The flood of PSUs at b-schools may reduce

“Where will the jobs come from?” was the question that was doing the rounds of b-schools when news of the economic slowdown came through. Public Sector Units (PSUs) provided the answer and picked up a lot of MBA graduates from across the country. The jobs crunch helped PSUs get quality students at lower salary levels while b-schools were able to secure jobs for their students. PSUs featured prominently in this year’s placements at prominent institutes and were considered to be the saviours of the day. However, they too are not immune to the problems of the economy. PSUs are facing problems with finances and some prominent units such as Bharat Heavy Electricals Limited (BHEL) and Oil and Natural Gas Corporation (ONGC) are accused of faulty incentive schemes.

There has been a reduction in the profit levels at PSUs and this will create problems in expansion and start of new projects. The government has also planned to retain a 51 percent stake in PSUs while releasing the remaining percentage to the public.

B-school faculty believe that MBA graduates will not be affected by these developments because public sector banks have been the primary recruiters at institutes whereas PSUs from other sectors are mainly involved in these issues. Amrish Sharma, placements officer at the International Management Institute, Delhi (IMI) has a positive attitude towards disinvestment and says, “Opportunities will increase if a private player is involved in PSU operations.” He adds, “PSUs which are running in losses did not recruit from business schools.”

This placements season did see b-schoolers compromising on salaries so that they could take up campus placements. It will be interesting to see if PSUs return in full strength in next year’s placements or if public sector banks get affected and they are unable to recruit b-schoolers. If the second case were to happen and private sector hiring does not return to what it was in boom times then b-schools will face even more difficulties in placing all students. As Munish Bharagva, Placements chairperson at Indian Institute of Foreign Trade (IIFT), Delhi says, “We’re keeping our fingers crossed. The first quarter results have not been good. We’ll have to wait and see how things turn out in next year’s placements.”

UGC gets a move on to set common standards for institutes

Officials of the University Grants Commission (UGC) have kicked and screamed that the UGC cannot be shut down like a factory. However, the UGC is waking up to the fact that some kind of standardization is required in India’s higher education sector. There are various kinds of universities in India and students are graded according to different standards. This can cause issues when students wish to apply for further studies in India or abroad. It is encouraging that the UGC has recognized this issue and has set up a committee to frame a credit transfer system.

This is a small step which may help bring some standards to education in India. Such a system will also help students to not have any confusion about which institutes they can apply to after completing their course. Institutes should also be told to clearly disclose the credits given to various courses so that students know from the beginning what they are getting into. Sometimes students are confused about the value of degrees offered by institutes and prospects after graduating from a particular institute.

An official credit transfer system is definitely a welcome move but India’s universities urgently require opening up of the various disciplines which are offered at universities. As suggested in the Yash Pal report, students should be allowed to opt for courses from various disciplines offered at a university. I think that it’s a waste of resources if a university offers disciplines such as engineering, medicine, management, sociology etc and does not allow a student of say engineering to take any subjects from the other disciplines. Studying subjects from various disciplines will help students to get a wider perspective of things and learn in a holistic manner.

It will be interesting to see how the credit transfer system is designed and how courses at institutes are evaluated. I hope that it does not prove to be simply an academic exercise which does not provide any insights into the quality of the program offered. Courses should be rigorously examined and the system should ensure that comparison across programs is possible.

Time to revise the way a would be manager is selected

How do you become the best business school in any country? Is it by concentrating on the quality of students graduating out of the school? Or is it by concentrating on the kind of students that enter your business school.

There is nothing wrong with that; the students that enter a top business school ought to deserve being there. They need to be the crème-de-la-crème of the entire applying lot to be at premier business institutions and become future managers of prestigious businesses. However, are we sure that the selection processes in business schools really sift the deserving from the not-deserving? I am guessing no. Many business schools select students on the basis of their profiles which will benefit them (the school) later in their placements; higher placements mean higher ranking of the school. However, not reason enough to select a great manager in the making.

CAT or the Common Admission Test is supposedly one of the most difficult and competitive test you would have to take if you plan to be an MBA.  Many take it for years together before cracking it finally. They slog, burn the midnight oil (sometimes thrice over) before they are able to get that coveted percentile. However, wasn’t CAT supposed to be a logical test? Logic not developed by slogging but inherent to a person.

The Group Discussion and the Personal Interview: The candidates who finally convert a call for admission have an academic background to kill for and in some cases work experience in the social sector. This aspect of the decision making process by the schools is so known-to-all that candidates have devised methods to play around it. They join an NGO at such a time that they get the work experience without their interviewers getting the hint of their ‘philanthropic’ intentions. A good academic background is not indicative of a good manager; it’s only indicative of a person who knows how to work his way through the rote-learning based academic system. Candidates prepare for the interviews too at length and only few of them in real life are different from their rehearsed counterparts.

I am not trying to put down anybody who got an admission in an MBA college; it was no mean feat and one you should be proud of. However, the admission process for MBA colleges has gone repetitive and should be revised. The catch is to sift out the managers from the MBA aspirants.

Now NIIT as a University

If all goes through as planned and said, the upcoming NIIT University or NU could very well be the symbol of the proposed (and much hyped) educational reforms in India.  For the environment conscious, it can also be the symbol of one of the few energy efficient educational institutions in India.

NU, currently offering three courses in Bachelor of Technology (B.Tech), Masters in Technology (M.Tech) and Doctor of Philosophy (PhD) is spread over 100 acres in Neemrana Rajasthan and is registered as a Private University under The Rajasthan Administration. It will be operational by September 21, 2009 (this is when the first B.Tech class will commence on the campus). And yes, to get into the Engineering course here, you need to give an interview; Interview because the University is preparing to produce “Technology leaders” and not just Engineers. Also, future MBA programs are also in the offing.

How that will be done is by basing all education on the following four principles, which are that education should be a) aligned to Industry, b) Technology enabled, c)Research focused and d)Seamless or incorporating inter disciplinary studies. In other terms, the education as aspired to be imparted here will be as per industry standards and will be such that the students need not be retrained when they join work in an organization. It will use the new age tools in technology to the fullest (the site itself is linked to Twitter, Flickr and Facebook which tells you that NU is serious about its ‘use of technology’ bit). Research or rather the absence of it is the buzz word of education-India. NU, with its existing research lab for faculty in IIT Delhi and another one coming up in the campus will make sure that both its students and teachers get to do some hard core research during their course. Many of the research papers done by the faculty are already available on the website. The curriculum would be made more holistic by the ‘seamless’ studies concept. Through this, students will be able to study subjects not directly related to their course but important for their overall growth.

In the above we see in practice, some of the suggestions of the Yashpal report which have been discussed at length at all platforms. With industry leaders on its board, the university aims to get a cross section of Industry-Academia-Research to develop a knowledge based and employment based education in the country. I am keeping my fingers crossed and hoping they deliver what they have promised.

Another rap on the knuckles for deemed universities

This is definitely not the best time to be the head of a deemed university. The Yash Pal report has recommended that deemed universities ramp up within a period of three years or face getting dissolved. These institutes continue to face the heat and the UGC has informed them that they must stop offering degrees to students who have enrolled in unapproved courses. They’ve also been told that the distance education courses which they offer must be approved by a joint board consisting of the AICTE, UGC and Distance Education Council.

An institute was given the deemed university status when it was judged to provide courses and conduct research of the level of a university. These universities receive funds from the UGC but enjoy a lot more freedom than other educational institutions. They don’t need to get approval from higher bodies in order to make changes to courses or student intake. Deemed universities offer a variety of courses and also maintain study centers to supplement distance education courses. The UGC has cracked down on these universities and said that they cannot admit students at study centers and offer degrees to such students.

The government has faced criticism for the high number of deemed universities which have been approved in recent years. It is believed that government and political connections have led to easy availability of this status. This status was earlier granted to institutes which were at least 25 years old and now even institutes which have been around for five years have approached the UGC for approval.

The government must first clearly decide how deemed universities are expected to function and what requirements they must fulfill. The UGC’s days are probably numbered but the body is still monitoring the activities of deemed universities. It will be unfortunate if deemed universities continue to operate with this level of freedom and students end up getting a raw deal. Good quality administrators are urgently required at deemed universities so that the institutes operate in a fair and appropriate manner. If these institutes are indeed going to work as autonomous universities then this is an issue which urgently needs to be resolved by higher education regulatory bodies.

The budget brings good news for loans. There is more to be done.

Students will benefit from this year’s Union Budget but there is a lot which remains to be done on the part of the government. Let’s go with the facts first. It’s been declared that students from weaker sections of society will not have to pay any interest during the study period for loans which are taken from scheduled banks. Scheduled banks include banks such as the State Bank of India and other public sector banks, private banks such as ICICI, HDFC Bank and also select foreign banks. Approximately five lakh students are expected to benefit from this scheme.

Firstly, the government should specify what income level of people will qualify as weaker sections of society. The provision of education loans is another area in which the government can make some useful changes. Students usually opt for an education loan to fund their MBA studies in India and these programs usually cost in excess of Rs five lakhs. Students have often encountered difficulties in securing education loans from the State Bank of India (SBI) where it the branch manager who decides whether the loan should be granted or not. SBI also requires that there should be a branch in the student’s hometown and the student or his parents should have an account in that branch.

I think that the government should definitely lay down rules which smoothen the process of obtaining loans. It is unfair to force students to approach multiple banks so that they can get funds for their studies. Banks should be given clear directions that education loans should be easily available to students enrolling in India’s top 50 MBA colleges. This year, the recession has resulted in b-schools finding it difficult to place the entire batch of students but the Indian economy is showing signs of recovery and should bounce back in a few years time.

Top b-schools such as the Indian Institute of Management (IIMs) have bank tie-ups to provide loans for students at lower interest rates while students at other institutes have to make their own arrangements. Public sector and nationalized banks could be encouraged to have tie-ups with b-schools outside the top ten institutes so that students can get education loans in an easier manner. A lot of b-schools have increased their fee in the past two years. The government should definitely make efforts to ensure that the loan process does not stop deserving students from making use of management education.

Teachers missing in Budget 2009

The Budget-2009 has allocated Rs.15, 429 crore (Rs.154.29 billion), including a planned allocation of Rs.9,600 crore. The break up is as follows:

1) UGC has been provided Rs 4,374.95 crore, which includes
expenditure for both Central and Deemed Universities.
2) The allocation for Central Universities includes allocation of Rs 1,033
crore for implementation of OBC reservation in terms with Oversight
Committee recommendations.
3) Rs 900 crore for “National Mission for Education through
ICT”.
4) Rs 827 crore allotted for one Central University in each uncovered state.
Rs 215 crore for Indian Institutes of Science for Education
and Research (IISERs).
5) Rs.3,902 crore for Technical Education that includes assistance to IITs, IIMs and NITs.
6) Rs. 494.5 crore for setting up and up-gradation of Polytechnics under the Skill Development Mission.

As I see it, again there will be large amounts of money doled out to the education sector and most of it will enter the pockets of various middlemen/babus or whatever you might want to call them. The effective money will be too less to do anything substantial and that will be the end of story for Indian education reforms. On the contrary, things might not be as bad as I picture them out to be and something might come out of the education budget after all. However, when I see no change in government’s thinking and planning for the cause of higher education, I strut back to my pessimism.

We do need more funds on education; no denying that, but with that we also need a new direction in which these funds would be utilized. Apart from the incessant focus on students, shouldn’t we focus on teachers? Much has been talked about the importance of teacher’s education and development to uplift the education sector in India. Is it not peculiar then that there is no allocation of budget exclusively for teacher’s education and training in the present Budget-2009?

Over the years, teachers have received substandard training in India which shows that it is not a section recognized by the government as worthy of paying attention to. The attention is always paid to the end product; i.e. the quality of the students coming out of the institutes. Tough entrance exams ensure that the students who enter sail through on their own (without much input from the teachers) which in turn ensures that the incompetence of teachers does not become a matter of much concern.

Education for teachers should follow a periodic certification system as followed by many corporate organizations around the world. This means that the teachers should revise their knowledge by a periodic certification examination system in which they are able to upgrade their knowledge as per industry requirements. Of course it should be additional to high quality research which should be compulsorily undertaken by all teachers especially in the higher education sector. Teachers should also be encouraged to take workshops with people from the industry to impart the latest information to their students. And all of that will only be possible if the teachers have their own budget to start with.

Unless focus shifts to the ‘input’ in education, little change can be expected in the output. The government should realize that a good teacher is seldom born, but can always be trained.

Dean ISB on the Yashpal Report

Some time back, I wrote about the view points of directors of various business institutions on the Yashpal report. Directors of various colleges from Indian Institute of Foreign Trade to Indian Management Institution gave their opinions about the points discussed in the Yashpal report.  Recently I got Ajit Rangnekar, Dean of Indian School of Business (ISB), Hyderabad to present his views on the Yashpal report; He had some interesting suggestions:

a) Abolition of all regulatory bodies such as the AICTE and UGC

We have long recommended the rationalization of the regulatory structure in education, especially in Higher Education. Whatever be the purpose of the regulation, the simple truth is that there has been an ever increasing shortage of high quality Institutions. At the same time we have seen a proliferation of institutions of dubious quality.

b) Formation of National Commission of Higher Education and Research

The HRD Minister’s statements and his ideas are a breath of fresh air. I am sure all of us will want to support the growth of high quality education in India. The issue as always in India is not about the law, or the composition and the mandate of the Commission, but how it will actually function on the ground. We should focus on whether it will be able to achieve its objective of rapidly increasing the numbers of high quality Institutions, and that is a tough question to answer.

c) Developing IITs and IIMs as full fledged universities that would grant degrees in all disciplines

This is not an easy one. On the one hand, it needs to be considered whether there should be any place in the overall system for stand alone, specialized Centers /Schools of Excellence, particularly for post graduate education.  Another example of such an Institution is the Indian Institute of Science, Bangalore.  It is worth reflecting whether part of the reason for the success of the IITs, and IIMs is that they are small and manageable, rather than very large and unwieldy. In fact, it was not long ago that the IIMs expressed their inability to expand and grow rapidly to accommodate the extra student intake necessitated by the government’s reservation policy.

Another aspect to consider is the governance and management of academic institutions and universities.  One should be open to the possibility of bringing in professional managers into the system for more efficient general administration, while leaving the academic administration to the faculty in these institutions.

d) Research in Universities

This is an absolute must. Also, the government must focus on supporting and funding high quality PhD programs. Today that is a very weak area in even our top ranked universities in the country.  Without robust doctoral programs we will never be able to address the shortage of good quality, well trained faculty.

e) Inter and Intra disciplinary studies in institutes

At the undergraduate level this is required. In our education system we force our children to make choices about subjects and disciplines too early. In fact, in India the tradition of a liberal arts education has almost disappeared. This is not good for the overall development of an individual or the society as a whole. Also, it is inter disciplinary research that leads to path breaking innovations.  Once again this effort can be promoted by creating funding programs specifically for funding multi disciplinary research.

f) Discontinuation of granting the Deemed University status to Universities

Once the definition and categories of universities is clear and specified, there will be no need to have a “deemed” university. Either an institution will be a university or it will not. I do feel that there should be a provision for stand alone, specialist education and research institutions at the post graduate level to be able to grant degrees without being classified as a university.

g) Allocation of funds as the report mentions compulsory financial aid to students

Once universities and colleges have more autonomy selected students.  In setting their fees and deciding their expansion plans, cross subsidizing the underprivileged, meritorious students should not be a problem.  Instead of providing subsidized education to all, as is the case now, the system should enable institutions to charge full fees to those students who have the means to pay and offer liberal scholarships to those who cannot

The idea to bring in professional managers in the business of administration at colleges as suggested by Dean Rangnekar is a useful one. Professional managers can speed up the administration of the college, hence providing more time for it to develop academically. Another interesting thought is the idea of a stand alone institution that would be able to grant degrees without it being classified as a university. Such institutions will help ultra specialized research and development in niche areas without having to bother whether they fulfill the criterion for them to be called as a university. It will be great for the cause of education if small suggestions from those within the industry are incorporated in its development.

The changing winds of b-school placements

No one really has a clear idea of when b-schoolers will get back their eye grabbing salaries and zip-zap-zoom campus placements. However, students are definitely not cooling their heels and waiting for the situation to normalize. Their logic is simple: if companies will not come to campus then they will have to go out into the real world to snap up job offers. And that’s what students are doing. People usually get involved in activities such as adventure sports, trekking and whitewater rafting if they are on holiday or have lost their jobs. B-schoolers on the other hand are going for these activities and coming back with jobs in their pocket!

What’s more, such trips are part of the course at the Indian Institute of Management, Ahmedabad (IIM-A). It seems to me that these are extremely innovative and useful initiatives. Students end up interacting and networking with company officials in an informal environment. Such interactions besides providing exposure to students also help them to get a clearer idea of what companies are looking for in students.

In India, companies directly recruit students from b-school campuses and this model is very different from that present in foreign colleges. Students in American business schools visit companies and look for jobs without the institute setting up a systematic campus placement process. Such a process allows students to get to know more about how companies operate and also provides them with more freedom in choosing job offers.

There are various reasons why companies choose to recruit from IIM campuses and not directly from the job market. However, the recession has prompted students and institutes to relook things. It will be interesting to see if more b-schools adopt this strategy of setting up interactions with company representatives and corporate figures. Such changes will result in b-schoolers actively searching for jobs and not being restricted to the placement rules imposed by institutes. MBAs would also be prompted to search for jobs that are more connected with their interests. Campus placements at Indian b-schools often result in students getting pressurized because of placement rules and strategies being followed by other students. These problems may be overcome if b-schools choose to operate in a different way and give students a lot more freedom.

The flip side of reforms

While going through this morning’s Business Standard, I came across an article titled “How many MBA’s do we really need?” by Abheek Barua who is the chief economist of the HDFC Bank. He talks about the large amount of MBAs available in India and the not-so-MBA-type jobs that they are forced to do.  ‘Forced’ because they are less skilled for the high end jobs but better connected than the section of people who should be ideally doing that job.

This is the flip side of the high growth in higher education in India; characterized by the mushrooming of engineering and management institutions all across the country. While the government and the AICTE can pat their backs on the number of ‘approved’ institutions they have created for ‘quality’ higher education so that every child has an opportunity to become and engineer or an MBA, the fact remains that such institutions do little to create a quality Engineer or a Manager. Isn’t it true that in most of the engineering colleges in India, you can graduate as a computer engineer without having to write a single line of code?

The problem goes deeper than just the lack of quality in higher educational institutions in India.  The problem is due to the lack of thought given to its development. While I agree with the fact that we need more institutes and colleges imparting good quality education, I also believe that we need to create a system which wouldn’t skew an individual’s thinking to a single domain. Higher education with regards to engineering and MBA shouldn’t be made so easy that a student is not allowed to think about options beyond that.  The contrast in the number of specialized institutions teaching arts and humanities and those teaching engineering and MBA say it all.

It’s high time we stop talking about ‘higher education’ only in terms of engineering, medical and management. Higher education needs to incorporate arts, humanities, fine arts and science and technology. Till this kind of expansion is not given to the realm of higher education, we can only expect substandard quality products from even high quality institutions. An important facet of educational reforms should be the availability of options with a student to pursue the subject of his choice with an open mind. This option should be both in terms of availability of institutions and the availability of jobs (after the course). Quality will be restored when students are spread out in the many different fields that education has to offer.