Management Education in India - September 2013

1careers360 research

Careers360

ManageMent education in

india crisis or

opportunity?

status of education report series

september, 2013


Status Report B-Schools

Issues that plague the business education scene in the country include increase in number of seats, falling student interests, rising fees and decelerating return on investments. In short, management education is going through a crisis. The paper, while enumerating the ills that adversly affect the

system (also based on our survey of 577 B-Schools) present an overall picture and flags issues that the different stakeholders of the system namely the B-Schools, the recruiters, the aspi-rants and the media must confront and address.

Part 1: Status of Management Education in India ......................................................................................................................... 03 Preamble 1.0 Rising batch size! Falling recruitments 2.0 Decreasing students’ interests 3.0 Bigger difficulty - lack of information 4.0 Is MBA/PGDM past its prime? 5.0 Regulatory regime Way Forward

Part 2: Report on the MBA/PGDM students’ perception about their programme .................................................................. 11 Summing up ............................................................................................................................................................................. 15

ABStRAct

contEntS

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project editors b mahesh sarma, dr. nimesh chandra

research anupam sinha, aeshwarya tiwari

art director anshul sharma

design rajesh chawla


preambleTo say that management education in the country is going through a crisis is an understatement. An unfavorable global economic environment, tottering domestic economy, shaky business confidence on one hand and massive expansion, rising fees and falling placements on the other, have placed many management schools on the brink.

MBA education in the country is indeed going through a rough patch. And the buffeting has only begun. As the economy tightens further in the coming months, the place-ment season for the 2014 graduating class is going to be all that more tough. Directors of B-Schools bristle at the thought of students and media calculating Return on Investment ( ROI) for something as nebulous as education. Unfortunately, the ultimate value for an MBA or PGDM programmes has always been measured by one number, the CTC one gets in the final placement. The blame probably lies at the doors of the insti-tutions that sold one crore-plus package dreams when the going was good. This dream, impossible to achieve, has come back to bite the hand that feeds it.

It is a choppy sea out there! Institutions better beware!

1.0 rising batch size! falling recruitmentsThe problem is not entirely the making of the B-Schools. They flowed with economic trends. After the global meltdown in 2008, most of the western economies went through a shakeout, but Indian economy was relatively unscathed, and in the period between 2009 and 2012 Indian economy was on steroids, B-Schools followed suit. They expanded as if there was no tomorrow. Look at the aggregate numbers.

Growth of MBA/PGDM seats in India

Year seats % YoY increase cumulative Growth

2006-07 94,704 - –

2007-08 121,867 28.60% 29%

2008-09 149,555 22.70% 58%

2009-10 179,561 20% 90%

2010-11 277,811 54.70% 193%

2011-12 352,571 27% 272%

2012-13 385,008 9.20% 307%source : careers360 research

Indian B-Schools went on a capacity addition spree during 2010-11 and 2011-12 with a massive growth of 54% and 27% respectively. But the economy began slowing down from 2012 onwards, and is now literally sputtering. The reasons could be many, but the fact is the economy as a whole was unable to absorb this growth in numbers.

Take the case of IIM Calcutta, a premier B-School. Compare the text of IIM Calcutta’s Placement Report 2012 to that of 2013. The 2012 report says, ‘...Batch of 2010-2012, kicked off on 20th February 2012 and concluded by 23rd February 2012. All the process concluded by the end of slot 1, with all of the 352 students who sat for the placement process receiving job offers by the end of the fourth day.’

The institute had raised the intake of the 2013 graduating class by 26% to 462. The final placement report came quite late and the language is telling. ‘The 5-day process was a slot based process conducted in the first week of March 2013. Fol-lowing the slot based process, the rolling process commenced on 9th March’.

What the sophisticated phrase ‘rolling process’ in the report hides is the fact that nearly 50-plus students struggled quite hard to get placed. The scenario has repeated in almost all the marquee institutions which increased their intake numbers in 2011.

Bigger number to blame - Indicative listbatch size 2012 2013IIM Calcutta 350 462

IIM Lucknow 380 430

IIM Kozhikode 317 325

IIM Rohtak 37 122

What may be of solace in these dark times is that the melt-down is happening across the value chain. If IIM-C, struggles to place its entire students, what choice does a well-meaning institute located in the back and beyond have?

1.1 the fees too are to be blamed?What made matters worse is that the same period saw expo-nential growth in the fees charged by the institutions. It was from 2008 onwards that MBA became outrageously expen-sive. The deluge began with the IIMs. The IIMA set the ball roll-ing by raising fees from Rs. 4.3 lakh for two years to a massive

PARt 1: StAtuS of MAnAGEMEnt EDucAtIon In thE countRy



11 lakh in 2008 ( See Table above). The rest followed suit.

The fee rise looks much more ominous when one calculates it as a percentage of GDP/Per capita (nominal). India turns out to be one of the most expensive nations in the world to pursue higher education, especially an MBA.

MBA fees as a ratio of per capita - a comparison

country per capita (nominal)

cost of full-time mba

cost as % of per capita

USA 49,922 112,350 225%

UK 38,589 63,800 165%

Singapore 51,162 58,000 113%

Australia 67,723 49,378 73%

India 1,492 23,923 1603%

Pakistan 1,296 11,448 883%

source: per capita info from imf (2012) & tuition fees from institute’s websites. the institutes are - usa: harvard business school; singapore: national university of singapore; uK: said business school, university of oxford; india: iim ahmedabad; australia: university of melbourne; pakistan: Lahore university of management sciences * all figures in us$

1.2 it was too good to be trueAs inflation galloped the fees also were raised regularly every year as the Table on top shows clearly. And it wasn’t pinch-ing since economic growth did raise the salaries too. But it was short-lived. As salaries nose-dived, the ROI became less attractive. With exponential rise in fees, most students incurred huge debts. High fees, falling salaries and rising inter-est rates meant that for a sizeable section of students, ROI on MBAs became negative on an immediate basis.

One could justifiably argue that an MBA is a tertiary quali-fication and ideally its ROI must be calculated over a lifetime. Also that B-Schools are academic institutions that provide education and not placement agencies, and there is tremen-dous value that the alumni network of the school bestows on the students over a lifetime.

None of these arguments appeal to a student who pays over Rs.12-14 lakhs as fees, is jobless or joining a job with a Rs. 4 lakh annual package, and pays an EMI of about Rs. 25- 35,000. He or she won’t buy this logic. Their successors learn from them. And they walk away from MBA admissions.

2.0 decreasing student interestsMBA aspirants are rational beings. Their cost benefit analysis appears to be on the dot. Despite the troubles many IIMs face in placements, the positives that an IIM education provides far outweigh the immediate struggles some of them might face during placements.

The CAT exam saw the maximum test-takers in 2008, when the number of applicants touched 2.76 lakhs. It went down to 2.41 in 2009, 2.04 in 2010, and slightly hit the rising curve with 2.05 in 2011 and 2.14 in 2012. And if the pace of registration for 2013 is any indication the numbers actually might touch or breach the 2008 figures.

The CMAT examination conducted by AICTE too saw nearly 85,000 students appearing for it in its most recent edition.

So the demand for a seat in a top-tier school is only going to get more competitive. But the blood bath happens in the Tier-2 and Tier-3 schools.

Be it Tamil Nadu or Uttar Pradesh or Maharashtra, the pre-sent MBA admission season is in an extremely sorry state of affairs. A Times of India report dated 23rd July says, ‘Over 32k MBA seats left vacant in B-schools of Maharashtra’. In the state, where a total of 45,700 MBA seats are available, only 12,800 seats have been filled after the fourth round of Centralised Admission Process (CAP) by the State Admissions Board. In fact in Nagpur region, 20 schools reportedly did not get a single admission.

The situation is much worse in Uttar Pradesh. In 2012 the state could get just 14,000 applications for the available 24,000 seats. The counselling process saw less than half of

ExPonEntIAl rIsE In fEEs At thE IIMs - InDIcAtIvE lIst

b-schools 2007 2008 2009 2010 2011 2012 2013

IIM Ahmedabad 4.3 11.5 12.5 13.7 14.4 15.5 16.0

IIM Bangalore 5.0 9.5 11.5 13.0 13.0 15.0 17.0

IIM Calcutta 5.0 7.5 9.5 13.5 13.5 13.5 13.5

IIM Lucknow 4.0 8.0 8.0 8.0 8.0 12.5 10.8

IIM Kozhikode 4.0 9.0 10.0 10.0 9.7 9.75 9.75

IIM Indore 3.9 7.1 10.0 10.0 12.0 13.0 13.0

* all figures in indian ` in lakhs

source: careers360 research


them applying for admissions. In Tamil Nadu, the counselling began on July 28 and as on 14th August 2013, nearly 40% seats are vacant. The scenario repeats in Madhya Pradesh, and Gujarat as well.

And this drop in student interest is reflected in the national scenario as well. The latest data from AICTE Approval Process Handbook clearly shows that both PGDM and MBA institutes are slowing down. The preceding tables give a clearer picture.

Between 2011 and 2013 AICTE received 231 closure applica-tions from management institutions. Many schools must have opened up during this period as well. In aggregate there is a loss of about 108 institutes in the last two years. If the news-paper reports are to be believed, next year’s numbers would be quite a revelation.

AIctE-approved PGDM institutes

region no. of pGdm institutes as on 31st march 2012

no. of pGdm institutes in 2013

Central India 33 21

Eastern India 31 8

North-West India 42 64

Northern India 93 48

South -Central India

27 53

South- West India 24 23

Southern India 6 33

Western India 52 33

Grand total 308 283

AIctE-approved MBA schools

region no: of mba institutes in 2012

no: of mba institutes in 2013

Central India 369 372

Eastern India 147 150

North-West India 472 477

Northern India 522 527

South -Central India 943 943

South- West India 277 278

Southern India 395 397

Western India 416 417

Grand total 3541 3561

The number of PGDM institutions in Maharashtra and Uttar pradesh has come down substantially by 46% and 42%. East-ern India too bore the brunt of the slow down with a decline of 74%.

It is regrettable because normally when an economy goes through a downturn, skill and knowledge-building acquires significance and normally institutions do see a rise in enroll-ments. Our hypothesis regarding what makes MBA an odd one out is in two parts, a) it is very expensive and b) students many not believe that there is value to be gained by pursing an MBA. It is these probable causes of lack of trust that we investigate further. It is imperative that institutions, at some point start measuring themselves on the ROI and more impor-tantly, get together, to rebuild the confidence of the student in management education.

3.0 bigger difficulty - lack of informationThe primary reason why students are vary of taking admission in a B-School is because he or she is unable to trust the information pro-vided by the institution. Careers360 has fought innumerable battles with institutions. In fact IIM-A in 2011 informed us that information regarding faculty, infrastructure, placements and research are not in public interest.

What are the factors that a stu-dent must know when he decides to take admission in a B-School?

●● Type of students and their percentile cut-offs●● The quality of faculty●● Level of placements and average salaries and ●● Infrastructure resources

3.1 regulator apathyAICTE, the agency mandated by Govt. of India to regulate technical education does not provide usable information. All useful information that the agency must provide appear to be perpetually under construction. Barring a list of approved institutions, all new approvals, application status, accredita-tion, out put info, college data etc., are all hidden under a portal, which demands a user name and password. Thus data, which otherwise must be publicly available is now restricted and hidden.

3.2 mandatory disclosures of aicte All AICTE-approved colleges are supposed to upload crucial data on all parameters under the head of Mandatory Disclo-sures (MDs) on their website. Out of the 577 AICTE-approved colleges we surveyed, only 19 of them of them gave us com-plete data. At least 16 of them of had a file which was either corrupt or did not open. And140 of them did a have a file but the information was incomplete with respect to both place-ment and admission criterion. More than half the institutes have skeletal information. 211 institutions have mandatory disclosures, which are at least two years old.

source: aicte annual report 2011-12 and http://www.aicte-india.org

84 DECEMBER 2011360CaREERs

Cover Story Data

IIMA: Are there skeletons In your cupboArd?

From our first issue, we have been harping on the need for institutions to be transparent. Each year we have faced varying degrees of difficulty in getting data from institutions. Ironically, even though there is no bind-

ing government directive, most private institutions at least provide us some information. But invariably it is the public institutions who behave like ostriches. An IIM director almost abused our reporter for having the temerity to file an RTI with 32 questions. We are forced to file them because institutes do not give out data, which is routinely available in any self-respecting foreign B-School. This year ,interest-ingly, we got responses from most IIMs and half the IITs. But this response from IIMA takes the cake!

We asked IIMA questions regarding, programme, student qualifications, faculty qualifications, teaching load, publica-tions record, amongst other things. The Public Information officer decides there is “NO PUBLIC INTEREST IN THE INFORMATION YOU ASKED”.

If the way IIMA, which is built on tax payers money runs is not of public interest, what else is ? And who gave the PIO the power to decide what is of public interest? We have of course filed an application with the appellate authority. But the point is that IIMA as a standard bearer of management education in the country must have been the first to disclose these information pro-actively in the public domain. They must inform what is the productivity of their faculty, how much money the institute makes, how many papers does the faculty publish and where do they publish them.

We filed RTIs with 24 institutes. some asked us for money, for documents. some asked us to come and inspect the records, ourselves. But IIMa said, informing the public is not of public interest

Response from IIMA to our RTI Request

If IIMA publishes this kind of information other players would be forced to follow suit. And the general level of man-agement education in the country would improve.

We wonder, does the grand daddy of management educa-tion, have feet of clay?

84_Data.indd 84 29/11/11 4:42 PM



level of completeness of mandatory disclosure

Quantum of information no of instt %

80% and above 61 11%

60-80% 19 3%

40- 60% 111 19%

Less than 40% 386 67%

3.3 how do other government & private institutes fare? If the case of AICTE-approved institutions is far from satisfac-tory, the case of recognized universities (both public and pri-vate) is no better. The Government of India has mandated the publication of minimum disclosure for all these institutions. But most of the institutes surveyed (including the IIMs and IITs) gave out very little information, barring a few exceptions.

3.4 institutional website statusWebsite is the primary source in this connected world. Out of the 1019 colleges we surveyed, 429 websites either did not exist or does not open. That is, 42% colleges have given us no means to contact them. The information brochure, placement brochure are primary sources of information for any potential B-School. But they too provided very little useful information.

4.0 is mba/pGdm past its prime?The sheer fact that good schools, despite the doubling or quadrupling their number of seats are seeing a rise in appli-cation shows that students see value and appreciate a good education. Exams like NMAT, and XAT are seeing a rise in the number of test takers. In fact XAT which was falling from a high of 1.02 lakh applicants in 2009 dipped again before notching 0.92 lakh in 2012. The figure again fell in 2013. But the num-bers are quite on the rise this year. According to Prof. Vishwa Ballabh, Chairperson, Admission, XLRI Jamshedpur, XAT 2014 saw 2700 applicants on the first day of opening of registration. So good schools are back in the reckoning, though they need to be careful about indiscriminately increasing their number of seats.

4.1 What makes a good school?Infrastructure, faculty, MDPs, alumni and research appear to differentiate great schools from the rest. Having been rating B-Schools for the last four years we see a new trend emerging. Each year we examine over 100 B-Schools’ data to create a ranking for B-Schools and in the process have a sizeable data on over 30-odd parameters for nearly 250 B-Schools. They are a reasonable representation of the universe of over 2500 schools in the country. Schools are increasingly attempting to add value across the board to both themselves and their students. And that has resulted in Tier-2 schools emerging in many mini-metropolitan cities like Mangalore, Coimbatore, Mysore, Nagpur, Vizag, Madurai, Bhubaneswar amongst oth-ers. What does the data say?

4.2 publicationsThis is one of the biggest positive changes that is visible from

the schools’ side. Out of the 161 schools that submitted data to us for ranking last year, 61 had a journal. Though most of them are not refereed and periodicity is suspect, it is hearten-ing to note that at least more than one-third of the schools had some form of publishing activity up and going. Since last year we have been using Web of Science data published by Thompson Reuters © and Scopus data by Elsevier © to meas-ure the publication record of B-Schools. And the results are quite revealing. Of the 221 schools we searched for data, only 67 schools have published in international refereed journals. The top 10 schools account for nearly 40% of the total knowl-edge production by the top 200 schools in the country.

top ten schools in publicationIIM Bangalore

IIM Calcutta

Indian School of Business, Hyderabad

Management Development Institute (MDI), Gurgaon

IIM Lucknow

Indian Institute of Science (Department of Management Studies), Bangalore

IIM Ahmedabad

IIT Madras (Department of Management Studies)

IIT Bombay (Shailesh J Mehta School of Management)

Just two out of the top ten schools are from the private sector, and three out of 10 are departments within IITs or IISc. IIMA, the pioneer of management education in the country is behind even IIM Lucknow. In their quest to do more Research Reports and MDPs the faculty at IIMA appear to have forgot-ten the primary focus of publishing high quality research.

What matters is the bottom 20 schools in the list. Of them, 16 are from the private sector and nine of them are PGDM institutions. The fact that private-funded institutions with lim-ited means are attempting to compete with good institutions is heartening to note and gives some hope that a number of young private players are attempting to up the ante.

Institutes with at least 10 publications in a year (2011-12)Xavier Institute of Social Service, Ranchi

Indian Institute of Social Welfare & Business Management (IISWBM), Kolkata

Jaipuria Institute of Management, Lucknow

Amrita School of Business, Coimbatore

Great Lakes Institute of Management, Chennai

ICFAI Business School, Hyderabad

University of Delhi (Department of Business Economics - DBE), New Delhi


Institutes with at least 10 publications in a year (2011-12)Institute of Management, Nirma University (IMNU), Ahmedabad

IIM Shillong

Indian School of Mines (Department of Management Studies), Dhanbad

SP Jain Institute of Management Research, Mumbai

4.3 alumni - the new frontierAlumni remain the most visible ambassadors of a school. Their achievements reflect the school’s efficiency. Unlike interna-tional schools, very few Indian schools provide the database of their alumni to research/media organizations. So we used data from LinkedIn, the largest professional networking platform.

Social media has begun to plays an expanded role in the way we communicate and connect with each other. A recent research report suggests that by 2014 over 30% of all recruit-ments would happen online. Unfortunately barring a few top schools, especially in the metros, none of the B-Schools have attempted to leverage this platform. Out of the 200 schools in our consideration set, only 75 schools have LinkedIn alumni presence. We analysed at least 15,801 profiles to arrive at a LinkedIn profile of alumni for these 75 schools.

The profiles were grouped based on the designations that the alumni have as well as the type of companies they work for. The designations were grouped as Manager, Dy. Manager and Executive. The companies were grouped as MNCs, large PSUS/companies, small or emerging companies. The findings gelled well with the hypothesis one has about the standing of a B-School. One would assume that a top of the line B-School, which admits students with work experience, will have alumni

working for consulting profiles in top companies, while as a Tier-2 school with a location disadvantage will be dominated by sales profiles. The data bears us out.

linkedin Performancemanager dy manager executive

top 10 49% 52% 9%

Middle 10 7% 32% 60%

Bottom 10 4% 14% 82%

The top schools are dominated by managerial positions. If you look at the top 10 schools, none of them have more than 10% of their total alumni profile in executive roles. The bottom 10% is totally dominated by entry-level functions. Each of the bottom 10 schools have not more than 2 % of the alumni hold-ing managerial profiles, there by clearly establishing a differ-entiating tool for both the recruiters and the aspirants. Unique phenomenon like a Tier-2 school predominantly favoured by PSUs, a remote-location school finding favour with consulting companies, schools with only executive profiles also came up in our analysis

We also examined the functional area in depth. Even here consulting function dominates the top tier schools. Sales is the most visible function as we go down the list. For more information on the alumni performance, and recruiting styles of companies visit your schools page at www.bschool.careers360.com or read the story on our web archives.

4.4 student diversityGreat students gave IIMs their distinctive identity. The fact that just about 0.03% of the students who apply get into IIMs give the recruiters a certain confidence about the quality of these

so whAt

Do wE know

ABout 2012

AluMnI

l IBM, Infosys, Accenture, Oracle, TCS, and Cognizant Technology Solutions are bulk recruiters at IIM A, B, C. They also recruit across Tier 1 & 2 schools.

l Global consulting like Boston Consulting Group, McKinsey & Company, Bain & Company, AT Kearney, Booz & Company, Accenture and Deloitte recruited for consultancy, research & executive profiles.

l Barclays Capital, Citibank, Deutsche Bank and Nomura are among investment banks where 2012 students joined. Others such as ICICI, Royal Bank of Scotland, Yes Bank, Axis Bank also recruited in large numbers.

l Many alumni took up roles in sales and marketing in firms such as ITC, Airtel and Supermax and Procter & Gamble.

l According to the data captured, IIM-A has 17.2%, IIMB 10.5%, IIMC 5.2% of 2012 alumni living abroad, whereas in IIM I,L,K this varies between 0-2 %.

l If we talk about students going abroad numbers, ISB Hyderabad tops the chart with 93 alumni placed abroad.

l Going entrepreneur way are more from IIM A,B,C vis-a-vis IIM K, I, L.

l A significantly large number of IIM alumni are working in sectors like Consultancy, Business Development and IT as depicted through graphs.

l For other good schools like University of Delhi (FMS), XLRI Jamshedpur a majority of alumni work in consulting space (21.9% & 23.75 % respectively).

l XLRI Jamshedpur has 26.3% of its 2012 alumni going for HR role, however, trend is different in Great Lakes as 35.2% is in business development.

l In case of JBIMS, 33% alumni go for HR and Administrative roles.



students. What is interesting is the fact the schools appear to be consistently working on getting better students.

schools with experienced students

name of the institute Work exper> 2yrs.

Great Lakes Institute of Management, Chennai

99%

Indian Institute of Management, Lucknow 53%

Symbiosis Institute of Operations Management

46%

Prin L.N. Welingkar Institute of Management Development & Research, Mumbai

45%

IIT-Delhi, DMS 43%

Even Tier-2 schools which participated in our ranking have at least 20-30% of their batch size with work experience. While little could be gleaned about the quality of the experience, it is commendable that schools are focusing on creating a better student body consistently.

Cut–offs too are an indicator, but there are enormous dif-ficulties in identifying cut-offs, since at the last count there are over 42 different entrance exams and most institutions use more than one entrance to admit students. But what is visible is the fact that cut-offs do go down as one goes down the pecking order.

4.5 the biG mYthUnfortunately, aspirants as well as some recruiters have a myth about CAT schools. These schools are perceived to be having a higher quality of students since they admit students through CAT. Nothing could be farther from the truth. CAT is an eliminating entrance test, with difficulty levels touching stratosphere so that they could eliminate 99% of the test- takers. So while percentile could be 90, the absolute score a CAT test-taker could be as low as 10 or 20. So a 90 percentile MAT students might be as good or as bad as 85 percentile CAT taker. But the myth lives on!

4.6 Gender diversityIndian B-Schools, especially at the top level are poor in ensuring gender diversity. The biggest culprit in our data set is DOMS, IIT Madras which has a 1: 6.5 ratio of males to females. The other members are not far behind. But there are schools like Prestige, IBS Hyderabad; Sona, Salem; MANAGE, Hyderabad; IMS, Kolkata which have a ratio of 1:1 or even 1: <1 where girls are more than boys. Way to go!

Gender diversity in IIMs

name of the institute male: female ratio

IIT-Delhi, DMS 6.50

Indian Institute of Management Lucknow

5.97

MDI, Gurgaon 5.48

Symbiosis Institute of Operations Management, Nasik

4.83

Institute of Management Technology, Ghaziabad

4.80

4.7 Quality of facultyFaculty unfortunately has become a ’hygiene’ factor for a B-School. Its presence is never feted, and absence notified. World over, quality of faculty is measured by the research output, their consultancy work and the MDPs/EDPs they put together. Their immediate quality is measured by their tertiary qualifications. Only the top schools have a faculty with large PhD qualifications. While most IIMs, MDI, XLRI etc have almost 90-100% of their faculty with tertiary qualifications, the num-ber drops drastically as we move beyond the top 50 B-Schools.

Percentage of faculty with PhDname of the institute phd/ fac ratioIndian Institute of Management, Bangalore

98%

Indian Institute of Management Lucknow

92%

MDI 84%

Institute of Management Technology, Ghaziabad

88%

None of the institutes provide detailed information on the nature of experience of faculty. AICTE demands that teach-ing, industry and research experience are segregated. Since teaching and research go hand in hand, some professors give you the same number of years in both the cases. What is worse, if someone is working full-time in the industry and teaching part-time, they are accounted separately. This results in instances where a 50-year old faculty claims over 70 years of total experience.

4.8 international facultyThis is another factor that is catching up with B-Schools. Many schools now bring in faculty from B-Schools abroad for a term or two so as to expose their students to global think-ing. Schools like ISB, Hyderabad and Great Lakes primarily depend on international faculty for their programme delivery and even use it as an USP. Out of the 200 schools surveyed not more than 15 have international faculty.


4.9 academia-industry interfaceWhen one does R&D, investment is converted into knowledge. A basic fact is that most of the B-Schools in India do not give due weightage to the notion that when one innovates, the new knowledge thus created brings more money. And this is so because the focus of maximum number of B-Schools is on teaching and not on integrating research with teaching. Innovation, which gets better as institutes engage more with industry, is simply not on the mission statement.

Of the top 120 B-Schools in the country, 43% did not report any industrial consultancy while 31% had less than five industry assignments on an annual basis. The earning through industry consultancy in B-Schools is also dismal with an annual earning peak of Rs. 250 lakh in a top B-school. While every institution has its own norm of devoting X no. of days for consultancy in a year, (for instance in IIM-A, a faculty can do a maximum of 53 days of consultancy), the larger fact remains that the number of faculty members willing to actively par-ticipate in industry interaction is extremely low even in the best of B-Schools.

Management Development Programmes, another indicator of industry interaction, suggests them to be underplayed as 45% of the top 150 B-Schools in Careers360 ranking survey reported no MDPs in two years. Some 34 B-Schools shared that the earnings through MDPs was more than Rs. 1 million in two years while 10 Schools reported more than Rs. 10 mil-lion in two years.

4.10 entrepreneurship cellsAnother mode of industry interaction for academia is through Entrepreneurship Development Cells. With the AICTE estab-lishing 62 new E-Cells at institutions in 2011-12, most of which offer PGDM/MBA, it is a good effort, provided activities in these cells are monitored to yield results. The Industry Insti-tute Partnership Cell (IIPC) operated by the AICTE is to foster interface between the two entities by giving a grant. But this is largely dominated by engineering institutes.

Distribution of grant under Entrepreneurship Development cell (2011-12)

type of institution no. of projects

Grant amount (in rs. Lakhs)

Deemed University/ University Department

1 4

Government/Govt. Aided College

7 56

Self-financing Institutions

54 288.69

total 62 348.69source: aicte annual report 2011-12 and http://www.aicte-india.org

4.11 infrastructureThe prominent elements contributing to infrastructure in a B-School include classrooms, library, books & e-resources, laboratories, ICT tools and services, residential facility on cam-pus, and enabling environment such as indoor and outdoor game arena, discussion area, incubation unit et al.

As per the Careers360 2012 Survey covering 577 B-Schools, the following outcomes were seen:

library Books39% institutes had 1000-10000 books

38% institutes had 10000-25000 books

19% institutes had 25000-50000 books

4% had over 50000 books

residential facility80% of the B-Schools we surveyed had some sort of residential facility. But when we examined it, most of them were outside the academic premises and were primarily reserved for either outstation students or women. Only 14% had 100 percent accommodation for both male and female students.

Only 11 campuses were integrated in the sense that they had residential, academic and recreational facilities; all located within the same premises. When quizzed, most students did place a premium on integrated campuses, other things being equal. Some of the students we talked to were willing to consider a good campus, even outside the city limits, if it has integrated facilities

For faculty, only 46% of the B-Schools had some kind of a residential facility. Only 3% of the B-Schools were fully resi-dential campuses where both students and faculty could stay.

Faculty accommodation plays a very crucial factor in foster-ing learning for students. Availability of faculty after office hours facilitates a relationship that might contribute to learn-ing, which is long lasting and deep. But very few campuses appear to provide such facilities.

e-resourcesThere has been an exponential growth in the use of e-resourc-es be it e-journals, periodicals, or online databases. More than 60% B-Schools have invested in making their campus wi-fi. The top B-Schools have 100 Mbps campus network connectiv-ity with a 2 Mbps dedicated Internet connection reaching out to each hostel room.



5.0 regulatory regimeThe love-hate relationship between the regulators and insti-tutes continue. A legacy of the License Raj, the regulatory regime is still warped in a mind-set that treats private sector with tremendous suspicion. So norms are more in tune with inputs, like land, machines and infrastructure. But nothing or no norm exists for output. This has resulted in unscrupulous elements circumventing the system and getting requisite permissions.

5.1 What are the issues?Focus on mundane inputs: No creative tweaking of norms. Computer lab still appears as a mandatory facility even while institutes are moving towards ubiquitous computing through iPads and smartphones.

Restrictive academic norms: Absolutely no space for innova-tion in programme, like industry connect. If an institution ties up with a corporation for long-term internship, it would fall foul of the attendance norms of AICTE.

Interference in admissions: Even as there are five national admissions tests, AICTE comes up with an additional test making it mandatory. The objective is laudable, to reduce the number of tests that a student must take. The regulation is under litigation and the Supreme Court has extended the stay on this regulation and allowed institutions to admit students based on any of the six national tests.

Freedom to raise the number of seats or open satellite campus: The regulator has no bandwidth to permit well-performing institutions that seek growth and expansion to either increase the number of students admitted or allow the institution to open a satellite campus. The procedures are cumbersome, daunting and intimidating, to say the least.

Distance learning: A big quagmire wherein as on date there is no clarity on the validity of a distance learning MBA and uni-versity degrees offered by study centers outside the territorial jurisdiction of the university. There is also confusion regarding the regulatory authority for MBA programmes in the light of the recent Supreme court judgment.

Way forwardThe markets are falling, sentiment is negative and students are deserting in droves. These are best of times and worst of times! Only good institutions would weather the storm and emerge stronger. The least that all the stakeholders could do is band together and fight. ●● Are institutions willing to up the transparency quotient? ●● Are corporations willing to invest in good schools? ●● Are regulators willing to assist and promote rather than

resist and obstruct? ●● Will we have a better MBA ecosystem in the country?

The 3 lakh-plus students who opt for the programme deserve every bit if it. Are we up to it?



PARt II: B-School AluMnI SAtISfActIon SuRvEy RESultS

Satisfaction of alumni is the best indicator for a job well done by any educational institution. We ran a survey for the last two months to examine how satisfied the students are. After

S.1 I am getting/got the full value from my MBA/PGDM programmeA. After spending crucial time for a course that radically influences one’s career progression, if 31% feel they are not happy with their decision to do a management programme, it does reflect a grave problem. B-Schools in the East zone, however, had a better satisfac-tion response, possibly due to good schools focusing on industry- integrated curriculum and relatively better job prospects as noted in the survey.

S.2 My B-School’s faculty is/was up to the mark and their teaching methods added tremendous value to meA. In India, where the learning in classrooms is highly dependent on the theoretical inputs and text book content as compared to foreign B-Schools where candidates with professional work experience are any day more; 64% of satisfied respondents is a blessing in disguise. And if one in three candidates disagree with the pedagogy, they seem to be aware of what they are missing.

getting responses from 1228 students, through direct contact and through forums, we grouped them, cleaned them up and analysed the data. Here are the findings

strongly disagree

7%

strongly agree

24%

disagree

24%

agree

45%

strongly disagree

5%strongly agree

25%

disagree

31%

agree

39%

S.3 I feel there is/was a learning environment in my B-SchoolA. 78% is quite satisfied with the professional ambience in the institute. This largely stems from the reality that the average age of budding managers is quite low vis-à-vis the global average of say 32 years. But one cannot ignore the fact that a number of B-Schools are increasingly placing a lot of emphasis on the latest business practices, tools and trends that are found everywhere in the world.

strongly disagree

5%

disagree

17%

strongly agree

31%

agree

47%

s: statement a: analysis



S.6 My B-School taught me that life is much more than just maximization of profit or survival of the fittestA. Ethics appears to be on a slightly weaker wicket. What must have been an overwhelming vote of confidence stops far short of that. About 26% (one-fourth of the sample) do not agree that the school where they studied taught them values, which are beyond immedi-ate gratification. Competitive spirt appears to be the prime factor for not focusing on ethics

S.5 MBA programme helped me improve my soft-skills and grooming.A. This is in line with the imperative course modules that state what management as a discipline is all about. Effective communication, personality grooming, nurturing creativity, arguing your point out – are such skills that prove the 87% of satisfied respondents right.

strongly Disagree

7%strongly agree

38%

agree

36%

Disagree

19%

strongly Disagree

3%

agree

48%

Disagree

10%

strongly agree

39%

S.4 I’d recommend the specialised MBAs offered by B-Schools, e.g. MBA (Pharma.), MBA (Real Estate), MBA (Telecom)A. The trend to pick up a niche area and focus a lot more on the specialised domain is still not in the populace (45% versus 55%). The charm of an evergreen field like Marketing, Finance, Human Resource or Systems where employment opportunities are sizeable outshines the possibility of spending two years in an industry-specific course.

strongly agree

16%

strongly Disagree

18%

agree

29%

Disagree

37%


S.8 My B-School’s Career Center/Placement Cell is/was of great help, with regard to industry interface, summer and final placements.A. Placement offices better shape up. While 40% students are happy an almost equal figure, 39%, appear unhappy. The poor quality of offers, bad or unknown companies being brought in to shore up the numbers and outrageous rules for participation in campus place-ments are the most common issues that students crib about.

S.7 My B-School batchmates and alumni are of great help to meA. Alumni appear to be supportive. About 73% (over 2/3rd) of the population agree that the alumni did provide help. According to the respondents, finding a guest speaker, organizing summer place-ment and putting in a good word for final placement are the three major issues in which alumni are of help.

strongly Disagree

15%

strongly agree

22%

agree

39%Disagree

24%

strongly Disagree

7%

agree

46%

Disagree

19%

strongly agree

28%

S.9 My B-School offers best in class infrastructure – library, canteen, campus, hostels, computer labs, auditorium etcA. “Can I have some more?” appears to be the common lament of the students. Even respondents from schools which boast of reasonably good infrastructure appear to be wanting more. Nearly 33% of the respondents would like a substantial improvement in their institu-tional infrastructure. Bad or insufficient residential facilities appear to be the common grouse.

strongly Disagree

7%

agree

45%Disagree

22%

strongly agree

26%



S.12 I would recommend my friends/relatives to do an MBA.A. This statement reflects the faith students have in MBA as a worthy credential to pursue. Just over half of the total respondents agree that they would recommend the degree to their juniors. The fact that only 18% students have decided not to recommend the degree shows the inherent resilience of the credential.

S.11 The Return on Investment (ROI) on my MBA/PGDM is good.A. 37% of the sample size says their ROI is no good. Higher expec-tation is a prime factor for this disappointment. But higher costs, killing interest rates and general rise in inflation too have added to the worries of the students. Quite a few respondents when quizzed lament that their current pay package is just about sufficient to cover the EMI of the education loan.

strongly Disagree

11%agree

39%Disagree

26%

strongly agree

24%

S.10 A recognized degree by AICTE/UGC is crucial.A. The faith in education regulator is on the wane. Not more than 20% of the respondents consider an approval as very crucial. Rec-ognition by industry and evidence of strong placements are the most crucial factors according to the respondents. “Many approved schools are pathetic” is the common refrain when quizzed about their disagreement.

strongly Disagree

9%

agree

39%

Disagree

10%

strongly agree

42%

strongly Disagree

5%

agree

53%

Disagree

13%

strongly agree

29%


S.14. I am satisfied with my job placement after passing my MBA.A. 44%, that is, nearly half of the respondents contend that they are not happy with the placements they got from their school. If we slice this data year-wise, nearly 78% of the students who had passed out in 2013 have responded negatively to this statement. In other words, the most recent placement season is also the worst as far as quality of the jobs is concerned.

S.13 I would recommend my friends/relatives to join my B-School.A. Here is a matter of concern. 36% of the respondents say they will not recommend their school. And more than 10% very strongly hold that opinion. The fact that at least one-third of the universe has no faith in their own alma mater must serve as a wake up call for the institution. “Over promising and under delivering” is the common refrain when these respondents are quizzed as to why they will not recommend their alma mater.

S.15 My MBA is valued by the industry I am working in.A. 33%, that is, one-third of the polled alumni perceive that there is little or no value in the course they have pursued when they go to work in industry. The respondents cite outdated curriculum, over reliance on theory at the cost of practical exposure, lack of training in building skills as the most important causes for this level of obso-lescence in their programme.

Disagree

11%

strongly Disagree

21%

strongly Disagree

23%

agree

39%

agree

37%

Disagree

22%

strongly agree

29%

strongly Disagree

13%agree

37%Disagree

23%

strongly agree

27%

strongly agree

18%

The responses to majority of questions posed to MBA can-didates invariably suggest an increase in the dissatisfaction levels on parameters as varied as course curriculum, teaching techniques, niche specialisations, placements, add-on value, return on investment, infrastructure and regulatory regime. The most telling thing noted was the discontent shown in

recommending the MBA programme to aspirants and half of the pass-outs not being happy in their current jobs. Moreover, competitive spirit seemed to outshine ethics. The saving grace for management education was reflected in the respondents expressing their satisfaction on peer learning, alumni support, and a sound environment for gaining knowledge.

SUMMInG UP



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Management Education in India - September 2013

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Transcript of Management Education in India - September 2013