Cover story: IRMA: A Fairy Tale [Pg. 3] <link updated to site home> ( Search On Cite | Search On Google ) IRMA: A Fairy Tale The rural management institute ploughs a lonely furrow, attracting talent with its promise of challenges rather than money.
Text by Suveen K. Sinha
Kurien, he of the white revolution fame, doesn't remember the year. But it was a long time ago that his cousin Ravi J. Matthai, the Founder-Director of Indian Institute of Management, Ahmedabad, invited him to join the institute's governing board. Attending his first meeting of the board, Kurien said the institute was wasting public funds drawn from the Consolidated Fund of India to produce managers for transnationals. Instead, it should be producing managers for agriculture, on which lay the foundation of industry, but about which no one seemed bothered. A cigar-chomping board member, a prominent industrialist of Ahmedabad, responded with biting satire: "You want us to produce graduates to milk cows?" Kurien, unfazed, retorted: "No, but you would perhaps prefer that they suck cigars."
Kurien never attended another meeting of the IIM-a board as he set about building an institute that would be better than IIM-a and serve the purpose that IIM-a would not. That is how Institute of Rural Management, Anand, (IRMA), was born in 1979. And one of the first members on its board was Matthai. Ever since, IRMA has eked out a niche for itself in the management jungle, with its philosophy of building and sustaining a partnership between rural people and committed professional managers. New [IR] Man On The Block
The story is turning out to be something of a fairy tale as IRMA has bagged the fifth rank in BT's latest survey of B-schools-right after the four IIMs of Bangalore, Ahmedabad, Calcutta, and Lucknow. Of course, the institute has been helped in no small measure by the revised parameters of the survey. Among specialised schools, which produce sectoral MBAs, IRMA is right at the top.
Expectedly, the faces of the first years at IRMA light up when the news is broken to them. Their lips broaden into a 'finally' kind of smile as they talk enthusiastically about why they joined the institute. Director Katar Singh is nothing short of ecstatic. "Ours is the foremost institute of its kind in the world as it applies principles and techniques of management to rural institutes, organisations, and resources," he says. Second-in-command K. Prathap Reddy makes a valiant effort to hide his glee, but to no avail, as he punches holes in the methodology of earlier surveys that, well, did not really talk about IRMA. But the impact is perhaps the most-pronounced on Chairman Kurien's usually inscrutable face. As the somewhat reclusive septuagenarian narrates one story after another over an hour-long interaction with BT in his largely-naturally-lit office, the photographer shooting his pictures says he has never captured so many expressions on Kurien's face.
They can all be forgiven for the reactions. It hasn't been quick and it hasn't been easy. It wasn't long ago that IRMA graduates were looked upon as the children of a lesser God in the upwardly mobile, dark-suited world of MBAs, where placement salaries determine social strata, the cellphone is but an extension of the palm, and management jargon merely everyday conversation. If IRMA has remained largely untouched by the MBA frenzy that followed the engineering-medico-civil services wave, it was simply because its students were never in pursuit of the pot of gold at the end of the rainbow. The Odd [IR] Man Out
The Top100 B-Schools In India
hirty per cent of IRMA grads join GCMMF or NDDB; 50 per cent join NGOs; about 10-15 per cent join donor agencies; and the remaining 15 per cent opt out of the sector. Today, 40 per cent of IRMA's 1,200 alums are no longer in the sector. ''W
e must produce managers who don't go away to the US, as IIM graduates do... The managers of MNCs have the only goal of maximising value for a handful of shareholders overseas. A manager of Amul has to look after the interests of 4,00,000 farmers. It's much more difficult.'' A
unique feature of IRMA, the field work segment requires students to spend 10 weeks working in a village with one of 600 designated cooperatives and NGOs. Many of those villages don't even have basic amenities like toilets. The faculty closely interacts with the students during a portion of the field work.
But that precisely is IRMA's raison d'etre; and if you are pursuing the pot of gold, you've come to the wrong place. The top salary drawn by IRMA graduates-if they stick to the sector-never exceeds Rs 3 lakh a month-against Rs 10-15 lakh for their brethren in the IIM world. As Reddy points out: "We don't operate in the open market. We just cater to the needs of our clients, who need the best of talent but can't pay too much." What IRMA looks for is people who look for challenges rather than high salaries; people like Matthai, who, along with three of his graduates, lived out of a Telco truck gifted by Ratan Tata to improve the living standards of the natives of Jawaja, a village in Rajasthan where the only occupation was skinning animals. That it took its toll on Matthai's health and may have caused his demise is another story. Says Kurien: "We must produce managers who don't go away to the US, as IIM graduates do-the managers of MNCs have the only goal of maximising value for a handful of shareholders overseas. A manager of Amul (Gujarat Cooperative Milk Marketing Federation) has to look after the interests of 4,00,000 farmers. It's much more difficult."
It's for this difficult task that the curriculum strives to equip the students for and it's in this context that the field work segment assumes paramount importance. A unique feature of IRMA, the field work segment requires students to spend 10 weeks working in a village with one of 600 designated cooperatives and NGOs. Many of those villages don't even have basic amenities like toilets. The faculty closely interacts with the students during a portion of the field work. In fact, experience-based learning-that includes summer training and management traineeship in addition to the field work-forms 40 per cent of the 88-week programme.
The going hasn't been bad so far. Even in these times of the Gold Rush, about 5,000 applications come for the 60 slots each year. Thirty per cent of the graduates join GCMMF or National Dairy Development Board, 50 per cent join non-government cooperatives and other agencies, and about 10-15 per cent join the donor agencies. Still, even though the entrance tests are designed to spot commitment to the cause and the course aims at developing it further, faculty member Vishwa Ballabh, in charge of placements, reveals that about 15 per cent of those passing out each year opt out of the sector. And 40 per cent of the 1,200-strong alumni are no more working in the sector. Singh, however, says that 60 per cent is a very high retention rate. Paradoxically, these turncoats may have contributed greatly to enhancing IRMA's reputation in the outside world. And Reddy says IRMA grads opting out of the sector attract salaries at par with IIM grads. [IR] Managing Finances
1. NDDB contributed to the corpus of IRMA in two tranches: Rs 9 crore and Rs 8 crore
2. This corpus has now grown to Rs 33 crore
3. Interest earned on the corpus, owing to falling interest rates, is stagnating around Rs 4 crore a year
4. IRMA earns about Rs 2.5 crore a year through consultancy and various projects
5. Expenditure, meanwhile, has caught up with earnings
The sharp sectoral focus also makes finances an issue for IRMA. It started with a corpus donated in two tranches by NDDB: Rs 9 crore and Rs 8 crore. That corpus has grown to Rs 33 crore. The institute's major income is interest earned on this corpus, that comes to about Rs 4 crore a year. In addition, it earns about Rs 2.5 crore a year through consultancy and various projects. Lately, expenditure has caught up with earnings as interest income has stagnated in the falling rate regime. It's difficult to take on more revenue-generating work as it entails diverting the faculty's time away from the institute's programmes.
So, why not expand the faculty? As Singh points out: "We don't want too large a faculty (at present, IRMA has 25 permanent members in addition to five visiting ones) as it's difficult to manage. Besides, it's not easy to find so many committed people." But he readily admits that there is a dire need to boost earnings, especially as there is a subsidy component of Rs 1-1.5 lakh on each student over two years. One way could be to get consultancy work from entities like UNICEF that pay well. Otherwise, a grant or two could come in handy.
Surely, these are issues that need to be addressed. But Kurien remains unfazed. When he first came to the Anand area in 1949, no one would take him on as a tenant since he was a Christian, a meat-eater and, worst of all, a bachelor. He therefore lived in a garage for a long time. "Everything here was built brick-by-brick," he says. And addressing these issues merely means a few more bricks. 21st July 2008 From India, Ahmadabad