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Nothing lasts forever When there is summer, can winter be far behind? Globalisation led to a magnificent show in Circa 2000. What was then "chief de raison" for grand placements has now become the "bete noire". Trade Cycles (read recession) and political (read international turmoil) has affected the placements at leading B-schools in India. Recruiters have scaled down their requirements keeping in mind the adverse market and the international conflicts. Mood is not exactly upbeat at any of the leading B-schools of the country. And layoffs by AC and KPMG in Dec 2001 of people from 2001 batch haven't exactly helped in any way. Summers Till last year, IIM graduates were most coveted in India by corporate. Whopping number of 65 students from IIMA in year 2001 did their summer training abroad rubbing shoulders with Harvard, Yale, Kelloggs' MBA students on New York's Wall Street in 2001. LBS students participated in Confluence - an IIMA student competition in 2001 - and won few prizes too!. (Summer Training is an important part of the curriculum to gain first hand industry exposure after first year grind at campus). However, internationalisation of IIMA has also affected it in a negative way. With economy of nations being inter-linked and inter-dependent as never before, recession in US has also had an effect on the Indian economy. Also recession means lowered recruitments and also lower uptake of summer trainees - all bad news for graduate MBAs at B-schools. Post 9/11 due to international turmoil, most of the foreign recruiters were unable to come down to IIMA campus to participate in the summer selection and thus summer placement interviews for foreign recruiters were conducted via the video-conferencing. 5 out of 7 video-conferencing lines in Ahmedabad were kept free for IIMA students to negotiate with prospective recruiters over 3 days in October. Some foreign recruiters come to IIMA campus only for the recruitment in India. These include blue-chip firms like Goldman Sachs, MSDW, ML, UBS Warburg, McKenna Consulting, Marakon associates, IFC, Swatch and Indocean Chase. This year less than 30 students (25 so far since last reports came in) are going abroad for summers. Even worse, 8 students from the current batch of 2001-03 have not been placed with even the Indian recruiters. This is first time ever in the history of IIMA, an Institute that the Asia Inc. in 1997 termed as the toughest place in world to get admission into, a fact subsequently affirmed by Economist in a recent survey. Remember that the chances of getting into IIMA is only 0.05% compared that of getting into Harvard, Wharton or LBS where the students have 13-14% chances of getting admission. Apparently, the situation at other IIMs is no better. Worse still for newly established IIMs. Reports coming out from campus indicate that IIMC has over 30 students who are yet to be placed for summers and IIMB has another 40 students who are waiting in the wings. With US economists now officially declaring that the recession is on, situation doesn't look rosy in near future. Final Placements The campuses are witnessing a flurry of activities. This time tension is writ large over the faces. A subdued summer placement has had an obvious effect. Even worse is expected in the final placements which begin in February, starting with IIML placements. Placement scene then moves onto Joka at IIMC, and then IIMB, and finally culminates with IIMA placements at Vastrapur in first week of March. Pre Placement Talks (PPTs), which started from November 2001, are almost over at all the leading B-school campuses, but students are cautious with potential recruiters. If placements at any of the other top-20 Indian B-school (like FORE, IMI, etc.) are any indicator, it's gonna be a hard placement season, with many predicting it to be as gloomy as any wet, grey London winter day. Though average salary at B-schools is not expected to dip, but number of offers will be far and between. For records, average IIMA graduate commands over $ 95,000 USD for foreign posting and over Rs. 6.5 Lakhs for Indian posting besides stock options. Ditto for other leading IIMs, i.e. IIMB, IIMC and IIML. Even students who graduated in March 2001 have not been spared the music of the recession. Leading US based supply chain firm, i2 Technologies, withdrew all 18 offers with compensatory pay of 75 days. Leading retail banker, that promised two foreign postings, later accommodated them in India. KPMG, a leading consulting firm, handed over pink slips to few people from 2001 batch in Dec. 2001, and so did Andersen Consulting. With the corporate focussing on bottomline and cutting costs in the recession, situation is grim. And students know it! Last few months have seen a flurry of mails in the alumni groups to seek more companies for participating in the placement process. A few years ago, this must have been unthinkable. Though this year has seen an all-time high with 17 international Pre Placement Offers (PPOs) against 10 PPOs last year, students are apprehensive and repeated media reports of layoffs hasn't done anything to improve the confidence. Last year, out of 10 PPOs, 8 were from Lehman Brothers only. With the tension at Indo-Pak borders, even a small escalation in regular firing might see the withdrawal of these companies from the Placement 2002. If that happens, it would be the final nail in the coffin of dreams of the toppers of the batch, who dream of rubbing shoulders with Wharton or Harvard alumni on the wall Street. The number of offers per recruiter in Placement 2002 is expected to take a dip sharply. Though regular recruiters will be there, but many of them would be there for relationship-building exercise and would dole out a few offers only. In booming markets, companies look at expanding their operations and consequently recruit heavily. In recessionary market, companies consolidate their operations and cut the spending and thus requirements are scaled down. In view of the uncertainty in the market conditions, many students have accepted the PPOs to end the uncertainty. Otherwise, not many students would have opted for PPOs, and would have participated in the placement process to seek better deals. Most of the PPOs are also from the domestic companies, like HLL and P&G, which regularly give PPOs. However, most of the other Indian companies make PPOs in January-end - February, when the actual requirements at these companies become much clear and they have participated in the other B-school placements except IIMs. Placement committees are busy and working overtime to contact and get more companies to participate in Placements 2002. Hence the mailers to the alumni. Though around 60 firms participated at IIMA placements last year, this year the Placement committee has approached over 300 potential recruiters. Like 2001, the profile of the recruiters will see a further change this year. (Read CoolAvenues placement story 2001 for change in recruiters profile). The juggernaut of Investment firms, Consultancy firms and IT majors will be slowed down to a centipede's crawl. This year will see increase in accepted offers of FMCG, for FMCG market is one market that is least affected by recession. The Placement Committee is also busy exploring avenues with media, advertising, healthcare and infrastructure this year. Diversifying the recruiter mix will not only minimise risk, but will also give a wider choice and exposure to students. Media companies and healthcare might be seen at campuses after a break in last few years. Media companies and Healthcare bowed out of the campuses of IIMs as they were unable to match the salaries, international assignments and the stock-options offered by IT MNCs and Wall Street biggies. Real estate and Insurance might be in the action for first time as these sectors have opened up. Maybe sun will shine on these sectors after a few years in wilderness. Snapshot from US The initial placement process at US B-schools has already started. And situation isn't rosy as in last decade. In what has become a silver lining in a depressing year for the world's advertising industry, advertising companies are enjoying a marked increase in both - the quantity and the quality - of job applicants. WPP is the second largest advertising holding company in the world. WPP's agencies include Ogilvy & Mather, J. Walter Thompson, and Young & Rubicam. Each year WPP receives only 8-10 applications a year from Harvard Business School graduates for its marketing program. This year, 25 submissions came flying in from hopefuls with Harvard B-school degrees. Says an insider, " These were candidates who wouldn't have looked at us in other years". Says a HR person at WPP, "This year WPP has received 60% more applications for its top-level marketing program from people with MBA degrees". The trend is also evident in individual agencies as well. DDB BMP, which is a part of No. 1 ad holding company Omnicom Group, has received more than 1000 applications from MBA graduated this year compared with about 800 in past years. Evidently advertising isn't the only industry which is getting more quality and quantity of potential workers. This scenario might be replayed in India as well with many media firms and pharmaceutical firms participating in the placement process this year. Overall, few changes in the offing! Hope floats!
Source: Daxxx (IIMA'98)
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Read complete story of Placement 2001 as it happened along with analysis and comparison across the B-Schools and segment-wise analysis.
Read complete story of Placement 2000 as it happened along with analysis and comparison across the Indian and US B-Schools and segment-wise analysis. Mail your comments at: webmaster@coolavenues.com |
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