Upper crust B-schools moving up in quality

The big B-school event of 2004 is not Murli Manohar Joshi's efforts to cut fees at the IIMs nor his successor's restoration of the status quo.

Rather, it is the significant improvement in the quality of B-schools at the upper end of the spectrum. India has nearly 1,000 business schools of variable quality, but the upper crust  is now nudging up towards the figure of 100, if not more.

If this year's ratings by the All India Management Association are any guide, schools rated A+ or A, the two highest categories, add up to 79 in a rated universe of 300. Assuming that a few good schools may not have participated in the exercise, a figure of 100 is not an unreasonable assumption.

The big trend is the increase in the number of schools moving up in quality. The numbers in most of the upper grades -- whether A+, A, B+ or B -- are higher both in absolute and percentage terms. On the other hand, schools in the C and C+ grades have seen a corresponding reduction.

This could mean two things: more of the better schools are choosing to get themselves rated even as the weaker ones choose to withdraw. It could also mean that schools that were lower down in the pecking order are now making serious efforts to raise quality.

A-grade schools have shown the highest growth in terms of both numbers and percentage share. Compared to 2003, when there were 44 A-grade schools accounting for 16 per cent of the schools rated, this time around there are 53 schools accounting for 19 per cent of the total (see table).

AIMA seeks to grade B-schools into three broad categories --- A, B, and C --- with two sub-categories each, with upper sub-categories identified with a plus sign.

This makes for six narrower categories, ranging from A+ and A to C+ and C. While the top-most categories --- the 13 Super League schools in the A+ sub-category --- contain the usual suspects, what is important is the distribution of schools in the grading.

Of the 300 B-schools that participated in 2004, less than 10 per cent fall in the A+ category of which the Super League schools account for half the number.

The A's account for nearly 19 per cent of the total, the B's (B+ and B) for another 30 per cent, and the C's for more than 40 per cent, making a clear pyramid.

That about sums up the state of management education in the country --- while the top 10 per cent have the potential to impart good education, another 20 per cent can do so with some further investment and effort, and the rest (the B and C categories) will either have to move up or move out.

Institutions in the B and C categories form over 70 per cent of the AIMA survey. If the survey ratings hold good for the whole universe of nearly 1,000 B-schools recognised by the All India Council for Technical Education, that's 700 schools which need substantial improvement. It is also a telling comment on the true quality of management education in the country.

In the Super League --- the exclusive club of B-schools that are a class apart --- there is one major change, with the Xavier Institute of Management, Bhubaneswar, making an entry.

This club now has a strength of 13, the other 12 being the same as in 2003: the four IIMs at Ahmedabad, Kolkata, Bangalore, and Lucknow, the Gurgaon-based Management Development Institute, two IIT management schools at Delhi and Mumbai, the National Institute of Industrial Engineering (NITIE, Mumbai), the Xavier Labour Relations Institute (Jamshedpur), Delhi University's Faculty of Management Studies (FMS), Mumbai's SP Jain Institute of Management and Research and the Institute of Rural Management, Anand (Gujarat).

Just one rung below the Super League is another group of 13 institutes which are also in the A+ category. This group has seen significant changes, with six schools upgrading themselves from the A category in 2004.

The group has also seen some high-profile exits --- the two IIMs at Indore and Kozhikode --- suggesting that the pressure for places at the top of the pile is intense.

In 2003, these two IIMs could not make it to the Super League club in the A+, providing proof that the rating criteria can differentiate between good schools and excellent ones. The IIM brandname alone is not enough.

The AIMA ratings focus on hard numbers, basically on five core parameters: intellectual capital, admissions and placements, infrastructure, interface with industry, and governance.

Intellectual capital, which includes factors like faculty qualifications, books and research papers published, and so on, receives the highest weightage of 30 per cent. Admissions and placements and infrastructure 25 per cent each, industry interface 12.5 per cent and governance the balance 7.5 per cent.

At a news conference held in Delhi on Friday to announce the ratings, AIMA director-general DN Khurana said the 2004 survey involved a lot of cross-checking.

While schools falling under the A and B categories were physically inspected, the results for the rest were based on the responses furnished by the schools themselves.

But even here the scores this time were correlated with those of 2003. Some 17 schools that participated in the survey this year were excluded from the ratings because they did not have a three-year track record of existence.

AIMA Vice-President Sunil Alagh said that in future ratings may have to look at core competencies in specific streams like marketing or finance.