongly agree with the 'inflated expectations' argument. Many e-business enterprises were lost due to that course of thinking; We have tremendously functional LMSs and wonderfully crafted contents but we do not have people to work on them. The Bible plainly states that 'all things are lawful, but not all things are advantageous ... not all
things build up'. That is what happened to e-learning - the believe in the superiority of science and technology elevated it high but the reality of a 'layman' has crashed this image into pieces.

MARIUSZ MIRECKI
e-school project manager
LINGUA NOVA