How the 2-year MBA continues to be in demand in India, bucking global trend

Change is famously the only constant, but its pace has accelerated in recent times, especially in advanced economies, where questions are being raised about the relevance of two-year management programmes for both students and employers. “The two-year MBA in the US is under severe financial stress,” says Varun Nagaraj, Dean of the S. P. Jain Institute of Management and Research.  

Enrolments to schools outside the elite league of, say, Harvard till Carnegie Mellon, are under pressure because their value proposition is not that great beyond a certain ranking. That’s why specialised one-year masters are all the rage now there, says Nagaraj. 

“The new money-spinner for all US business schools is the variety of one-year programmes either in data analytics or business intelligence or supply chain.” This was already the case in Europe, says IIM Bangalore (IIMB) Director Rishikesha T. Krishnan, where they don’t have too many one-year MBA courses in general management. “They recognise that in one year, there is only about so much you can do,” he says. 

But India is different. Here, the two-year MBA serves more as a “mind-expanding finishing school” in the absence of a broad-based liberal arts approach to education, says Nagaraj. “MBAs here have to almost act as the fourth and fifth year of school or college. We should look at it differently [here] than in the US because what precedes the MBA in India is very different.” Plus, what serves the two-year MBA’s case well in India is its popularity among newcomers to the workforce as a path to well-paying jobs. For instance, XLRI Jamshedpur Director Fr S. George, SJ says the institute’s XAT 2023 entrance exam received more applications for the two-year programmes than the one-year ones. “The competition for seats for the one-year programmes is comparatively lower than the two-year programmes. Indian MNCs are interested in hiring young professionals—rather than experienced candidates—whom they can groom and mould as per their requirements,” he says. 

IIM Calcutta (IIMC) Director Uttam Kumar Sarkar says a high percentage of graduates continue to be hired for general management skills. “It’s not either/or. We need both the full-time MBA as well as specialised programmes of shorter duration… I can use AI and ML in a certain sector, say, manufacturing. But I need to know a little bit of manufacturing as well. So, I need marketing, finance, organisational behaviour and all these core concepts to be put in perspective.” 

The consensus among India’s top MBA institutes is that the two-year courses will persist at least for the next decade. But the opportunity cost involved in staying away from the workforce for two years in a fast-changing business world for professionals with work experience is fuelling the interest for one-year programmes. “Experienced professionals are the driving force behind the rapid adoption of the one-year MBA programme in India,” says Fr George. Institutes such as the Indian School of Business 

(ISB), IIMs AB-C, XLRI, and SPJIMR, among others, have started the one-year format, reflecting the industry’s demand for practical experience combined with specialised business education. 

ISB, the pioneer of the one-year format in India, sees work experience as important for MBAs. “It leads to better learning outcomes because of students’ ability to connect what is taught in the classroom with what they had experienced previously. They get better context and learning from the lectures because of this relatability,” says Ramabhadran Thirumalai, Deputy Dean–Academic Programmes, ISB. Not surprisingly, experts predict greater pull for the one-year format in times to come. “I won’t be surprised in the long run if things shift more and more to a one-year programme, particularly for people with experience,” says IIMB’s Krishnan. 

Client expectations from the consulting industry are evolving, which reflects in the hiring profiles, says Priya Ramdev, Director of People Function at McKinsey & Company. “While the generalist consulting aptitude remains integral to client needs, industry/ functional knowledge and expertise is also becoming critical for certain roles. Any programme that can meet these requirements will continue to remain relevant for the industry,” she says. 

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