Conversion of B-schools into Businesses

Business Schools were set up in late 19th century as vocational trade schools. The studies of the Ford Foundation and Carnegie foundation had provided 64% of all grants to US universities both for new initiatives and for existing institutions and thus their money has had tremendous influence over the direction of education.

After the Second World War, both the Carnegie and Ford Foundations felt that business schools needed to professionalise and grow beyond their origins. Importantly, in the midst of the Cold War poor-quality business education was seen to threaten the health of the economy, democracy and the American way of life. The studies of the Ford Foundation and Carnegie foundation of 1959 led to their transformation from practical institutions into academic behemoths.

Schools were to professionalise, with faculty holding doctorates and producing graduate-level academic publications; students were to be taught quantitative methods and behavioural sciences – and only those academically qualified were to be admitted. Business schools all over the world started reinventing themselves to comply with such new expectations and the strings attached by the donors. And, while not obviously stated but clearly understood, schools were to have an anticommunist, pro-business and clearly capitalist orientation. This is the b-school model that India emulated.

The “storm” of rankings changed everything. In simple terms and for better or worse, the advent of rankings in 1987 marked the dawn of the era of business schools as businesses with the rules of the game laid down by the Foundation Studies. The U.S. News & World Report published a reputation survey of b-schools. Business Week published the first full business school assessment in 1998. Today there are other rankings provided by – Bloomberg BusinessWeek; Forbes, Financial Times, the Economist, and the Wall Street Journal.

India would not lag behind and there are now a plethora of rankings including those by Business-Today, Business India, Business World, ET, Business Standard, AIMA, MBAUniverse, Outlook, Careers360, and so on. Few people may remember what it was like before the rankings. It was a time when business schools could actually focus on improving the quality of their schools’ educational offerings. Discussions about strategic marketing were confined mostly to the marketing curriculum. PR firms were hired by businesses, not business schools. Most business schools had sufficient facilities, but few buildings had marble floors, soaring atriums, or plush carpeting. IIMs were affordable for most students, and even top MBA programs were accessible to students with high potential but low CAT/MAT scores.

What they teach and how they teach has lost focus for the leadership at b-schools. Instead, they are chasing the new indicators of quality and success for b-schools as being determined by the rankings –

  1. applicant rejection rates (how difficult is it to get admission),
  2. placements (how quickly, how early, how many aspiring recruiters, number of job offers per available student and at what emoluments),
  3. rankings (playing upon the better ones out of so many available and suppressing the inferior ones as biased),
  4. Infrastructure (marble floorings, air-conditioning, cafeteria, LCD projectors, books in the library,
  5. Advisory councils (reflecting affiliations rather than the capability of the constituent members)
  6. faculty (their credentials rather than ability and availability to teach).

B-schools are now businesses with business-to-customer marketing practices in chasing students and business-to-business marketing in chasing potential recruiters. Executive education and consulting was always about business-to-business marketing.

B-schools are on the path of evolving into trading exchanges for the managerial-talent.

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Take a PAUSE ! THINK !!

Profitability of business is associated with the efficiency of deployment of an input-mix comprising of – Machines, Manpower, Materials, Methods, and Money.  The era of increasing the component of Manpower in this heady mix is long gone and the emphasis has been on reducing the Manpower to a LEAN extent possible. Technology (Methods) makes labour a commodity-input that can be contracted as easily as any other. The shifts from outsourcing to ‘Uber’isation have been largely driven by the corporate imperative to create shareholder value, and under our current conditions, creating shareholder value and creating good jobs are largely incompatible. Corporations are “job creators” only as a last resort.

Out there is a sea of humanity, which more than anything in the world, wants a regular job with a wage. Jobs provide income, inclusion, confidence, comfort, security, a meaning to life and are a source of engagement that keeps people busy. Good jobs are essential to the good life. Yet good jobs are a minority and India needs lots of them.

Jobs and wages have to be at the heart of all economic growth. Growth without increase in jobs could trigger the rise of anti-nationalism, populism, crime, fanaticism or civil-unrest. Neither a Socialist nor a Capitalist approach to economic management can overcome the threats and consequences of job-less growth.

Technology is not destiny; nor is globalisation. Their direction is not random but shaped by decisions made by firms, governments and individuals. In other words, there is a choice, and it is up to leaders of governments, corporations and civil institutions to shape it in ways that will benefit ordinary citizens as well as themselves – or, as we have seen, ordinary citizens will do it for them.


Precariat – Appreciating the Rise of This Social Class

The richest 1 per cent in India cornered 73 per cent of the wealth generated in the country last year, a worrying picture of rising income inequality. Besides, 67 crore Indians comprising the population’s poorest half saw their wealth rise by just 1 per cent, as per the survey released by the international rights group Oxfam. The situation appears even grimmer globally, where 82 per cent of the wealth generated last year worldwide went to the 1 per cent, while 3.7 billion people that account for the poorest half of population saw no increase in their wealth. That the global picture is worse than what it is for India can be a very fragile solace.

In sociology and economics, the precariat is a social class formed by people suffering from precarity, which is a condition of existence without predictability or security, affecting material or psychological welfare. Specifically, it is the condition of lack of job security, including intermittent employment or underemployment and the resultant precarious existence.

In pursuit of competitiveness, governments have implemented policies of labor flexibility, making labour more insecure, leaving millions without health care, pensions or other benefits. Governments have turned to means-tested social assistance and to workfare. The welfare state has withered. The precariat has emerged from the liberalisation that underpinned globalisation. It consists of a multitude of insecure people, living bits-and-pieces lives, in and out of short-term jobs, without a narrative of occupational development, including millions of frustrated educated youth who do not like what they see before them, millions of women abused in oppressive labour, growing numbers of criminalised tagged for life, millions being categorised as ‘disabled’ and migrants in their hundreds of millions around the world. They are denizens; they have a more restricted range of social, cultural, political and economic rights than citizens around them.

Precariat is a new dangerous class-in-the-making, internally divided into angry and bitter factions, who face overlapping challenges of unemployment, low income and loss of social security. Most in it do not belong to any professional or craft community; they have no social memory on which to call, and no shadow of the future hanging over their deliberations with other people, making them opportunistic. The biggest dangers are social illnesses and the risk that populist politicians will play on their fears and insecurities to lure them onto the rocks of neo-fascism, blaming ‘big government’ and ‘strangers’ for their plight.

So far, the precariat in Europe has been mostly engaged in EuroMayDay parades and loosely organised protests. But this is changing rapidly, as events in Spain and Greece are showing, following on the precariat-led uprisings in the middle-east. Recent political discourse directed at the Precariat shaping the success in the election outcomes of the US, France and Philippines show the strength of this emerging class. Precariats face insecurity, instability and vulnerability. This tribe is as much anti-state as it is anti-business.

A progressive strategy for the precariat must involve more equitable control over other key assets of a tertiary society – quality time, quality space, knowledge and financial capital. There is no valid reason for all the revenue from financial capital going to tiny elite who have a particular talent to make money from money. The only way to reduce income inequality in an open market society is to ensure an equitable distribution of financial capital.

This article draws on “The Precariat: The New Dangerous Class” by Guy Standing


In Modi, We Trust! Why?

Prime Minister Narendra Modi, nearly four years after coming to power remains “by far the most popular national figure in Indian politics.” Multiple Opinion surveys (latest being survey by ABP News-Lokniti-CSDS and India Today-Karvy survey, both conducted in January 2018) say people are satisfied with the direction in which the country is being steered and the state of the economy under Modi despite the controversial decision to ban high currency notes, shoddy implementation of GST, Cow vigilantism, Doklam, Dalit agitation and a bleak employment situation.  Why are we in love with Narendra Modi?

A very simple, intuitive and rational answer to the question is because we, the citizens, believe that his ideas work or promise to do so. In the latter case, his ideas can still be evaluated subsequently and adopted more widely or discarded as inappropriate. We, the citizens, believe that Modi is working towards a purpose, is methodical in his approach and has the cognitive capabilities to understand the problems of the people. This is in spite of the ground reality that specifying the nature of the problems and objectives is difficult and the impact/success of practices or interventions by Modi are notoriously difficult to isolate.

A completely different point of view also offers an equally plausible explanation for the triumph of Modi’s discourse. Modi and his ideas epitomise the underlying anxieties and yearnings and a corresponding ‘need’ for a potentially comforting sense of order and identity and/or control of the citizens. This notwithstanding the fact that Modi’s perspective is typically associated with emotionally charged, sometimes impulsive, decisions to adopt, often simplistic and rational ideas without serious attention being given to their likely effectiveness for such a complex country.

None from his party or from any other political party is challenging Modi to be the Prime Minister of India save and except a feeble claim by Rahul Gandhi. All political parties are adopting similar practices to catch the fancy of the voters.  Practices like — dressing up, head-gears, temple-visits are being adopted for symbolic reasons — seeking electorate legitimacy— rather than, or even regardless of, efficiency or control outcomes.

Cultural (social identity) plurality and fluidity across such large and spread out country like India are both an advantage and a challenge.  In giving primacy to social context, such approaches are concerned with variety as well as homogeneity in being shaped by factors such as the ‘mentality’ of local political elites; role of local media and professional groups and religious networks. There is a distinction between the ideologies and techniques associated with individual approaches and either is adopted independently. For example, Rahul claimed being a ‘Janeu-Dhari-Shiv-Bhakt’ (technique) in Gujarat without overtly supporting Hinduism (ideology), something which did not resonate culturally with the electorate.

Modi exudes the persuasive powers of a political guru through his charisma and verbal and nonverbal presentation techniques thereby connecting with the citizens who have been starving for such relationship over the long years of UPA government. He has the key of impression management, not content, although ‘the content (i.e. packaging) is itself part of the performance.’

Modi is often active and tactical in the production and transformation of ideas into rhetoric. ‘Rhetoric’ is rarely appropriate or necessary in governance though it is an essential ingredient to politicking and politics. ‘Mere rhetoric’ should be typically contrasted with reality or truth. The underlying problem with such narratives is in ‘fight/ flight’ where survival rests on destroying or evading the ‘enemy’ (“Congress Mukt Bharat”) and ‘dependency’ on an all-powerful leader (Modi himself) who is beyond criticism.

Demand for new ideas in political discourse is shaped by a competition between ‘techno-economic forces’ and ‘socio-psychological vulnerabilities.’ Modi is successful in supplying ideas to fuel Current Political Discourse, some of which are faddish, others fashionable and few substantive.

At the risk of simplification, different factors that are making Modi successful with the citizens are — his effectiveness in the party and in the government; his relieving anxiety and securing identity for an ordinary person cutting across age, gender and religion;  his successful rhetoric; his cultural resonance or meaning; and securing legitimacy to his ideas through electoral victories.

A lesson that Modi has scripted for all – be they journalists, opinion-makers, intellectuals, drawing-room debaters, civil-society activists, tv-hosts or the so called ‘Architects of Networked Disinformation’- rationality is necessarily political, emotional, cultural, institutional and rhetorical, but not reducible to any of them.