Dive Brief:

• Colleges that offer online programs should grow their digital credential options in order to stay competitive, according to a new report from the International Council for Open and Distance Education (ICDE).
• Credentials are an increasingly popular option for learners, prompting traditional colleges and alternative education providers to increase their offerings to claim a stake in the growing market. Colleges that don't follow suit could lose out to "nontraditional and tech-savvy organizations" that are dipping into "universities' traditional spheres of influence," ICDE warns.
• Traditional transcripts don't adequately convey a student’s skills, whereas credentials indicate if an applicant has the required competencies for a job, the working group argues. Credentials will eventually make transcripts irrelevant, they predict, and better align learning outcomes with workplace needs.

Dive Insight:

The organization describes the rise of credentials as a watershed moment for higher education.

"The (alternative digital credential) movement is developing at the pace of technology, leaving many, but not all, universities behind, mired in a characteristic inability to embrace change, even when that change clearly serves students and society," the group writes. 

Indeed, the number of credentials has ballooned in recent years. Though many are offered through nontraditional education providers, colleges have been quick to develop their own. In fact, the overwhelming majority (94%) of colleges in a 2016 study of 190 institutions indicated they offer some form of alternative credential.

ICDE, which has more than 180 member institutions worldwide, advocates for online and flexible education options. So it comes as no surprise that it would take a strong position on the importance of credentials. However, skeptics of the credential movement have noted there are some barriers to their widespread adoption. 

For one, the rush to create credentials has left students struggling to navigate a massive marketplace. The number of unique credentials — including traditional degree programs, certificates and other options — has grown to roughly 650,000, according to figures collected by Credential Engine, a nonprofit that aims to make the credential marketplace more transparent. 

Further, employers have been slow to accept or even understand alternative credentials, instead preferring traditional degree programs. 

Yet the ICDE report points to research showing employers may prefer digital credentials and portfolios when evaluating candidates. Additionally, 81% of hiring managers found digital portfolios useful for evaluating recent graduates, compared to 48% of those who said the same about traditional academic transcripts, according to a report last year from the Association of American Colleges and Universities. 

Eventually, the group contends, credentials will render transcripts "obsolete." It's important to note, however, that the authors do not predict credentials will take the place of a college degree. 

"While degree (diploma) completion will remain important to employers," they write, "alternative forms of verification of learning and competency will create a new and dynamic ecosystem for the evaluation of applied learning and workplace competence."

The group provides several recommendations for how a college should roll out digital credentials. Among them, institutions should first get buy-in from the administration and academic leadership, be careful not to duplicate other certifications they offer and align their credentials with in-demand skills in the workforce.