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'New IITs, IIMs are non-performing assets'

Last updated on: June 6, 2011 18:19 IST

Image: Dr Pritam Singh
Apurv Pandit,

One of the few Padmashri recipients in the management education space, management guru Dr Pritam Singh, Director General of International Management Institute (IMI), Delhi is well-known for having hauled up the fortunes of the Indian Institute of Management (IIM), Lucknow, and the Management Development Institute (MDI), Gurgaon, during his tenures as their director. This April, IMI Delhi hired him as the Director General, hoping to benefit from the same 'midas' touch' that helped IIM Lucknow and MDI.

As an influential professor of eminence who sits on important panels including those of the All India Council of Technical Education (AICTE), he is known to have strong opinions on business education, some of which PaGaLGuY captured at an interview at the IMI campus last month.

According to you, what in the Indian context improves a b-school's reputation among applicants and corporates?

Business education is built around three powerful concepts. The first is creation of knowledge. Being a brahminical profession, and I don't mean that in a casteist way, it is incumbent on the faculty of a b-school to create knowledge. The second one is dissemination of knowledge, and third is application of knowledge.

These three concepts translate to research, teaching and being involved in executive education. Whenever I have been involved with b-schools, I have tried to inculcate these three pillars to create a holistic school.

Barring four or five b-schools, most b-schools in India are not holistic by this definition. Both the university MBA education in India and privately-run PGDM programmes are largely teaching-oriented. I will not call these schools holistic by any measure.

In executive education, it is important to powerfully connect with one's clients, that is members of the corporate world. This year, we (IMI Delhi) have already gathered Management Development programme (MDP) business of Rs 7.5 crore. Such connections help us during the campus placements process because when the corporates have a good experience with a school, they come back to hire graduate talent from it. Better placements make better quality of students join the school in future years and this leads to a sort of a cycle that improves a b-school's standing.

I also believe that a b-school cannot be healthy unless it is fully residential. As we expand, we are going to create 200 rooms with 400 beds within the IMI Delhi campus. We are demolishing the existing canteen and putting up a four floor building there.

'The role of a teacher is... to shape opinions'

Isn't IMI moving to a larger campus to support its growth?

We are building a larger 16-acre campus in Bhubhaneswar, not here in Delhi. In India unfortunately when we talk about campuses we speak in terms of 100 or 200 acres. But not all of it is used. Take IIM Lucknow for example, where we have a 180 acre campus of which hardly 20 acres is used. Should we have such large campuses at all? So IMI Delhi here is a three acre campus with four conference halls, three MDP rooms for 75 managers, four syndicate rooms and then a total of around 500 rooms for the MDP participants and graduate students.

I may also persuade AICTE to, and it should buy the concept of allowing b-schools to operate in multiple shifts. The government is unnecessarily opening up so many Indian Institutes of Technology (IITs) and IIMs which are essentially non-performing assets. Instead of that, why don't they run two shifts in the same campus and harness the unused areas of their existing large campuses.

Does the pressure of teaching in graduate programmes and MDPs take away from the time needed for research?

That's why the average teaching load on our faculty is 3.5-4 courses whereas the norms are that one should teach 6 courses. We are 40 faculty members now and we plan to be 60 by next year with the same purpose of not doing any one thing at the cost of something else. Besides, when you do consulting work, you can use the experience to write a lot of cases or write books.

At this stage of IMI's growth, what is more important -- creating case studies or publishing research in reputed journals?

Harvard has gathered great eminence primarily because of their case studies. When you write a case study, you understand business in the real world. But when you write a research piece, it becomes an esoteric piece of work. Many times I jokingly say that such research is read only by its writer, the reviewer and the proofreader but nobody else. However, research that is published in top-tier journals is very important. So according to me both case study writing and top-tier research are important. Even writing in The Economic Times is important for professors as it helps shape opinions.

The role of a teacher is not only to publish something for their intellectual satisfaction, but to also shape opinions. That is why I believe that so long as professors are shaping opinions and creating a different set of mindsets, they are doing a good job.

'Most b-schools are spending too much time on branding and positioning devoid of focus on quality'

The two b-schools which you have formerly headed -- IIM Lucknow and MDI Gurgaon -- climbed up the b-school rankings of that time during your tenure. When you take over the responsibility of a b-school, are your governance decisions shaped by the effect they would have on rankings, or were the good rankings a side-effect?

Branding is very important for a b-school. For me, business models of b-schools should also focus on the branding. You may have a great product, but if there is no branding, the product will collapse. People do not buy a product, but its image. Whatever I do with a b-school, I want that the market should perceive it correctly. Which is why branding and positioning are an integral part of my thinking. During my tenures at IIM Lucknow and MDI Gurgaon, the rankings improved greatly and as a result the average salaries of the graduates also went up by as high as 40% over the previous year.

So whatever I do, I honestly and sincerely believe that a business school should market itself well. You might be doing a great job, but it doesn't matter if nobody sees it. Here at IMI, we were ranked number 3 in Businessworld's Intellectual Capital rankings last year, but how many people were really aware of that? None, I think.

So if I want IMI to be in the top seven institutes of the country, I would have to look at our processes, branding strategy, marketing strategy, media communication and so on.

There are some 2,700 b-schools in India and all of them are trying to get a piece of the applicant pool's attention. How would you comment about the way b-schools are marketing themselves? Which schools do you think are doing it right and where are the other schools going wrong?

Most b-schools are spending too much time on branding and positioning devoid of focus on quality of delivery.

Quality is about delivering what you promise. While I do talk about marketing and positioning, I also simultaneously bring in unimaginable rigour into the institute. I make people slog and also don't mind knocking off three to four non-performing students every year so that a sense of rigour is established.

A mineral water making company once invited me for advice on branding their product and I told them just one thing, "Make sure your water is pure. Then you do your marketing and positioning." There are many institutes which do heavy advertising and branding but are run by '420-type' (unscrupulous) characters. So branding and positioning have to be backed by high quality delivery.

'I think that among the generation Y, materialistic possession defines identities...'

While you do speak about infrastructure and intellectual capital, you function in a context where the worth of a b-school is decided largely on the basis of the placement salaries. What are your thoughts on such a salary-driven education market and do you see it changing anytime soon?

I think that among the generation Y, materialistic possession defines identities, especially after India has started integrating with the world. Earlier, identities used to be defined using families, community, culture or place of origin. With the importance of these things fading out, how do you establish your identity in your surroundings? With what you earn, how much you own, whether you have a car or house or not. We are beginning to live in a society where we start life with a loan and also die with a loan. I feel perturbed that as a society we might be going the same way as America. This is especially true of the metros. In a huge place like Delhi, it's easy to feel lost and then want to rebuild identity based on money and materialistic possessions. This isn't so much true of the Indian smaller towns yet.

Secondly, youngsters today know that when they start their jobs, they will have to make tremendous sacrifices of their entrepreneurial creativity and innovation or their power to influence and experiment because the corporate world doesn't allow any of this to blossom.

Young people have creative minds, they want to take risks and try to actualise but they don't get to do it in corporate jobs. That's when what we call the Theory of Substitution kicks in. When I don't get to experiment or be creative in my job, I try to compensate it with money. I implicitly tell my boss that I don't like your style of functioning, you neither empower me enough nor delegate enough responsibilities to me, so at least pay me enough money to comply with what you ask of me.

So if you realise, salaries have become compliance-centric demands. The rage in the corporate world today is that if you want to retain talent, give them more money. If you want to attract talent, give them more money. Money is important no doubt, but the real issue is whether we can architect the organisations of tomorrow where some of our natural needs are met -- the need to create, relate, experiment, question and dissent. If such organisations are created, the undue craze for money may go down.

After you joined IMI, what did you find the institute doing wrong and what have you changed?

I do not dwell on the past. I believe that if you want to create tomorrow, you must forget about yesterday. You must have visited IMI earlier. I am not sure if you've noticed but you will find the walls in my room and the entire ground floor decorated with photographs which were not there earlier. I believe that after my joining, people at IMI should see a quick visible change. They are usually not clued-in to what is happening in the Board (of Governors), but they do notice things such as cleanliness, discipline, and that people are arriving to work on time.

The first thing I did after joining was make a presentation to the people here about the problems, things we can do to find solutions to them, increasing faculty size and discussions about improving our ranking. In the beginning people thought that I would be just another guy who will go just as easily as he came. But I find that if you repeat a lie a hundred times, it becomes a truth. But if you repeat a truth a hundred times, it turns into a very powerful movement.

If you want people to see a dream, or be part of a journey of winning, you can't rely on things such as the vision statement or mission statement that consultants tend to create because nobody relates to those sort of sentences.

The other thing is that infrastructure is very important. It is not acceptable to me that some of our students have to stay outside the campus. We don't have enough place for conducting MDPs and it doesn't make business sense for us to conduct MDPs in five-star hotels. So we are building facilities of all of these.

Schools are known because of their specialised centres of management areas. For example, we have seven such centres. I would like outside participation from senior management of corporates in the growth of both the centres and the areas. We would like to engage at least 150 people from outside of IMI in co-creating new initiatives in the institute.

'We are not in the business of producing scholars, but grooming leaders'

What was the experience of conducting admissions for PGDM this year like? Have you noticed a change in the quality of students?

We have observed that there is no correlation between the academic performance of students in their PGDM and their Common Admissions Test (CAT) scores. But there is a direct correlation between their past scholastic scores and their PDGM scores. As a result not just us, but even the IIMs have increased the component of past scholastic performance during their admissions. The idea is that if the scholastic performance has been high during school and college, it must be high during the PGDM too, as it shows consistency, commitment and sincerity. So we expect the quality of students to be very different starting this year.

We are not in the business of producing scholars, but in the business of grooming leaders. Teaching finance or marketing are merely instruments for grooming leaders. While case studies can sharpen one's mind, they cannot produce leaders. Leadership isn't as much about the power of the mind as about the power of soul. So I am going to work on revamping the pedagogy of IMI completely. We are going to actively have a lot of movie screenings, theatre, drama and really blossom the personality of our students. Starting next year, we will even do simulation exercises at the time of admission interviews to see the candidate behaviour and observe whether they have leadership potential in them.

How do you see the Common Admissions Test (CAT) evolving?

CAT is a very quant-centric exam. The Greek philosophy has been that if you have the power of mind, you must also have the power of action and therefore the power to lead. The Bhagvad Gita however said that the power of mind merely makes a person dissective and critical. But it is the power of action that makes a leader. So I am of the opinion that a test like the CAT should also focus on testing one's emotional power and their values.

It's very unfortunate in this country that the courts had decided (in 2009) that 70 percent of the component of admissions must be given to the CAT. Whereas whenever you deal with humans, there will always be subjectivity. Jack Welch has said that a person might be 100% in terms of ability, but if his willingness is only 40%, don't even touch him. I think that most schools are realising that it can be disastrous to select students merely on the basis of CAT.

Why are schools realising this only now, after admitting students through a CAT-centric process for so many years?

It has been a natural gradual realisation and also due to the crusading of many people inside the IIM system such as me. I have been opposing the CAT ever since my days at IIM Bangalore. In fact, had I continued for some more time as the Director of IIM Lucknow, I actually would have got an external testing agency to conduct the CAT. The truth is that nobody in an IIM has the time be involved with the CAT but then there are vested interests there who argue that the IIMs make good money with the CAT and do not want to tamper with it.

Secondly, you see, social scientists are known to have an inferiority complex which they try to compensate by bringing in mathematics and physics into their subjects and trying to convert everything to numbers. If you read management books in the area of communication, there too one sees mathematical modeling happening. Many times I find that in the pursuit of quantifying everything people lose sight of the actual subject.

Management is not a hard science but a performing art. That is why I have always criticised the CAT which quantifies things that cannot be converted to numbers. Does the CAT have any correlation with being a thinker, leader, philosopher or the desire to make a difference? Not so, I think.

'The AICTE must understand is that quality without cost doesn't have any meaning'

Earlier in our conversation before this interview started, you mentioned that medical schools should be located near hospitals and engineering colleges near factories. What sense does it make for a management school like IMI to open its new branches in Bhubhaneswar and Kolkata?

Kolkata in the last 15 years has done a great job in emerging as an Information Technology centre and for whatever it's worth, (former chief minister) Buddhadeb Bhattacharjee has done a great job.

If you ask my opinion, in 15 years Bhubhabeswar is going to be 'the' place because of the mineral industry. It has political stability and then companies like POSCO, NALCO, Mahanadi, Vizag or Uttaranchal Steel are entering the city. As a good businessman, I wouldn't see a market as it is today, but how it will emerge to be tomorrow.

For example, you may not talk very highly of Jaipur now. But 15 years down the line it will be a great hub on the back of the petroleum industry and because of its nearness to Delhi. Consider the area encompassed by Delhi, Chandigarh, Jaipur, Meerut, Faridabad, Rohtak -- it will be the largest global urban hub of the future. In fact, had I been at the helm of affairs at IMI when the new campus locations were chosen, I would have argued for Jaipur.

Do you think it's ironic that none of the new campuses of established and cash-rich b-schools are in the country's commercial capital Mumbai?

In Mumbai the land costs are out of reach. You can't even get half an acre of land easily. Here in Delhi we have three acres of land. Such land in Mumbai will not cost us below Rs 25 or 30 crore. Land is an issue and that is why schools like SP Jain, NMIMS or JBIMS cannot expand even if they wanted to. Besides, there are already some 60 b-schools in Mumbai so it's a crowded space.

What is your opinion on the AICTE circular that has caused a standoff between private b-schools and the government?

I have vehemently opposed that AICTE circular in my media interviews and in my meeting with HRD minister Kapil Sibal. I have a few things to say to the government: if you have opened up the market, please allow market forces to operate. If they don't allow the market forces to operate, the scoundrels amongst us will not die.

Secondly, it doesn't make any sense to me that if you can't punish the scoundrels, you start creating rules which also hurt the honest guys. I have a question: has AICTE ever, ever succeeded in closing down a single bad b-school in India? No. What have they been able to do with IIPM (Indian Institute of Planning and Management)? What they are doing instead, is creating problems for the good ones.

Another concept that the AICTE must understand is that quality without cost doesn't have any meaning (on the subject of AICTE trying to regulate private b-school fees). Good quality comes with a cost component. When I was a member of one AICTE panel, I was asked based on my experience of managing IIM Lucknow and MDI Gurgaon as to what fee structures b-schools should have. My counter-question to them was: what kind of quality are you talking about? If you want Harvard-level education, you will have one kind of fees but if you want Phoenix-level education, you will have another type of fees. Price is linked with quality. This simple fact the AICTE doesn't understand.

I also want to tell the AICTE, that the moment you give me accreditation, don't inspect me for five years. What sense does it make to inspect me every year after having approved my school? Would you believe it that they are now asking for thumb impressions of all the faculty in the AICTE approved institutes? What can one infer about AICTE except that they are just trying to assert themselves in a space where they are becoming irrelevant?

I have been a member of the Executive Committee of the AICTE and I am still there. The reason I have all these strong opinions is because I want to change that institution and I think that they will have to change too.

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