ISB Has Cracked The 1-Year Course. Will The 20-Month Course Click?

Pioneer of the one-year MBA programme for young working professionals in the country, the Indian School of Business (ISB) finally bit the bullet to announce the launch of a new 20-month MBA for students with zero-to-two-year experience.

But the new programme comes when the market is crowded with similar programmes. Key questions some observers are asking are: Is this too little, too late? Will there be a brand dilution of ISB where differentiation is diminished? Or, is it largely another revenue generation strategy? The truth, as often, perhaps lies somewhere in between.

Will the gambit work? Two aspects will define whether it will be a success or not.

The institution has acquired many accolades since its launch in 2001. It was ranked number one in India in the Financial Times Global MBA rankings and 31 in the world. The LinkedIn Top MBA 2024 programmes ranked it at number six globally.

Today, with over 16,000 alumni worldwide and the highest number of start-up entrepreneurs from any B-school in India, it appears that ISB has everything going for it. The proposal for the longer programme was not a knee-jerk reaction but something that had been internally debated for a couple of years. While ISB has built a stack of programmes from the one-year MBA to a doctoral equivalent one, the 20-month MBA was a big gap.

Professor Madan Pillutla, dean of ISB, said, “Our many conversations with industry leaders and recruiters reveal a need for young professionals who can step straight into roles that require business acumen alongside deep expertise in data and technology.”

A professor at a top business school in Delhi who did not want to be named added, “ISB has realised that Indian parents and students intrinsically like a 20-month programme. This new course from ISB is an acceptance of the same.”

Quality Has To Be Paramount

ISB is taking a deep dive into the full-term MBA market in India at a time when it is under pressure in the United States and Europe. But the demand for a good MBA product continues to remain high in the India market. In 2023 when worldwide application to business schools dropped by 5%, in India a record of 3.3 lakh students registered for the Common Admission Test (CAT).

Management institutes in India came up in the 1960s as a response from the government to the need for qualified managers in public sector units in post-independence India. Gradually, the Indian Institutes of Management (IIM) were established in Calcutta and Ahmedabad in 1961.

Those in Bangalore and Lucknow were set up in 1973 and 1984 respectively. With the liberalisation of the economy in 1991 and the growth of the private sector and thereafter the globalisation of the industry, IIMs sprouted in different parts of the country so much so that there are 21 of them today. The private sector also established business schools.

Today, it is estimated that there are a few thousand B-schools in the country with the Ministry of Education’s National Institutional Ranking Framework rating over a 100 management institutes as the top ones in the country.

The flagship programme of almost all of these B-schools is the 20-month MBA with admission through the Common Admission Test (CAT) and others.

It was against this backdrop that ISB started in 2001 with its one-year programme and emerged as a global contender even though it is not affiliated with the All India Council for Technical Education. The government is also trying to encourage the leading business schools globally to set up campuses in India, though progress has been slow.

While ISB has traditionally been the leader from India in global rankings, the IIMs in Ahmedabad, Bangalore and Calcutta (Kolkata) are also inching up in the global pecking order. Two decades on, as ISB prepares to enter the 20-month MBA segment, it will not be a cakewalk.

Sapna Popli, professor of marketing at IMT, Ghaziabad said, “One has to tread with caution when expanding the product portfolio. If portfolio product A has been hugely successful, has had a unique, differentiated offering and stood the test of time, using one’s existing brand strength and offering uniqueness in product B should be a high priority especially when entering an already cluttered market.”

Diluting Differentiation?

A crucial factor in the Indian management education landscape is the blurring and diluting of differentiation among business schools. While ISB pioneered the one-year MBA, today many of the top-notch schools like IIMs, the Xavier School of Management and SP Jain also offer the same programme.

Again, ISB today seems to be sandwiched between the one-year and 20-month courses.

Some aspects of the teaching model of ISB like inviting renowned visiting faculty from global business schools are being replicated by newer schools like BITSoM, Mumbai and JAGSoM, Bengaluru.

Finally, ISB’s 20-month programme will now take CAT as one of the criteria for admission.

Its 20-month MBA fees is almost the same as that of IIMs and other top business schools in India.

Is there then a brand dilution from the premium positioning that ISB had?

Grace Marks

With many students of the one-year programme at ISB finding it strenuous, the new course offers an alternative with a better work-life balance.

A key factor for the success of any new MBA programme is industry engagement.

ISB may have an edge here with both summer internships and placements, an area all top business schools find difficult to manage.

Further, with 40-50% of the seats to be funded through scholarships, it will be able to draw some of the best candidates from IIM-A, B, and C for whom funding may be a challenge.

Finally, where will the future growth for ISB come from? The 2-year programme is a logical step forward as there are not too many programme segments left where ISB does not have a presence.

Ashwani Singla, founding managing partner of reputation management agency Astrum said, “This is a smart B-squared strategy from ISB: brand extension and business extension. The 20-month MBA was inevitable.”