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The Return On Investment
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Pawan Kumar, 32, though, has a different take. "I wanted to change my area of work, and the job opportunity I have received has put me at peace," says Kumar. After nine years in the IT industry, Kumar joined the GMP programme of XLRI, Jamshedpur, and is now placed as product manager in ICICI Prudential Life.
Thappa and Kumar are an interesting study in contrast, but with one common thread: their job offers were to their liking. It is a trend that has played out in full at B-school placements this year. "I think the job market is very close to the 2007 levels and we have improved significantly," says Saral Mukherjee, placements chairperson of IIM-A. "For a lot of firms, the pipeline had run dry because of the non-hiring in 2009 and 2010, which affected the increase in hiring this year."
After three years of gloom, salaries, too, have jumped. "The lateral offers I had received before the placement session had put me at ease for the final process where the only firm I interviewed with was Tata Administrative Services (TAS)," says 26-year-old Harshavardhan S. of IIM Calcutta (IIM-C), who accepted the offer from TAS for its Business Leadership Programme. Entering IIM-C during the recession and passing out when things got better, Harshavardhan received more than 100 per cent hike. The recent graduate had lateral offers from Barclays Bank (Finance) and Deutsche Post DHL Inhouse Consulting (Miami, Florida, US). The average domestic salary of IIM-C this year is Rs 17.6 lakh, a 15 per cent increase from last year.
Barclays Corporate, which didn't turn to premier campuses last year, has recruited 18 students from the IIMs, XLRI, Jamnalal Bajaj, SP Jain and Faculty of Management Studies (FMS), Delhi this year. The banking giant also recruits from XIM Bhubaneswar, MDI (Gurgaon) and Narsee Monjee Institute of Management Studies (NMIMS), Mumbai. "We have made compensation offers in sync with the market," says Archana Shiroor, HR head at Barclays Corporate.
"If there was any residual effect of recession, it has gone this year; the market is very good even for people who didn't get their choice of career opportunities last year," says Nagraj, who had a pre-placement-offer (PPO) from Fullerton Securities and has recently joined the finance firm as an associate after completing his MBA from Delhi University's FMS. The average domestic salary at FMS went up to Rs 15.4 lakh this year compared to Rs 13.1 lakh last year, an increase of 17.6 per cent. Lateral offers to 97 students having more than 18 months of work experience was the highlight of the placements with an average salary of Rs 16.4 lakh. The business school has an overall batch of 203.
Though placements have improved, the number of students who opted out of placements (OOPS) has also increased. "This could be a combined result of a larger batch size, greater risk-taking ability and a supportive economic environment," says Sapna Agarwal, head of career development services at IIM Bangalore (IIM-B). The education loan restricts some of the students to pursue their entrepreneurial dreams. Some students, however, find a way out by working in start-ups. Viraj Chetan Desai, 23, from IIM-C has joined Q-Equip Associates India as senior associate. The company is a start-up dealing with business incubation consulting. "With the pay cheque I am offered, I hope to recover all the money invested in my MBA soon," says Desai.
The new second-year students also seem upbeat. "Many new companies came to the campus this year, which means more offers," says Naveen Khatri, an IIM Lucknow (IIM-L) student who interned with the corporate banking division of HSBC Bank. The number of lateral offers and PPOs at IIM-L this year was 213 and 70, respectively.
The sentiments are similar across the top tier. "Hoping that placements will continue to improve, I am looking at a career option in the finance sector," says Vishal Goel, 24, of IIM-Shillong (IIM-S), who interned with Bank of Baroda's specialised Integrated Treasury Branch. The number of offers may not be great at IIM-S but the B-school has experienced a steep hike of 20 per cent in its pay packages this year with an average salary of Rs 12.36 lakh.
Around 50 per cent of the interns are offered PPOs at Standard Chartered. The bank recruits from IIMs and XLRI for the International Graduate (IG) Program, a two-year rotational training. "It's a tailored development plan for each area of the business that determines the professional development of the student," says Madhavi Lall, HR regional head, India and South Asia, Standard Chartered. The company hired 29 IGs in 2009, 37 in 2010 and is looking at similar number of pass-outs this year, too.
The number of students sitting for the final placements has also gone down. "The number of offers per student increased with a total of 25 per cent increase this year," says Ashok Pundir, associate dean of placements at Mumbai-based National Institute of Industrial Engineering (NITIE). The average salary of NITIE was Rs 12.97 lakh as compared to Rs 9.7 lakh last year.
Among the companies making a beeline for the institutes are fast-moving consumer goods (FMCG) companies, banks, financial institutions and consultancies. In fact, the FMCG industry was the industry of choice for 54 per cent of the management students, according to the Nielsen Campus Track B-School Survey of December 2010. Other industries that students prefer are consulting (40 per cent), investment banks (27 per cent), oil and energy (23 per cent) and foreign banks (23 per cent).
Cadbury Kraft had recruited 14 management trainees last year; this year, the number is 19, out of which two students have been offered international assignments. "The compensation has increased by more than 20 per cent this year for management trainees," says Rajesh Ramanathan, HR director at Cadbury Kraft India. Also, the company hires around 30 students as summer interns every year. "Every year, approximately 40-50 per cent of our management trainees are absorbed in the organisation." Cadbury recruits from the IIMs, XLRI, FMS, NITIE and TISS each year.
IIM-A had taken the lead to change norms in Indian business education by adopting the cohort-based system of placements last year. A cohort is a group of companies (across sectors) that hire students over weekends, offering them similar job profiles. "The system takes more time. However, it does prove to be a superior match-making process, ensuring a better fit between the students and the companies," says Shiroor of Barclays Corporate.
The institute has also come up with a system of placement reporting standards. "There is a lot of variability in the way the institutes report data and if there is a need for standardisation, we are ready to take the lead," says Mukherjee of IIM-A. "We expect to convert the system into Indian placements reporting standards and are inviting business schools, recruiters and media to discuss the issue." The institute has not released its placement data yet and will come up with the audited figures on 26 June, three months after the batch graduates.
Besides IIM-A, IIM-S also follows the cohort-based process. On the other hand, ISB and other institutes offering executive PGPs follow the rolling system of placements.
IIM-B has not gone through any major alterations in the way placements are conducted at the B-school. The institute, however, has changed the existing ‘spot offer' concept to a new slot-based system. Thus, instead of making offers across the table, companies now release offers at fixed times at the end of every placement slot — there are two slots every day.
Mid-level companies that were the front-runners in terms of campus recruitments during the financial slowdown are on the backfoot now. "We haven't hired many students from the 2011 batch," says Bhavin Turakhia, chairman and CEO of the Directi Group, which had hired 15 B-school grads last year from ISB, MICA, IIM Bangalore, Calcutta and Kozhikode.
Stratum II, III
While the growth for top-tier institutes has been phenomenal, an improvement in the placement environment has provided much respite to the second-rung B-schools. "Many of the jobs offered this year seem more of a correction for the previous two years' slackening in offtake," says Fr Christie, director of Chennai's Loyola Institute of Business Administration (LIBA). "There was a marked change in both the quantity and quality of job profiles offered, and several new firms from pharmaceutical and IT sectors recruited from LIBA." The highest pay at LIBA stood at Rs 15 lakh, whereas the lowest package was of Rs 4.5 lakh with an average salary of Rs 8.33 lakh.
LIBA has been following a one-student-one-company policy for eight years, that is, after getting an offer the student has to sign out of the placement process. "The student may not boast of a slew of offers, but it also ensures no job loss, leading to the placement of the entire batch," says Christie.
Then there are the third-rung business schools — the ones most hit by the financial crisis. "The job market is still not fully recovered as compared to what it was 3-4 years ago," says Jyoti Nair, who heads corporate relations at Delhi-based Jagan Institute of Management Studies. "However, it is definitely better than last year." The major recruiters at the business school include Tata Consultancy Services, Deloitte, Grail Research, ICICI Bank, GlaxoSmithKline and Crisil.
FMCG giants and international hedge funds were also back on the premier campuses, while public sector undertakings (PSUs) have turned to the second- and third-rung schools. "This year, the placements were comparatively better as far as marketing and finance sectors are concerned, and many public sector banks recruited from the campus," says Gurinder Singh, director general of Amity International Business School (AIBS). Singh expects the market to further open up next year. The average salary of AIBS stood at Rs 7 lakh for a batch of 513 MBA students this year.
|For the past two years, neither were the companies making a lot of international offers nor were the students too keen on such options given the global economic outlook. However, the international offers across the business schools shot up dramatically this year. "I wanted to be a part of a global working environment," says Rahul Tom Joseph of IIM Calcutta, who is currently working with Deutsche Post DHL's Inhouse Consulting team in Singapore. "This place is a multicultural set-up, where we work on business issues that are broad in scope." IIM Ahmedabad has not come up with official figures, but confirmed "more than ever" international offers. International financial capitals such as London, New York, Singapore and Hong Kong are the most coveted options for students during the campus placements.|
Besides the rising international offers, a new trend has come up wherein companies are offering jobs that involve international responsibilities for positions based out of India. "Our students are happy about such offers, as they get an international exposure, while they are based in India," says Sapna Agarwal, head of career development services at IIM Bangalore.
Overall, this year's placements have matched those that took place during India Inc.'s boom years. The industry seems ready to take on the competition by pumping fresh blood into the organisation. Whether this is as good as it can get or the best is yet to come will be determined by the ever-changing economic situation.