The Centre’s decision to give greater autonomy to the Indian Institutes of Management (IIMs) will not have an immediate impact on the premiere B-schools.
IIM deans and directors told Business Standard that before they can take advantage of the autonomy a lot of ground work needs to be done.
The Ministry of Human Resource and Development (MHRD), gave freedom to the IIMs to manage their funds and approve their budget, implying that the premier management institutes may now have flexibility to decide on salary packages to attract foreign faculty.
“Earlier, the IIMs did not enjoy the freedom of compensation. Hence granting of autonomy will definitely kick start the process of attracting as well as retaining quality faculty. But offering competitive packages will not be enough, especially in the case of foreign faculty. There are other areas like exposure, career growth opportunities and research opportunities that also need to be worked upon if IIMs wish to attract quality faculty. Service compensation is just one of the areas but it will take some time before we can work on all these areas that will actually retain quality faculty,” said an IIM dean.
Echoing his views, Devi Singh, director of IIM Lucknow said, “Offering lucrative salaries is not the only way we can attract international faculty. The autonomy granted to IIMs has set things moving in that direction but the institutes have a lot of work at hand.”
The other argument of IIMs is on the priority in utilising funds. According to the dean, IIMs will also be required to decide on how much of the corpus will be used to offer better pay packages.
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“International salaries are exorbitant as compared to Indian standards. How much more will or can the IIMs offer? Just like an entrepreneur can decide on how much he can pay himself depending on his profit, IIMs will also have to prioritise on how much they would want to spend on research development and infrastructure before alloting funds for better compensation for faculty members.”
The autonomy was granted based on consultations with the three task forces set up by Union Minister for Human Resource Development Kapil Sibal in April, this year.
While Ajit Balakrishnan, founder, chairman & CEO of Rediff.com, was roped in to suggest ways to solve the staff crunch issue, the task force on governance was headed by Maruti Suzuki, India Chairman R C Bhargava. The other group to prepare a road map for funding of IIMs was headed by Hari Bhartia, co-chairman and managing director of Jubilant Organosys and president of Confederation of Indian Industries (CII).
Balakrishnan, who is also the chairman of the board of governors at IIM Calcutta, said, “We are keen to have international faculty at the IIMs, either permanent or visiting. While IIMs do have faculty members who visit the campus for a few weeks to a few months, we need to have them on campus for a larger duration, may be on a contract basis. We, however, must do this sensitively.”
The existing staff strength at the seven IIMs is around 400 full-time faculty members, while there is a need for another 60. With four new IIMs due to come up in 2010-2011, another 250 would be required. IIMs meet less than five per cent of India's need for management education. These institutions not only generate qualified faculty for their own needs but also for other management institutes.
“A major advantage out of the recent autonomy granted by the ministry is that IIMs can now offer lucrative packages not only to existing faculty members, but also use it to attract quality talent from within and outside the country. This is one of the beginnings to address to the faculty crunch plaguing the institutes since long," said a faculty member.