MBA SPECIAL....... IN INDIA SHOULD ONE SPEND LAKHS TO GET MBA FROM ANY INSTITUTE?

MBA SPECIAL IN INDIA SHOULD ONE SPEND LAKHS TO GET MBA FROM ANY INSTITUTE?

Grads of 37% B-schools start on salary less than Rs 3L/year: Study





A recent study has punctured the myth that a B-school degree guarantees a fat pay packet. The average annual salary offered to students during placements in close to 40% B-schools in the country is less than Rs 3 lakh, it has revealed.

Students from just 1% of the 4,500 institutes across the country -the top business schools that command Rs 12-15 lakh as course fees -are offered an annual salary upwards of Rs 9 lakh during campus placement.

The country's MBA dream, says the Crisil Research report, is fading fast as there is more awareness about the (lack of) quality , infrastructure and decreasing return on investment.

Around 37% of the Bschools were placed in the bottom, with many failing sometimes failing to place a single student. The average annual salary for those more fortunate is Rs 3 lakh. The largest chunk of B-schools --around 52%--falls in the Tier-III category of the study , with an average annual salary of Rs 3-5 lakh. That apart, just 60-80% of students in this category are offered jobs during campus placements.

For the study , Crisil graded B-schools into four categories based on parameters such as occupancy rate, number of students placed, average annual salaries offered and average course fees charged.

The seat occupancy rate is the worst in the 37% institutes that fall in Tier-IV . It is understandable, given that several fail to place any student some years; some, though, manage to place up to 60% of a batch.

The report predicts an improvement in the occupancy rate in the next two years, though, as several “B-grade Bschools“ are shutting shop.

“The number of B-schools in the country swelled to an estimated 4,500 in 2012-13 from 3,000 in 2009-10. However, in recent times, there are fewer takers for MBA programmes, especially in Tier-III and Tier-IV B-schools. Consequently , several institutes have had to shut shop,“ stated the report.

G D Yadav , vice-chancellor of Institute of Chemical Technology (ICT), who also submitted a report on vacancies in technical institutes, including engineering and MBA/MMS courses, said the study is not at all surprising. “Students who lose interest in engineering also go for an MBA degree. Therefore, more institutes came up. But not all offered quality education. There will be only a hand ful of institutes that are good and most sought-after.“ A government official refused to comment saying such an analysis is never done at the state level, but added it is “quite possible“.

“Due to low utilization, inadequate infrastructure, poor placements and unavailability of qualified faculty , we expect more Tier-IV institutes to shut shop in the near future... We expect the occupancy rate to improve to 70-72% by 2015-16 from the 68-70% in 2013-14,“ stated the report.

Yogita Rao