FEATURES/Boardroom | Sep 10, 2012 | 61821 views

IIM-A Needs to Step Out Into the Real World

The country's foremost management institute needs a whole new business model. Now!
IIM-A Needs to Step Out Into the Real World
Image: Alok Brahmbhatt for Forbes India
IT's TIME The tranquility at IIM-A's campus fosters an intellectual atmosphere, but step outside and it's clear that the world of business itself is changing rapidly


he weather in Ahmedabad was playing the perfect host on December 10, 2011. It was the last day of the golden jubilee celebrations of the Indian Institute of Management, Ahmedabad, the best business school in the country. The Louis Kahn Plaza was full with professors and alumni who had come from all over the world, who after a two-day tango with nostalgia and foxtrot with the future, were looking for relief. That’s when the headline act of the evening appeared in a metallic blue salwar kameez, the first strains of Raga Bhoopali (Mohanam) accompanying her to the stage. “I never thought I would return one day here in this way—to sing for you,” she said.

Chandrika Krishnamurthy Tandon is the first woman of Indian origin to become a partner at McKinsey. She is Pepsico chief Indra Nooyi’s elder sister, and graduated from the institute in 1975. Tandon was at the campus after three decades to perform her 2010 Grammy nominated song Om Namo Narayanaya. As her clear mezzo-soprano voice soared first with Vakratunda Mahakaya and later with Om Namo Naraynanaya, for once the congregation seemed at peace. The uneasy relationship of the past years between the alumni and the professors seemed distant.

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But she did something even more long lasting. The next day Atanu Ghosh, who was then the go-to man at the institute for alumni relations, announced that she had committed to contribute $1 million to her alma mater to a chair for entrepreneurship. That started off the giving. Naukri’s Sanjeev Bikhchandani, Eklavya Education Foundation’s Sunil Handa, and Orchid Pharmaceuticals’ Raghavendra Rao gave almost Rs 10 crore each, with other alumni chipping in with another Rs 8-10 crore. All this amount would come to the institute over four years. This was perhaps the largest pool of contribution given to the institute since its formative years in the early sixties.

Why does an institute with such an array of alumni have to wait so long for this? “It was a heart searing moment for me to come back and have KV Kamath, Harsha Bhogle and so many eminent alumni from so many fields in the audience that day. When I looked there I just saw immense possibilities for the institute. I had wanted to contribute for such a long time—guru dakshina—but did not know who to approach. And nobody ever asked,” says Tandon.

The isolation of the austere campus at Vastrapur, Ahmedabad, may foster a great intellectual atmosphere, but IIM Ahmedabad (IIM-A) and its professors know that winds of change are blowing all round it. Global Business Schools want to eat its lunch. Newly opened IIMs and other B-Schools want to snag its prized faculty. Five of the new IIMs have IIM-A professors as their directors.

The world of business itself is changing rapidly. Capitalism and its crises call out for a new improved economic system. Corporations around the world are required to focus much more on sustainability. Businesses are seen as being subject to societal obligations. India Inc needs new answers to survive and grow in a globalised world. And India needs IIM-A to showcase its thought leadership in public debate, in doing ground-breaking work on its inchoate but very promising economy. IIM-A needs to do more than what it does so well—teach students or be on policy making bodies. It needs to change.

Change is hard but it is hardest for those who are the best in their business and IIM-A is one for sure.
AM Naik is an unlikely man, one would imagine, to understand what IIM needs. He is, after all, not an MBA. He does not have a long association with the academic world, though, to be fair, he does come from a family of teachers. But ever since he was appointed as the chairman of the board of governors of IIM-A in late April, he has been trying to shake things up a bit. The current director Samir Barua’s term comes to an end in September 2012. In his last meeting as chairman, Vijaypat Singhania had formed a search committee for the new director of IIM-A. After he took charge, the first thing that Naik did was to reconstitute the search committee. Prafull Anubhai, who was associated with IIM-A for more than 40 years, was left out of the committee—and Naik himself decided to chair it.

Given his experiences over the last decade at L&T, he probably knows an organisation ripe for reinvention when he sees such an entity.

When Naik took over L&T way back in 1999, it was a behemoth where seniority mattered more than performance. This meant that bright young people left the group to try their luck elsewhere. Its stock price was languishing and it was twice a takeover target. Naik has since then been able to create a group that has much more synergy, is far more performance oriented and has been able to open up international markets to hedge its business against slowdown in any one market.

He could perhaps take a leaf out of the approach Mukesh Ambani has used at IIM Bangalore to get things moving in spite of government control. As chairman, Ambani is said to have teamed up well with Director Prakash Apte and more recently, Pankaj Chandra, to help the research agenda. For one, IIM-B has been particularly successful in attracting relatively younger faculty with doctoral degrees from top universities such as MIT, Wharton, Cornell, INSEAD and John Hopkins. Besides, faculty has been clearly incentivised to do more research. None of this has been without its share of controversy. But thanks to the strong, decisive leadership shown by both the director and the board of governors, the fresh blood has succeeded, to some extent, in creating their own space, despite a lot of heartburn inside faculty rooms.

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Comments (6)
Praveen Sep 20, 2012
Everybody saw many CEO's from IIMA., but are there any CEO's from ISB????
Response to Praveen:
Sunder Oct 6, 2012
ISB is only 10 year old dude..How can you expect Many CEOs out of it, they are still growing in their orgs...
IIMs are 50 year old institutes hence so many CEOs. Comparison on this front is very Unfair.
Anyways..There are many ventures started by ISB alumns and the CEO of India Branch of Groupon Ankur is an ISB alum
Rajkumari Sep 13, 2012
I think FMS , Delhi is good In marginal analysis as it is funded by government. After infrastructure woes are clear in next 1-2 year.It will certaily gain traction against b-schools such as HBS, wharton etc.
Manoj Khare Sep 11, 2012
Dear sir, first of all - my compliments on a well researched article. Also brickbats on the tenor of the article - it reminds me of the articles about India's poor, slums etc - it focuses only on the dark sides.

As an alumni, I am aware and I'm sure, so are IIMA board, director and faculty of the issues you have highlighted. However, the school faces indirect government interference, and also seems to want to work with the government, and not despite it.

Secondly, the quality education and culture at IIMA is much bettter than the contenders you speak of. The challenges before such a institution are not solved through simplistic means as - lets do more research, hire more faculty and take in more students - voila - all will be well - it has to be much more, and do much more. Hope you will appreciate it.
Response to Manoj Khare:
Manoj Khare Sep 11, 2012
Just to add (pun intended) - the author seems to want to push IIMA to get into the business of education, whereas IIMA has been all about education of business - that it has succeeded is revealed by your own statistic of 62% of CEO's in India being from the institute. Beat that if you can.
Though I completely agree that IIMA should re-invent itself in the face of new realities of India, I dont believe we should convert this hallowed institution into a shop selling education. While praising the US model of education has become the norm, since it has thrown up many highly-regarded univs, please also acknowledge the dark side - how their alumni have and continue to bring shame to their companies and their country through unethical pursuit of market beating profits (and bonuses?).
As far as I know, IIMA alumni (mostly) have an amazingly clean track record and are respected. Touche'
Rohit Bansal Sep 11, 2012
top class piece. enjoyed, benefitted, shared. thank you!
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