MBAs EXPECTATIONS & REALITIES

Countries are neither developed nor underdeveloped; they are simply either well managed or under managed. So said Peter Drucker, the legendary management guru. That indicates to the need for a large number of good managers in a developing country like Nepal.

September 2004 marks the Golden Jubilee of management education in Nepal. It was on Bhadra 17 in 2011 BS that Ishwari Lal Shrestha and Narayan Lal Shrestha initiated commerce department in Tri-Chandra College even before the Tribhuvan University (TU) was established. And the day is still being observed as Commerce Day by the management students and teachers throughout the country. 

And there was reason for the celebration. The products from this faculty were readily employed in the private and public sector enterprises. But the golden age for commerce graduates (holding degrees such as B.Com. and M. Com.), who were employed mostly as accountants and financial managers, did not last long. Now most of the managerial positions in the private sector firms are filled up by people from foreign universities who come with MBA degree. Now Nepal too has a number of universities and colleges imparting MBA education invented in USA in 1908. Among the products of Nepal’s managers production centres, those with TU degree are facing tough time finding the jobs of their choice. While those from Kathmandu University (KU) are doing much better, they too have recently started facing difficulties in finding suitable placements. Other Nepali universities have just sent their MBA products to the market. For example, Apex College, affiliated to Pokhara University granted the degree to its first batch of MBA students only in the beginning of this year.

However, the problem is not only with the graduates of TU, which is plagued by frequent strikes, by teachers who are mostly on lengthy sabbatical or moonlighting and by students who bunk most of the classes and do little of project work. Also the graduates of more private sector like KU which started in 1993 specialising in management education and promising to impart most advanced management education in the country comparable with best management institutes of the world, are complaining that they are not receiving the sort of treatment from employers that they had expected while enrolling for the MBA course.

That was not the case in early 90s. The best corporates of the country used to recruit the KU students straight from the campus of Kathmandu University School of Management (KUSOM). Now many KUSOM graduates have to go hunting for the jobs. Though it can be found that almost all of the KUSOM graduates manage to get good jobs and most of them are holding good positions in good companies or have opened their own businesses, a significant number have gone abroad, normally because of lack of  good opportunity here. When KUSOM held an alumni meet recently, the turnout was less than 100 while the total number of its graduates so far has reached 326. Most of the rest must have gone abroad. Even those who have got good positions within the country now had to go job hopping for several years before finally landing on the present satisfactory job.

The reasons are many and the graduates, the universities and the employers point fingers at each other. While the employers say that the Nepali MBA graduates are not capable to fit in the Nepali organizations as they are trained in things that are relevant in advanced countries, the authorities of the universities say the Nepali firms are still being run with primitive management style and thus offering no attraction for the MBA graduates who are trained to work under proper management culture. The students, in turn, say, while the schools did not provide them enough practical knowledge, the employers are, on the one hand, discriminating against MBAs graduates of Nepali universities.

The situation also makes one to turn to the critics of management courses who say the management schools do not actually teach any specific skills to the students that may be required in the real life situations. The attraction for the employers to turn to the management schools is the selection process of the schools for enrolment which makes sure that people unfit for the managerial positions are already blocked out. This serves as the shortlisting of the candidates when an employer looks for trainee managers. Another good thing about business schools that even the critics admire is that the good schools plug the students into an invaluable network of contacts. However, such critics point out that management legend Jack Welch credited for turning around General Electric and introducing the concept of Six Sigma was not an MBA (he was an Engineer).

However, management experts say these comments do not carry much weight as the market demand for MBAs has been continuously increasing all over the world, including Nepal.

Turning to the Nepali MBAs and their problem of not finding satisfactory jobs in Nepal, one explanation frequently cited in recent days is what is generally referred to as “the current situation of the country” which has disturbed the business environment of Nepal.

But that logic does not hold water when one finds that many positions in Nepal are being held by expatriates with MBA degrees.

That leaves only two plausible reasons to explain the malady. One is the lack of modern management culture in the business firms and the other lack of sufficient practical knowledge in MBAs from Nepali colleges.

Unfortunately, both of the causes are true as the experience of some KUSOM and TU graduates indicates.

All of these MBAs (though the degree of TU graduates is called MBS or Master of Business Studies, the course is very much similar to MBA) contacted by Nubiz said there was a lot of difference between the theory they were taught in the colleges and the practical life in the business firms they joined.

One MBA who was recruited straight from the campus by an airline is now working with an NGO after she had to leave the airline when it was about to close down. And her account not only summarizes the reasons for the collapse of the company’s business, it also illustrates how the Nepali business firms lack modern management culture. According to her, there was no defined job description for the people, the sales and marketing jobs were put under the same department, and the senior executives were not able to define priorities or to coordinate and plan the corporate activities. The employees working on a project would have to stop suddenly as the budget would abruptly stop flowing to their department. This developed a sense of job insecurity among such people and they left the company gradually.

Source: KUSOM

But that was not the case only with Nepali business. Even MNC affiliates seem to suffer from the same malady. For example, an MBA who first joined the Nepali affiliate of an international express delivery service firm, moved on to an INGO and is now with a bank, complains of centralized authority, highly bureaucratic decision-making process and ineffective hierarchy in the previous organizations where he left.

Another MBA who has been working with an insurance company for over three years after leaving a media company where she worked only about seven months, says she too found lot of difference between what she had learnt as theory in the college and what she actually had to face in the job. “There were lot more challenges,” she sums up, and adds, “it was very challenging to communicate with people from different walks of life.” However, she is satisfied for the opportunities she received as her expectations were not very high. “I was looking for good working environment and good platform to prove my capabilities though the pay package may be moderate.”

Compare that with the experience of an MBA (read MBS) from TU. He is jobless now after five years of graduation despite having wide experience in media companies and ad agencies. He too complains of theoretical knowledge from the university being insufficient. “We are required to work in fields unrelated to our specialization and the salary offered is peanuts.”

But another TU product who now works with an insurance company says he is satisfied with the job he has got as his expectation of getting a good platform to learn and grow has been met.

Employers' View

The feedback from employers is mixed. The CEO of an MNC affiliate which has in its payroll about 10 MBAs (both from Nepali and foreign universities) says all of them are well versed in their fields of specialization, and they are doing well in sales, marketing and finance. But, he also adds that they needed some months of rigorous orientation before they actually started taking the charge of jobs assigned. “Anyway, they are better than the normal graduates,” he adds.

His views match with those of the MBAs Nubiz interviewed. For example, he also says that the MBAs lacked practical orientation when they first approached his company. “They had not done enough case studies and project work,” he commented and advised to introduce a sort of apprenticeship system (instead of simple internship) which should be well structured.

His views are shared also by another MNC affiliate’s CEO, who has four MBAs in his company. “They are creative and innovative,” he says, but complains that the MBAs from Nepali universities have very high ambitions which cannot be satisfied by the employer at the very beginning. “So they should learn to have patience,” he adds. He also points out the lack of enough case studies and project work and suggests that the universities or colleges should administer more case studies particularly in “decision making.”

Hotel is found to be sector where MBAs are either not employed or left the job soon after employment. Even those who are still working in the hotels are found looking for a job change. Upon inquiry, it was found out that MBAs