Integrated Marketing for PGSEM

Introduction

To comprehend some of the current issues better, it helps to understand the background of the PGSEM program. Why was the course envisaged in the first place? According to Professor Prakash Apte[1], “IIMB’s mission today is to become one of the best institutions in the world offering its services and expertise to a broad range of stakeholders, which it intends to achieve via its motto – excellence through partnerships…While technology institutions are producing excellent technological talent, somebody needs to reach out to these technologists in the form of a part time management program … to acquire the necessary management skills, attitudes and mindsets …to enable them to compete …”. IIMB perceived thus a gap in the growth story of the IT industry in the form of a chasm that separated technical excellence from managerial insights among the IT executives. To fill this gap by partnering with leading IT firms and providing a unique flexible management education program, tailored to the needs of the IT industry, PGSEM was conceived. As per professor S Raghunath[2], PGSEM is the means for creating the required competitive advantage for the participating software professional and for the company.

While the program schedule was tailored for the specific needs of the IT professionals, the contents of the program remained pretty much the same as a general management program. In a later section in this analysis, a critical discussion of this approach is presented.

During the start of the course, IIMB worked closely with a few IT companies (partner companies) who helped in identifying some of the specificities and in setting up the logistics of the course. These were the companies who explicitly recognized the value that such a course can deliver to their respective companies. In return, IIMB agreed to lower the course fee for employees of these companies for a certain number of candidates, every year. Many of the initial partner companies have continued on board while some of them are no longer active participants.

During the last decade since its inception in 1998, PGSEM has undergone several changes fuelled by continuous experiential learning year after year, however, the overall contents and philosophy has remained intact. Has PGSEM been able to create a niche market offering for the IT industry – professionals with a unique combination of technical excellence and requisite business acumen who can blend the two fields while creating a formidable value proposition that provides an undeniable and irreplaceable competitive advantage to IT firms? What are the possible reasons for a lukewarm response to brand PGSEM so far? These and some other nagging questions will be evaluated in this analysis with an aim to dig out the root-cause and possible remedies.

The Current Situation

As discussed in the case, despite the purported unique value proposition that the course brings, PGSEM has still got a very limited brand value among influential DMUs in the software industry. Before delving into the reasons for the lack of perceived brand value, let us identify the various stakeholders from within the PGSEM community and analyse their current position.

Stakeholders within PGSEM community and their current positioning

i) IIM Bangalore faculty – Most faculty member enjoy teaching the PGSEM students as they feel that the experience the class brings in adds valuable dimensions to class room discussions. Many faculty members are keen on enhancing brand PGSEM. Some faculty members also voluntarily organize talks by reputed experts from the industry to bridge the gap between academics and the real world. Despite the interest in the success of PGSEM, most faculty members are able to do little more than provide their recommendations to PGSEM chairman. Also, most of them have internal focus (curriculum, teaching methodologies etc.).

ii) IIM Bangalore PGSEM chairperson and PGSEM office – The PGSEM chairperson is the administrative head of the program (also is a faculty member). The PGSEM chairperson and office not only handle the regular administrative chores, but also take active part in strategic discussions about strengthening the brand, enhancing the value delivery process internally and increasing awareness of the program externally. The chairperson is also the decision making authority for most decisions pertaining to the program. In this process, he/she needs to balance various conflicting requirements of the stakeholders and reach a decision that best fits the motto of the organization (IIMB) and aspirations of the students. While the Chairperson is the ultimate decision making entity, the final decision is significantly constrained by influence from IIMB administration (the director) and to some extent, the partner companies.

The chairperson is supportive of all activities that help the cause of PGSEM except for providing any kind of placement assistance. Even minimal placement assistance has been ruled out. With regards to the new 1 year PGPX course (that does have placements), the chairperson shares the PGSEM communities concerns about the possibility of cannibalization of this program.

iii) IIM Bangalore administration (represented by the Director) – Responsible for the overall functioning of all programs, director is the most powerful of all influencers. He bears the responsibility of balancing several conflicting requirements and leading the overall IIMB strategy. The director sees PGPX as a complementary course to PGSEM – in fact the purported target group for PGPX is 7+ years experience while for PGSEM it is 2-7 years. The director only has a limited understanding of the concerns of PGSEM students. As the director attention spans across a much larger territory, he is not expected to devote much energy for the PGSEM cause. However, his approval for any proposal that radically alters the structure of the program is imperative.

iv) PGSEM students (current batches; represented by PGSEM SAC) – They are the most affected entity but exercise the least influencing power. The SAC has been relentlessly trying to table the concerns and aspirations of PGSEM students and has achieved moderate success at best. While the long standing demand for placements has been categorically ruled out and PGPX has become a reality, they continue to explore various ways of improving brand PGSEM. One of the battles that they have been fighting internally is against extremely poor response from PGSEM students in any events that they organize.

The PGSEM student community itself is composed of professionals with disparate aspirations and background. While there are some students who treat PGSEM as a substitute for full-time general management education (and so think there is parity with PGPs, PGPX etc.), there are others who agree with the part-time tag. The experience range of about 2-15 years means that the composition is pretty diverse. This makes the aspirations very different as well – for example, a person with 10years of IT experience would want to stick to the same industry while 2-5 years experienced candidates are open to switching domains and industries. Some people treat PGSEM as a learning opportunity (long term intangible gains) while others treat it as a stepping stone to a business management career (short term, tangible benefit). Such differences in expectations result in altering the value proposition that the course offers on a per candidate basis.

Despite the disparities, all students agree that any enhancement in the value of brand PGSEM will positively impact their careers.

v) Partner companies – Lately, most of these have not been actively involved in any activities related to the PGSEM program. The initial enthusiasm shown by them has waned – they are now only too happy to allow some of their employees to pursue the program and most of them do not offer any explicit opportunity of career changes after the course if completed. However, IIM continues to regard the relationship with these partners as an essential cornerstone of the program and is averse to taking any measures which are even remotely likely to antagonize the partners. This way, they have an indirect influence of the DMUs in IIM.

vi) Current companies of PGSEM students (several of them, but treated as one entity here) – They have no role to play except for allowing their employees to take time off from work on Fridays and purse the program. Their contact is with their employees and many of them actually cooperate with the employees when scheduling on-site visits etc. However, they shall be an affected party – if PGSEM brand is strong enough to generate quick alternative employment, then their current companies stand to loose; however, if the companies themselves offer a position that suits the new set of values which employees bring to the table, they stand to gain. They have an indirect influence on the decision making process at IIMB – if they perceive adverse impact of allowing their employees to pursue the program they may start discouraging their staff from enrolling for PGSEM. This is an important consideration for the DMUs in IIMB.

vii) PGSEM Alumni – While they have minimum power and may not influence the decisions making either directly or otherwise, they are the brand ambassadors of the course. After all, they are the ones who have experienced the market first hand and so can provide valuable inputs on what shall work and what is deemed to fail. Their inputs are invaluable in any activities that are taken up or any strategies that PGSEM community chooses adopt. The alumni are also benefited by increased perceived brand image of the program.

What Ails PGSEM?

The following discussion identifies the root cause for various weaknesses of the PGSEM program in its current state. The analysis focuses on each of the 3 main constituents of the program – The Institute, the participants and the industry.

i) The Institute

While the program was started to address the needs of the IT industry, sparing the course schedule, there is hardly any customization for any specific needs of the industry. As the course contents are on par with any generic MBA program in the country, there is a glaring dichotomy between the original intention of the program (which is still emphasized) and the actual delivery.

The institute has not actually researched or analyzed the demand from the industry for such a course for IT professionals – there appears to be no data to justify 150 PGSEM students per year. There were some companies interested in the idea, to start with, and some are still interested; however do we have a demand supply mismatch here? Apparently yes; if there was enough demand, there wouldn’t be as many alumni who, after completing the course, would continue to do what they would have done sans the PGSEM degree.

The intake ratio of PGPs is in the range of less than 1% of total applicants, the intake for PGSEM is in the range of 15%. While any program needs to justify its economic viability, the 14% difference in the intake ratio is still an outstanding cause concern. While brand IIM may not get dented by the failure of brand PGSEM, the institute still has the obligation to ensure the success of PGSEM. IIM needs to take all possible measures to ensure that the quality of students is not compromised.

A case in point is the recent hike in fee of the course from Rs.3.5 Lakhs to Rs.7.5 Lakhs within a span of 2 years. The fact that the course still runs full should not be mistaken for continuing demand – a significant portion of this pseudo demand may be fuelled from individual aspirations of participants to get a management degree from IIM rather than from real industry need.

Apparently the recent launch of PGPX in IIMB and the subsequent re-positioning of PGSEM by segmenting based on experience levels is a sort of acknowledgment of the hitherto limited success of brand PGSEM.

ii) The Participants

This set constitutes of a diverse set of professionals who have taken up the PGSEM program for vastly different reasons. Classifying the participants based on certain parameters helps explain the wide range of responses to various stimuli. For example, their responses to the question - “what value do you think PGSEM has provided to your career goals” can range from “negligible benefit” to “absolutely wonderful!” depending on their initial individual motivations and on current experience levels. The matrix on the following page classifies the participants into 7 categories and evaluates their typical responses to the following stimuli – satisfaction levels, sensitivity to placement assistance, networking opportunities and plans after PGSEM. The 3 boxes on the top left quadrant indicate low satisfaction levels while the 3 boxes in the bottom right quadrant have fair satisfaction levels.

Aspirations from PGSEM	No. of years of experience >>>
	2-5	6-9	9-15
Substitute for a regular MBA	Very low satisfaction, despite the learning. Placement assistance is the key. Most of them aggressively look for career switch, through networking or any other means.	Low satisfaction. Placement assistance good to have. Not so aggressive in switching careers but keep an eye on opportunities. Utilize networking opportunities.	An almost empty set.
Career switch to managerial domain within the IT industry	Low satisfaction. Looking for placement assistance. High on networking and measure the worth of the course by short term results of getting into business oriented positions within the IT industry.	Average satisfaction. Placement assistance good to have but can do without. Mainly look within IT circles for opportunities. Not very aggressive in networking. Many end up continuing in their previous roles, at least for the first few years after PGSEM.	Decent satisfaction levels. More often than not, they are already in managerial positions and are not too keen on entirely switching domains. Use the knowledge gained to make incremental transition to more business oriented positions.
Improve Understanding of business. Learning is the key - application to current job is the main motivation.	An almost empty set.	Fairly satisfied. Not keen on placements assistance, but may not shun the opportunity, if it comes. They have a long term focus. Low on networking. At middle level positions in respective companies, they are looking only for incremental benefits from the course.	Small set of people here - but they are much more satisfied with the course. Placement assistance is immaterial to them. They are no likely to go for any kind of switch in career - derive the learning and apply to current job is the motto. Very low on networking.

Clearly, the implicit existence of the above segments among the participants makes it difficult to generate a forceful cogent message from the student community. This also explains the modest success of various networking events organized by a few enthusiastic participants who typically belong to one of the 3 boxes in the top-left quadrant.

iii) The Industry

Despite the humongous success of the IT industry, India still has a meagre 2% share of the worlds IT and IT enabled services market[3]. In terms of fully developed software products, the produce from India is negligible[4]. The domestic market for these services or products is a miniscule percentage of global market for Indian IT products and services. Overall the Indian IT industry is still in a state of nascence. This limits the number of opportunities for PGSEM graduates. A significant boost to the demand for IT techno-managers is possible only when the domestic producer-consumer markets for IT products kicks-off and begins to fire all cylinders. The current needs of the industry are more or less satisfied by on-job experience based development of in-house managers. Arguably, the performance of these managers can be significantly enhanced if their experience is backed by a strong theoretical background. Currently many of these managers perform sub-optimally; this slack can be expected to show up in future as increasing competition, consolidation of customer base, increased cost pressures and the need for strategic positioning become critical in a maturing industry – this is where PGSEM fits in. Meanwhile, the industry shall benefit if it identifies and exploits the latent need for IT techno-managers in the country – this is a potential means to gain competitive advantage when competing against established global brands.

A related problem is that in many cases the current companies of the executives allow their employee to pursue the program not to bring back specific business knowledge but as a retention mechanism.

The PGSEM Market

Firstly we clarify what the term “PGSEM market” refers to? Interestingly, there are two possible interpretations –

1. PGSEM is a product/service that IIMB produces and sells to IT executives in Bangalore/Chennai. Here IIMB is the seller and PGSEM student is the buyer. In this interpretation, PGSEM has been a successful product as the course has been running full strength since its inception. The market does not seem to be price sensitive as all 150 product units are successfully sold despite jacking up the unit price steeply during the last 2 years. Note however that individual buyers might actually be price sensitive – it is just that the demand is large enough to ensure high price sensitive buyers are replaced easily by low price sensitive buyers.
2. PGSEM students are the product that IIMB produces and the IT industry is the customer for this product. As per this interpretation, PGSEM has seen only moderate success. Here the customers (IT companies) do not perceive the product (PGSEM student) to be of the same quality as other IIMB products. However, having subjected a PGSEM student to a comparably strenuous training process with respect to their flagship product (PGP student), the institute feels justified in seeking a comparable brand identity for its part-time product.

It is the interpretation in bullet “b.” above that we refer to when we use the term “PGSEM market”.

Niche or Commodity

The average industry perception is that this course is yet another part-time program that churns out professionals with shallow knowledge of management principles, finance, marketing etc. Some sections of the industry also treat this as a redundant value proposition – this happens especially if an executive continues to work in a pre-PGSEM (or equivalent) role after the completion of the course. Another reasoning often given is also that in positions where an MBA is needed – why not go for a full-time student. All these signify a “commodity” treatment meted out to the PGSEM product.

On the other hand, from the perspective of a student or the institute – a PGSEM student brings in a unique value proposition to his/her customers – which is not only different from the proposition a part-time MBA brings, but also different from what a regular MBA brings to the table. Thus, PGSEM must be marketed as a niche product – any attempt to align it with a regular MBA when marketing shall erode the unique value proposition of the PGSEM brand. It is foolhardy for some students to think of PGSEM as a conduit to get into the same bandwagon as the PGPs; admittedly though, exceptions exist.

The onus of identifying or creating a market for this niche market offering is with the students and the institute. There is a market for the niche – just that it is lying dormant under the bureaucracy and busy schedule of management in the top domestic and MNC firms.

Two aspects stand out when designing a marketing plan for niche products – first, the customer segment is small and the supplier needs to ensure to carefully and accurately segment the market to carve the niche out; second, the production must not significantly exceed the demand.

Does a PGSEM Market Exist At All?

Mr. Nandan Nelikini in an interview[5] has explicitly stated that “PGSEM graduates are of strategic importance to Infosys in their endeavour to move up the value chain. In their roles as customer facing executives they are in a position to understand and evaluate a deal both technically and strategically.”

For a growth industry like IT, it is only natural that a niche marked for PGSEM graduate exists. The missing link is that there has been a lack of overt recognition for this observation. Perhaps what is lacking is awareness among the IT industry and overcoming this might as well constitute a lion’s share of the effort involved in gaining brand recognition.

It must be stated here that the form in which PGSEM market exists is different from the market for regular MBAs, executive MBAs and part-time MBAs – the key then is to identify and respect the difference. Too much effort shall be wasted in efforts involving achieving recognition in the same league as other MBA programs.

The fact that many alumni are able to affect a career shift, typically within the IT industry, speaks for itself about the existence of the market. However, one may not get into banking, finance, investment banking and similar career opportunities as a direct outcome of the course.

Yet another avenue for PGSEM graduates is to join IT start-ups – it is here that the need for multi-functional skills (technical + business) could be most vital.

The Marketing Plan

The overall strategy should be –

i) to identify the latent need and carve out a niche market segment for PGSEM – shun the thinking that PGSEM is another avenue to pursue MBA from IIM.

ii) to match the course content, duration and structure to specific needs of the IT industry, essentially creating a value-based market offering for the IT industry. The main challenge in this approach would be to grapple with the lack of in-house expertise in the software domain.

iii) to look out for opportunities in start-ups

iv) to establish a communication channel with influential VCs and entrepreneurs.

v) to match supply with demand – this will also help maintain the quality of participation. A one-time effort with an eye to re-evaluate this and adjust supply once in 3-4 years. This does not have to involve any significant market research – the performance of latest outgoing batches is a decent indicator.

The following marketing plan identifies specific actionable items that can be expected to yield results in medium term –

The Institute

1. The institute sets up a committee to carry out extensive research within the Indian IT industry for techno-managerial requirements. The goal is not just to obtain a binary – yes or no. The idea is to estimate both – the number of requirements (current, near future and in the long run) and the specific common skill set that is being sought. To achieve this, the following tasks can be taken up

a. Roll out the committee with 5 student members, PGSEM chairperson, and about 2 faculty members. Most of the data gathering shall be done by students.

b. Leverage brand IIM to organize meetings with prominent company representatives. Committee members could also meet small group of representatives from various IT companies simultaneously and achieve better efficiencies.

c. The IT companies chosen for a single meeting must be in the same sub-domain of the IT sector – for example service based Indian companies, product based Indian companies, BPOs, hardware design engineering companies, product MNCs, services MNCs etc. could be the criteria for grouping IT companies.

d. Communicate the current course structure and accept feedback. Shape out the gap between “expectations” and “current delivery”. The goal here is to prioritize the needs in order that the subsequent recommendations provide maximum value against expectations to the industry.

e. Formulate the recommendations and initiate a process to implement the same.

2. At present, external faculty / industry leaders are invited to conduct guest sessions in the classes. The concept can be extended to invite IT industry business leaders to talk about IT related real world topics and thus create a boost to the niche expertise that PGSEM intends to achieve.

3. The launch of PGPX has confused the positioning of IIMB strategy towards executive education. The experience based target segments for these programs only appear to be artificially masking the overlap between PGSEM and PGPX. Palpably, one of the goals of launching the PGPX program was to compete with equivalent (and very successful) courses of other reputed institutes as IIMA and ISB. The achievement of this goal is much harder if the lower limit of experience level is retained at 7 years. In all likelihood, this limit will have to be relaxed eventually (probably as early as within a couple of years) to a level that matches with competing programs. The move appears to be creating a case for extinction of PGSEM if there are no changes to the overall content and structure of the course. Note that extinction also means that the course continues to exist – but is no longer actively sought after by the most talented of IT executives (the average quality of students declines).

4. As mentioned earlier, quite a few PGSEM students are doing this program as a substitute for general management education. There is also a strong case of strengthening the niche that PGSEM really belongs to, be it by reducing its strength in terms of number of students. These two factors in tandem create a case for considering migration of students from PGSEM to PGPX. The migration could be selective – but there is a need to seriously consider this option for the current batches of students. In future as the distinction between PGPX and PGSEM becomes more elaborate, applicants will be in a position to make the right choice aligned with their goals and aspirations.

5. The institute needs to re-evaluate its relationship with partner companies – are they currently playing the role in the program that was originally envisaged? Business acumen tells that every contract – explicit or psychological – has an expected expiry, unless otherwise called out perpetual. Where are we on this front – 10 years!

Is the fear of antagonizing partner companies real? Even if that is the case – what exactly will antagonize the partners? If these are questions for which the answers are hazy, then the institute needs to get clarity – after all, understanding their exact position and negotiating with the companies can significantly enhance the returns from PGSEM for the institute. PGSEM is an invaluable innovation of IIMB; it does not deserve to fade into oblivion because of an unsubstantiated belief that might no longer be as relevant as it was 6-9 years back.

6. The fear of the institute that providing placements or assistance in any form will discourage current employers from allowing their employees to pursue PGSEM is practical, but may not be as significant a factor as made out to be. There are several reasons to support the argument that the impact of this aspect may not be so significant after all –

a. What has been the average stay of an employee in a typical IT company in India – 2-4 years? So if a participant who has been in the company for 1 year before joining PGSEM and continues to stay for another 3 years (most participants do not switch jobs during the course because it involves additional work load), we are already hitting the upper end of the average. In fact, many companies have clauses for pursuing higher education wherein the employee commits to stay with the company for 1-2 years (min.) after the course completion. For several IT firms, higher education is a mechanism of employee retention.

b. Companies whose employees have switched jobs during the course of PGSEM have anyways lost them despite no placement assistance from the institute. This weakens (not nullifies) the argument that placement assistance will discourage employers.

c. A positive affect of providing assistance with placements is that the current employers will be encouraged (compelled?) to look for a profile within the company that matches the employee’s aspirations after the course completion. A part of the problem that is currently facing PGSEM will be resolved straightaway.

d. The institute can also consider indirect methods of providing assistance – all that is needed is to provide industry contacts, exposure to the various start-ups in the industry, probably NSRCEL can provide invaluable assistance in establishing industry-PGSEM contact.

e. There can also be other innovative methods – for example, the institute commits to not providing any placement assistance to graduating batches for the first 1 year after the course completion. During this time the participant are free to explore opportunities within the current organization or elsewhere. After completion of 1 year, placement assistance can be provided to selected candidates (only for those who still need it).

f. In any case, what is the harm in rolling out placements on an experimental basis, say for 2 years? If partner companies are unhappy or if there is a significant resistance from IT firms in allowing their employees to take up the course, the institute can monitor and roll back the assistance. Nothing shall be lost – the gain will be that the test roll-out will provide an evaluation of PGSEM students vis-à-vis general industry requirements.

7. Target start-ups and encourage entrepreneurship among PGSEM candidates. NSRCEL can organize meetings with current and proposed incubation project representatives. This shall benefit both the PGSEM students and the incubated ventures.

PGSEM Students

1. The Student’s Affairs Committee should continue to partner with the Media Branding Cell of PGSEM to organize more events that bring the industry closer to the institute and to PGSEM.

2. Every participant must ensure to participate in such events as every effort of networking is futile without adequate participation.

3. Participating students should also continuously talk to the HR and senior management in their respective companies and build a PGSEM community with their companies as well. Actively identify those needs, roles and responsibilities that best match the value from the course.

4. The students need to get into the habit of networking – best opportunities come knocking at networking events. Leverage the power of internet (communities, groups, web-site etc.) in building strong networks. While some effort is underway on this front, the biggest dampener is lack of participation from a majority of folks. Students also need to network well with other programs at IIMB – PGP and PGPX.

5. Leverage the power of the alumni; the SAC and media branding cell need to create a database of all alumni and encourage interactions between alumni and present students. Successful alumni can be a great resource for boosting the brand PGSEM in their respective organizations. They can exercise authority or argue out the need to hire PGSEM students in their organizations.

6. Invite the HR and senior management of IT firms to the campus and organize presentations from the chairperson, faculty, successful alumni and a few students in order to create awareness about the program. Focus should be on the value that these executives can deliver to their organization in a business/marketing role as against their current engineering role. Encourage them to participate in the program at different levels depending on their bandwidth –

a. At the highest level, the HR/senior management representatives are involved in examining the course structure and providing their feedback on how things can be tuned to specific IT requirements.

b. At the mid-level the representatives of companies are involved in meeting respective employees from time to time and assessing which area within their companies can leverage the additional skills of the employee. Opportunities to shift from engineering to marketing or sales, or business analyst role are all considered during these meetings.

c. At the lowest level, the goal is for HR and senior management to be aware of what the course exactly means for the employee and for the organization.

Kill PGSEM?

Unless the course structure evolves around creating a niche market for the software industry – the course is bound to extinction, especially in light of the new PGPX course, which is also a general management program for executives with the added benefit of placements. To reiterate – extinction does not necessary mean the course will cease to exist (at least in the near term of 2-4 years) – it could simply mean that whatever brand has so far been established gets eroded and there are no longer any serious (talented) takers for the course. This eventually may cause real extinction as well! Eventually one might see the number of sections in PGPX increasing to absorb the more talented executives.

PGSEM shall survive if at least one of the following conditions are met –

a. The institute provides some kind of assistance for placements – indirect placement assistance may also be fine.

b. Brand building and marketing of PGSEM among IT firms is taken up on a revolutionary scale – both by the institute and by the students

c. The course structure and contents are substantially altered based on feedback from the industry to meet their specific needs. This might involve reducing the duration of the course, reducing the intake (purely demand base) and tighter selection criteria. In this model the course shall be completed only with active participation of the sponsoring company – perhaps a full scale project to be done in the current company to qualify for a degree.

P.S. It is a lot easier for a person who is not determined to succeed to not succeed. It is also not that difficult for a person who is determined to succeed to succeed. Remaining combinations are very difficult to achieve. So the institute will succeed in its PGSEM endeavour only if it is determined to succeed – same applies to the students.

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[1] http://www.youtube.com/watch?v=clKiw2oMzOc – Professor Apte’s interview.

[2] http://www.youtube.com/watch?v=pO4g3ECVi_k&feature=related – Professor Raghunat’s interview

[3] Business Gyan magazine, October 2008 issue – print edition.

[4] Business Gyan magazine, October 2008

[5] http://www.youtube.com/watch?v=-Q12M8fQZMw