This post is not about teaching business
strategy in Business Schools. It is about an important question, should a B
School require a business strategy? I think yes, one must have a business
model; where to and how to make money and how to spend it.
What are the priorities and what are the
larger or long term institutional objectives? What kind of an institution do we
want to build and for whom? These questions are explicitly addressed in
the case of most formal organizations and there is an articulated strategic
plan to realize the corporate aspirations for businesses.
What about a a business school? How do we
compare and judge alternate strategic choices if we do not have a clear
direction?
There are many, however who may feel upset
that I am looking at a business school as a business. The hypocrisy is that we
can teach business, but teaching business must not be called a business though
it is always one. Mostly academics are the first to reject theory as
impractical in their own organizations. Imagine discussing about vertical
integration and rapid skimming for a business school and lifestyle segmentation
of our customers who are our students. The perpetrator of such ideas may not be
liked very much by colleagues.
Should a B school be profitable and how do
we do this, what if it is in public sector?
These thoughts were prompted initially by
IIM Indore's decision to go for backward integration and start under graduate
programmes. Look at the initial furor it created. Many academics said this will
dilute the quality of the institution. There are IITs who are better known for
under graduate programmes. There are many reputed Universities in US whose
quality has not gone down despite running much sought after under-grad
programmes. Why should IIMs be exceptions?
After a few years, it is still early to
judge whether this programme is successful in terms of acceptance of its
graduates by the industry. But in terms of acceptance by potential applicants,
it is a success. In terms of profitability, it is a huge success.
Once I worked in an institution where the
management claimed that one can study from 'Playschool to PhD' with out leaving
the campus. Would IIM Indore pursue this aspiration? They already have Doctoral
and Masters. Now they are going upstream to under graduate programmes. Would
they continue to have a school also, so that they can straddle the entire
supply chain? Or should they diversify to law, botany, mathematics, medicine
etc. Will they remain a market nicher or will they try to be the cost leader or
volume leader.
I also wonder what hundreds of under
graduate students and their parents will do to the IIM system. Imagine PTA,
progress reports, parents crying on the inaugural day, Imagine the professor
struggling to adopt to students in their early teens. It would be certainly an
interesting experiment.
A few more years down the line, I
would love to read a case study on what strategic directions are served by this
move.
This article is written by Professor Anand Unnithan. Prof. Anand Unnithan
is an Associate Professor of Marketing in Indian Institute of Management Kozhikode and
is a Visiting Associate Professor at School Of
Management, Asian Institute of Technology, Thailand.
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