The 11 September terrorist attack, coming on top of a global economic recession, has advanced the hour of reckoning for B-schools which were already under considerable pressure to stay competitive. The unthinkable has happened: a management degree doesn't guarantee the pick of jobs anymore. Companies everywhere are downsizing and any hiring that takes place is more selective than ever before. The MBA bubble has finally burst.

The irony of the situation is that, despite the uncertainty about placements, B-Schools are seeing a greater rush of applicants for admission this year. This phenomenon is common during an economic recession, when people look to an MBA to give them an edge in their careers. This makes it even more difficult for B-schools to prove their worth in an increasingly tight market for premium jobs.

The second AIMA­Business India survey of B-Schools found that those which got their faculty numbers right, had strengthened their links with industry, and were already investing in expanding their infrastructure, weren't too worried about the future. For those who didn't do all of those things, the future promises to be challenging. High-powered advertising, smart marketing, the help of scores of well-connected individuals, and other survival strategies, may not fly in the face of hard facts. As the survey also reveals, even the best B-schools with brand equity, scores of top-shot alumni, and sheer vintage were at a clear disadvantage against relative newcomers who had wisely invested in the right aspects. Their students got the best jobs going.

This year's listing threw up some surprises. A large number of relatively low-profile schools, most of them new to the game, made it to the A category. IIT Delhi and NITIE Mumbai, both technology-oriented, government-backed institutes, made their appearance for the first time on the Top 10 list. These are clear pointers to which way the wind is blowing. For the second time in succession IIM Lucknow, the youngest of the five original group of IIMs, managed to stay ahead of its older cousins, Bangalore and Kolkata.

NITIE and IIT Delhi, the debutants in the Top 10, have set a different benchmark for themselves. They call it 'employability' as opposed to employment. A play on words? Not exactly. Dr Thomas Mathew, director of NITIE, is investing in building new infrastructure and trying to rope in more faculty. The IIMs of Bangalore and Kolkata, ranked as second and third in our survey, are also abuzz with activity, also in infrastructure-building and rapidly raising their intellectual capital stock. In much the same way as Lucknow, IIMC also feels constrained by its remoteness of location. The city has grown densely till the Jokai complex on the outskirts.

IIM-C's solution is to build a world-class complex closer to the airport which would act as a satellite campus. The institute has no dearth of funds for investment in such a project, but is somewhat constrained by the bureaucracy of sanctions, etc, which is a bane of government-run educational institutions. But the soft-spoken director Amitava Bose is confident he will be able to pull off the new campus plan. Meanwhile, a brand new auditorium complex is getting completed and a new building for additional hostels is fast coming up. "We are investing heavily in faculty quality and encouraging the faculty to acquire fellowships or PhDs at our cost. We are also encouraging our faculty to get international exposure through exchange programmes and research," explains Bose.

Thinking global is a watchword across campuses. IIM Bangalore, located in the software capital of the country, has set its sights firmly on globalisation. Its director, Prof. Rammohan Rao, says: "Our growth plans are focused on getting global attention, which we will achieve through exposing our faculty and students to an international management environment." The institute has tied up with 23 top campuses around the world and is actively promoting faculty and student exchanges through these efforts. XLRI, the brand leader in human resources, has a new classroom complex and relocation of faculty and students has started. Narsee Monjee (NMIMS) of Mumbai is refurbishing its exterior and interior completely to match its growing strength in the management movement of this country, with a Rs5-crore-plus investment. The distant Xavier Institute of Management, Bhubaneswar, stays in our top listing. This is another institute that has suffered from its locational disadvantage but overcome through high quality of faculty and strong industry linkages.

Moving to the A category, the fair number of new names there are because they have reported a healthy increase in their faculty numbers, increased industrial interface, invested in expanding their infrastructure, and have a consistently good placement record. Is there a way of putting these top-performing institutions in a cluster? Hard to tell, as each is in a class of its own. For instance, from the IIM system the newest kid on the block, IIM Kozhikode, with barely two batches out, has arrived on this list mainly on account of its strong research contribution work in terms of papers published at conferences, good industry interface despite its lush green hinterland location, and good infrastructure even if it is borrowed for the moment from the Ministry of Science and Technology.

THE NEW IIM

 A world-class Rs60-crore facility is coming up located atop twin rain-swept mountain tops of Kunnamangalam in the Western Ghats, which will place IIM-K firmly in a class of its own. "We are very excited about the pace of progress and hope to begin classes in the new complex from the next academic session," says director A.H. Kalro. The institute is a forerunner in electronic networking and using the Net for teaching in a big way. The new campus will enhance the network capabilities greatly, enabling the institute to offer Net-based learning and knowledge use to other institutes. "We will work like an ASP under a tie-up we are planning with Hughes Software," Kalro says.

IITs LEAD THE WAY

 The two IITs of Mumbai and Kharagpur have schools in the list, reflecting the strides they have made in bridging the management and technology education gap. Both campuses have done extremely well on the placements front and also in curriculum revisions, not to mention the heightened industrial interface activity. Sectoral management institutes Indian Institutes of Forestry Management, Bhopal Indian Institute of Rural Management, and the ever-popular Institute for Rural Management Anand of Amul fame, have figured in the list, showing yet another direction the management education movement is taking in the country. The appearance of PSG College of Coimbatore is an endorsement of the years of quiet work this world-class institution has been carrying out in the textile industry capital of Tamil Nadu. The T.A. Pai Institute in Mangalore has been consistently rated as one of the best and fastest-growing schools in the country, endorsing its position in our listing.

THE BAJAJ SYNDROME

Go down the list in the remaining A category: a number of institutes, most of them from the university system, figure here. They include the much-revered Jamnalal Bajaj, which has always figured somewhere after the IIMs. That we had to downgrade Jamnalal is no reflection of any damage to its brand equity or its effectiveness in delivering world-class management education. It is constrained by the small, bare minimum complement of faculty as per AICTE norms. The institute lost out on faculty numbers, faculty spending, and library investment, over which it has little or no control, being one of the 18 or so colleges belonging to the University of Mumbai system. Ironically, being in the university means Jamnalal Bajaj is possibly the only college in the reckoning of top recruiters of the world to provide the best talent at the cheapest price -- the very reason the government got into management teaching in a big way. 

The Bajaj syndrome seems to persist as you move to the next lower categories B+ and B, with many older and well-established colleges from the university system suffering for want of expansion in faculty numbers and investment in infrastructure-creation. Even those in the private sector or those run by trusts of various hues are equally constrained by an insensitive bureaucracy, multiplicity of regulatory and certifying agencies working at cross-purposes, outdated systems of gauging student input quality, poor fee structures, and of course an all-pervading shortage of intellectual capital.

FACULTY SHORTAGE A HARD REALITY

The percentage of institutions with faculties of less than the AICTE-stipulated seven to a batch strength of 60 students. The survey shows as many as 26 per cent of the schools did not meet this norm. Likewise, when it comes to writing of books, 59 per cent of the institutions in our survey did not have a single book written. Also, 6 per cent of all schools in our survey had no library to speak of. There's more: 8 per cent reported that they did not have any sort of link with industry, the percentage of such schools as high as 17 in the C category.

The overall faculty numbers increased from 3,418 to 3,803 between 2000 and 2001. The total number of students in all the 271 schools we surveyed came to around 20,782, indicating a faculty­student ratio of 1:6, which is not so bad by world standards. But across the spectrum things aren't so rosy. For instance, while the Top 10 admitted a mere 1,361 students and accounted for 450 faculty, the bottom C had 11,151 students, for whom there were only 1,429 faculty.

We could clearly see from our survey that all the fast-growing institutions, right across the ownership spectrum, could keep their pace only by improving faculty numbers, investing in computers and library, and spending liberally on faculty development. University schools and those less innovative ones from the government and even private sector are backmarkers today owing to their neglect of intellectual capital and infrastructure spending. University schools and those from the IIT system are clear victims of this process.