The Cost of Higher Education

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In the last 4 years, the tuition fees and other costs associated with institutions of higher learning have started shooting through the roof. For example, fees at IIM-Ahmedabad are now reportedly Rs.13.5 Lakhs for two years. I am not commenting about whether the fees charged today by IIM-A reflect the worth of the education or not (that is a separate point for another day). My intent here is to create consciousness of  the indirect, secondary impact of the fee-rise. The primary effect is on the students hoping to get or getting admission at IIM-A. The secondary effect affects the entire sector it operates in.

Fees charged by such iconic institutions are a little like the "Bank Rate" announced by the RBI: while nobody uses that as a benchmark, generally, fees charged by other institutions with lesser reputations tend to cluster around this figure, and use it as a justification. Some charge more (like the ISB) and most charge less, but not much less. Since the IIM-A has raised fees roughly three-fold (I stand to be corrected) in less than 5 years, institutions of much, much lesser repute (ranging from good, low profile institutions to fly-by-night operators with monstrous advertising budgets) have, in the same period, at least doubled their fees without in any way delivering anything substantially better to the student body. It would be fine if the earlier fees were so low that profitability was an issue. They never were. Higher education has become a business in which politicians have dabbled and entered in a big way. This itself is a sure sign  of how lucrative the business was. Now, they are rubbing their hands in glee: Along with a huge increase in the fees, there has most likely been a significant fall experienced in the cost of "managing the environment", what with the regulatore, the AICTE standing totally discredited today.

What's more, the other forces that could have drummed sense into this sector, like the raters, have themselves over the years, opened themselves to charges of being very pliable, though some of them are in all probability pillars of rectitude. Besides, in any case, rating methodology is itself open to question, with its predominant reliance on physical indicators like infrastructure, which is very easy to create and set up in sectors like Management Education -- no equipment, hospitals or labs are needed. Also,.many institutions have learnt many tricks to "game" these ratings. As a result, there is no way for the lay person to figure out which rater is the most honest, or which institution is the best value for money, or even which institution is exceptionally good. B-Schools, especially, have become marketing institutions at two ends -- to attract applicants and students at one end, and to attract employers and push their students into lucrative jobs at the other (which is already becoming too difficult for most institutions to guarantee, so they talk of maximum and average packages, while downplaying the percentage of placement.

Every student must today conduct a RoI exercise for whether it is worth doing an MBA or not. An important element in this RoI calculation has to be opportunity cost -- what you would earn if you were not to do your MBA. The purpose of this exercise is to recognize clearly that for the below-average or average student, today, even doing an MBA from a 50th or 100th rank B-School in most ranking lists, or worse, an unranked B-School, it will never be worthwhile in financial terms. Once this clarity is achieved, one can take a decision about whether it is worth ding an MBA for all the non-financial reasons, like status, prestige, etc.
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Portfolio Living: A Personal Experience

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This is my first "autobiographical" blog entry. So, Dear Reader, you are forewarned!

About a year ago, I gave up what was my fourth job in 7 years, to resume my life as an independent professional.  Each job was radically different from the other. First, I was Director of a KPO/ BPO company with responsibilities mainly restricted to the D in R&D. I dumbed down processes so that both, scale and quality could be managed with lesser experienced or skilled people. I could almost call myself a software professional then. The next job was that of a full-time Professor in a B-School in Mumbai. The third was with the training unit of a large conglomerate, organising and delivering high quality, expensive training programmes in Finance for all levels of finance managers upto the CFO level. The last was as Dean of a B-School, with the job consisting mainly of mentoring and lecturing. My first job came at the end of a long 16-year innings as a practising Chartered Accountant. Here too, I did several things besides the bread-and-butter work of tax advisory and filings. I was, at various times, author, visiting faculty at B-Schools, editor, banker, software product developer, and (on rare occasions) public speaker. 

When I started my second innings as an independent professional, I have not kept myself bound by the shackles of a Certificate of Practice as a Chartered Accountant, as I don't audit, attest or represent anybody before any authority. I landed a near-full-time assignment with an old mentor, and decided to pursue studies in the field of Intellectual Property Rights. I also organised my life such that I spent almost no time on commuting. I therefore get 4 hours extra everyday compare to people who commute to the other end of Mumbai city, all the better to pursue varied interests outside of work, and more intellectual stimulation too.

In scarcely a year, I found myself getting involved in several small as well as long-range assignments or projects, all using spare time outside of a normal working day. Many of these projects have little earning or financial potential, like making mind-maps of various theoretical topics in the CA syllabus for aiding my son's learning, building a family tree, helping create and raise funds for a school alumni network, etc.. They were satisfying, nevertheless. I also did (and still do, whenever I get an opportunity) several small "promotional" or "concept-selling" appearances at various fora, selling the concept of greater awareness of IPR among the community of corporate managers. I am also working simultaneously on two distinct research projects in the field of IPR. As a result, my work content on any day is refreshingly varied though all the variation is during the "after-hours".

Recently, I met a dear friend (and former colleague) who has equally eclectic interests as mine, but has scholastic credentials much better than mine, (Fulbright scholar and all that). In fact, I have such a high opinion of his capabilities that I once told him in all seriousness that he could be the next Vir Sanghvi or Karan Thapar in the world of television news, if only he allowed himself the luxury of a career change. When he asked what I was upto, and I told him all the small and big things that I am engaging in nowadays, he remarked that I had transitioned to a portfolio life. I asked him what he meant by it, and then he told me about a book called The Elephant and the Flea by Charles Handy. The next day, I googled "Portfolio Living Handy" and got this and this. And discovered that my new way of life indeed had a name: Portfolio Living. Apparently, there are many, many people living this way (I am not a freak!) and their tribe is increasing everyday. Have been sleeping well since.:-)
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Some advice I gave today

Exchanged email with a young girl, who is still in her first job, and was a colleague a few years ago.  She showed very good command over English in her brief emails.


She had given up her pursuit of a Masters degree in her discipline, and had stated on another PG degree. I thought she was a bit too casual about her career choice, so I gave her some unsolicited advice. I wrote: 

I am ANGRY at your being so casual (or so it seems!) about your career. Even if it is unsolicited, I will write some things below which I hope you take constructively.

There are two parts to getting the benefit of any learning:

(1) Learn the stuff. That, to some extent, you have done.

(2) Get an external "Stamp of Approval". That is what the Masters would be for you.

Why is it required? you may ask. Again, 2 major reasons:

(1) When you learn, you get theoretical insights into the practical stuff you do, which can surprise you. Sometimes, you will get moments when, involuntarily, you go, "Aha !!!" -- this is worth much more than the fees -- because at that moment, some part of your understanding deepensor broadens, PERMANENTLY.

(2) No organization is worth getting "hooked on" to; i.e., do not fall into the trap of being dependent on any organization. For you to be 'mobile' if needed in your job, you have to have your resume attractive enough to get another job very soon. Organisations are never worth being loyal to. Choose a fine husband, and be loyal to him. That is fine. But never fall in love with organizations.

Your interest in, and command over written English is a rare gem: nurture it. There will ALWAYS be demand for someone who can write and speak good English.

If you want to move into another sphere, by all means, do so. But remember, you will start at the bottom of a new ladder. ... So decide what you want to do, and then be willing to slog for a few years.

Have you started writing? Why don't you blog regularly, and send me a link? I would like to see your thoughts once in a while.

And then I sent her a link to this blog, saying that I got satisfaction in writing it, even though nobody read it!