Placement signals

Just as one swallow does not make a summer's day, too much need not be read into the fact that many of the top B-schools have managed to get their wards placed in well-paying jobs on Day One.

Nor does it mean that all's well with the Indian B-school system, including the IIMs. When the economy is booming, some degree of corporate enthusiasm during placement season is only to be expected.

But the true test of the system as a whole comes when one looks at the salary averages "" and not the exceptions. The fact is B-school placement salaries vary by a factor of 1:8 or even 1:10 when one compares the best 10-15 of them with the ones at the bottom of the pile.

Business Standard published excerpts from a survey conducted by the All India Management Association last December which showed that the Super League schools at the top managed average salary levels of over Rs 6 lakh per annum in 2003 as against a meagre Rs 80,000 for the C-grade schools.

Preliminary reports, published in Business Standard last week, show that the ongoing 2004 placements season has been no different.

If one were to exclude the normal 10-15 per cent annual increases and inflation adjustments, the salaries being recorded this year are not necessarily significantly better than 2003 for either the Super League schools or the bottom-rungers. Which is as it should be.

For the truth is that while the top B-schools do indeed produce students of very high intellectual merit, that's not the same as saying that they are producing great managers.

Any dipstick survey among corporate HR managers will show that industry is not exactly thrilled with the kind of overambitious, get-ahead-quick kind of recruits it has been getting from the IIMs and Super League B-schools.

Many companies, in fact, even prefer going to the second-rung schools to avoid culture mismatches and excessive career expectations.

So what is one to make of the much-touted Day One successes this year? There could be three reasons for it. One, after being a bit under the weather for much of 2001-03, the software and BPO sectors are making up for the slack recruitment in the past to prime the pipeline for business growth.

Two, the institutes also seem to be getting better at marketing themselves than before. In 2002, the IIM-A actually flew students to hotels in Mumbai for international summer placement interviews since it realised that recruiters may be squeamish about jetting over to post-riots Ahmedabad.

This year, many B-schools appear to have offered more Day One slots to companies that wanted it. A neat way of assuring Day One placements.

And three, the recent bad publicity involving the IIMs (CAT paper leaks, spat with the education ministry over fees, etc) appears to have convinced B-school managements that they cannot afford to mess up this year's placements without denting their image.

All these three factors appear to have helped in ensuring good placements for the best schools. The real test, however, remains: the Indian B-school system can consider itself a real success only when it manages to push up its average salaries at the bottom end of the spectrum and not merely the top.