Placements 2006: Of Laterals, Media Hype & Collateral Damage

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First, there is no Rs. 80 Lakhs salary offered in India. The figure was USD 193,000, which is for overseas location, and hence converting it straight into INR is nothing but a matter of fiction. The more notable comparison would have been to see at par salaries offered at global business schools, and from that it can be affirmed that IIMs have truly arrived in the global markets and have now become part of recruiting calendar of top recruiters.
In class of 2005, the average median base salary at Harvard Business School was USD 90,000 + additional compensation, like bonus and commission, while at IIMB this year, gross salary was reported at USD 193,000 (base salary figure was not provided, but is rumored to be USD 73,000, with USD 120,000 in additional bonus (sign-on and annual). Further, average dollar salary at IIMs has been in range of USD 75,000 to USD 85,000, which is quite near to median of USD 80,000 being bagged at Harvard. Of course, the bonus component is not included in Harvard salary, which will set it quite apart from IIMs, but none the less, the top-end of IIMs is quite at spitting distance if not par with its global peers.

But these figures have another trend, which conveniently got ignored in all this reportage. It were not rookies or oven-fresh graduates who had bagged these headline hogging jobs, but seasoned professionals who have gone into business education after putting some years at work, and for whom MBA is just not a degree but an attempt to get back to basics after getting hand dirty. Like their counterparts in West, the class composition is slowly changing at Indian B-schools, where the laterals are grabbing job offers with higher pay - and the story has been similar at all IIMs, where at IIM-L a record 105 lateral offers were made, while at IIM-C over 72 lateral job offers were made with 8 international offers, and in the same spirit Rs. 30 Lakhs job offer at IIMA was bagged by a civil servant. In a way, this is in line with global trends where in Ivy League B-schools, average pre-MBA experience is 4 years as compared to India where almost 80% of the class is fresh graduate, and hence, is more rooted in theory than application. And while 4-5 years back, companies were not open to recruit MBAs with high pre-MBA work-ex, today they are chasing the seasoned professionals, and this in a sense signals the dawn of maturity on corporate recruiter.

However, coming back to the hype part, it is clearly visible that salaries were as per the industry standard and any civil servant of significant vintage with or without IIM tag will get Rs. 30 Lakhs (with 15% variance) from Industry. In fact, lot many software professionals with 10-15 years of work-ex make more than Rs. 30-40 Lakhs per year. So if someone with 10 years of hardcore relevant experience joins at Rs. 30 Lakhs, it is hardly news. Moreover, in designing compensation, a lot many factors are added which are not visible to common public, for instance one of the leading bank adds Rs. 1.5 Lakhs p.a. in the salary as part of canteen expenditure and also potential saving from Rs. 20 Lakhs home loan that one is entitled to at a subsidized rate!!!

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