CAT 2015: Will brand IIM sustain to create high interest among MBA aspirants?

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MBAUniverse.com News Desk |
December 26, 2015
Mushrooming of IIMs without giving a proper thought has raised the doubts among MBA aspirants whether they will have a well secured future and competitive ability in national and global business management market
An IIM is looked upon by MBA aspirants as an ultimate destination where they can get best education on management and its establishment should also be in accordance with the reputation and brand attached to it

The product is said to move on the path of dilution in case mass production of the same becomes rampant without due quality checks. Wouldn’t the theory tested well over a period of time on diversified type of education hold good on brand IIMs as well? Abrupt mushrooming of IIMs without giving a proper thought has not only raised the doubts among the stake holders and MBA aspirants in particular whether they will have a well secured future and competitive ability in national and global business management market on completing their MBA/PGP in 2018 from new, newest or comparatively old IIMs.

Not all IIMs treated as preferred destination
Getting answer may not be easy but one thing is clear that not all the IIMs are preferred destination for MBA aspirants. Ask a CAT 2015 test taker or even those who are preparing for CAT 2016 or CAT 2017, the prompt reply would be in favour of IIM Ahmedabad, IIM Bangalore, IIM Calcutta or IIM Lucknow. Many of the CAT 2015 takers wouldn’t mention IIM Indore, Kozhikode or Shillong even, although they are well established and have also mentored newer IIMs.

MHRD didn’t allow the dust to settle
There used to be only 4 IIMs earlier. The brand IIM used to compete with the best B-schools in the world. Gradually 3 more IIMs namely IIM Indore, IIM Kozhikode and IIM Shillong were established. Even today many candidates getting admission in these IIMs, go for one more year of preparation and prefer to join one of 4 oldest IIMs for the fact that the late established IIMs are yet to command the same brand value in the family of IIMs as the old ones enjoy.

Then came the year 2009 and 6 more IIMs were announced to be established in Kashipur, Raipur, Ranchi, Rohtak, Tiruchirappalli and Udaipur. Since 2010-11 these 6 new IIMs have been operating from the temporary rented campuses but so far none of them have been able to move to their permanent campus. The mentorship period that provided a shield to these IIMs is also over and now these new IIMs have to sustain on their own.

The intake in these IIMs has also not substantially been increased due to various factors and one of them is that high percentilers in CAT exam prefer to turn to IIM Ahmedabad, Bangalore and Calcutta instead of going for admission in the newer ones.

Instead of learning a few key lessons on how to keep intact and promote brand IIMs, the MHRD announced another batch of IIMs in 6 states of Andhra Pradesh, Bihar, Himachal Pradesh, Maharashtra, Odisha and Punjab creating a tug of war between state and central Governments instead of giving a thought how to offer quality management education in these absolutely new IIMs who had to begin operation in 2015.

The transit campuses without having sufficient infrastructure suitable for MBA education were chosen at the nick of the time instead of going through a well planned process. The City and location where to establish these IIMs in many states remained a bone of contention and a fight for political supremacy.  While IIM Bihar continued to toggle between Patna and BodhGaya, IIM in Odisha continued dangling between Bhubaneshwar and Sambalpur.

IIMs: Future in jeopardy
Out of 19 present IIMs, future of 12 IIMs is still in jeopardy. The facts could be astonishing to note as many IIMs are operating much below their self sanctioned capacity.

MHRD, after a key Cabinet meeting presided by the Prime Minister Mr Narendra Modi on June 24, 2015 announced that all the newest IIMs starting operation in 2015 would have an intake of 140 students each.

But, given the fact that no infrastructure was provided to any of the newest IIMs to accommodate the number and no faculty arrangement from the mentor IIM was available to teach such a large batch of 140 students, the mentor IIMs decided to restrict the batch size within 60 to 70 students. Many mentor IIMs advised MBAUniverse.com about their proposed batch size for new IIM, they are mentoring. The most interesting part has been that not even the bare minimum intake of 60 students could be achieved by any of the 6 newest IIMs for the batch 2015-17.

Not many students for new IIMs
IIMs are considered as the dream B-schools by MBA aspirants but the exact situation is contrary to this myth. Out of 19 IIMs, the 6 newly inaugurated ones have not been able to get bare minimum 60 students each. Present strength of students for PGP 2015-17 batch in these IIMs as per MHRD record is as follows-

IIM Name with State

Batch size 2015-17

IIM Amritsar (Punjab)

45

IIM BodhGaya (Bihar)-

30

IIM Nagpur (Maharashtra)

55

IIM Sambalpur (Odisha)

48

IIM Sirmaur (Himachal Pradesh)

22

IIM Visakhapatnam (Andhra Pradesh)

54

IIMs caught in web
The current batch size is in contrast to an approved intake of 140 students as decided by MHRD. It may not be possible for these IIMs to achieve this number even in PGP 2016-18 batch unless and until they reduce the qualifying CAT 2015 percentile score below 80.

If they go down with the required minimum percentile score in CAT 2015, these IIMs will be compromising with their quality of education. If they do not do it, they fear the risk of not getting the required number and will have to operate well below the sanctioned intake for 2016-18 batch.

In fact, instead of opting for any of the newer IIMs, most of the CAT 2015 test takers would like to go for private and highly ranked B-schools like SPJIMR, MDI, IMI, IMT, NMIMS, JBIMS, BIMTECH, TAPMI, apart from well renowned University B-schools like FMS Delhi, IITs among others.

Nothing clear on Placement & Ranking
Except for 5-6 older IIMs out 19, rest remain out of gambit of ranking positions as they are yet to qualify to get ranking status. The placement position as compared to highly ranked private B schools is also far from satisfactory.

The Return on Investment (RoI) in many IIMs is still well below the good private B-schools who have been gaining higher packages year after year. Not only this, whether these IIMs are getting 100% placement is also a matter of research.

High fee structure
IIMs are considered as the best resort to management education. But this education comes at a very high price tag in IIMs as compared to many top rated B-schools in India. None of the IIMs, including the newest ones charge less than Rs.10 lakhs and the older ones need more than Rs.18 lakhs to complete your 2 year management course.

On the other hand the B-schools like FMS Delhi, JBIMS Mumbai, NITIE, XLRI, BIMTECH, TAPMI among others charge lesser fee and offer better placement.

Interestingly, MHRD is mulling over to further reduce the fee for private PGDM B-schools but is in no mood to reduce the high fee structure of IIMs who get all the support from Government of India. If it happens, it will further distract the MBA aspirants to go for IIMs and they might prefer private B-schools to IIMs.

MHRD, Government of India, should therefore focus on policy formation to provide level playing field to IIMs as well as to other B-schools. Instead of naming an institute running in 2-3 rented rooms as an IIM, it should go for proper planning before announcing an IIM at a particular location. An IIM is looked upon by MBA aspirants as an ultimate destination where they can get best education on management and its establishment should also be in accordance with the reputation and brand attached to it.

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