Iim All Yours

The Indian Express - November 22, 2008

The Bhargava Committee Report: A Leap Backwards (PART II)

How the Bhargava Committee Report surrenders all significant control to the government

After the emasculation of the IIMs through two tier board control and a careful process of selection of the "right" board members, comes the bit about the "co-ordination" that the pan IIM super board will do amongst the IIMs, bringing them all down to the lowest common denominator. The report preaches the doctrine of 'sameness' across all IIMs, ignoring the idea that strategically, differentiation is what makes the larger IIMs collectively more competitive. IIM C chose a more analytical, quantitative orientation while, IIM A, pursued a more generalist program, inspired by its original collaborator, Harvard Business School. IIM B has gone the functional and sector specialization route. In recent times, IIMA has chosen to launch a one year executive MBA and a one year program for policy makers and development sector folks; both are very successful, took a lot of effort to create, and happened because some of its faculty were passionate about it and took the initiative. That's how academic institutions produce good work - fiats and mandates from higher up never work without faculty passion and motivation.

To discourage all such "non centralized" entrepreneurial activity, the report also recommends that the pan IIM board should have the power to transfer faculty that they consider underutilized in one IIM to another. Faculty have moved across IIMs and will continue to do so - but their choice depends on their interests and priorities, and not because some underemployed pan IIM committee with the dangerous weapon of "transfer" in its hands, decided to "load balance". The committee clearly does not understand the value of brand differentiation, or what motivates knowledge workers; perhaps because control, and not value creation, is their primary paradigm.

The report is accurate in its description of the current situation at IIMs. Yes the IIMs are not in good shape on many counts, and their lack of scale is a very valid criticism. The report,in the section called "Our analysis", says that the reason for this is that the boards of IIMs have not functioned well. Ironically, the Chairman of the board whose job it is to ensure that the board functions properly is selected by the MHRD.

On the issue of building scale, the report says "It may be argued that IIMs also did not have funds to build the infrastructure required for expanding capacity. However this argument would have had greater weight if well thought out proposals for expansion, and the needed funds, had been sent to the Government and had been rejected. This did not happen". Had the committee bothered to study the minutes of board meetings and the files pending with MHRD, instead of relying on the oral tradition of impressionistic interviews, it would have noticed some well thought put proposals gathering dust there, or having been turned down. A proposal for increasing faculty strength at one of the leading IIMs lay in the ministry for a year with no response. There is a well thought out proposal to operate overseas, earn good money, provide faculty learning, and forge research alliances, which was turned down. Till recently, the director of IIM could not travel abroad without a trip-by-trip clearance from MHRD, despite approvals of annual expense budgets by the board. The faculty pay is determined by the government as well as the consulting rate and how many days of consulting that can be done. So is this a board malfunction or a deeper malaise that is evident in the health of many PSUs? Will more government controlled governance solve this problem or make it worse? Is this situation one that motivates everyone to do their best? And is it not amazing that the IIMs even deliver the limited areas of excellence that they do, despite all this? Several other universities have dived headlong, under similar situations.

The boards of some of the IIMs like IIM Ahmedabad, have insisted on it becoming economically independent and funding its own expansion through internal resources - class sizes were gradually being increased before the OBC reservation and new long term programs have been established. Going with a handout to the Government is what their board explicitly forbids. The Government, by the way, has not provided all the funds requested for OBC expansion, which was part of the deal for speedy implementation of the new reservation policy. The institutes however stay committed to implementation as planned.

The recommendations of the report effectively say that the way to save the IIMs is to inject them with more of the same virus that got them diseased to begin with. And in this day and age of liberalization, and more so, with the abysmal track record of MHRD in running several great universities to the ground, the recommendations in this report are low on both intellect and integrity.

What's the solution? Give real governance a chance. Let the MHRD mandarins not talk directly to Directors of IIMs but let them function through the board. Lay out output expectations from the institutes and as shareholders do, let MHRD as a stakeholder demand that the board gets tough and monitors them and to drive performance. There is a well thought out proposal, on accountability and autonomy of IIMs, submitted by IIM Ahmedabad, under the guidance of its then Chairman Shri Narayanamurthy lying in MHRD for over three years, un acknowledged and un responded to. Let's implement that.

Why should readers engage with and worry about whether such a report should be implemented? Because as citizens, we must realize that it is our money and our institutions and our children's future that are being messed with. Many of us came from modest backgrounds, and had the benefit of a great education in good universities and institutions, run by educationists who cared about our education. We need to extend that same benefit to our next generation. We need role model institutions of good governance leading to good quality, to inspire several other institutions and create a positive movement in citizen driven improvements in education.

One of the subtitles of the report is IIMs: From great teaching institutions to thought leadership". Thought leadership requires an enabling environment, and if that is the goal of this report, then thought leadership to begin right there. Another subtitle of the report is "negotiating the Big Leap". Let us make it the big leap forward, not the big leap backward.