Government should oversee, not micro manage: IIM-A

AM Naik says autonomy of the institute would be compromised if the bill is implemented in current form and shape

Reiterating the B-school’s stand against certain clauses in the draft of the Indian Institutes of Management (IIM) Bill 2015 that rob IIMs of their autonomy, IIM Ahmedabad (IIM-A) Board Chairman AM Naik said the move will take management education at IIMs in the “opposite direction”.

“Our Prime Minister has always wished that we have at least 25 world-class institutions but this kind of regulation only takes it in the opposite direction,” said Naik, who is also the group executive chairman of Larsen & Toubro Limited.

Addressing mediapersons here on Thursday, Naik said the draft Bill, in its current shape and form, will make all IIMs only an operational centre with all major regulations happening from Delhi.

“The final Bill, which was approved between all the IIMs and the Ministry of Human Resources Development (MHRD), has been ‘completely changed’ and made even worse than where we started three years ago with sweeping powers with the government, which virtually makes the institution an operational centre with all the major diktats or directions and approvals, regulations happening from Delhi.”

Naik said the autonomy of the institute would be compromised if the Bill is implemented in the current form and shape.

Commenting on the issue, IIM-A director Ashish Nanda said, “Our stance is that there is a misunderstanding from their side. We are actually having a conversation with them to help them understand how we see the impact of the Bill.”

“Overseeing, we don’t mind, but micro-management is not good,” Nanda said.

Pushing for more freedom for all IIMs, Naik stated, “More and more freedom should be given to educational institutions in framing curriculum, devising fee structure, recruitment of faculty, senior positions, the board and so on.”

“The current Bill, in the present shape and form, if implemented, will take away a lot of the freedom of the institution. The institution will no longer be autonomous,” he asserted.

When asked about the steps being taken to counter the passage of the Bill in Parliament in the coming monsoon session, he said, “We have taken up the issue with the HRD ministry. We have written a letter to them why this should not be implemented in the present shape. Our director has been in discussion with the officials there.” “Previous consultations led to a draft. But, we got a new draft. What triggered the change? We don’t know. We are conveying to them the new draft has certain significant negative consequences (for the institute),”  he added. On being asked if the current Bill will affect brand IIM, Nanda said, “We are fairly confident that the right approach will prevail. We think we are in the right. We will continue to have conversations with them. We will continue to share with the public our point of view on why we think this is right.”

Nanda said under the current Bill, there is regulation for strategic to operational matters — be it related to admission of students or postgraduate programmes, or formation of new departments, establishment of buildings — among others.

Naik said the current Bill strikes at the autonomy of the institute and is concerned with over-regulation. Nanda pointed out that regulation and control over every decision of the institute reduces its flexibility.

He further said that they have started holding discussions with the HRD ministry but no assurance has been given as yet.

On being asked if the Bill will send a wrong message on the global level regarding quality of education, Nanda said, “If this Bill is passed, it is harmful to management studies in India,” adding, “The government should be a wise overseer from a distance, give resources to the institutes, hold institutes accountable for performance, and reward based on performance instead of micro-managing daily affairs of the institute. You end up making people in decision-making positions feeling disempowered. And, you end up with absence of innovation.” Naik said there are two representatives of the HRD ministry on the board. But, for that, there is no need for regulation.

Meanwhile, the institute crossed the revenue mark of Rs 200 crore, Nanda said, adding that the IIM-A was the first IIM to surpass the Rs 200 crore revenue figure.