Even the best can always get better. But in the case of the Indian Institutes of Management (IIM), proposed recommendations by a ministry of human resource development (HRD) report would only lead to a governance disaster.
Now the directors of the IIMs are rightfully against most of the proposed reforms.
Last September’s IIM report, chaired by R.C. Bhargava, proposed a major restructuring of the institutes’ governance, under the guidance of a “pan-IIM board,” which would make policy decisions and focus on long-term vision for the institutes. On paper this might seem like a good thing, but an HRD-controlled board would lead to stifling bureaucracy, hindering the greatest asset the IIMs have.
HRD has a chequered history of packing committees with its own yes men, and the proposed board, which would be chaired by a prime ministerial-nominee, would surely be a political handout—and would detract from any meaningful reforms.
A key reason why the IIMs are such extraordinary institutions is that they have been able to act independently of a bureaucracy that is often more of a hindrance than a benefit. Because each IIM can set its own fees and salaries, they are able to attract top teaching talent— the sort that makes the IIMs world-renowned. And, because the IIMs maintain a level of autonomy, each is able to specialize in certain fields; these specialities are surely a tremendous asset in an increasingly competitive job market.
The HRD-sponsored report states that “IIMs are, and will to an increasing degree face intense competition from private business schools, and could lose their pre-eminent position if remedial steps are not taken now.” This statement is wholly true, and as public institutions, the IIMs do need a level of accountability as well. The problem, though, is that a pan-IIM board would surely curtail the ability of the IIMs to fight off an increasingly competitive private sector in education. In this case, the medicine would be worse than the infliction.
It is no secret that foreign universities and education firms are looking at India’s education sector, which is seen as a long-term growth prospect and a fairly lucrative market. The IIMs need to be wary of this to maintain their edge. But burying the world-class institutes in impenetrable bureaucracy would be a mistake.
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