We’ve seen the disruptive power of “micro” in the fields of finance (micro-loans and micro-savings), insurance (micro-insurance), work (micro-jobs), housing (micro-homes), and entrepreneurship (micro-consignment). Now, it’s education’s turn. Many schools, companies, and nonprofits are starting to experiment with micro-credentials, using a common digital framework (“open badges”) developed by the Mozilla Foundation. Even textbook giant Pearson has launched its own badging platform, placing a huge bet on this new trend. Similarly, Blackboard is integrating digital badges into its learning management systems.

If digital badges start to gain traction as a credentialing tool, they will force us to re-think and redesign learning and education, especially for emerging fields such as social innovation.

So how do digital badges work? Unlike traditional academic degrees that tend to communicate what subject you studied and where you studied it, most digital badges are more granular in scope. They point to specific knowledge and skills you’ve acquired, and in most cases, demonstrated. For example, instead of going to a reputable business school and leveraging that institution’s MBA to get a job, you would earn a series of badges that would demonstrate your business acumen—such as your mastery of business model canvas, Lean Startup, and customer development. Your school—or any school for that matter—doesn’t need to issue the badges itself; the badges simply need to come from a trusted source that can certify your competencies.

Some may ask, what’s wrong with our existing system of education credentialing, and why would micro-credentials be better? I believe three global trends are driving the move toward digital badges as a new knowledge currency:

1. The widening skills gap

As McKinsey reported in its 2012 “Education to Employment” survey, companies are having a hard time filling job vacancies even though 75 million youth are unemployed. According to 39 percent of companies surveyed, the main reason is “lack of skills.” Although 70 percent of educational institutions believe students are prepared for work, only 42 percent of companies think so.

Employers will want new ways to close that “reality gap” and signal the specific skill sets they need, possibly using a system of micro-credentials (badges). Just last month, AT&T and other industry leaders joined forces with Udacity to launch “nanodegrees,” which they describe as job-focused credentials that people can earn in 6 to 12 months.

Schools that care about job placement will soon have to follow suit and guide students toward similar nano- or micro-credentials; this will require that learners demonstrate, not just claim, that they have the specific skills industries want.

2. The need for flexible, lifelong learning

Getting a job is just the beginning. Today’s workers will likely change jobs every 4.5 years and change careers 2 or 3 times over their lifetimes. If you’re a freelancer—a likely scenario for 40 percent of US workers by 2020—you will change the type of work you do even more frequently.

This means we need a system for constant, lifelong learning in all contexts. Today’s academic degrees and certificate programs could never offer that type of flexibility.

Furthermore, work in today’s ever-changing world is increasingly multi-disciplinary. I used to be a full-time journalist, but my job today cuts across multiple sectors—media, education, and social innovation. I need to build competencies and credibility in all three fields, and I have to do so while working full-time. I can probably fit in micro-credentials, but I definitely don’t have time to earn another master’s or doctorate degree.

3. The rise of networks over institutions

Where we learn is changing too. For centuries, institutions have curated and disseminated most knowledge. Although institutions still hold great power, we also see networks, both online and offline, driving much learning and change.

Today’s learners want to access the best knowledge from across networks, rather than from one or two reputable institutions. In fact, whether or not schools encourage it, people already do. Network-based learners will demand a new knowledge currency, one that can travel across online networks and provide evidence for knowledge and skills.

Mozilla’s Open Badges are traceable and verifiable, and allow people to embed all types of proof—testimonials, endorsements, links, images, documents, and videos. They are more than “just a piece of paper.”

Universities may resist micro-credentials the way many have resisted massive open online courses (MOOCs). Mature and protected industries such as law and medicine might also stand firm. But quite a few universities around the world have already shown a willingness to experiment. UC Davis, for example, has designed a new major based on badges (rather than courses) to integrate skills and experiential learning. Purdue is moving towards a passport system of badges for all students.

But we won’t see true disruption in credentialing until entire fields or communities of practice adopt micro-credentials. Computer science has been heading that way. So might social innovation, which hasn’t found a home at most universities; even when schools offer classes, it’s not clear which department should own it or if any one department could.

In Canada, businesses, nonprofits, and schools across the innovation ecosystem are planning to co-create badges for the national (and potentially global) network of changemakers, and have already held an Open Badges Summit. Whatever school you go to and even if you’re not in school, you will be able to earn badges for Social Innovation 101, Sustainability 101, Leadership, Crowdfunding, 3D Printing, Storytelling, Theory of Change, and Social Finance.

Each badge will define a learning pathway that builds on other pathways and leads to new ones. In addition to schools, nonprofits and even companies will facilitate some learning. Social entrepreneurship education (and credentialing) will be everyone’s business.

Can a new knowledge currency (and marketplace) for social innovation take hold or will we continue to seek institutional stamps of approval from elite universities? Even if badges are not the answer, we will need something to make education and learning credentials more relevant, flexible, and open.

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