ISB: Its stars are not twinkling to expectation (2 June 2002)
It was supposed to be the Kelloggs and Wharton business schools rolled into one— not merely the best Indian business school, but one that was on par with the top ivy league schools.
Its concept, structure and corporate was so impressive that it would be hard to imagine how anything could possibly go wrong with the Indian School of Business (ISB) based at Hyderabad.
The world’s top management consultancy, McKinsey & Co has structured it and for all practical purposes runs the school.
Apart from its direct collaboration with Kelloggs and Wharton it has affiliations with the London School of Economics (LSE) and others. And its 57-member international board would probably give Harvard an inferiority complex. The board includes every corporate chief in India who matters (Ratan Tata and Kumaramangalam Birla have stepped down from the board) and the international representation includes deans of Kellogg, Wharton and the LSE and chairmen of Bechtel, BAT, Sara Lee, Aventis, Citibank, Daimler-Chrysler, Royal Philips Electronics, Royal Dutch/Shell, LG Chemicals, Orix and Novartis among others.
Clearly, the ISB model is flawed and it badly needs a mid-course correction and drastic cost cutting if it has to grow into a serious academic institution
Naturally, the faculty was to comprise the biggest academic stars from around the world who would fly in for six week teaching modules. In short, ISB was would make it unnecessary for the brightest Indians to go abroad and make Hyderabad a global destination for management students.
Unfortunately, things haven’t quite worked that way. However, for the purpose of this article I am excluding teething problems such as the cost overrun, infrastructure facilities that were not completed, or an occasional roof that caved in on the posh, five-star campus. I will only look at core issues such as education and placements. Sadly, ISB has slipped on those too.
Many students of ISB’s first batch of graduates feel badly short-changed in terms of the education that they received. This is because many of the academic stars who visited ISB simply failed to twinkle and promises that were made to them before joining did not materialise. Many, including Dipak Jain (dean of Kelloggs who was earlier tipped to head ISB) and Sumantra Ghosal, were barely there for a little over a week and course matter was often condensed to suit the convenience of the visiting stars.
Just about half the visiting faculty managed to stay even for the fully five weeks. The rest tried to hurry through their course material in anywhere between on to three weeks. There were of course many excellent teachers among those that came to India, but their numbers were not large enough to make up for the rest and some were not even Ivy league standard.
Another catch was that unlike other management schools where the faculty is available to students for post-class consultation, many of ISB’s visiting teachers spent their free time meeting family (if they were Indian) or being tourists (if they were foreigners). This leads to yet another problem.
An educational institution earns its spurs, not merely by its course curriculum but also the body of original research that it is produces. ISB’s visiting faculty model excludes that possibility.
Not true, say its directors who spoke to us. They insist that the initial structure was aimed at giving the school a flying start and hopefully persuade some academic gurus from the Ivy league schools to come back to India as resident tenured professors at ISB.
But, the plan does not seem to be working as anticipated. In chasing stars from abroad, ISB seems to have ignored its tiny resident faculty, and some of them (equally distinguished) have even chosen to return to their previous jobs.
All this too would have been forgotten if ISB had ensured ‘the best placements in the world’ that it had promised its students. But the numbers tell a sad story.
After all the hype only 80 of the 128 students were placed. Of these only seven were hired by foreign companies (barring the Chhabria group), say students. However ISB’s website says that 166 offers were made of which 35 were from overseas. According to students many offers were subsequently withdrawn or the salaries were too low and unacceptable.
Again the website says that average annual offers from overseas were $82,000 and domestic offers were Rs 8.4 lakh. A top Indian company told me that it had offered just Rs 4 lakh to four students and none of them accepted.
Incidentally, Indian corporate houses represented on the board of directors have coughed up Rs 5 crore each to set up ISB, with Reliance and Laxmi Mittal contributing Rs 10 crore each, but they still made offers at salaries that were unacceptable to the students.Infosys, ITC, HSBC hired one person each.
McKinsey itself hired just three students that too at salaries comparable with those paid to IIM graduates. There were only two sets of big placements. One was Godrej-Sara Lee which offered jobs to 14 students and the other was the late Manu Chhabria, who offered 35 jobs (20 at the Dubai-based Jumbo Electronics and 15 at Shaw Wallace). After Chhabria’s untimely demise, nine of the 20 offers at Jumbo have been withdrawn.
Clearly, the ISB model is flawed and it badly needs a mid-course correction and drastic cost cutting if it has to grow into a serious academic institution and not the rich boys school that it is in danger of becoming. But we cannot say if such a move is contemplated or what form it would take.
That is because ISB Dean Pramath Sinha, a McKinsey appointee, took offence at our questions and decided not to answer them ‘as a matter of principle’. Sinha says that he did not like my approach, and I must admit that I had declined his offer to visit the school (at ISB’s expense) because I felt that my queries did not require such a visit.
He said I was “welcome to contact any of our directors in Mumbai”, but simultaneously wrote to them and asked them to direct my queries back to him. However some directors and academics have given me their perspective on an off-the-record basis.
Incidentally, although Sinha emailed me, he also said that he was perhaps “over-reacting to the medium—email may not always be the best way to communicate. I recently told someone ‘I hate email’ for precisely this inability to convey what we really mean”. That probably says a lot about the sort of utlra-modern, wired up institution that ISB is. -- Sucheta Dalal