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How much should B-schools Charge?

ET Cases, 6 Pages
AUTHOR(S) : A. J. Swapna and Dr. Nagendra V. Chowdary

Case Preview

How much should B-schools Charge?

Why MBA has been an aspirational professional degree for lakhs of students in India, like elsewhere in the world? Why did the Indian Government start an IIM in 1961 almost along with the IITs? When India embarked on LPG (Liberalisation, Privatisation and Globalisation) reforms in 1991, the demand for professional managers too went up and to leverage the new-found opportunity, several Business Schools (B-schools) were set up. Companies were willing to pay top dollar to this new breed of executives who were seen as wunderkinds capable of putting family-held, traditional businesses on fast track. Management became a sought-after career for students (and continues to do so) and MBA the key to success in life. The three-letter acronym spelled money as well as status.

What accounts for the demand for an MBA program - is it the job, salary package, career enhancement, networking, learning, social status or anything else? Keeping pace with the demand, the price of an MBA program went up during 2013-2018. Why did the price for an MBA program go up during 2013-2018, when the average salary of an MBA graduate decreased during the same period? Why is there a price disparity amongst the 20 IIMs when the admission criterion is same? The other top-tier Indian B-schools also command huge fees (Exhibit I). What accounts for the price disparities? It is argued that the CTS (Cost to the Student) would be even higher when his/her personal expenses over the two years are included for a two-year MBA............


Exhibit I: IIMs and Leading B-schools Fee Structure and Total Seat Availability

Exhibit II: Average Salary of Top 30 B-schools

Teaching Note Preview

How much should B-schools Charge?


The purpose of this Teaching Plan is neither to outline the answers to Case Debate’s discussion questions nor to suggest an ideal way of conducting an effective debate basis the given topic. It is more to share the authors’ perspectives, basis their classroom orchestration of this Case Debate, on possible ways of orchestrating this Case Debate.

Purpose of the Case Debate

Purpose of this Case Debate, which is a prelude to the Case Method of Teaching, is to inculcate the following skills [Exhibit (TP)-I] that would amply benefit the participants during their careers............

As this Case Debate is based on a very generic topic, the purpose is not to dwell into only the research-based inputs but more to prepare the students/participants for the process of case discussion – except that while the case discussion would be based on the case facts, the Case Debate encourages the students/participants to present their ideas with no rigorous business dilemma........................



Exhibit (TP)-II: Attributes of a Successful Educational Brand

Exhibit (TP)-III: Declining Campus Placements and Number of Institutions Closed Down – 2018

Exhibit (TP)-IV: Classroom Orchestration Plan – How Much Should B-schools Charge?

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Product code: MKTG-9-0071, MKTG-9-0071A


This Case Debate enables an interesting discussion and debate on the fees charged by Indian Business Schools (B-schools) in the light of decreasing average salaries of MBA graduates coupled with an abysmal employability level. According to a recent study by The Associated Chambers of Commerce and Industry of India (ASSOCHAM), most of the leading B-schools in India were producing 'sub-par graduates' who were either unemployable or earned less than INR10,000 a month. These management graduates on an average spend around INR3,00,000 to INR5,00,000 for a two-year MBA programme. Enthused by 1991 economic reforms, plethora of B-schools were established to churn out professional managers to script new corporate mandates. However, over the last 5 years - 2013-2018 two disturbing trends have been plaguing the Indian B-schools. The first was to do with the deplorable employability - only 7% are employable - of MBA graduates, the second related to the fee hikes when the average salaries decreased. What explains this dichotomy? What are the reasons for this trend of increasing fee between the years 2013-2018? Why do 20 IIMs charge different prices when the admission criterion is the same?

This Case Debate centres around (a) How to improve the employability quotient of MBA graduates and what should be the role of B-schools, regulatory bodies - such as AICTE, UGC, Government of India's Ministry of HRD, India Inc. and students? (b) What are the plausible reasons for price disparities amongst 20 IIMs and other top-tier Indian B-schools?

Purpose of this Case Debate, which is a prelude to the Case Method of Teaching, is to inculcate the following skills that would amply benefit the participants during their careers
(a) Ideation
(b) Discussion and Debate
(c) Empathy
(d) Appreciation

Case Debate Positioning and Setting

Depending on the purpose, this Case Debate can be used for either of the following:

  • MBA/Executive MBA Programs – Marketing Management Course – To discuss and debate on the pricing of MBA program and to understand the reasons for price disparities amongst 20 IIMs and other top-ranked Indian B-schools
  • Undergraduate Programs/BBA Programs – General Management Course – To discuss and debate whether the major attribute of a successful educational brand is measured solely by its ability to transform the students’ lives through placements

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- Abstract
- Case Debate
- Teaching Plan (**ONLY for Academicians)

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