IIM-L placement session ends, average salary drops 25%

The Indian Institute of Management Lucknow completed its placement exercise with average salary figures dropping by as much as 25%, though the PSU sector and government banks bailed out the students from the otherwise grim job market scenario. The PSU sector was the highest recruiter at IIM-L which saw total number of international and domestic offers dropping drastically.

Though the IIM-L did not reveal the salary figures, Prof Sushil Kumar, Chairman Placements at IIM-L, said that the salary level has seen a decline. He pointed out that the decrease for the 2008-10 batch has been in the same proportion as has been witnessed in the other IIMs.

Sources at the IIM-L said that the tough job market scenario saw the placements exercise being extended, which could only be completed well after the annual convocation ceremony. Despite bearing the brunt of the global downturn, finance came out as the winner once again with 40% of the students opting for it as compared to only 31% last year. Sales and marketing also witnessed a larger number of students being placed, up from 18% last year to 31% for the batch of 2008-10. A total of 284 offers as compared to 496 last year, were made to 267 students of the graduating batch along with 25 pre-placement offers.

CAT enrolment sees 20% rise, GRE, Toefl fall 30%

The global slowdown is taking a toll on the number of takers for international education training programmes. Enrolments for the Common Admission Test (CAT) at MBA test-preparing institutes, however, are in full swing.

Institutes confirm that student enrolment numbers for international education training programmes such as the Graduate Record Examination (GRE) and Test of English as a Foreign Language (Toefl) have fallen around 30 per cent so far. Enrolments for Graduate Management Aptitude Test (GMAT) have been stagnant.

The only exam to see a 20 per cent rise in the number of registrations is CAT — the gateway to Indian B-schools. CAT enrolments in test-preparing institutes continue till early September (the exam is held in November), but GRE and TOEFL tests are held round the year.

At the Hyderabad-based Triumphant Institute of Management Education (TIME), for instance, CAT contributes over 50 per cent to annual revenues. The institute also runs the popular Campus Recruitment Training (CRT) programme. “One would think stiffer competition would make more people enrol for programmes like the CRT or the GRE, but that is not the case,” said Jaideep Singh Chowdhary, senior manager-corporate planning at TIME.

“With people perceiving fewer opportunities, they are putting even their preparations on hold. This could explain the dip in enrolment numbers,” he added.

Delhi-based Career Launcher estimates that enrolments for GRE at the institute have seen a 20 per cent drop. “We will have to wait another quarter and see how the numbers pan out. So far we have seen some slowdown in the international education segment,” said Managing Director Nikhil Mahajan.

US-based ETS (Educational Testing Service), which conducts GRE and Toefl among other examinations worldwide, says that historically, it has seen increases in GRE during economic slowdowns and expects the same this year. However, David Payne, vice-president and COO, higher education, ETS, agreed that GRE volumes in India dropped in 2008.

Payne, however, is optimistic that GRE will have a robust year “because interest in graduate school increases due, in part, to the economy”.

CAT may not go online this year

The Common Admission Test (CAT) this year too may remain a paper-pencil test. Last December, the Indian Institutes of Management (IIMs) had floated a tender and shortlisted four companies to conduct CAT 2009 online. These companies include ETS Prometric, Pearson VUE, Eduquity Career Technologies and Mumbai-based Attest, a wholly-owned subsidiary of Aptech.

The Common Admission Test (CAT) this year too may remain a paper-pencil test. Last December, the Indian Institutes of Management (IIMs) had floated a tender and shortlisted four companies to conduct CAT 2009 online. These companies include ETS Prometric, Pearson VUE, Eduquity Career Technologies and Mumbai-based Attest, a wholly-owned subsidiary of Aptech.

IIMs to review placement plans

The falling job market is forcing the premier Indian Institutes of Management (IIMs) to review their placement strategies. The options include doing away with Day Zero and reducing placement fees.

Day Zero is the name given to the day placements begin at IIMs. Day Zero and Day One are reserved for top companies like investment banks and consulting firms that confirm participation on campus.

The placement fees are higher on these first two days — each company pays Rs 1 lakh as participation charge and Rs 1 lakh as recruitment charge. These charges drop to between Rs 80,000 and Rs 50,000 each for participation fee and recruitment charges on the next few days.

OUT OF PLACE
* Day Zero could go
* Placements could be spread over a week or even a fortnight
* Placement fees could be reduced
* Special strategy being devised to attract government-owned companies
In good times, most students are placed by Day Zero and Day One, which means many of the smaller companies that come to campus later leave empty-handed.

To cope with what one IIM official described as “the madness around Day Zero”, the B-schools are exploring ways of extending the placement process to over a week or fortnight so that all companies have a better chance.

“We are going to re-examine the entire placement process, including the Day Zero strategy and look into what needs to be done for a long-term relationship with companies. So far, we concentrated on a very narrow segment and pool of recruiters,” said Samir Barua, Director IIM Ahmedabad (IIM-A), the oldest and most prestigious of the IIMs.

IIM-A finished its placements last week and recorded a 32 per cent dip in its salary packages. IIM Bangalore (IIM-B) and IIM Calcutta (IIM-C), which have also completed placements, will make the results public on Tuesday.

IIM Bangalore (IIM-B), too, said it will re-examine its placement strategy in the next few days. “We know that the present placement system is an imperfect system. But among all imperfect systems, this is the perfect system,” said Sourav Mukherji, placement chairperson, IIM-B.

The institute has decided to rename its placement cell “career development and placement cell” and will recruit a new person dedicated to look at placement and career development-related activities and liaison with companies.

The IIMs will also look at a reasonable placement fee. This year, many domestic and foreign companies in banking and financial services, consulting and consumer goods had written to the IIMs, requesting them to waive or lower participation and recruitment fees. IIMs said they charge placement fees from companies to meet scholarship and other educational needs on the campus, since the fees for the flagship management programme is heavily subsidised.

Slowing economy may end IIM placements boom

The economic slowdown has finally reached campuses of the premier Indian Institutes of Management (IIMs).

This year, IIM Ahmedabad (IIM-A), the largest and most prestigious of the institutes, has seen a 50 per cent slowdown in placements on the coveted "day zero" (the first day), probably for the first time since the dotcom bust in 2000.

Sources said only 18 to 20 out of 250-odd students were placed on day one yesterday, compared to 40 to 50 in a good year. Last year, when the economy was booming, more than 65 per cent (161 students) were hired by 25 firms on slot zero.

IIM Ahmedabad may have missed regulars like Lehman Brothers and Merrill Lynch on day one of its final "placement week," but new companies from other sectors might save the day for the institute .

The placement procedure is expected to continue till late night on Thursday and sources maintained that sectors like general management, market research, FMCG and pharma will be among the new participants on day one. There is less enthusiasm from foreign firms this time, and it's the domestic ones that are more prominent.

This year, IIM-A has kept the placement development under wraps. According to Samir Barua, director of IIM-A, "There has been speculation in media about the placements. We are only into a day and a half of the placements and it is too early for us to comment."

Last year, 90 firms participated, offering an average domestic salary of Rs 17.85 lakh and an average international salary of $119,000. The highest domestic acceptances ranged from Rs 50 lakh to Rs 70 lakh last year and the highest international acceptances from $280,000 to $360,000. The number of companies visiting campus on day zero this year could not be ascertained.

"It is evident that the economic downturn has affected placements this year. Nevertheless, it has opened up opportunities for organisations in newer sectors like market research and pharma. Investment banks and consulting firms did come on day zero as usual, but so did companies in the newer sectors," said a source familiar to the development.

Meanwhile, IIM Bangalore begins its final placements on Friday and students are keeping their fingers crossed. “The institute has had a subdued response to its lateral placements this year and says there is a lot of uncertainty over the number of companies that will participate in placements,” said a placement official.

The number of participating companies on the campus would come down to around 70 from about 100 last year. In 2008, investment bankers including McKinsey, Lehman Brothers, Boston Consulting, Goldman Sach and Merrill Lynch were leading in terms of placement offers. Most of these companies are not participating in the final placement this year.

About 250 students will sit for placements this year. IIM-B's summer placements were also not all that successful this time. Only 55 students of the 2009 graduating batch have managed to get pre-placement offers as compared to 110 students of the 2008 graduating batch.

Also, unlike previous years when each student managed to get at least four or five offers on an average, this year it might not be the case.

Although all the IIMs have contacted a number of new companies to increase the pool, they are hoping that there is no overlap of offers. “In over-lapping, a student accepts only one offer, the rest get cancelled and go waste. We are hoping this does not happen this year,” said a placement chairperson from one of the IIMs who did not wish to be quoted.

IIM Calcutta, which held the first phase of its final placements process between February 21 and 24, saw 207 offers to 265 students. Out of the 207 offers, 33 are for international locations with assignments in the US, UK, Europe and Asia-Pacific. India still remained the preferred destination most of the students. Around 56 offers are pre-placement offers (PPOs), made to students based on the summer internships. Some PPOs were rejected owing to the expected curb on H1B visas by the US and location preferences.

The institute said it has seen an increase of around 20 per cent in its salary level so far. Last year, IIM-C recorded the highest salary at $340,000 (Rs 1.36 crore). The institute will resume placements on March 2 after the final examinations.

IT companies keep away

Lateral placements (placements for those with work experience of around 2 years) have begun in B-schools across the country. However, information technology (IT) firms seem to be keeping away from campuses.

“This year, placements have not been as easy as last year. Lateral placements, which began last week, have been slow. While other sectors have been coming in, IT services companies have been virtually non-existent,” said ND Sharma, placement co-ordinator, KJ Somaiya Institute of Management Studies. Of the 130 eligible students from the batch of 300 in his institute, around 95 students have been placed.

“Last year, TCS recruited around 10 students during lateral placements. This year, the company took only one student. Infosys is not even visiting the campus,” added Sharma.

Sourav Mukherji, chairperson (placements) at Indian Institute of Management, Bangalore, (IIM-B) said as a part of the cost cutting measures, IT companies are playing safe in case of recruitment. “Fewer IT companies are visiting our campus during lateral placements. Instead of recruiting an average of 10 students, they are recruiting around 6-7 students only this year,” he added.

At IIM Ahmedabad, which is tight-lipped about its placements this year, approximately 120 students are eligible for lateral placements. Last year, around 37 consulting, private equity, real estate, finance, information technology, general management and marketing companies made 103 offers to 112 students at IIM-A.

The institute, however, is moving away from conservative sectors like international banks and consultancy firms and looking at fresh sectors this year. “We are inviting many first-time recruiters to the campus. We are keen to look at new and challenging roles for students. Although firms like consulting firms are among our long-standing recruiting partners, we are looking at a diverse set of sectors and firms this year,” said Mihir Lal, student co-ordinator, placements, IIM-A.

At the Institute of Chartered Financial Analysts of India (ICFAI) University, Ahmedabad, around 120 offers from 33 recruiters have been received for 250 students. “We expect another 35-40 recruiters during the next couple of months. IT companies have shown a gradual decline over two years. This year, there is a definite downward trend. Banking has emerged as a prominent sector. The other sectors that seem promising are insurance, media, FMCG, analytics and pharma manufacturing,” said an ICFAI spokesperson.

“Post-recruitment training is getting more importance now. Unlike last year, when we were the beneficiaries of bulk recruitment, recruiters are very selective this year. Moreover, the expectations of companies are increasing and they require candidates who would be able to deliver on the job,” the spokesperson added.

Harvard's hard lessons

“Do you need to get back to rigorous studies?” asked Patricia.”I am getting rusty, and this programme is for people with 20 years of experience,” I replied, hoping she would donate some savings to finance my re-education. She did not.

Anyway, I landed at Harvard, with 150 other managers, directors, army commanders, bureaucrats, from 55 countries, to school for eight weeks.

The first surprise: Young clergyman John Harvard, whose name the university bears, did not donate much money; he bequeathed £779 (50 per cent of his estate), but 400 books! Thus, the Harvard monogram proclaims, “Books Tell The Truth!”

The second surprise: Harvard is a monastery! Wake up at 5.30 am, exercise; breakfast at 7 am, classes from 8 am to 4 or 5 pm. Dinner at 6.30 pm. Then, living-group homework between 8 and 11 pm. Later, return to your room to revise the next day’s case studies.

Certainly the professors were brilliant. Professor Yoffie taught us to encompass the strategy of mega corporations like Microsoft in one simple line. Professor Furhan guided us through labyrinths of international finance.

Dean Light and Nobel laureate Robert Merton explicated the causes leading to the financial meltdown. Professor Vietor reduced complex country budgets to ordinary balance sheets. “Identifying a consumer need is the seed of successful businesses,” said professor Quelch. Professor Nabil unraveled the mysteries of hedge funds.

To sleep five hours was a pure vision. Weekends involved incremental classes, meetings, working-dinners. Professor Tushman used case studies on Nike, Airbus and Wal-Mart to usher reality in class. We read cases during mealtimes, in taxis, and even at the barbers’! It was an intravenous injection of concentrated knowledge.

Professor Kotter lectured a day on leadership, and counseled that though we may learn 7,000 new ideas at the course, on return we should focus on just two. His ultimate warning was: “If I meet you at some airport, five years hence, I will only ask you, ‘What are you doing in your life?’”

That was the pivotal lesson: What are we doing with our lives? Do we matter in the lives of the poor, weak, embattled? Marketing, finance and production teach us to sell shampoo, shoe polish, shaving cream. But is that our principal goal in life? How do we build a better community, and become leaders who make a difference?

Five weeks and 2,500 pages later, my eyes were red and swollen. I would sneak out and take long walks in the lush, manicured lawns of the campus, dodging darting squirrels and turkeys. It was fall time, dry brown leaves fluttered in the cold, freezing breeze. I ruminated on why some companies turned monolithic, others atrophied.

We pondered how our lives could have been, had we come to Harvard earlier. Harvard is a factory, producing presidents for countries and corporations — John Kennedy, Bill Gates, Rahul Bajaj, to name a few. Harvard is flush with endowments of $38.7 billion in the treasury. Its mahogany classrooms, carpets, art, living rooms, symposium halls would rate it a seven-star school.

In eight weeks, 150 students from multifarious continents stayed interwoven into a stout community. We willingly gave up preferred pleasures to keep the team bonded. The minds exercised, but the hearts ruled. We knew we could lean on each other, anytime, anywhere. Eight weeks and 900 hours of hard academic labour forged us into caring friends and alumni. I fantasised: cluster/insulate leaders like Obama, Brown, Bin-Laden, Manmohan, Zardari, Ahmadinejad, Peres, under a roof for two months to hammer out a “Peace Plan World 2009”. The Harvard Advanced Management module of work might deliver.

Folklore builds institutions. The myth around this progra­mme is that, on completion, 60 per cent of the participants change jobs and 20 per cent change partners.

On my return, Patricia queried, “Have you been transformed? Are you promoted? What are your plans?”

I replied, “My plan is to sleep. I suffer from ‘acute sleep-deficiency’. Then, I will labour five years to return my bank loan of $70,000 for my management pilgrimage.”

“Professor Kotter will be desperately disappointed in you,” she ruled. Perhaps.

Rajendra K Aneja is the chief executive officer of a foods company in Dubai.