The falling job market is forcing the premier Indian Institutes of Management to review their placement strategies. The options include doing away with Day Zero and reducing placement fees.
Day Zero is the name given to the day placements begin at the IIMs. Day Zero and Day One are reserved for top companies like investment banks and consulting firms that confirm participation on campus.
The placement fees are higher on these first two days -- each company pays Rs 1 lakh (Rs 100,000) as participation charge and Rs 1 lakh (Rs 100,000) as recruitment charge. These charges drop to between Rs 80,000 and Rs 50,000 each for participation fee and recruitment charges on the next few days.
In good times, most students are placed by Day Zero and Day One, which means many of the smaller companies that come to campus later leave empty-handed.
To cope with what one IIM official described as "the madness around Day Zero," the B-schools are exploring ways of extending the placement process to over a week or fortnight so that all companies have a better chance.
"We are going to re-examine the entire placement process, including the Day Zero strategy and look into what needs to be done for a long-term relationship with companies. So far, we concentrated on a very narrow segment and pool of recruiters," said Samir Barua, director, IIM Ahmedabad, the oldest and most prestigious of the IIMs.
IIM-A finished its placements last week and recorded a 32 per cent dip in its salary packages. IIM Bangalore and IIM Calcutta, which have also completed placements, will make the results public on Tuesday.
IIM Bangalore, too, said it will re-examine its placement strategy in the next few days. "We know that the present placement system is an imperfect system. But among all imperfect systems, this is the perfect system," said Sourav Mukherji, placement chairperson, IIM-B.
The institute has decided to rename its placement cell 'career development and placement cell' and will recruit a new person dedicated to look at placement and career development-related activities and liaison with companies.
The IIMs will also look at a reasonable placement fee. This year, many domestic and foreign companies in banking and financial services, consulting and consumer goods had written to the IIMs, requesting them to waive or lower participation and recruitment fees. IIMs said they charge placement fees from companies to meet scholarship and other educational needs on the campus, since the fees for the flagship management programme is heavily subsidised.
The IIMs are also looking at devising a strategy which could be specially made to attract government-owned companies (PSUs or public sector undertakings) on campus after this season's experience.
This year, PSUs and banks made good the gap left by private sector companies. B-schools saw a 20 to 50 per cent jump in the registration of government companies visiting the campuses. They recruited some 40 students from IIM-A this year, with Union Bank among the top recruiters.
"We are looking at how we can take a big share of the PSU pie and make it attractive to the students. PSUs offer a great career development path and we need to talk to the students about this," said Professor Prafulla Agnihotri, placement chairperson at IIM-C.
IIM-B also said it would need multiple companies on the campus to provide a meaningful profile to an MBA student, since it is expanding in terms of number of students and programmes. Barua of IIM-A agreed there is a need to convince students to consider opportunities and challenges that PSUs offer.