Friday, May 14, 2010

Tapping rural talent: B-schools go hinterland

Gunpal Lad (26) from Barshi village in Maharashtra’s Solapur district hit a wall some years ago when his father refused to allow him to enter the family’s grain-trading business. The commerce graduate went in for the next best option he knew of: he applied for the common entrance test to the state’s management institutes. Mr. Lad got through in the second attempt and was allotted a college in Kamlapur, a village in Sangola taluka in his home district. Today, he works with Infosys and earns Rs. 140,000 a year. His classmates at the Sinhagad Institute of Business Management (SIBM) were recruited by HDFC Bank for its rural operations, Tata AIG, Bajaj Allianz and Infosys. Mr. Lad was, in a way, lucky that his father did not accept him in the family business. For most students from the country’s rural and semi-urban areas, an MBA is a conscious choice, a way to earn a regular income when compared to the uncertainty involved in pursuing agriculture or a small-scale family business. This has spurred established institutes to set up infrastructure in rural areas. "Not only is there a very high demand for professional education in these areas, but there is also competition among institutes to tap the best talent", said VS Mangnale, director (MBA) of SIBM.

Maharashtra alone has 300 MBA institutes with a combined annual capacity of about 22,000 candidates. The education trusts in "talukas" have already set up MBA colleges in rural areas. While Solapur district has five MBA colleges, another three to four are in the pipeline. The Sinhagad Institute from Pune, for instance, has set up a campus on 20 acres in the temple town of Pandharpur in Solapur district. Not to be left behind, the Pune-based Maharashtra Institute of Technology has acquired land in Solapur for its campus while the Bharati Vidyapeeth Deemed University is offering varied professional courses along with management education.

One reason places like Solapur and its surrounding districts like Sangli, Kolhapur, Satara and rural Pune are attracting such institutes is that these are relatively more developed compared to the state’s other semi-urban areas. "We started the MBA course in Nashik because we had land there. But we are confident that we can run an institute anywhere if we provide good infrastructure and staff. The demand for education will always increase", says R.P. Joshi, Director of Pune Vidyarthi Griha’s College of Engineering, which recently started an MBA college at Mhasrul in Nashik.

Another reason such institutes are located in the hinterland are that the promoters hail from these areas, and have trusted local manpower to take care of day-to-day administration. For the students, it’s a win-win on more than one count. For one, such courses work out cheaper compared to pursuing an MBA in a city, as Mr Mangnale points out. Students save on the cost of living and other incidental expenditures in big cities. The annual hostel fee in Sangola, for instance, is Rs. 27,000 per student while in Pune it is Rs. 39,000. The only thing that is different from the urban campuses is that the faculty of these institutes has to work doubly hard at improving communication skills of its students.

The students are in no way found wanting in ambition or confidence, though. "Some of them even want to become CEOs", says Aesha Aleem, a professor at Sinhagad’s Kamlapur campus. Wasim Kalavant from Ichalkarnaji in Sangli district, for instance, hopes to build enough reserves to be able to run his family business of manufacturing four-wheeler batteries. He completed his Bachelor’s in Business Administration from the town and took a loan of Rs. 150,000 to pursue an MBA. "I want to get some experience in the corporate world and collect capital by working for five to six years", says Kalavant. For students from more modest backgrounds, getting a job that pays between Rs. 13,000 and Rs. 15,000 per month is the minimum expectation.

The math works out right for the institutes and faculty too. "The time to reach break-even for an educational institute in rural areas is about four years as against two years in urban areas", says Mr Mangnale. The faculty, which comes from MBA colleges in the area, is attracted by the salaries and infrastructure that the better-known institutes offer, and are even willing to stay in staff quarters.

Source: The Economic Times, May 14, 2010

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