Archive for October, 2007

Are our IIMs Overly US-centric?

Twenty six of us were seated around a long U-shaped table. It was late in the afternoon. The room was semi-dark. Each of us had a plate of sweets and a bottle of mineral water in front. A third of the people seated here were CEOís of large and famous Indian companies, some recently retired, others still very active in business.  Another third were high-level civil servants. The rest was a mix of senior company executives and academics. A slightly graying 40-something man stood at the head of the U in front of a brightly-lit screen. Everyone was intently focused on what the man was saying straining to take in every word above the whirring sound of the air conditioners valiantly battling to tone down the heat from the October afternoon sun.
 We were at IIM Calcuttaís quarterly board meeting. The Professor at the podium was walking us through some pretty revolutionary ideas for updating the curriculum for the flagship two-year Post Graduate Programme in Management- the result of nearly three years of debate within the faculty. A mandatory course in a foreign language, other than English, was the first of the many revolutionary ideas.  The world is increasingly globalized, explained the professor, and our students need to be comfortable in dealing with people of other cultures. It was one of those ideas that catch you by surprise because once you hear it you wonder why you didnít think of it earlier.
 A compulsory course on Ethics was the next big idea. Of course, the professor quickly added, itís not that we think we can ďteachĒ people issues like ethics but it certainly was worthwhile to explore with young and impressionable minds what constitutes unethical behavior in business. Explore with them how to deal with bosses who sail too close to the wind in ethical matters. Perhaps even demonstrate to students that ethical companies get practical rewards such as higher stock market valuations. None of us around the table could quarrel with this either.
 There were a few murmurs around the table when the professor mooted his next big idea- increase and emphasize the mathematical content of the programme. More and more stock trading is being done based on mathematical models, he pointed out and since the majority of the graduating class finds its way to financial service and consulting companies, being adept at mathematical modeling is likely to be a useful thing.
 Thatís when a really revolutionary idea was sprung on us. By a board member, a retired CEO. Is it possible, he asked, that our IIMs, espouse essentially an American way of managing businesses? Should we not be opening our minds to looking at other ways of managing too? Arenít there lessons to be learnt, for example, from successful Japanese companies?  Companies such as Toyota have used a subcontracting system to rise to the top of the world auto industry. What are the practices they have instituted that makes co-operation with suppliers possible over the long term? What makes it possible for Japanese companies and their partners to exploit complementary assets? What allows them to have a convergence of purpose with their suppliers? How do they so successfully manage the interface between themselves and their suppliers? Is this something in the Japanese industry structure? Or something in Japanese society?
 While our meeting ended with all of us promising to think about this issue, that evening as I drove back into Calcutta city along the Ganges, I asked myself: are ways of managing businesses different across countries?
Prof Bruce Kogut of Wharton and INSEAD, writing in the journal, ďManagement ScienceĒ, is someone who believes that the institutional environment in which large firms operate differs significantly across countries. Boards of US companies, for example, are much more powerful than boards in France or Japan. Institutional investors have a large say in how large US firms are run whereas in France and Japan itís not institutional investors but government bureaucrats that wield this kind of power. In Germany, commercial banks and labor unions have strong voices on company boards.  Again, in Germany, there are few industrial groups whereas in Japan groups of large companies are tied together in keiretsu with a large firm and a bank as the hub. These differences in the institutional environment play a crucial role in how management plays out.
Maybe management thought, to be powerful, ought be like the Ganges itself- springing from many different sources. The Alaknanda river meets the Dhauliganga, then the Mandakini at Nandprayag, then the Pindar at Karnaprayag, and finally the Bhagirathi at Devaprayag to form the Ganges. Then the Ganges emerges from the Himalayas at Haridwar, and flows for 800 km till the Yamuna joins it at Allahabad.  Then it picks up speed  as rivers such as the Kosi, Son, Gandak and Ghaghra join it. When it reaches Bengal, the Meghna River joins it before it flows into the Bay of Bengal.
 Maybe, what we teach at our IIMs need to be like the Ganges, nourished from many different sources.



I read with great interest your article on whether IIM’s are overly US looking.  I strongly agree with your thoughts.
The US is head and shoulders above other countries in terms of management research output. Add to it the fact that business schools across the world have come to rely on textbooks written by American professors and you have an American focus on management education.  
When I did an executive education program at IIM Ahmedabad in 2000, I remember a marketing professor taking us through an HBS case about the Suzuki Samurai. A group of people who had never been to the US, had little knowledge of the market environment were analyzing why a concept did not work. Obviously, the learning we derived from it was suboptimal. I am sure this situation is changing as the IIMs produce more case studies and research.
The graduates of 2009 should be exposed to the world order they will be function in (BRIC countries contributing disproportionately to world growth, shrinking populations & relative importance of Europe/Japan). In this regard, any steps taken by IIM Calcutta to modify the curriculum would benefit graduates tremendously.
I enjoy reading your notes about taking IIM C forward. Thank you for sharing them.
Krishna Hegde


Big fan of rediff and India Abroad.   Congrats on building a great media business.

On your recent article about the philosophy of MBA programs, you had ended the article with a provocative question around whether our MBA programs need to be nourished like the Ganges and essentially saying we need to accommodate philosophies from multiple sources.  I tend to cringe whenever I hear folks espousing multiplicity for multiplicity’s sake.  We need our MBA’s programs to follow the “right” philosophy and if it does happen so that the “right” philosophy is an amalgam of various things from various cultures than we should do so.  The idea of a global buffet based educational philosophy where you pick things just because they are different does not make sense to me. 

Most MBA programs adopt an US centric view because the US centric view optimizes around capital and return on capital (not saying that this is a good or bad thing but just stating the fact).  Optimizing around capital has many social and labor implications – the Japanese optimize around market share and maximum production even if it undermines return on capital.  As a venture capitalist, there is no doubt which philosophy I believe in ;-) ;-).  If your goal is to maximize wealth creation (again not saying that is a good or bad thing) then the US centric philosophy is the way to go.

Venky Ganesan
Dear Ajit,
I read your article in with great relish. I admire the way you have steered rediff to become one of the foremost india based internet portals.
Regarding your article, while the argument is not very old that we are following US in terms of evrything we do, we will have to look at it from a different light. I feel that there is nothing wrong in accepting what is good from other cultures and countries. Looking at the specific aspect of curriculum, it is important to note that the number of electives offered by american graduate schools are far more than indian schools. Faculty shortage is one major concern, i agree.
You mentioned three different topics that was discussed, language course, ethics and more mathematical courses. I am especially keen that all bschools start full fledged course modules in ethics and CSR. These courses should be made mandatory and a clear expectation should be set as to what it means and how important these subjects are.
As such these are extremely important for any new bschool graduate, but there are some areas where i feel indian management schools should give more importance. For e.g it would be great if there is a course on new venture planning in indian context. This could include courses, workshops and meeting with people, like you for e.g., who have successfully established brands and companies in india and also india specific venture capitalists. This could also include how to deal with issues related to IP.
Another area is Knowledge Management. This century is touted as the knowledge century and the ability to develop, manage, dissiminate and profit from knowledge is of great importance. Again this is a concept that the japanese have used successfully to build their global dominance.
The internet has changed the world interacts and this has significant impact of business. You being the head of one of the leading global internet portal would vouch for that. The future business models would involve understand the social aspects of internet and how that can inspire and invigorate businesses. So the sociology of the internet and the concept of Web 2.0 should be made part of the tool set for future managers.
Finally i feel that project management should also become part of the new manager. With a lot of developments happening in the infrastructure development in india, it would be important for people to have a good grasp of the project management methodologies.
Knowledge mgmt and project mgmt are offered as part of the PGESM program at IIMB. but it is necessary to offer these courses as part fo the normal MBA as well. I feel that these courses would significantly help the young student become a better manager.

Sathya Pandalai
Dear Ajit

After reading, Are Our IIMs Over US-Centric, I thought our International Conference, ” Expanding Horizons of Indian Business & Indian Management”  would interest u. It is being organised by  Indian Business Academy in association with WISDOM, Banasthali  on Jan 15-16, at IBA Bangalore and Feb 19-20 at IBA Greater Noida. This would be a path breaking conf.  like the earlier conferences that we had at IISc and WISDOM. The attached brochure provides the outline of the conference and its themes.

We look forward to your support for the conference and invite u to present ur views. Already leading academicans such as Prof S. K. Chakraborty, Dr M B Athreya, Dr Gustavsson from Swedish Business School,  have confirmed their participation as key note speakers

Subhash Sharma
subhash sharma
Hi Ajit,

Here’s what I feel about Ethics being “taught” being a “course” (as in, being part of syllabus).

We are a country of “moral science” classes being part of curriculum in schools.  Colleges dont have them, is felt that the kids have got the foundation right already, based on which the next lessons are taught.

Times when ethics / corporate governance is taught in Company Secretaries / Chartered Accountants course; governed as clause 49 of listing agreement; or regulated, you would always see that the “words” are what is met, “spirit” is what a few follow (largely because of the person’s values in life, upbringing and the eco-system that person is working in).  Example, think of corporate governance in Real estate industry…

While the thought of the IIM Prof is laudable, I think his ‘exploration’ might remain a survey / research paper on the subject.

Sharda Balaji
Legal Counsel, corporate advisor, aspiring enterprenuer
sharda  balaji <>

Dear Shri Ajit Balakrishnan,

I am a regular reader of Business Standard and  read  your
article regularly.
I am eager to know:
“Were you born in a village? or do you have any ancestral village in India?
Have you ever solved one or two problems of the said village or town?
What were those problems?
How did you solve them?
Were the solutions economical?

With regards,
S.C. Aggarwal,
Founder, Poverty Trust,


Dear Mr Balakrishnan,

I enjoyed reading your column today. It is most unusual for the chairman
of a board to make public any item discussed in a board meeting- excuses
for not parting with nformation are more common.

I had occasion to post a comment in my blog. The link is attached.


Dr.T T Ram Mohan              
Finance & Accounting Area          
Indian Institute of Management        
Vastrapur, Ahmedabad-380015    



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