Management education is now 45 years old if we count the business administration departments established in 1955 in Delhi and two other universities. The number of management schools recognized by the Central government is now said to have reached 2,500. India and the United States of America have the largest number of students going to business schools. The vast majority of these schools in India is well below standard, with few staff members and that of low quality, poor facilities as in libraries and computers. The image of most is that they are there only to make money for the promoters. Business school students do not come for an education but for the choicest jobs. Business school education is seen as inculcating greed as the highest virtue. The large number of MBAs in financial firms in the US at the time the world economy was thrown by their mismanagement into recession is validation of this.
With India on a sustainable high growth path, management is a key to sustainability. Management education must reform if we are to grow. The Association of Indian Management Schools established in 1988, with 500 member institutions today, held its 16th convention recently. Many members have learnt from each other and there appears to be a distinct improvement. It is among those who are not members that there is much to be concerned about. Many are mere moneymaking institutions. A business degree is felt to be a guarantee of well-paid jobs. Parents are willing to pay extortionate fees. The schools squeeze the last drop through capitation fees, unreasonable extra fees and high tuition fees.
The report of the National Knowledge Commission when implemented, and the impending supersession of the regulatory body, the All India Council for Technical Education, could help matters. But the task is very difficult. Many hundreds of recognized business schools across all sectors — private and public, in Central and in state universities — have to improve. There are many other unrecognized schools as well that offer management education. There is little information in the public domain about recognized and unrecognized ones. The ratings by different news and business magazines cover only a fraction of recognized schools. The supervision by the AICTE has been superficial, ineffective and biased. No regulatory body will be able to impose minimum standards. Market forces, namely students and parents, prospective employers and the media, must decide on the schools’ quality.
Efficient markets need all stakeholders to have easy access to full information about each school, a single national objective rating each year for all schools, all schools to be rated and graded by an independent agency, a single admission test from which students are selected for different schools, and transparent governance of each school. None of these conditions exists today. Newspaper reports suggest that the government is considering asking all educational institutions, including business schools, to follow transparent norms of governance on the lines that the Securities and Exchange Board of India has laid down for listed companies. I have made this suggestion for many years and it is good that it might be followed.
The other change under consideration by the government is a single admission test for students to business schools. This will reduce the burden on applicants having to appear for many tests. A number of vested interests will lobby against these. It is also essential that full information on each business school is available each year in time for students considering business education. Compulsory disclosure with severe penalties for false statements about numbers of faculty, qualifications, facilities and so on is necessary. The government should have the spine to force these policies.
Management education is an artificial construct grafted on to many other streams from which the faculty and students come. Ideally, the undergraduate years must prepare students for the postgraduate education. Engineering or social sciences, the main sources today, do not cover all the disciplines from which management studies have evolved. These include economics, psychology, political science, anthropology, sociology, time and motion studies, statistical sampling and other techniques, and using information technology for better decisionmaking and innovation, among others. Some work experience in between the undergraduate and graduate studies will prepare the student better for business management. We must also ensure that management education is not confined to business applications only, since it is as important for government and non-governmental and non-profit institutions. Faculty must also be integrated for management education, with annual updating programmes.
Today’s changing world requires that management education prepare students to tackle challenges, including the accelerating economic growth in India, the exploding domestic markets and opportunities overseas, the consequent increase of interest in India of foreign companies and of Indian companies overseas. We can expect that there will be a significant improvement in industrial growth and in organized agriculture and services. Markets are becoming so big and competitive that the rewards of success are substantial and the costs of failure also very great.
Organizations are becoming big and complex and making them work effectively in any sector is the management challenge. Information technology applications are giving management greater opportunities and capability to improve efficiency, reduce costs and promote innovation. Managers are becoming mobile across borders, as are all manner of institutions and businesses. This makes it imperative that managers have good cross-cultural understanding and respect. From teaching skills, techniques and contexts, management education must help development of strong interpersonal skills, team building and social and emotional skills.
Management education can no longer be left to self-serving regulators and entrepreneurs focused on money-making. Its overall governance and regulation must be subject to strict rules and penalties for violations. The government may replace the AICTE with less intrusive regulators, but regulations, inspections and penalties are unavoidable.
We must have registration of all schools and adherence to conditions that will be investigated from time to time. Violation of conditions must lead to closure. These conditions must include adequate classrooms, sufficient access to computers and the internet, numbers of faculty and their quality in terms of education and publications, and ratings of teachers by their students. Full autonomy to institutions in deciding subjects, curricula, pedagogy, study materials and so on is essential. There must also be integration of heterogeneous faculty into the subject of management. Frequent tests to evaluate the students’ absorption of learning, rather than a periodical examination, and much more exposure to real-life management under faculty supervision are necessary. The key is integration: of teachers from different disciplines, of pedagogy for integrated, and not just functional, learning and of human with functional skills.
Summer and final placements must go beyond organized industry and include small-scale, nongovernmental and non-profit organizations, and the government itself. Management faculty who take students on field trips (the late professor, S.K. Bhattacharya, took them on consulting assignments, the professor, Anil Gupta, takes students to discover small innovations), provide unusual and useful learning. Similarly, exposure to other cultures within and outside India might be gained through visits to tribal areas, watching movies from other countries, food festivals, and so on.
Management education has a vital role to play in India’s future development. It must produce managers who are not restricted to industry, who can learn to integrate all management functions and not become narrow specialists, who have an interest in building society rather than only making money for themselves, are humane and not authoritarian in style, are curious to learn and apply new skills and techniques, accept different cultures and work with them, and who want to improve the conditions of the very poor and deprived. How management education changes will determine the future of India’s economy.
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