MBA or PGDM - making sense of what suits you best

With more than 4000 institutions in India offering PGDM and MBA and, in some cases, dual options,
you are spoilt for choice and often confused by variety and number. Taking aspirants (often fresh
graduates) for granted, at times institutions do not share full technical details. The result: young
candidates try to make sense by reputation and ranking and, sometimes, by recommendation of
online sites who evaluate institutions primarily on placement salary (called “average salary”, which
is nothing but cost to the company or CTC, arrived at by dividing total package in rupee value by
batch size). These seem to be the main drivers even today, alongside faculty, infrastructure,
pedagogy, research, and industry connect. Apart from assessing how much one will earn (ROI) in
relation to money invested, aspirants must look at a particular program’s value addition. Rather
than taking average salary as the defining factor, you need to choose based on a set of parameters.

Looked at practically, it does not matter much whether you are enrolled in an institution ranked
among the top twenty business schools or the top fifty. Out of the 4000-odd recognized business
schools in India, if you get admitted to any one among the top 2%, have the right attitude, and gain
knowledge and skill, then you should be able to secure a package better than the average salary of
the batch. You should select the B-School based on how you fit into the program rather than getting
attracted by the quality of the institution. Try not to get swayed by suave marketing conducted by
institutions or the reputational legacies they exude. Your choice should be based on the quality of
management education, the stream (specialization) you would like to pursue, and the demonstrated
performance of the institution in that particular area. A postgraduate degree suited to your needs
should be the guiding light, not market perception.

Every year witnesses an overabundance of new institutions and models in India. Many newly
created IIMs are picking up, even if they are in no way near some of the autonomous private
business schools. This is purely because of brand IIM. There are several entrance examinations like
CAT, XAT, GMAT, NMAT, SNAP, MAT, CMAT, and ATMA. Every year a million plus aspirants
participate in entrance tests. This clearly indicates growing demand. While some B-Schools with
high academic standards are not able to admit students, many others are not able to fill their
sanctioned capacity. This creates mismatch in the market. This also raises eyebrows about the gaps
in the quality of conducted tests, which may be part of the selection process for PGDM with a cut-off
for accepted entrance examinations and GD / PI processes. To address this gap, the government
needs to look at a few quality entrance examinations. We should try to refrain from mass producing
management postgraduates without employable skills. Alongside, we need to review University
MBA, which runs programs in large numbers, often without placement assistance.

It is important for an aspirant to understand the basic difference between these programs and their
regulatory and legal standing. This will help you to understand the selection process and to invest
wisely for the next two years and beyond.
Post Graduate Diploma in Management (PGDM) is popular and continues to be in demand. The
primary reason is that it was offered by the IIMs, which have great brand value. This, in spite of the
fact that many of the new IIMs are not at par with top private business schools which offer better
quality across three parameters (Input, Throughput, and Output) alongside market capitalization or
demand. PGDM courses have better market acceptability for recruitment and higher salary. In
PGDM programs, both IIMs and autonomous private business schools can design their own
curriculum, pedagogy, and evaluation method tailored to contemporary industry and corporate
needs. Interestingly, most privately run autonomous institutions seem to be following the pattern
of IIMs, apart from some value addition in creating employment opportunities for graduating
students. Most PGDM aspirants are looking at government recognitions like AICTE and
accreditations like National Board of Accreditation to choose an institution, if it is not granting an
MBA degree. Now, with the new IIM Bill in place, IIMs are going to offer an MBA degree. Clarity is
needed as to whether autonomous private business schools will also be allowed to grant MBA
degree.

As an aspirant, you should know the PGDM must have “MBA equivalence”. This is granted only if the
institution has an affiliation with or approval from Association of Indian Universities (AIU). The
AICTE approval process mandates that AIU authorization is possible only if an institution has NBA
or an International Accreditation. Only few institutions offering PGDM have one or more of these
requirements in place. PGDM graduating students cannot pursue higher studies abroad; for
example, a Ph.D. course, if that institution does not have AIU sanction which is again subject to NBA
approval. This implies a possible risk aspirants are exposed to in such PGDM institutions. In recent
years (from 2010 onwards) there are noticeable uncertainties in AICTE approval, which needs to be
obtained through Extension Process in the Supreme Court. For this, Education Promotion Society of
India (EPSI) is fighting the case for private autonomous PGDM institutions. Proposals for an
independent regulatory body like Higher Education Regulatory Authority (HERA) are yet to be
finalized. An aspirant must keep these points in mind while selecting an institution.

With IIMs offering MBA degrees, apart from universities and deemed universities, there would be
questions in the minds of aspirants. Unless there is a level playing field for PGDM, diploma-granting
autonomous business schools may face a tough situation. While selecting autonomous PGDM-
granting institutions, evaluate all these points – including AICTE and AIU approvals to consider
MBA equivalence; national accreditations like NBA and NAAC; and international accreditations like
AMBA, AACSB, EQVIS, etc. – to make a balanced assessment.

On the other hand, if you are interested in an MBA-degree-granting institution, you must look at
value additions like dual degree, postgraduate certificate in management along with MBA degree, or
skill exchange programs offered through tie-ups with international institutions. This will help you
get the edge in a highly competitive environment. An MBA-degree-granting institution with the
flexibility to create curriculum with industry input may prove better compared to a PGDM
institution driven by numbers and often insensitive to statutory and industry needs. Try not to rely
on myth, fantasy, and hearsay while investing your time and money. Do comprehensive research
and analyse the available data and information. Think and act wisely.

Dr. C.N. Narayana

(Senior Professor; Former Principal Director of KIAMS & IFIM; Advisor to FBS)