The vast majority of management graduates are produced by AICTE approved factories which are neither affiliated to reputed universities or have even the basic minimal infrastructure. By A SPECIAL CORRESPONDENT.

INDIA PROBABLY produces over 110,000 MBAs (PGDM, PGDBM, MMS etc) roughly the same number as the United States which has a GDP over 20 times greater than India’s. Germany, with seven times our GDP produces just 16,000. The vast majority of these MBAs are produced by AICTE approved factories that are more often than not affiliated to reputed universities like Bombay and Pune. So what do we do with all this managerial talent? Are we employing so many managers, setting ourselves on a fantastic growth trajectory? Are we exporting managers?

Unfortunately neither! While a fair number of engineering graduates do go abroad and do fairly well hardly any MBAs join the international business world, although a handful do move to the top in multinationals. A miniscule number go west, mainly to the US, for doctoral programmes and take faculty positions. But the annual outflow on this score is not even at the three-figure mark.

The rest struggle to find openings at home and most find some kind of job within a year, but what kind of opening? Probably less than 5000 of them actually get placed in positions that would be described as managerial in most countries. The rest take jobs that would have otherwise gone to any graduate or in some cases to an engineering graduate. They are largely field sales jobs, junior clerical (the official designations sound a little more respectable) positions in HR departments and increasingly as call-centre operators.

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In terms of salary, products from the top 15 institutes get average starts of over 5-lakhs/ annum, from the next 15 the average would be 3 lakhs and for the rest the gross package is often below a lakh. These figures are in fact somewhat exaggerated as employers increasingly quote cost to company and the actual take homes would be 20 to 40% lower. In fact many engineering or even commerce graduates find it difficult to get the same salary as they would have after the first degree, though it is a couple of years and lakhs down the road. Two years of work experience would have stood them in better stead. Even among those that get past the 3-lakh mark the job content has no relationship to what they are supposedly trained for. A major employer of top B school pass-outs once told me that nothing they learn at management institutes is useful to the organization but “if a guy has been selected for IIT and then for IIM he probably is capable. We actually expect them to unlearn and start afresh”

This is not new. Management graduates have been taking low paid almost clerical positions for years and there is no evidence that they move up much faster than the non-MBAs. Yet B schools continue to mushroom and all of them get more applicants than the seats on offer. And they are not cheap. Fees, in most cases, not counting lodging and boarding expenses are around a lakh a year. In certain cases, as in Bombay when a somewhat lower fee is prescribed for the regular MMS students entering via the CET (common entrance test), the institutes try and persuade students to join the diploma programme at a higher fee. They tell prospective students that they have better programmes and placements for the PGDM course. They give the impression that they get good placements and print lists of companies that “ came to campus”. Some of these companies only had an executive giving a talk or maybe took one student in the last five years.

The course content and programme delivery is pathetic. Course curricula are revised very infrequently if at all and have no relationship with the current business scenario. They appoint one or two full-time faculty and rely on “visiting” faculty. In many cases these teachers are superannuated, unemployed people who acquired a masters degree in something 30 years ago. They come to the classroom with a set of sepia tinted transparencies and talk for a couple of hours, essentially reading out the content of text books written decades ago. Questions from students get the response: “ I’m giving you notes.” This tribe referred to as brief case professors manage to attend course review meets and ensure that change does not take place, as change would make their obsolescence obvious. The libraries add very few titles (generally only low priced editions) and most academic journals are conspicuous by their absence. Computer facilities are limited and on campus, use of a computer entails waiting in a queue. The classrooms have basic furniture and a small blackboard with an LCD in one of them reserved for special occasions

But, despite the fact that students learn nothing and get no jobs, seats get taken and the demand is still rising. The shakeout that has happened in engineering is not in sight. And college managements are raking in huge profits. Many of them even manage to take money under the table from people who have made the grade on merit. Why?

It seems the cheap availability of MBAs has lead to a situation where a company that may have employed a B.A. or B.Com now use the management degree as a pre-qualification to bring the number of eligible applicants to a managerial level so you need the management qualification to become a clerk just as you need to be a graduate to become a peon or chauffer. Consequently the MBA is needed today to get any white-collar job, even if it pays just Rs 4000 per month.

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