It all took a worldwide recession to break the myth of the great Indian MBA dream.

It all started with the liberalisation in early 90s when MNCs started coming to India and fabulous placements in 2000 saw the critics singing hosannas about the Indian MBAs arriving on the global market place. This coupled with Information technology boom saw dramatic increase in salaries. Job opportunities multiplied.

And suddenly the focus shifted on the need of management professionals as required by the MNCs and the Indian corporate. Increasing salaries at IIMs gave birth to Indian MBA dream of making it rich quick. The later half of 90s saw mushrooming of the B-schools in every nick and the corner of the country, all promising jobs with multinationals with good salaries graduates can only dream about! It was no surprise that gullible people fell for the great Indian MBA dream.

So what happened to the dream in times of recession?

Internationally, at US B-schools placements 2002 have been in pretty bad shape. In Harvard and London Business School, there are reports of 10-20% of the batch being without a job-offer till reports last came in. In other B-schools, apart from Ivy League B-schools, the scene is equally bad.

Back home, placements at XIMB, NITIE, SPJIMR and NMIMS are over, and last year, while schools were falling over each other to share their placement data, Omerta has become the word for these B-Schools this year. Ditto goes for some of the IIMs.

The brunt of recession has been borne out by the small management institutes all over the country.

Most of the fly-by-night operators behind the mushrooming of the management institutes in B & C class towns are facing an uphill task. With the recession forcing the corporate to go slow on hiring to reduce expenditures, only the critical vacancies are being filled up. Recruitment of management trainees is the first casualty. Corporate are going to top-tier (read top 15) B-schools for relationship building. They are recruiting only minimum management trainees so that they can get enough raw management material for future managerial requirements. There is no bending over backwards to recruit heavily.

With average offers per company declining drastically, companies are getting their limited requirements fulfilled at top 10 B-schools. Consequently, they are not looking beyond first tier B-schools. This has important ramifications for tier II and tier III B-schools. This year good companies are not coming to these schools for recruiting unlike last two years when these companies came to recruit from tier II and even tier III B-schools, as their recruitment requirements were not fulfilled by tier I B-schools, since most of the students from IIMs were placed abroad.

Lack of good offers in top half of tier II has been evident this year. B-schools like FORE, IMI are facing a tough fight to place their people with good companies, and around 20% students at these Institutes are yet to be placed. This is compounded by the stark fact that there are very few offers on table for second half of tier II and tier III.. Plainly speaking, there are no recruiters at all! And students are at sea!

Consequently, students who paid around Rs. 60,000-1,00,000 for 2 year MBA programme are desperately searching for a job to start their professional career. And lack of employment opportunities in a recessionary market is a spoilsport to the glorious dreams shown to them when they were ushered in these management insitutes.

The great Indian MBA dream has turned sour. And so fast! Atleast for the tier II and tier III B-schools. The IIMs and other top B-schools have established their reputation over the years and have managed to stay afloat in the recessionary market, but the brunt of recession has been borne by the others.

So where do we go now?

There is a lesson in this for all the stakeholders involved and the potential entrants.

Management Institutes set-up overnight has to realise that they need to invest in basic infrastructure rather than merely setting up a institute in a rented place. They need to invest in the faculty with rich field experience, and good academic background. Rather than learning by rote from books, management education has evolved as an art, leaning heavily into case-study based learning. This is where the other institutes, apart from IIMs and other top-10 B-schools, fall short by a great length. Investment in IT facilities, like LAN, computer use in professional work, etc., should be accorded priority

Interaction with industry involving learning from good cases are a prerequisite for a good management education along with training in the efficient and effective use of IT for maximising the returns to the employer. The sooner the tier II and tier III B-schools realise this, the better.

As for the current students, they should ask amangement for more industry exposure and making cases more industry relevant besides developing their IT skills.

As for the MBA aspiarnts - Do not go by the size of the hoarding and the building of the Institute. Go and visit the Institute. Ask for information from the management on the issues, like industry exposure, industry relevant courses and the past employment-records in the last 2-3 years. Best bet is to interact with the current and past students of that institutes who would give you a correct picture about the place along with the details of employment assistance offered by the Institute.

Be cautious!

IIMs have shown that there is more substance in the Indian MBA dream. You just got to find the right institute!

Amen!

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Placements 2001

Read complete story of Placement 2001 as it happened along with analysis and comparison across the B-Schools and segment-wise analysis.

Placements 2000

Read complete story of Placement 2000 as it happened along with analysis and comparison across the Indian and US B-Schools and segment-wise analysis.

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