Management Education in the Competitive Arena

- A Study of South Bangalore.

Introduction:
In the present global economy and knowledge era, there is a paradigm shift in the
required skills and knowledge to manage all type of organizations and institutions
worldwide. The changing environment has increased global and regional transactions in
both the production and financial spheres of economic activity. The human
interdependency throughout the world has integrated the states nations and markets and
this has created an international division of labour where the wealth creation increasingly
comes from the economic factors of other countries. Since the business organizations are
passing through these critical rapid global changes the managers of these organisations in
all countries need to be extra smart and faster to respond to the new challenges in a
systematic manner.

India is emerging as a successful player since it has adopted globalisation in 1991-92. An

agriculture-based economy, which was recording an average of 3.5 per cent GDP till
1990, has recorded a growth in all fields. Since 1991, India’s GDP has averaged to 6.5
per cent, one of the highest rates in the world. This is expected to increase to 8 per cent
during 2005-06. This hike is largely due to the opening of its markets, the deregulation
of its economy, and the privatization of its public sector enterprises. The development of
information technology industry has made India a powerhouse in a sector that is
transforming the world economy. Statistics reveal that the trade and commerce and the
service sector contribution towards the GDP is more than 70 percent of the total. Since
the size of India’s middle class exceeds the total population of United States or European
Union it is considered as one of the most happening emerging markets in the world,
therefore its domestic market also is growing along with foreign trade. Demand for
talents and skill in the field of trade and commerce both by MNC’s and Indian
companies today has increased beyond anybody’s imagination. Therefore, the business
educators in the country should gear up to exploit full benefits of it.

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Challenges of Globalisation and Business Education:
The global integration has progressed rapidly but unevenly. The wide disparity between
countries resulting from the integration is manifested in many indicators of divergences
in incomes, exports, taxes and worker remittances. Since the factors of production and
wealth creation flows from different countries the societies are changing, cultures are
integrating, customers’ needs are changing and the markets are collaborating. The other
problems are job displacement from low-wage countries, constraints on national policy
making, economic disruptions. Therefore the qualities required in a leader/manager are
also changing. The qualities desired by the globalised industries in a manager are:
 Core competencies in strategic orientation,
 Team leadership and communication,
 Concern for personal development,
 High standards of professionalism,
 Achievement motivation and
 Soft skills.

Present Indian Scenario:

The country has paid due attention towards business/commerce education since
Independence. In the past, the periodic changes in industrial and trade policies of the
country prompted the business educators also to change the curriculum they offered to the
learners in business management courses. Time and again the institutions, universities
and other business education centers in India in collaboration with ICWAI, ICAI and
ACSI have succeeded in meeting the challenges of changes. Today, India is addressing
the need for leadership and professionalism for global competitiveness, through the
development of intellectual capital. It is framing policies to produce skilled managerial
and technical manpower to provide a distinct cutting edge in the global competition. It
must be noted that Indian government has brought impressive changes in the policies of
universities and higher education, particularly by making accreditation of colleges and
universities compulsory, offering autonomy to universities and colleges, and by granting
the permission to the universities to open their campuses abroad. But the changes in trade

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and commerce are taking place so fast that there is a gap identified between the demand
for and supply of the managerial talents and skills.

MBA is the most popular business management qualification in the world. In India it is
fifty years old. The first Indian Institute of Management (IIM) was set up at Ahmedabad
in 1961 with the help of Harvard Business School and today there are 11 such institutions
in the country. No doubt that IIMs produce managers of world class, but the number of
such institutions is very small. Where as, Commerce / business education in India started
in 1886 in Madras and today it is spread all over the country. India has around 1700 B-
Schools recognized by AICTE providing higher business education. Apart from these
institutions, there are 306 universities and 15000 colleges playing an important role in
providing business education. Today 75 million learners pursue higher education in India
and it is expected to be 160 million by 2025 of which above 50 per cent of them are
expected to pursue business / commerce education. ‘The Higher Education in India’, a
vision and action country paper by UNESCO World Conference on ‘Higher Education in
the Twenty-first Century’ has made it known that there are more PhDs in India per capita
than anywhere in the world. But it is also true that Indian companies or Indian employees
often fall short of delivering what is intended and this is something that needs to be
looked into seriously if India intends to compete globally.

Majority of the Indian youth get their business education through universities, colleges
and other institutes, which are not of ‘A’ grade, and are slow in adapting to the
requirements of India’s changing economy due to various reasons. Industry today is
unhappy because the best students who come out of such colleges with flying colours are
not able to cope up with the demands of the business world. Hence, corporate houses are
stepping in to provide training in areas where India's state-run vocational schools and
universities fall short. Infosys has its own leadership training institute established in
Mysore, where the required soft skill training is provided to all their newly recruited
employees. Pantaloon Retail, India's largest discount retailer, funds two-year retail-
management courses at two colleges in Bombay and will soon set up its own retail
school. "Someone has to fill the gap if government doesn't do it," says Pantaloon Chief

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Operating Officer Ved Prakash. Human resources consultancy Ma Foi runs what it calls
"bridge" training courses in Madras for companies whose potential recruits fall just short
of hiring. In fact from 1st April 2005, several universities of multinational nature have
started luring the students with their attractive curricula. Since the fee structure is heavy,
the middle class Indian is not able to afford this in the near future but in the long run, the
Indian universities and colleges might have a natural death unless they stand up now to
face the challenge. Therefore, a empirical study was conducted with a sample survey of
100 students belonging to two management institutes and 10 industries at Bangalore
south.

Objectives of the study:

The objectives of this study are to identify the exact cause for the gap between the
management skills required by the present industry and the management skills acquired
by the candidates/students during their course of study and to make necessary suggestions
to bridge the gap between talent available and talent required.

Statement of Problem:
The demand for India’s labour force is increasing day by day because the companies
worldwide are rushing to take advantage of the country’s cheap and abundant labour
force. India has a huge educated workforce but it is identified that they lack skill of
adapting to corporate culture. IIM and few A grade institutes such as ICFAI, MAAHE,
TAPIME produced MBAs are much wanted candidates by both national and
multinational companies because of their brand image and adaptability. But the numbers
of such candidates are very few. The rest of the MBAs produced in the country have
problems either to get a right job or to retain the job. The attrition rate of employees in all
most all type of companies is nearly 25 percent to 40 percent. The companies blame it on
the education system. Therefore, business educators have double responsibility in
equipping their students to face the challenges of the global world and to supply enough
talented and trained candidates to the corporate world. This study tries to identify and
analyse the reasons for the students’ failure in facing the challenges posed by the present
corporate world and also tries to identify the requirement of the corporate world.

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Methodology:
For any scientific study of human behaviour, methodology occupies an important place.
In this endeavor, the primary data has been collected from the 100 business management
education (MBA) students and 10 industries with the help of a structured questionnaire in
south of Bangalore city. Only the MBA students are taken as samples for conducting the
survey because in the present atmosphere it is only they who aspire to be the
managers/leaders. The questionnaire was administered to the students and industrialists
personally. The fieldwork was completed in the first week of February 2006.

Limitations of the study:

Though management education is required world wide, this research paper is confined to
southern part of Bangalore city. Given the number of students and business houses at
Bangalore south, the 100 students and 10 industries may not be adequate. The sample
size is limited by the time and finance factors. However this attempt is made with
appropriate methodology. Though it is not an exhaustive study of factors responsible for
the gap between academia and industry, it definitely indicates the attitude and preferences
in industry. Thus this could be a representative study of challenges of globalisation in
business education.

Results and discussions:

Students are the ‘King Pins’ in the business education. Job opportunity being the criterion
for management learning in business education, students prefer MBA degree which can
increase the chances of getting the managerial post in industry to earn good salary.
The present study is on the respondents’ opinion towards relevance of the curriculum
offered by the institutions and universities to enable them to face the challenges of
globalisation. The analysis includes the profile of the respondents, their opinion on
college, teachers, relevance of curriculum, skill development, industrial visits, business
lab, computer lab, campus selection, their orientation towards job and self employment
and the seniors’ job related problems. The requirement of industry, and their opinion
towards the capabilities of present day fresh managerial candidates also is included in the
analysis.

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 Table 1
Distribution of Respondents Based on Percentage of marks and specialization subject
% of marks HR Marketing Finance Total
Below 60 % 2 - - 2 (2)
60 % to 80 % 19 27 09 55 (55)
Above 80 % 1 11 31 43 (43)
Total 22 (22) 38 (38) 40 (40) 100
Figures in the parentheses are the percentages.
Table 1 reveals that out of 100 students sample only two of them had secured below 60 %
of marks in the previous examination. 55 of them had secured between 60 to 80 percent
of marks and 43 of them had secured above 80 percent of marks in the previous
examination.

The two students who had secured below 60 percent of marks, 19 students securing
between 60 to 80 percent and one student having above 80 percent of marks have chosen
HR as their specialization, 27 students of 60 to 80 percent and 11 students of above 80
percent have chosen marketing as their specialization, 9 of 60 to 80 percent students and
31 of above 80 percent students have chosen finance as their specialization. All 100 of
them say that they chose these subjects because of good job opportunities. It can also be
observed that majority of above 80 percent students think that finance is the field, which
has much scope. Marketing is also equally popular subject chosen by 38 students. HR
chosen by 22 students is also emerging as an important subject of specialization.
Table 2
Opinion on the college, teachers and teaching
Statements Below 60 % 60 to 80 % Above 80% Total
Teachers are talented 2 (100) 22 (40) 18 (42) 42 (42)
Teachers use innovative methods 2 (100) 23 (42) 19 (44) 44 (44)
of teaching
Teachers give individual attention 2 (100) 21 (38) 28 (65) 51 (51)
College is disciplined 2 (100) 22 (40) 20 (47) 44 (44)
Figures in the parentheses represent the percentages.
From the table 2 it is clear that mediocre students are very happy with the college,
teachers and their method of teaching but totally it is only around 45 percent of students

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who are happy with their college and the abilities of teachers but the rest of them are
unhappy with the teachers, their ability to teach and the college as such.

It can be understood from the study that even though the MBA course is very popular
course, and the colleges are successful profit wise, students are realizing that the colleges
are not providing what they have to be and what they are promising. If this trend
continues, then the present regime of foreign universities and institutions will prove to be
fatal to Indian institutions.
Table 3
Relevance of curriculum:
Curriculum Syllabus Theory and skill
% of marks Number of % to Number of % to Number of % to
respondents total respondents total respondents total
Below 60 % 2 (2) 100 2 (2) 100 2 (2) 100
60 % to 80 % 39 (55) 71 32 (55) 58 31 (55) 56
Above 80 % 26 (43) 60 30 (43) 70 29 (43) 67
Total 67 (100) 67 64 (100) 62 (100)
Figures in the parentheses represent the totals.

It can be observed in table 3 that 67 percent of the students agree that the curriculum set
by institutions and universities are considered to be good. 64 percent say that the syllabus
is relevant and 62 percent say the skill development and theory combination offered by
the institutions and colleges are up to the mark. On an average around 65 percent students
are happy with the present status of management education but the other 35 percent of the
students are not happy with it. 35 percent of the student community means a large
portion of the students whom the colleges and institutions cant afford to loose.

Table 4
Skill development and industrial visits

Usefulness of skill development Useful ness of industrial visit

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% of marks Number of respondents % to total Number of respondents % to total
Below 60 % 2 (2) 100 2 (2) 100
60 % to 80 % 41 (55) 75 39 (55) 71
Above 80 % 22 (43) 51 26 (43) 60
Total 65 (100) 65 67 (100) 67
Figures in the parentheses represent the totals.
It is obvious from table 4 that around 65 percent of the students agree that both sill
development included in the syllabus and the industrial visits arranged by the colleges
and institutions are useful for them to understand the working pattern of the industries but
the other 35 percent say it is not enough.
Table 5
Relevance of business lab and computer lab

Relevance of business lab Relevance of computer lab

% of marks Number of respondents % to total Number of respondents % to total
Below 60 % 2 (2) 100 2 (2) 100

60 % to 80 % 8 (55) 15 52 (55) 95
Above 80 % 6 (43) 14 41 (43) 95
Total 16 (100) 16 95 (100) 95
Figures in the parentheses represent the totals.
It is clear from table5 that only 16 percent of the students feel that there is any use from
the business lab. In fact majority of the students said that they don’t have any business
lab. Whereas 95 percent of the students agree that computers and computer lab is a grate
help for their studies. Establishing a full-fledged business lab can help the students to be
familiar with the materials they need to use in the industry and will help them to gain
practical knowledge.

Table 6
Orientation towards job and self-employment
Specialization Total no of Number of students % to No. of students seeking % to
chosen students Seeking job total self employment total
HR 22 15 68 7 32
Marketing 38 29 76 9 24
Finance 40 32 80 8 20
100 76 76 24 24

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It can be observed from table 6 that more than 75 percent of the students study only with
the purpose of getting a job and getting a fat salary. Only 24 percent of the students say
that they intend to be self-employed after working for few years. It shows that
management education has failed in initiating entrepreneurship among the students.
Table 7
Seniors’ work place problems
Number of respondents % to total
Adjustment problems 86 86
Lack of soft skills 3 3
Short of subject knowledge - -
Lack of practical knowledge 11 11
Total 100 100

Table 7 reveals that the 86 percent of respondent students feel that their seniors who have
got good jobs have adjustment problems, 11 percent have problems because of lack of
practical knowledge and only 3 percent feel that they lack soft skills where as the ten
industrialists who were interviewed felt that all new managers have adjustment problems
because they lack soft skills. Table 8 shows the opinion of industrialists regarding the
managers they appoint.

Table 8
Procedure of selecting the manager
Software % to Manufacturing % to
companies total companies total
Promotion 2 50 4 100
Placement cell 4 100 1 25
Campus selection 3 75 -
By calling up applications 3 75
Casual callers 2 50
Online selection 3 75 -
Through employees 4 100 1 25

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It can be seen in table 8 that all manufacturing industries prefer to promote their
employees as managers. They also appoint managers by calling applications from
experienced candidates and the experienced casual callers. But all software industries say
that they prefer to appoint their managers either through placement cell or give
preference to those who are introduced by their existing employees. 75 percent of the
companies said they go for campus selection and online selection. This trend shows that
different companies follow different procedure in selecting their managers.
Table 9
Qqualities preferred in a manager/leader
Number of respondents % to total
Communication skill 10 100
Professionalism 6 60
Concern for personal development 6 60
Team leadership 10 100
Achievement motivation 7 70
Decision-making skill 10 100
Soft skills 10 100

It can be understood from table 9 that all companies irrespective of their nature agree in
saying that the most desired qualities in a manager are communication skill, team spirit,
decision making skill and soft skills.
Table 10
Lack of skills in the manager/leader
Number of respondents % to total
Core competency skill 10 100
Communication skill 8 80
Team leadership skill 7 70
Professionalism, 7 70
Concern for personal development 4 40
Achievement motivation 10 100
Learning ability 8 80
Adaptability 10 100
Relationship between knowledge and 4 70
skill
Soft skills 10 100

From table 10 it can be observed that the 10 industries irrespective of their nature of work

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said that the present day managerial candidates lack qualities such as core competency
skill, achievement motivation, adaptability and soft skill. 80 percent of them said that
learning ability is lacking and 70 percent said professionalism, communication skill, and
team leadership skills are missing in the present managers. Only 40 percent of the
industries said that concern for personal development and relationship between
knowledge and skill are also missing. Whereas, in table 7 it is observed that only 3
students agreed that their seniors face problems in their working place because of lack of
soft skills. This trend shows that the students don’t even know what is missing in them.
Table 11 also supports this argument.

In table 11 it is clear that even the industry agrees saying the ratio between skill
development and knowledge should be 80:20 and 70:30 only 10 percent each said that it
should be 60:40 and 50:50
Table 11
Distribution of Respondents Based on the preferred combination of theory and skill
development in the syllabus
90:10 80:20 70:30 60:40 50:50
Number of respondents - 4 4 1 1
Percentage to total 40 40 10 10

Findings of the study:

The four college students, who were chosen as samples said that their college arranges
for campus selection and above 50 per cent students get selected for jobs. All the ten
industries agreed that they prefer only MBA degree holders for managerial posts. 100 per
cent of them said they know the MBA course content. Only 60 per cent of the industries
agreed that a fresh MBA degree holder can be appointed but all of them say that they
provide training along with orientation to such candidates. 100 per cent of the
industrialists agreed saying that the industrialist and business people should be involved
while framing the syllabus for business education but only 40 percent of them said that
they have time to spare for such activity. The other important findings are:

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1. The major defect in management candidates identified by the industrialists is that
they lack soft skills such as business ethics and values, communicative skills,
active listening skills, coordinating skills, dressing and etiquettes.
2. Business educators should make efforts to increase core competency, adaptability
to industry, and self-motivation among their pupils by providing enough
opportunities.
3. Present day manager candidates are not adapted to learning continuously from
theirs and others experiences. They believe too much in what they have studied
theoretically. They are always busy in analyzing the situation rather than solving
the problem.
4. Managers lack professionalism and leadership qualities and the industrialists
connect this attitude of them to lack of experience to consultancy work during
their study period.
5. The Candidates fail to draw a right relationship between knowledge and skill
because they lack the practical knowledge of business situation. They seem to be
lost in searching for an answer in the theories they have learnt for the real life
business situation.
6. Management educationalists have failed in selecting a right mix of theory and
skill development syllabus for the candidates.
7. Today’s managers are analysis (explanation) oriented not action oriented.
8. Management education has failed to keep pace with the technological
advancement; therefore, the candidates chosen for management post carry
outdated information to the work place.

Suggestions:
1. The main gap of lack of soft skills can be overcome by including the learning
of soft skill as a subject. Humanities, psychology and other arts subjects,
which have, close relationship with the study of human skills should be made
a part of management education to increase the humane skills.
2. The business educators should change the course contents in time by taking
the periodic changes in the competitive business environment. A proper

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 interaction between the academicians, experts and industrialists is of prime
importance while framing such course content.
3. Institutions that teach business management should produce professional who
are adept at learning continuously. Business schools should teach their
students basic skills for problem solving, making them proficient in learning
in a multidisciplinary environment.
4. No doubt all institutions have introduced computer usage and learning in their
course, but what is important is to encourage the students to learn advance
applications of computers to keep abreast with the changing trends in the
industry.
5. MBA students view their education as a stepping-stone into the corporate
world. The dominant value of MBA degree today is enhancement of career
and high pay. When it does not happen candidates loose hope and get into
depression. Therefore, Government should take measures to involve leading
industrialists to work in coordination with the B-schools to provide the
required skill and knowledge for meeting the challenges of modern business.
6. Today, there are so many MBA’s available that the employers recruit MBA’s
for positions for which graduates are sufficient. Therefore, now it looks
inevitable for everyone to do MBA, which is very expensive and is not
affordable for majority of the Indians. Government and AICTE should take
steps to restrict the number of MBA degree holders as it is done by ICAI and
ICWAI and declare MBA degree as a professional degree.
7. Students should not be viewed as customers because by doing so the business
values drive academic agenda, which forces compromising on values and the
very character of higher education.
8. Once a degree is tagged with pay, position and career advancement, learning
for the sake of learning and knowledge enhancement stops and this leads to
malpractices in the education field. What is education if it cannot impart
value? Therefore, imparting value is a must in management education
Business educators should think of the measures to uphold the value of
education.

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9. Indian faculty should author/recommend textbooks and develops case studies
with Indian context and help the students to understand the prevailing
situations. The American way of teaching and the books authored by
Americans is one of the biggest banes of management education since the
inception of MBA degree in India. The American view of management is too
bureaucratic, confrontational and rigid, it emphasizes too much on individual.
This has an adverse effect because Indian scenario values moderation,
relationships and trust. Students with nil or less work experience tend to
follow what is learnt theoretically during the course and might fail as
managers.
10. Job security provided by Government owned management colleges has led to
lack of individual accountability by the faculty. Job security tagged to
individual performance and accountability should be encouraged.
11. Most of the Indian B-Schools fail to attract good faculty because of the pay
package. Government should take measures to attract intelligent and good
people into teaching profession by fixing an average salary to all teachers
taking the salaries of corporate world as basis. Unless this is settled the best
people either would prefer to work in corporate sector or go abroad for higher
studies.
12. Majority of management colleges are private colleges, which have very few
permanent faculties. Most of the teachers are visiting faculty who are paid by
the hour and teach in more than one college. They have very short time
orientation and this acts as an impediment to their teaching and the learning
process of students. AICTE should take measures to put restrictions on college
managements by fixing up the ratio between permanent and visiting faculties.
13. Majority of the teachers who teach do not have any industry experience but
they can make an effort to get over this drawback through keeping themselves
updated on whatever is happening in present day business. Teachers while
explaining the management concepts should have conviction and they should
prove it with good examples.

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14. The curricula of management colleges and institutes give a compartmentalized
view of management to the students they divide all activities of the business
as functions such as marketing management, financial management, human
resource management, operations management, systems management etc. To
the students, in their learning stage, each of these functions stands apart from
others. In industry, all these activities take place simultaneously. Managing a
business means putting things together in the form of coherent visions, and
integrated systems. Modern organizations are trying to break down the walls
between the compartments. Therefore, a new structure that encourages
synthesis rather than separation of the subjects should be developed.
15. Industrial managers should associate with institutions to provide latest
practical knowledge input to the students. Skills to handle real business
situation should be taught to the candidates. Students should never expect an
ideal situation to work with. Skills such as interpersonal skill, teamwork skills,
negotiating skills and political skills are very important to survive in the
modern business world.
16. Many industrialists feel that today’s MBA’s are not capable of handling
manufacturing situation because working for a manufacturing company
requires a lot of business sense, management skills and technical knowledge.
Therefore, case study discussion, management games, simulations role-play
should be made a part of the academic activity. It is imperative that
management educators prepare leaders who can effectively respond to any
situation that may arise from changes, great or small, complex or unadorned.
17. Learning the basics of business and management should start at pre-
matriculation level itself so that elementary aspects are covered at that stage
only. This will enable introduction of contemporary subjects at the higher
level.
18. The industrialists should realize that it is cost effective to join hands with the
academicians and institutions to coordinate the theory and practice than
establishing their own elaborated training centers, the reputed companies

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 should come forward to work with the existing colleges and universities on
the practical aspect of education and training of the young generation.
19. Few universities and educational institutes have established business
laboratories, but mere collection and exhibition of management equipments
will not help the students unless measures are taken towards the utilization of
these labs as training ground to equip the students.
20. Last but the most important suggestion is that since AICTE is not exclusively
for Management education, there is a need for an establishment of a separate
body mainly for governing the activities of management studies.

Summary:
Narayan Murthy, the chief mentor of Infosys is of the opinion that ‘both college degrees
and soft skills play an equal role in framing the personality of a person. Unfortunately in
India, when a student finishes his studies he is only half equipped to face the corporate
world’. 21st century is of business century, youth getting commerce and business
education degrees have a bright future provided the stakeholders such as Government,
Corporatist, universities and trade organizations act fast together on the issue of business
education. While the country's elite universities and institutions who have close
connection with the industry, graduate fewer than 100,000 students annually, the rest of
the 14 million people choose between lower-level universities and vocational training
schools, which haven't adapted to the requirements of India's changing economy. Unless
the education system can fulfill the aspirations of India's youth, the current boom could
turn into a disaster, without some changes, the aspirations of India's employers, who need
more and better-trained workers than ever, will remain unfulfilled as well.

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REFERENCES:
1. Education Times, The Times of India, Monday, January 9, 2006.
2. C Sharath Kumar, DH Education, Deccan Herald, Thursday March3, 2005.
3. Philip G. Altbach, ‘The Hindu Online Education’, April 12, 2005.
4. ‘Higher Education in India’, The Hindu, Tuesday, February 5, 2002.

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