Think beyond the IIMs-will Indian firms start doing this?

Like how the IIT brand was largely built by the legions of Silicon valley(and other) engineers, the IIM brand can be mostly credited to the achievements of the alumni in conventional industries/vocations like marketing(HUL, P&G), general management, consulting and entrepreneurship(read Rashmi Bansal's books). But in the past 10 years or so, the 'cream' of the batch is seeking lucrative pastures abroad(yours truly also!) in investment banking, consulting and other 'Day-0' jobs. These jobs are high risk-high return ones, unlike their more sedate counterparts in advertising, commercial banking, general management etc. While those alumni have certainly made their mark(leading to companies coming back time and again), the subprime crisis exposed the frailty of this model with the top Bschools having to depend on PSU/PSU banks to bail them out.  But that is not the subject of this post, rather this post analyzes whether the IIMs are driving away top Indian firms with their 'day system' etc.

In general, those who pursue MBA are primarily money driven, so it is no surprise that they seek the best jobs available at that time. Before the 2000s, those best jobs were largely domestic consulting, general management(TAS), advertising, media, commercial banking(ICICI) etc. That led to the 'best'(in terms of academics, CV, aptitude etc etc-placement wise best) staying in India to pursue careers. They left their mark, and built the IIM brand, being acknowledged the best in India. Post the 2000s, the best jobs monetarily are consulting(again!) and investment banking. No wonder then that with those rare exceptions, the 'best' gravitate towards those roles, largely in MNCs and abroad. Even a Tata, Reliance, Infosys etc was relegated to the second day, to pick from the rejects of earlier days. Harsh, but true. This still happens.

To some extent, one can argue that the day system is student preference, and that those who pay more should get better positioning. But the holes in that argument is that one does not give merit for tenure, stability etc. The same banks who abandoned campuses en-masse in 2009, get pride of place in 2010 and beyond, while the recruiters who came to the rescue of the campuses in 2009, are relegated to their (usual place of) latter days. No wonder then, that the recruiters with ego/brand image from other industries, may feel that they are not desired on campus, and go elsewhere. Consider this:-

1. IIM-L is now spoken in the same breath as IIM-A/B/C. While their academics, infrastructure, students etc all deserve credit, it did help them that companies like HUL, P&G, TAS, ICICI did not find sufficient willing candidates at A
2. The toppers from lower 1st tier colleges(MDI, SP Jain, XLRI) may be as good(or even better) than the average students of IIM-A/B/C. A smart recruiter may prefer pride of place in those colleges, to being regarded 2nd grade in IIM A/B/C. 
3. As informed by a noted HR Prof at IIM-A, banks like HDFC/ICICI prefer to recruit IIM ABC graduates laterally, when they no longer come with unrealistic expectations. 
4. Every year, the quality, variety and diversity of recruiters goes up at other colleges. For example, a MDI student was offered an 2011 summers advertising internship in London, which I'm sure IIM A/B/C students would kill for(!)
5. Placements are handled by a student elected body, with little faculty oversight. This may lead to inconsistent strategy across years, and little institutional memory. As discussed in Cohan's book(Money and Power), Goldman Sachs refused to help in fund raising for a potential USA Presidential candidate, because he had ruined the career of one of their partners 19 years ago!! I'm quite certain that the institutional memory of the IIMs(or to be fair most other management colleges) does NOT extend that long. Perhaps there is something to be said for professional involvement in the process, but then the issues with that are confidentiality, and loss of management development opportunities for the students
6. Other things being equal(or even unequal at times!!), alumni prefer to recruit from their alma mater. And lets be honest. There is no substantial entry level difference among candidates, and MBA colleges live or die on their alumni network. And if companies recruit elsewhere and realize that they can get 'value for money' there, that may continue.

Of course, this is not only the student's fault. Other reasons for this skewed approach can be

1. The last 2 years admissions criteria of the IIMs-few are ‘off the charts/exceptional’. This is not must to be good managers but that old eclectic mix is missing..less diversity
2. Quality of applicants also to do with this-for corporate finance/strategic management roles, diverse background helps which over the last 5 years has been falling. For instance CAs may consider Corp Fin but engineers may not.

Whatever the reasons/effects be, this issue needs to be discussed. Given the recession in the West/Europe, students from those schools are now coming to Asia in large numbers, where their alumni are also present. To leverage on the 'India Story', Indian corporates should be willing to have IIM ABC students as their partners(not in the literal sense!). But given that few of the top students prefer India, will they be outshown by the toppers from other colleges? Even if that does not happen, another factor to consider is once the music stops(lesser foreign roles), will Indian Cos be willing to return to ABC where they are given stepchild treatment in terms of positioning/applicant qualities? 

So what is the way out? There are no easy solutions to this, but you need to break some eggs to make an omlette! While the respective Placecomm heads/members/faculty supervisors would be in the best position to analyze and find out solutions, my view as a student would be to make the system of 'clusters' and 'days' more transparent, also highlighting the non monetary benefits of non glamorous industries. For example, working 1yr in an ICICI/HDFC may provide more learning than 2-3yrs in some foreign locale. Alumni would be the best source for this info, but thanks to the issues mentioned above, they are scarce in those industries.

While IIM ABC are still considered India's best colleges(in that order!), can that perception sustain without a substantial continued alumni achievement in India? I only hope it does!
Disclaimer: This is not based on any statistical research as such, but on the alumni meet(s)/reunions I have seen, placements preferences etc. Though largely modeled on IIM-A, this should apply to IIM-B/IIM-C also. This does NOT convey the official views of either IIM-A or any student body. While I'm told that this applies to the IITs too, I do not have enough data yet to blog on that!