MBA Live

A few weeks ago, the Centre for Innovation, Incubation and Entrepreneurship (CIIE) at IIM Ahmedabad organised a conference where alumni entrepreneurs were invited to share their experiences with the centre and with students interested in becoming entrepreneurs.

Most of us would assume that very few people showed up on either side, since the popular perception of IIMA is that it is the bastion of straight-andnarrow corporate executives, and not the breeding ground for off-the-beaten-track entrepreneurs who march to the beat of their own drummer.

Factually, the audience comprised about 150 alumni entrepreneurs and over 250 eager beaver students who came to learn whatever they could and to ask questions like “Is 5-6 years of work experience in a company a good thing before striking out on your own” and “how do you know when you are ready to take the plunge”.

At the conference the CIIE also released a book written by an entrepreneur alumna, Rashmi Bansal, titled Stay Hungry, Stay Foolish, covering the story of 25 alumni entrepreneurs who she divided into Believers (those who always knew what they wanted to do), Opportunists (who were hit by an entrepreneurship opportunity they couldn’t refuse), and Alternate Vision (people who became social entrepreneurs or ran boutique businesses).

Alternative Vision

The list of IIM-A Alumni entrepreneurs is very impressive and includes a heartening number of social entrepreneurs too — naukri.com, Subhiksha, Edelweiss, Mastek, Mphasis, Educomp, Makemytrip.com, India Infoline , IRIS, Gridstone, Orchid Pharmaceuticals , Give Foundation, Basix and Eklavya, to name a few.

Some of them went straight into entrepreneurship on graduating. Others first worked for a few years gathering experience in other companies. Sanjeev Bikchandani worked for a few years with a company before quitting to set up naukri.com and R Subramaniam of Subhiksha spent 15 days with a large multinational bank and decided that dealing with money markets and bonds would not give him the life skills he needed and then moved to Enfield for two years before setting up his own shop. Vijay Mahajan of Basix opted out of placement to pursue his alternate vision, but worked first for another NGO before setting up Pradan. Some were late bloomers and some even were ‘second innings’ entrepreneurs , having retired early form top corporate jobs. Rahul Bhasin did a buyout of the securities firm he was working with and Jerry Rao started Mphasis after an entire career with Citibank.

On an average, over the years, 25-30 % of every batch eventually ends up becoming entrepreneurs. The move was more gradual in the older batches but is accelerating in the batches of the 90s and 2000s. Last year, 11 students in a class of 200 or so did not seek placement and set off on their own entrepreneurship voyage — definitely a sign of the times, with easier funding and the comfort that today’s corporate world will hire them at any time, on par with their classmates.

I asked a sample of these successful entrepreneurs to evaluate IIMA course content and teaching in the context of creating more people like themselves. There is a fair amount of consensus that the concepts or tools of business management being taught are equally relevant whether you are an entrepreneur or in an established corporate set up — because after all, running an organisation, whether your own or someone else’s is more or less the same. Also, in the early stages, entrepreneurs have to take on a variety of managerial roles themselves, since they can’t afford to hire too many experts. That’s why several of them support the view of R Subramaniam (RS) of Subhiksha that a ‘work somewhere first’ route is helpful.

However there is an equally emphatic agreement that the contexts / perspectives in which these tools get applied could be totally different in the world of entrepreneurship and more attention needs to be given to making that point.

The prescriptions on how to do this are varied. RS of Subhiksha feels that the way entrepreneurship is currently being portrayed in most B-Schools is much too romantic; and there is a need for highlighting the classic pain — it takes 10 to 12 years of struggle to build anything of significance. There is a real need to understand and control risk better and know what foolhardy and romantic risk is and what well gauged risk is. His prescription to do this is a ½ unit course “somewhere between OB and strategy” to sensitise would-be entrepreneurs to this.

Sanjeev Bikchandani of Naukri.com feels that B-Schools need more case studies on start ups and entrepreneur driven organisations in order for students to see alternate contexts and alternate views of the world. There must also be more successful and failed entrepreneurs invited to talk to the students to provide different role models of managing businesses. Taking Sanjeev’s thought further, I must say that having worked with both typically corporate CEOs and entrepreneurs, even the way management tools are applied are quite different.

For example, market research to scope business opportunity done for an entrepreneur ends up revealing different things than that for a protocol driven “current market and its rules” obsessed corporate CEO. An entrepreneur once said scathingly to me in reply to my question on how much he had leveraged his balance sheet to grow, “only you B School types think that one must leverage ones own balance sheet to grow. There are several other balance sheets you can leverage to grow” . And in fact he had done just that, all totally kosher and legal! Vaidy of Alchemy Capital says that the brain is meant for thinking, reasoning and memory.

He feels that a lot of what he was taught at IIMA is more connected with reasoning than it is with thinking; and also that the memory bank built in student’s heads of things that went wrong and right with entrepreneurial ventures is still quite lightweight compared to that of corporate behaviour. This again points to more exposure to people and case situations from the world of entrepreneurs. There is near total agreement that courses which “help give courage”, “strengthen resolve” , “are inspirational” , “accelerate the seed of entrepreneurship inside us” are very valuable.

A 20 year old course at IIMA that does this and that most of our entrepreneurs remember fondly is LEM - Laboratory in Entrepreneurial Motivation. For the past six years it has been offered by alumnus visiting faculty Sunil Honda, a pharma-turnededucation entrepreneur. His students say that it instils confidence, makes you interact with small shops in industrial estates who earn more than most corporate executives do, and it begs the question “why can’t we, with more education and privileges of intellectual exposure, do it too”? In fact, in the bidding system that students at IIMA use to get a course of their choice, this one comes near the top of the list.

Venkat, a social entrepreneur and founder of GIVE India says that while LEM inspired him to pursue his dream, he also found that the system of IPs (2 Credit Independent Projects) also helped him progress his future business ideas in depth, while getting him the credits needed to graduate.

The CIIE at IIMA was set up six years ago, with the coming together of seven faculty members from different areas, interested in doing research in entrepreneurship . Its chairperson Prof. Rakesh Basant, explains the IIMA philosophy that research centres be integrated with other areas of activity of the institute. One arm of this integration has been the creation and offering of a wide range of entrepreneurship relevant courses ranging from private equity all the way to social entrepreneurship, supported by custom created case material and designed to include project work on the companies being incubated by the centre, on managing the seed fund, in mentoring start ups, vetting their business plans and so on.

The Centre has also worked with the placement office to enable summer internships with start up companies, for a permanent placement slot just before the main placement activity begins, for start ups who want to come and recruit, and for those who want to be entrepreneurs straight after they graduate, a safety net scheme by which they can participate two years later in the campus placement process.

Clearly the mental, the environmental and the emotional aspects of becoming an entrepreneur are what BSchools ought to address. And even if concept learning stays the same, there is a necessity for context learning through greater exposure to entrepreneurs and start up case situations. Ramâ Bijapurkar is a management consultant and visiting faculty at IIMA.

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Q 1. Over 22 years of Experience in CII what make you to join apex body AIMA

22 years of grooming in CII made me ready to take up the challenge of the top executive job at AIMA. Lot of synergy between the kind of work done at CII and AIMA and so it is like a natural progression.

 Q 2. What’s your next step, after becoming the Director General of AIMA?

AIMA is a great Institution and a great Brand!

My key KRAs at AIMA, while all the while working towards AIMA’s vision to be a leader in management development movement and facilitate individuals and organizations realize their potential include International ties and linkages, enhance AIMA’s profile, E Learning and E Testing and more mega events from the AIMA portfolio.

Q 3. Any plans to improve the standard of MAT ?

The purpose of an aptitude test is to assess the potential of the candidates. In the case of Management Aptitude Test (MAT) it has been designed and structured to assess the potential of the candidates to undergo management programs.
We are working towards taking MAT online.

Q 4. What is the strategy behind conducting 20 to 25 events every year?

Events are one of the vehicles through which AIMA reaches out to its membership. They also profile AIMA. The differentiating factor is that AIMA events and programmes are based on industry needs. The mix of programmes is such that it caters to all managerial levels including b-school faculty and students.

The vision is to organize mega events – with a much higher profile while maintaining the content and depth of each event.

Q.5 Comment on “Business Responsibility Summit”

This Summit was path breaking, as it marked the beginning of a new movement of Responsible Business- a clear departure from CSR on the side. We set out to propose a definite agenda on Responsible Business for the professional community to follow and the response we got was satisfactory. We plan to take this further to ensure that the movement grows and businesses voluntarily assume responsible ways.

Q.6 What are the new courses in AIMA?

(a) In association with IGNOU, we are planning to introduce a few sectoral specialization courses in the areas of Energy, Transport and Education sectors. Some of these courses would be made available through e-learning mode.

(b) We are also planning to launch one year Post Graduate Diploma programme in Financial Planning to meet the growing demand for financial planners due to the exponential growth in the Financial Services sector.
Q 7. What do you think about the management talent in India?

Every year almost 1.5 to 2 lakh Management Graduates are passing out of over 1500 B-Schools in the country.  A large percentage of the graduates passing out from the average (not well known B-Schools) lack analytical and soft skills.  There are enough jobs but companies are complaining that they are not able to recruit people with right skills.

Q 8. Kindly comment on AMT session held on July 21st?

To contribute towards quality management education, AIMA offers certification service popularly known as Accredited Management Teacher (AMT). The certification recognizes the academic achievements and professional expertise of management professionals and management teachers. It aims at identifying capable professionals from any arena not necessarily academics who can effectively impart management education by virtue of their academic achievements and professional experience.

The idea of AMT certification is to create a pool of experienced and knowledgeable management faculty from academia and industry. AMTs become benchmark of quality management faculty for B-Schools. Accreditation sessions (presentation and interviews) are conducted once in a month i.e. normally on third Monday of each month at AIMA, New Delhi. The forthcoming AMT sessions are planned for 18 August and 15 September at Delhi. To facilitate the applicants from Kerala an AMT session is planned at Cochin on 29 September this year.

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The economic downturn is expected to take its toll on B-school placements too. The premier Indian Institutes of Management (IIMs) do not appear to be perturbed, but other prominent B-schools anticipate a 25-30 per cent drop in placements this academic year.

They are concerned that several regular companies may drop out of the placements and others may recruit fewer numbers than usual.

For instance, Mumbai-based SP Jain Institute of Management and Research (SPJIMR) discovered that although 60 per cent of the companies have committed to recruiting the regular numbers, 30 per cent said they are not sure if they would recruit in regular numbers and 8 per cent said they would freeze recruitment for the time being.

Placement officials of B-schools who spoke to this paper still hope the situation won’t be as bad but admit that the students might have to compromise on their dream profiles this year.

As a precautionary measure, the management institutes have already started expanding their company base by approaching new firms, such as smaller private equity players and wealth management firms. Unlike most years, the Banking and Financial Services (BFSI) sector is not expected to be the best performer on the campuses this year. FMCG, trading and the services sector might take the lead instead.

“The number of offers on B-school campuses by the financial sector could come down with some companies even opting out of placements this year,” said Professor Subir Verma, chairperson, placements, Management Development Institute, Gurgaon.

Some companies, however, see a silver lining in the current slowdown as they stand a chance to recruit students even at a salary they would have to offer.

According to a placement officer of a reputed Mumbai-based B-school, these companies, including banks, found it difficult to recruit from campus earlier because of relatively low salary levels, despite good job profiles.

“It helps us in the sales and marketing scenario. It’s a win-win situation for the company as well as the students because they will find growth and we will get the best of talent from second rung B-schools. Given the ambition and expectations, one cannot afford an IIM or an FMS student,” says T N Radhakrishna, HR Head, UTI MF. The company, however, would be careful in terms of articulating its recruitment needs, said Radhakrishna.

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In business, it’s the early bird that rakes in the moolah. Taking cue from the age-old proverb, two MBA students have turned entrepreneurs even before graduating.

H.R. Sampreet and Saurav Dhiman, second-year students of the Vinod Gupta School of Management at the Indian Institute of Technology, Kharagpur, have launched their own company, Enfount Business Solutions. Their maiden venture is Bulkdeals.co.in, a Bangalore-based online retail window specialising in institutional and organisational buying of laptops, desktops and other electronic items.

“Across campuses, students form groups to buy computers so retailers give them a discount,” said Sampreet. “But this happens locally and in an unorganised manner,” he explained.

The duo saw a business opportunity in this campus trend and created an online platform that is a one-stop-shop for bulk deals of laptops and desktops of all brands.

“Here, students can register and get great deals directly from the brands,” Sampreet said. “We estimate this to be a Rs 200-400 crore market. The brands, too, were looking for a single window to reach out to the student community. We had the business model and wanted to hit the market early, so we started even before graduating,” he added.

The company is partnering with almost all top brands such as Dell, LG, Hewlett Packard, Lenovo and HCL.

The website had over 1,000 visitors in the first three days of its launch and already has more than 300 members and over 20 registered colleges, including all the IITs.

When asked how they plan to balance studies with running a business, Saurav said: “It is all about time management. Our business requires just two or three hours a day, which we can easily put in.”

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The Indian economy has run into rough weather. B-schools, however, are not feeling the pinch, since companies are increasingly sending mid- and senior-level executives to management schools for skill enhancement programmes in a bid to increase productivity and motivate employees.

B-schools have seen an increase of 25-30 per cent in their revenues as more students take up the Management Development Programmes (MDPs) this year.

JK Organisation’s eastern division plans to send around 275 mid-level executives for training to IIM-Bangalore for these short-term MDPs. It plans to spend around Rs 4 crore on corporate training over the next two years. National Thermal Power Corporation will be sending 350 executives to B-schools against 250 last year.

GK Agarwal, executive director, human resources and Power Management Institute, National Thermal Power Corporation, says: “Training and development during a slowdown becomes even more important as an organisation needs to multiply its efforts and produce better results.”

The programmes include courses like ‘Case-Based Turnaround Management’, ‘Personality Development’, ‘Resilience Programmes’, ‘Entrepreneurial Development’, ‘Managing People’ and ‘How To Avoid Another Slowdown’.

Deepak Chandra, associate dean, Centre for Executive Education, Indian School of Business, Hyderabad, says: “When the markets are down, there is a need to acquire skills. This helps companies in their talent management strategy.”

Among IT firms, the bottom line is affected the most while the mid-management gets a hit in the realty, manufacturing, automobile, investment banking, insurance and brokerage businesses.

Prakash Bhide, president, corporate human resources, JK Organisation (eastern zone), says: “Sending executives for training helps in keeping them motivated. Productivity levels are also maintained. It’s a good investment even when the market is bad.”

Ganesh Shermon, partner and head, people and change solutions (Human Capital Advisory Services), KPMG, says: “Re-skilling will definitely go up during the current economic trend. Organisations will use B-schools to polish skills of their employees.”

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