Ajit Rangnekar, the mild-mannered dean of the Hyderabad-based Indian School of Business, is eagerly looking forward to April 2012 when India’s premier business school will launch its second campus in Mohali. A big bet for the school, the Mohali campus will mark the beginning of the second chapter of ISB’s unusual story.
In some ways, it will also mark the end of one of the most traumatic years in the short history of the school. The institution saw one of its key founders, former McKinsey & Co. Managing Director Rajat Gupta, become embroiled in a massive insider trading scandal in the U.S. that led to Gupta’s resignation as chairman of the school in March. ISB was Gupta’s brainchild, and it was he who brought the academic brains and the corporate forces together to establish the school in 2001. The same case also claimed another prominent ISB board member, Anil Kumar, who has pleaded guilty to securities fraud.
Rangnekar claims the scandal has had no impact on the school. “The important thing is that not a single one of our most important stakeholders – recruiters, students, incoming faculty – has expressed concern about the ISB as a consequence of that,” he maintains. “We all recognize that these things have happened because of what those people did or didn’t do outside of ISB.”
As if Gupta’s resignation wasn’t enough, it was an earlier scandal that pushed Rangnekar, deputy dean of ISBM from 2003 to 2009, into the dean’s role in January of 2010. The school’s previous head, Mendu Rammohan Rao, had to step down in the wake of an infamous scandal at the IT company Satyam Computer Services, where he was an independent director.
Those were tough times, says Rangnekar. “One day we had a dean and the next day we didn’t have a dean,” he says. “Also, this happened at a time when the economy was in shambles. So was it unpleasant? Absolutely. Was it unfortunate? Totally. But what do you do? You are faced with it, you have to fight it.”
Yet, it’s not an especially auspicious start for a school with the ambition to be among the top five business schools in the world. After a ten-year run, the school still has not been able to attract a highly diverse student population. Only 5.5% of the Class of 2012 is composed of non-Indian passport holders and only 29% of the students are female. What’s more, nearly a third of the students come from the Indian Institutes of Technology alone.
But the class has a respectable median GMAT of 710, and graduates of its one-year business program have done exceptionally well in the job market. This year 310 companies made 661 job offers to ISB’s graduates who pulled down average starting salaries of $121,008, for international positions outside India, roughly 2.3 times their incoming salary. If a graduate stayed in India, the average pay was considerably lower.
The school’s new campus will ramp up student numbers by 200 (the Hyderabad campus has a total enrollment of about 570) and also help ISB break new ground in manufacturing, healthcare, public policy and infrastructure through four institutes specifically focused on these areas. “For a long time, we have been wondering what being relevant to India means,” he says. “We concluded that there are some major national priorities and that’s how we honed in on those four areas.”
The Mohali campus is a crucial project for him. “My biggest priority over the next two to three years is to make Mohali a success,” he says. In many ways, it is an audacious plan. Four leading Indian industrialists have made an initial investment of some $44 million in this new venture and three international schools – MIT Sloan School of Management, the Wharton School and the Fletcher School of Law and Diplomacy at Tufts University – have joined in as academic partners.