A few days ago I met a senior IAS officer who held an important post in the human resources development (HRD) ministry of the previous government at the Centre. It was in his tenure that the Indian Institutes of Management (IIMs) confronted the first significant move to curtail their autonomy. Considered close to the then HRD minister, he was also known for arm twisting the IIM directors with fiats on matters such as fee reduction. I was interested in knowing his side of the story and what motivated him to take on the IIMs.
He started by describing how venal some directors of IIMs were, the corrupt practices they indulged in, and so on. The IIMs, he said, are among the most mismanaged institutions. For instance, he said, in IIM-Ahmedabad he observed there are more than 400 support staff for about 80 faculty. The faculty, too, he claimed, is mediocre and, on average, teaches for only three hours a week and doesn’t do much research. He said the incoming student group in the IIMs is very good, but the value addition is negligible. He cited the Shunglu committee report in support of his charges. And, of course, didn’t want his name mentioned.
I have read the Shunglu committee report and don’t agree with most of its findings. (See IIM-A’s own 2004 response to the report at www.livemint.com/iimaresponse.htm)
Whatever excuses the bureaucrats or politicians give, they can’t camouflage the desire to control the IIMs; not for the good of society, but to satisfy their egos and the power associated with such control. The high growth in demand for management jobs in the last decade has probably made IIMs too tempting for the HRD ministry.
It is no coincidence that all over the world great educational institutions enjoy complete autonomy. Most of the top B-schools—such as the Harvard Business School and the Wharton School of the University of Pennsylvania—are not bothered with government interference, and do not depend on taxpayers’ money. They have to earn their own money by way of sponsored research, training and consulting. Pressure to survive or to beat competition brings out the best in them.
Like the last BJP administration, the current Congress-run ministry too is keen to assert its power over the IIMs by way of selection of directors or control over their corpus. The ministry, it seems, is interested in making even the top three IIMs financially dependent on it. This would be a retrograde step. Without financial freedom, there can be no real autonomy. Rather, it should be a policy that IIMs should earn their money after a few years of nurturing, and not depend on government funding.
It is not that all the IIMs are doing a great job and no intervention is needed. In their about 45 years of existence, not much path-breaking research has been done; only a few of their faculty members can be considered world-class. They didn’t expand capacity substantially in the 1980s and 1990s when the economy needed it. They are also not proactive in generating competent faculty in large numbers. However, the solution to these problems is not in curtailing their freedom, but in giving them even more autonomy. They need to be given freedom to fix pay scales of the faculty, and a professional approach is needed in choosing the location of new IIMs.
Most of our university-based business schools are an example of how government control kills an educational institution. To update curriculum, to improve infrastructure or to hire faculty, there are many bureaucratic hurdles to be crossed. This is reflected in the steadily falling standards of university departments. Several years ago, the dean of a top-rated university department told me how he has no power even to buy a water cooler. It is also difficult to hire faculty. Besides low pay scales, the time lag between the application and call for interview for faculty is several months. If some business education brands such as the Faculty of Management Studies, Delhi and the Jamnalal Bajaj Institute of Management Studies, Mumbai, are still managing to get reasonably good placements, it is primarily because of their location, high quality of student intake and alumni network. For students, the low fee here is also a major attraction. But, none of the university departments can be called as truly integrated with industry. Most of them function as inefficient teaching colleges. The pedagogy used—in most cases the lecture method—is also outdated. It is also unlikely that the vicious circle of good intake and good placements for some university B-schools will continue for long in this increasingly competitive environment. We already see the desperation among some top university B-schools to be in the race.
In our annual B-school surveys we have seen that these departments don’t send data or even try and manipulate information to get better ranking. The University Business School of Chandigarh last year sacked a top official when the vice-chancellor was informed about the malpractices in giving information for the survey. If the IIMs have to be spared the fate of university departments, the government, instead of inventing ways to encroach upon their autonomy, should be generous in giving them freedom to grow and compete.
Premchand Palety is director of Centre for Forecasting & Research (C-fore) in New Delhi, from where he keeps a close eye on India’s business schools.
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