Internationalising Indian B-schools

Updated: Aug 4 2014, 06:42am hrs
Several leading multinational companies, including Adobe, Pepsi, Microsoft, Deutsche Bank, Citibank, US Airways and others, at some point in their history, have been led by CEOs of Indian origin. The vast majority of these CEOs studied in the Indian education system up to the bachelors level. Similarly, some of the most successful faculty members and administrators at global business schools are of Indian origin. It is, therefore, puzzling that there are so few Indian business schools in the global top 100 lists.

One of the major reasons for this is that Indian business schools have not seen the need, until now, to benchmark themselves with the leading global business schools. First, even the certificates that the best Indian institutions (the standalone business schools) offerthe Post Graduate Diploma in Management (PGDM) and the Fellow Program in Management (FPM)are not the same as the globally recognised degrees, the MBA and the PhD.

Second, Indian business schools hardly attract international students. I first studied and later taught at the IESE Business School, which has 56 nationalities represented in the 2013 intake of approximately 280 MBA students. At the China Europe International Business School (CEIBS) where I am currently teaching, 35% of our intake of 180 students is from outside mainland China, with the US, the EU, India and South Korea making up the largest contingents. Other Chinese business schools, mainly at public universities, also attract decent numbers of foreign students.

Third, there are few international faculty members employed by Indian business schools. At CEIBS, more than a third of our faculty is of non-Chinese ethnicity and more than two-thirds have non-PRC passports. Even public universities in China have been able to attract foreign faculty.

One reason India does not attract many foreign students and faculty is that its level of integration with global trade and investment flows is still quite low. Chinas foreign trade (exports plus imports) is 5.3 times Indias, its inward stock of foreign direct investment (FDI) is 4.3 times and its outward stock of FDI is 4.5 times. This brings a much larger flow of international managers and international business opportunities to China. Thus, prospective MBA students and faculty see coming to China as a career enhancing move.

Fourth, very few Indian business schools run joint and dual degree programmes with international institutions. Most leading Chinese business schools run such programmes. This has given faculty members and staff from the Chinese schools exposure to best practices in programme management and has been an important mechanism of knowledge transfer.

Finally, very few Indian business schools have sought to acquire international legitimacy by obtaining accreditation from, say, the AACSB and the EFMD (which grants the EQUIS certificate). Nine Chinese universities have the AACSB and ten the EQUIS certification, whereas the number is two and two, respectively, for India.

In summary, although the MBA degree has only a 20-year history in their country, Chinese academic institutions have shown great determination and purpose in benchmarking themselves with global standards in order to upgrade the quality of their offerings. Indian business schools would do well to learn from them.

(The author is delivering a Special Address at 5th Indian Management Conclave 2014, to be held in Delhi on August 8-9)

By S Ramakrishna Velamuri

The author is professor of Entrepreneurship, and chair, department of Strategy & Entrepreneurship, China Europe International Business School