Enhancing quality of business education in india

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Management education in India is fast undergoing a radical change and great demand especially after the change towards liberalization, privatization, and globalization. But there are several challenges to improve our nation management education. The rapid growth and proliferation of business schools, has led to the emergence of some schools having dubious quality and business education has come under scrutiny. Therefore, it would be fruitful to investigate the challenges for enhancing the quality of business education in India. In the paper, describe areas of concern such as quality assurance, quality of students, faculty shortage and development programme, proper infrastructure & facilities required for institutes, development of teaching material and case studies, networking, internationalise management education, post-experience and distance learning programmes and role of professional bodies and authorities with respect to AICTE for development of management education in India.


Management education in India is fast undergoing a radical change and great demand especially after the change towards liberalization, privatization, and globalization. But there are several challenges to improve our nation management education. Today there are over 1700 management institutions in the country. Nearly one lakh management graduate pass out every year in India, providing a tremendous potential to contribution of a 'Knowledge Society'. Management is a much sought-after field for Indians. Today, the best and brightest students want to study management because it is a sure way to well-paid jobs with great prospects for advancement. In 2008-09, there were over 102,000 students studying for a Masters of Business Administration or its equivalent.


No. of

Business schools added


Annual addition

1950-80 (30 years)



1980-1995 (15 years)



1995-2000 (5 years)



2000-2006 (6 years)



Source: Adapted from Dayal, I., "Developing Management Education in India", Journal of Management Research, 2(2), August 2002, page: 101.

This vast number of Business Schools needs to satisfy two main questions such as,

Are they really providing quality of management education to students to sustain in corporate world?

What will be the quality of budding managers who are produced by these management institutes?

The short answer is no. Many of the over 1700 or so management schools recognized by the All India Council for Technical Education The All India Council for Technical Education (AICTE), is the statutory body established for proper planning and co-ordinated development of the technical education system in India. It was established in November, 1945.  (AICTE AICTE All India Council Technical Education ) have minimal faculty, most of whom have little practical experience in management and who undertake little research of decent quality.

Also there are several challenges of management education which require change in the character and structure of management education, integration of management education with corporate sector, up gradation of curriculum and course content, designing of different programs for executives, maintenance of an efficient and effective regulatory system of check mushrooming, and emphasis on research.

So now it is necessary examine the areas of concern, the key issues which the apex institution, AICTE should focus upon in uplifting the management education and making Indian MBA world class.

Because when we talk about the management education, we are basically referring to the shaping up of the student to develop the competency and capability either as an intrapreneur (to join and help an organization to grow) or as an entrepreneur (to establish and grow one's own organization). This capability does not necessarily always come from possessing a piece of paper whether called "degree" or "diploma" in Management, but also by means of developing the will & skill to contribute for Self reliance and self sustenance in nation building.

Management education cannot be compared with studying other subject areas like chemistry, physics, mathematics or law etc. Management education can rather be compared with medicine. No doctor is allowed near a patient purely on the basis of theoretical knowledge. Doctors learn the professional skills by acquiring the practical knowledge that is taught by practicing doctors and hence they become experts in diagnosing the real physical condition of patients. In the similar way, in a business scenario also you have to do things, take decisions, take actions, and monitor results.

The existing system of Management Education is alienated from real life. There is a gap between the subjects and the objectives and this cannot achieve such goals as national development, building an ethical, religious and spiritual value in business etc.


The management education system of our country is beset with a host of problems and challenges. The sudden proliferation of management institutions has lead to a considerable decline in the quality of education that is being offered.

In order to install the quality in the management education in India, the AICTE, apex institution in the country and universities should focus on the following issues -

Quality Assurance

Quality Of Students

Faculty shortage and Development Programme

Development of Teaching Material and Case studies


Internationalise Management Education

Role of professional bodies and authorities etc.

Post-Experience and Distance Learning Programmes

Proper Infrastructure & Facilities Required For Institutes

Quality Assurance

As management education grows and students, graduates, and faculties become more mobile, we must be increasingly concerned about the maintenance and assurance of quality. Government Regulatory Agencies such as AICTE have developed deep, yet flexible, standards to assess quality and support continuous improvement. These standards cover the full breadth of quality dimensions: mission, strategy, faculty, students, staff, curricula, educational outcomes, and research.

The standards define quality and, because they are linked to the mission of the school, they are designed to ensure that quality depends implicitly on whether the promises of schools and expectations of students and employers are met. The standards allow for a wide range of promises, as long as they are communicated accurately and delivered sufficiently.

Unfortunately, growing demand and competition can increase the incentive for schools to exaggerate promises, leaving their graduates with unmet expectations. In the environment we described above, with doctoral faculty becoming more scarce and with shrinking financial support from governments, there are tremendous pressures to cut corners, promise more, and deliver less.

Quality of Students

The quality of students entering business schools is very important to consider. As described earlier, traditionally, education in commerce was not seen as the educational path of the brightest students. However, currently, getting accepted into a well regarded business school is seen as very attractive career. IIMs have been ranked at the top in several surveys of b-schools in Asia-Pacific region, and admission to any IIM is seen by most as a passport to a fast track career at the national and international levels.

Each year about 200,000 aspiring candidates take Common Admission Test or the entrance exam of the IIMs. Of these 1,100 will be selected to join one of the IIM's. For example, IIM Ahmedabad has 200 seats. Thus admission standards are very high. Collectively, the IIMs have been recognized as the world's number 1 in terms of their selectivity, and difficulty of getting admission into.

An interesting aspect of the selection process is the use of different admission tests and procedures by different business schools, unlike the US where GMAT is used as a standard test score. The Government of India tried to introduce a common admission test for the b-schools but the Supreme Court of India rejected that attempt. The Court ruled that "private educational institutions have a personality of their own, and in order to maintain their atmosphere and traditions, it is necessary that they have the right to choose and select the students who can be admitted" (Goswami, 2003). The merits of a common entrance test are debatable and proponents will feel there is a need to develop some measures of equivalencies among scores of different admission tests, so that the quality of the inputs can be isolated from the quality of the academic process while making comparisons among different b-schools.

Faculty shortage and Development Programme

Non availability of adequate proficient faculty is a major constraint for sustainable growth of quality management education in India. The institute must have permanent or regular faculty in all the main areas of Management like Marketing, Human Resources, Economics, Information Technology, Accounting & Finance, Quantitative Methods and Production.

Each of these faculty members must meet at least one of the three criteria -

Senior managerial experience with a leading organisation along with ability to relate the same to the management concepts,

Consultancy experience in the corporate world and

Research experience in management.

If the faculties are simply graduates, post-graduates or PhDs without meeting these criteria then they would be just teaching the theories from the books which are not really relevant for a managerial career. Management career is about practice of management, which can be taught only by experience, expertise and exposure together with the relevant concepts.

The present faculty also needs to be adequately trained in the area of current and emerging trends. Established institutions, including do not take adequate interest in training management teachers in view of their need to generate additional knowledge.

There is, therefore, an urgent need to plan a crash programme to train Management teachers at selected management institutions. Faculty resource should be further strengthened by industry providing professional managers from different disciplines with successful track records as Visiting Faculty on lien or on deputation basis.

Also focus on revenues for attaining self-sufficiency. They are also facing a flight of talent to some of the new institutions, due to lure of attractive locations and even more attractive compensation packages. It is in fact posing a real danger that the established institutions may be weakened in the process, at least in the short term.

Development of Teaching Material and Case studies

Very few institutions in the country have been able to develop adequate teaching material including cases in terms of Indian ethos in management. There continues to be a very heavy reliance on foreign text books and cases. We need to nurture wide-spread management research including case research and publications indigenously.

The courses and programmes must be in line with the requirements of the corporate world and other organisations. It means these must have regular inputs incorporated from these organisations and not based on some books authored by someone who never had any exposure to the management career, consultancy or research.


India's corporations must become true partners in building the management education programs by supplying ideas, knowledge, capital, financial investment, and on-site experience for students, enabling them to learn in real-world situations.

The institute must have extensive networking with the corporate world and other organisations nationally and internationally. This networking, on the one hand, makes it possible for the regular interaction of their senior managerial personnel with the students while, on the other hand it will help to understand their requirements and reorient teaching, training, consultancy and research activities to meet the challenges of globalisation and liberalisation.

This also enables these organisations to consider the students for placement when they complete the programme.

There should be a formal forum for frequent interaction of Management institution and Management Associations, Chambers of Commerce & Industry and other professional bodies for upgradation of Management Education.

Internationalise Management Education

Business schools in India can design themselves as global institutions; building globally distributed educational programs and deep partnerships around the world right from the start.

As the business is getting global, day-by-day, there is an increasing need for the institutions to produce global managers. Therefore, it has become necessary that Indian Management education should also become more global. The message is quite clear; the response to the globalization of business is the globalization of management education.

The following are the directions in which the Business Schools can focus to make management education global -

i. The business schools must admit international students to the program. The Indian management institutes are the only ones with no international participation.

ii. The business schools should induct a few international faculties and provide an opportunity to the students to listen about other country's business culture and systems.

iii. They should provide an active program of students and faculty exchange with advanced countries.

iv. To ensure that at least 25% of the curriculum deals with international subjects like international economics, international marketing, international financial management, etc.,

v. They should collaborate with some well known foreign Business Schools by which Indian students can do part of their education in those institutes.

vi. Lastly the Business Schools also collaborate with some foreign placement consultancies to make sure at least some students can attain jobs abroad.

Role of professional bodies and authorities etc.

How does one select a good management institute for acquiring this capability? The tendency in India has generally been to go for the "recognised" courses or management institutes. But recognised by whom?

Here people forget the basic concept of a customer. While for a teacher the customer is the student, for a management institute the customer is the corporate world, other organisations and the society at large. Therefore, the management institute should be recognised by the corporate world, which is the largest recruiter of the management students. However, unfortunately the gullible students aspiring for a managerial career and their parents tend to generally look only for the governmental seal of recognition or approval.

In 1987 the Government of India had established a statutory body called "All India Council for Technical Education" (AICTE) with a mandate to ensure and regulate quality in management education in India.

Recently, to encourage a process of continuous review, AICTE has also launched National Board of Accreditation (NBA), using a benchmarking system with regard to factors such as physical infrastructure, quality of inputs, and faculty training. However, falling standards of schools approved by AICTE dropped its credibility. It is reported that many business schools got AICTE approval on the basis of attractive project plans, which never got implemented, so that some of them operated "virtually from sheds and garages." (Raghunath, 1998) The result is that most b-schools have abstained from seeking accreditation under NBA.

However, as per an Expert Committee Report submitted in May 2001 to the Union Minister for Human Resource Development, a large majority of these AICTE approved management institutions to the extent of shockingly high of 90% are sub-standard. Though these institutions have the "approval" or "recognition" by the AICTE but a large majority of these do not have the required faculty, facilities, courses and programmes.

If AICTE approval is no guarantee for quality management education then how does one choose a management institute, which would really lead a student to truly a managerial career?

Task for AICTE

In the years to come the demand and supply conditions concerned with MBA is going to see a mismatch.

The AICTE should act tough on certain key issue like:

a) It should allow minimum number of new management schools of quality to come up in next year's.

b) It should permit some good mid-level Business Schools to increase their intake capacity from the existing ones.

c) It should also consider encouraging some of the leading corporates to establish their own management schools.

d) AICTE should make each and every college accountable for all the information that they provide in the prospectus.

So there is a need to create a separate independent promotional/registry institution for management education and to replace the current regulation being carried out by the All India Council for Technical Education (AICTE), which is primarily concerned with engineering education.

So, what is the road ahead for AICTE? NKC's Pitroda has called for its role to be redefined. He has proposed an Independent Regulatory Authority for Higher Education for bodies like AICTE and the Medical Council of India (MCI), limiting their roles to that of professional associations. Sunil Bahri, Executive Director, NKC Says: "The role of AICTE should be to nurture institutions. It should focus on issues like faculty development and curriculum. Even accreditation should be assigned to other agencies."

Other analysts agree with NKC's line of thinking. Says Das: "Regulators should only ensure that institutions provide mandatory disclosures on the internet about their courses, faculties, fees, and facilities. Professional rating services should evaluate colleges the same way as CRISIL rates companies. This will make the system credible and competition will take care of the rest."

Self-Reliance through Resource Generation

The issue of self reliance of management institutions has/been raised on a number of occasions in the past and has also been commented upon by the Kurien Committee on IIMs.

The experiences of a large number of Management institutions in the private sector do clearly demonstrate that with a proper fee structure, the institutions in the Government sector including universities can also be self reliant.

While the commission should take a firm view on this aspect, the need to provide necessary resources to meet the capital needs of these institutions may however have to be agreed to, at least for a limited period. However, a point that needs to be considered is as to whether the Government Sector (University/IIMs) should any more invest in this field considering the fact that private sector can and should do equally well and provide quality management education.

At least some of the leading Management institutions from the Government system and the universities must aim at building a Corpus Fund to meet certain portion of their operational budget requirements. This can be done with innovative approaches in fund raising.

To achieve these objectives of self-reliance, the Working Group of NKC recommends that Management institutions:-

Raise the tuition fees to a level which can be justified by the market situation, say between Rs.25000 to Rs.40000 per year.

Introduce a service charge on every organisation that visits the management institutions for campus recruitment. All the 4 IIMs have already started this practice. It is possible for the University System to emulate this.

Reserve upto 20% of the seats for industry sponsored or NRI students, for whom the fees could be at least 4 times that of what is charged from Indian students.

Encourage faculty to take up training and consultancy for Industries which should become a major source of revenue for these institutions. The practices followed in this regard at the IIMs may be emulated by the University system.

Establish in every major town/city/area where a management institution/University Management Department is in operation a partnership alliance with a `lead industry' so that material and manpower support is available from that industry, in addition to the students and faculty having opportunities to interact with the industry.

In terms of the relative roles of the Private Sector and the Government sector in meeting the ever-growing demand for professionally trained managerial manpower in the country, the Working Group recommends that: The Private Sector should be encouraged to play an increasingly dominant role in meeting the professionally trained managerial manpower needs of the country.

Post-Experience and Distance Learning Programmes

Of late some institutions like IGNOU, AIMA offer distance learning programmes in Management Education for employed graduates. Such avenues should be strengthened, particularly with the opportunities provided by information technology with respect to remote teaching.

Similarly, there are Management institutions which offer long term part-time evening programme for working executives leading to Post Graduate Diploma/MBA avenues for post-experience training should be extended and upgraded to Cater to those who cannot afford full time Management Education.

Proper Infrastructure & Facilities Required For Institutes

Following are some of the things that can be done while setting up such an Institute-

The infrastructure and facilities must include classrooms with multimedia and projection facilities.

Latest computers and peripherals and a good library with collection of books on all management subjects.

Institute will have to organize seminars inviting Industry participation

Campus will have to be 24x7 open for the students

It has to be located in an area where some of the teachers can stay in the same campus along with the students who will stay in the hostels.


The present management education survived for nearly five decades in India and struggling to expand beyond national and geographical boundaries. With the boon of rapid changing technology and communication, the educational system is undergoing drastic changes although the pace is slow.

India's management education is undergoing a major transition. In India, there is a considerable hope and expectations regarding the value of management education and its potential contributing largely to nation's economic growth.

However, the renewed emphasis in the education sector in the 11th five year plan and increased expenditure in higher education can act as palliatives for the Indian management education system.