The Hindu Business Line : Where are the gurus?

Faculty shortage: The present crisis in B-schools is not just because of unattractive packages. It also has to do with the mushrooming of numerous management institutions in the last few years.

S. Lakshmi

Over 1,500 All India Council for Technical Education (AICTE)-approved private management institutions, six Indian Institutes of Management (IIMs) with seven more in the pipeline, not to forget the management departments in State-level universities and in the Indian Institutes of Technology (IITs). On an average, if every institute requires a minimum of 10 management professors with doctorates, then the country requires more than 15,000 faculty members for its B-schools. Going by the same arithmetic, this number of management faculty will cater to the need to produce over 300,000 managers in the next few years.

Are these numbers mind-boggling? Not yet? Then here are some more for you. Technically, the IIMs are the research graduate-producing workshops for most B-schools in the country. Typically, about 50-60 graduates pass out of the IIMs with doctoral degrees at the end of every year. Now, put this number against the required figure, which is 15,000.

“The gap is alarming,” says Ajit Balakrishnan, chairman of the board of governors, IIM-Calcutta and CEO of Rediff.com. But the problem, he continues, exists the world over. “This is not something that pertains just to our country. Of, course, thanks to the boom in the financial services industry, the demand for management graduates has grown manifold. However, this demand has not been met with the supply of adequate faculty members,” he points out.

Show me the money

The number of challenges in recruiting and retaining good faculty in Indian management institutions abound: a research-conducive environment, ease of access to study materials, a good library and international standards of remuneration to name just a few. Among the above, the five-letter word “money” daunts most B-schools, particularly the State-owned ones.

“The remuneration to faculty is restricted by government norms,” laments Samir Barua, Director, IIM-Ahmedabad. Agrees Shekhar Chaudhari, Director, IIM-Calcutta. “Providing complete autonomy to institutes like ours will help us give the much-needed impetus to faculty compensation structures. Owing to low pay-scales, a large number of ‘fellowship students’, those who are part of fellow programmes, join the industry. Naturally, the money is far better there,” he says. “An early decision on the pay revision is of utmost importance to keep the faculty motivated,” says K.T. Chacko, Director, Indian Institute of Foreign Trade, New Delhi endorsing Barua’s and Chaudhuri’s views. In internationally reputed institutes, academics have the opportunity of drawing very attractive remuneration. Industry experts firmly believe that this should be made possible in Indian institutions as well.

The base pay for faculty at IIMs and other State-run institutes is fixed by the government. To make the total pay packet look alluring, most institutes provide attractive incentives and perks. These perks, industry experts believe, are not good enough to motivate professors. Moreover, not everyone is willing to work on a perks- or incentive-driven pay structure. A senior professor at an IIM gets paid roughly around Rs 45,000 per month making that a little over Rs 5 lakh a year, while an assistant professor’s salary varies between Rs 4-4.5 lakh. For someone to be posted as professor he or she has to spend an extra four or five years after an MBA degree to attain a doctoral degree. “Who is willing to spend the extra years for a doctorate after post-graduation in management, especially when you know there is not going to be much return on investment if you take up a faculty job in India?,” questions a senior professor at IIM-Lucknow.

“The challenge is to get people who are truly academically oriented,” says J.K. Mitra, Dean at the Faculty of Management Studies (FMS), Delhi University who has a contrarian view on the subject. “Attractive packages,” he continues, “in institutions cannot alone be the solution. Such a solution has a probability of attracting bright, but wrong set of people.”

Private B-schools such as the Hyderabad-based Indian School of Business (ISB), Gurgaon-based Management Development Institute (MDI) and Ghaziabad-based Institute of Management Technology (IMT) hike salaries to attract good faculty. “All institutes that aspire to get the best human resources to teach their students should offer alluring monetary incentives,” says S.S. Sahay, Director, IMT.

“Remuneration is certainly important, but that alone will not be enough,” says ISB’s Dean M. Rammohan Rao. A research environment, collaborations and interactions with international schools and faculty and library services are very important in faculty development and retention, he adds.

Research required

B-schools are trying to improve the situation by sharing consultancy revenues with the faculty. But under the stiff hierarchical systems, senior professors benefit the most. Research assistants, who often hold doctorates in their subjects, attached to senior professors earn no more than Rs 15,000 per month. Given a situation like this, how can management institutions expect to attract good talent when BPOs pay that kind of money to undergraduates?

“Also, don’t forget that the number on the supply side is dwindling,” cautions Balakrishnan of Rediff. He suggests an increased stipend to research assistants may attract more students to management doctoral programmes.

Management institutions have formed islands of research centres. So, if IMT has set up four centres of research within its campus, ISB too has created several of them. And a steady demand for research papers from State governments and specialised industrial institutions and agencies, besides industry, is keeping the faculty at IIFT on their toes.

A quick look at the number of students pursuing doctoral programmes at institutes. There are 74 doctoral students at IIM-Ahmedabad; 32 at IMT; 55 at IIM-Calcutta; and 34 at IIFT. Out of which only 10-15 students qualify for the doctoral degree at each of these institutes.

“In the absence of good management PhD holders, about only one-fourth of the faculty are doctorates,” points out Balakrishnan.

That there is a scarcity of talented faculty in Indian B-schools is not new. Considering that it is the industry that hires managers produced by these institutes, what role does the industry play? “Unfortunately, Indian private sector has not played much of a role so far,” asseverates FMS Mitra.

There is a yawning gap that separates the industry from academia. “Corporate professionals should come forward and engage themselves in the quintessential academic functions of the execution of academic programmes of the institute and also give faculty an access to the industry where they can get a hands-on experience, it will give magnificent results, says Sahay at IMT.

“Corporates need to spearhead some of the research activity and share their experiences and lessons more openly,” says ISB’s Rao. Indian industry that is experiencing shortage of professional skills need to take an active role in designing curricula and giving direction to the scope of education so that relevant talent is made available, he adds.

Problem of plenty

The faculty shortage is likely to get worst when the seven IIMs announced get established (IIM Shillong is already in its first batch). The key is to give institutes such as the IIMs the autonomy to decide on the compensation packages and drive incentives.

On the other hand, many are developing indigenous research and development factories to produce academicians. Unfortunately, the compensation in B-schools does not match that in corporate jobs. So, the challenges are manifold.

The present crisis of faculty in B-schools in India is not just because of unattractive packages. It is also to do with the mushrooming of numerous management institutions in the last few years, which did not prepare themselves for the faculty supply chain. Most reputed institutions are in danger of losing their faculty to these private institutions that are poaching from established B-schools.

Such ‘match-making’ proposals are new to the education industry. Will this continue? “No,” asserts Balakrishnan of Rediff. “Because,” he continues, “these 1,300 or 1,500 B-schools will not exist in the years to come. There will only be 500 of them,” he ends on a positive note.

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