MBA Placement Season 2009
The Economic Times - March 3, 2009
The tough decision for this month's column was whether to write about the prognosis for consumer demand in India, post the global meltdown, India slow-down, e-sops (as the ET elegantly described vote inducing election expenditure); OR whether to write about what lessons placement committees (mostly comprising students) of top tier MBA schools ought to learn and act on, after the 2009 stressful placement season. This column opted to discuss the latter, because we want to urge future leaders of India Inc. to use their intellect and education to courageously depart from the past and do things differently for the different world of the future. If they are content being status-quo-ist in their placement models with the justification of "hamare khandaan ke purane rivaaz hain", they are out of step with the mindset that winning companies of India Inc. and the world want and need.
Closer home, students running placement at top MBA schools will run two risks if they do not review and revamp the whole placement game as it exists today. They will be scrambling harder as students' numbers increase each year and nimbler, smaller, challenger institutions, with no baggage re-write the rules of MBA campus placements.
The current placement game is all about rationing scarce resources, iron clad rules about which company comes how early, rules for how students must bid for jobs and choose them. This model was perfect for the 80s and 90s - low competition, few students, low heterogeneity in the batch, and total predictability of the hirer market. If several customers were upset, too bad, let them go, there are too many of them anyway, and the batch size is small. But let's take this year. Graduating class sizes are larger, the most popular category of employers, Wall Street, consulting companies, foreign banks are not recruiting or recruiting in diminished numbers. The placement 'business managers' have responded to this new world by not altering their rules of the game in terms of doling out day wise slots to companies, determined by majority votes, discouraging off-campus interviews, and by not questioning the old belief that "how early placement finishes = how good the placement season/ institution is". There have been no new innovative customer friendly propositions to widen the net of companies that could participate, no encouragement to students to seek to widen the net through pursuing "off-placement" jobs and bringing them into the placement fold for the future and so on.
In fact the response has been "more of the same", with more pressure and better cosmetics on courtesy. Wonder what these students would say about a case study where the airline industry is going through severe turbulence and perhaps being changed forever, and the leadership team of a leading airline decides to (a) distribute more fliers on the routes available, to crowds at every shopping mall and (b) change the uniforms of the crew and add an extra mint free in the menu.
This is also a good time to look at the placement fee imposed on companies. The logic of the fee was that there had to be an entry price paid for access to a privileged pool of candidates, and also that if headhunters charged a fee why should institutes not do so. Today, there are limited takers for the access to a privileged pool and the need is to re-examine the price elasticity of demand; also when the tide is not rising in overdrive, it is a good time to look at things truthfully. Other than logistic support on campus, no real search-firm like services was being provided by the institutions. No advice, no pre-interviewing and feedback in terms of fit with the company, no help in decision making or selling jobs to chosen candidates etc. Paying for placement isn't where money needs to be charged - it is paying for "advertising" (pre-placement talk or any other form of advertising and relationships building) that potential recruiters should be made to do.
Why have on campus interviewing at all in these days of technology and several flights a day to most destinations? Looking at it 'outside-in", it is pretty tough to get calendars synchronized for travel of any group of people from a company. It is a lot easier to do it via a conference bridge. Perhaps placement offices should contract with Reliance web worlds to get up several extra bridges for placement season - and get employers to pay for the use of them. Why have day slots in terms of how popular companies are? On the contrary, in these days of management theories on the 'long tail' and 'n=1', life is not about the bulk buyer getting preference. If two or four students want a product design job in an automotive company then they should be allowed to interview on day zero with companies of their choice. Even more worrying is the non sturdy academic legs that the receding tide is showing up. One recruiter said that in one of the institutes, he found that the majority of students had very narrow course specialization making them less than literate in other disciplines. And since jobs pertaining to that specialization were not available this year they were not even able to think (or talk!) their way through interviews for jobs in other verticals. That is worrisome because good managers must have a 'T' knowledge base - a decent knowledge of all disciplines and a deep spike in one or two chosen ones. Clearly the academic system needs to tweak the rules of course choice to ensure that there is enough choice for specialization but also creates a 'T' knowledge base. Perhaps the US liberal arts college system is one model, mandating a minimum number of credits in each area. From the students and placement point of view it de-risks them from the likes of events that we have just seen.
Even if the final steady state of the new world in 2012 is 60% similar to the old world of 2007, if the legacy systems and business models are of the 1980 and 1990s, it is time to dismantle them and build anew. That's what India Inc. has done post liberalization and World Inc. is doing today - so why should their suppliers of talent be stuck in quota/ license-permit raj and not move to a free market economy?