Why India’s Universities Struggle to Build Great Business Schools

For more than six decades, management education in India has been shaped by a small number of highly influential institutions, the standalone business schools. The establishment of IIM Calcutta and IIM Ahmedabad in 1961, with support from MIT and Harvard Business School respectively, and later IIM Bangalore in 1973, ensured that postgraduate management education in India began with high standards in teaching and curricula; the same cannot be said about research, but that is the subject of a future essay. The setting up of these standalone business schools was taking place within the broader context of the setting up of a number of standalone research and teaching institutions of excellence during Nehru’s prime ministership, such as Tata Institute of Fundamental Research (TIFR), Bhabha Atomic Research Centre (BARC), the Indian Institutes of Technology (IITs), Physical Research Laboratory (PRL), National Chemical Laboratory (NCL), All India Institute of Medical Sciences (AIIMS), etc. These standalone institutions therefore started with broad political, social and regulatory legitimacy, which facilitated the setting up of successive waves of such institutions in India.

Over time, institutions such as XLRI, S.P. Jain Institute of Management & Research (SPJIMR), Management Development Institute Gurgaon (MDI), The Indian Institute of Foreign Trade (IIFT), the Indian School of Business (ISB) and the newer Indian Institutes of Management (IIMs) joined this group, creating one of the most competitive management education markets in the world. This historical evolution has important implications for newer schools of management (SoMs), particularly those housed within multidisciplinary universities. While newer private universities such as Ashoka, FLAME, Krea, Shiv Nadar and Mahindra have made impressive progress in undergraduate education, competing in the postgraduate management market is a very different challenge altogether.

The question is not whether multidisciplinary universities can build strong business schools. They certainly can. The real question is what conditions are necessary for them to compete successfully against highly focused standalone institutions that have spent decades building their brands, networks and capabilities.

Why Postgraduate Management Education Is Different

Unlike undergraduate, postgraduate management education is fundamentally a national and increasingly global market.

In undergraduate education, most students remain close to home. Excluding engineering and medicine, between 60% and 75% of Indian undergraduate students study in the city or region where they completed high school. This creates relatively localised markets where institutional reputation, family preferences and convenience play important roles.

MBA and master's programmes operate very differently. Applicants routinely compare institutions across the country. A student in Hyderabad may consider ISB, IIM Ahmedabad, XLRI, MDI, SPJIMR, IIFT and several international programmes simultaneously. Employers recruit nationally. Rankings are scrutinised closely. Placement outcomes influence application decisions more than almost any other factor.

Globally, management-related programmes account for roughly one quarter of all master's enrolments, making management one of the largest postgraduate education markets in the world. Yet it is also one of the most competitive. In India, the ratio of post-graduate (MBA/PGP/PGDM) to undergraduate enrolment (BBA/BMS) in management is estimated to be between 1:3 and 1:4, according to the All India Survey of Higher Education (AISHE). This smaller market, combined with national and increasingly global competition, makes postgraduate management education significantly more competitive than the undergraduate market.

The Structural Advantage of Standalone B-Schools

Standalone business schools enjoy several structural advantages.

First, they possess singularity of purpose. Every major administrative process, from admissions to placements, alumni relations, executive education and faculty recruitment, is designed around management education. Their leadership teams spend every day thinking about how to improve rankings, recruiter relationships, executive education revenues and research output.

Second, they benefit from accumulated reputation. Institutions such as ISB, XLRI and the leading IIMs have spent decades building relationships with employers and alumni. These networks create powerful virtuous cycles. Strong placements attract strong applicants. Strong applicants attract the best recruiters. Successful graduates strengthen alumni networks, which further reinforce institutional reputation.

Third, standalone schools often align faculty incentives closely with outcomes that matter in management education. Faculty are rewarded for research visibility, executive education contributions (through extra pay), industry engagement and pedagogical innovation. Organisational attention is focused on a relatively small set of strategic priorities.

Although there are top standalone business schools in other countries, such as INSEAD (France, Singapore and Abu Dhabi), IMD (Switzerland), China Europe International Business School (China, Switzerland and Ghana), and Cheung Kong Graduate School of Business (China), the extent of dominance of standalone business schools in India is unique (for example, all 9 Indian b-schools in the top 100 of the Financial Times 2026 MBA Rankings are standalone schools). Important reasons are early mover advantage, adequate resources and focused decision making.

The experience of successful business schools globally suggests that organisational form matters less than decision-making autonomy.

This stands in sharp contrast to the United States, where all the leading schools, such as Harvard, Stanford, Wharton, Kellogg, Booth, Sloan and others, operate within universities. However, professional schools such as business, law, engineering and medicine enjoy substantial autonomy in admissions, faculty hiring, fundraising, curriculum design, alumni relations and corporate engagement. They are part of universities, but they are managed almost as independent entities.

By contrast, SoMs within Indian universities often compete internally for attention, resources and decision-making bandwidth with larger schools of engineering, sciences, humanities or law. Centralised administrative structures, while well-intentioned, can limit responsiveness in areas where business schools need speed and market orientation.

The experience of successful business schools globally suggests that organisational form matters less than decision-making autonomy. Whether they are standalone institutions such as INSEAD, IMD, CEIBS and ISB, or university-based schools such as Harvard, Stanford and Wharton, the strongest schools typically enjoy considerable control over admissions, faculty hiring, curriculum design, executive education and alumni engagement.

Why Autonomy Matters

If SoMs within multidisciplinary universities are to compete meaningfully with top standalone institutions, autonomy becomes critically important.

Admissions provide a good example. Building a successful MBA programme requires sophisticated market segmentation, targeted outreach, scholarships, branding campaigns and continuous engagement with prospective students. These activities require specialised admissions teams and dedicated marketing budgets.

Placements and corporate relations may be even more important. For MBA programmes, placement outcomes remain the single most important factor influencing applicant behaviour. Business schools need dedicated teams focused exclusively on employer engagement, alumni relations and recruiter development.

Executive education presents a similar challenge. The market for open-enrolment and customised executive programmes is intensely competitive. Corporate clients expect responsiveness, speed and flexibility. Successful executive education operations require entrepreneurial decision-making that can be difficult to achieve within centralised university structures.

Faculty hiring represents another critical area. Top business schools compete globally for talent. They often need differentiated compensation structures, flexible recruitment processes and the ability to align incentives with research, teaching and industry engagement.

Even curriculum design and assessment require autonomy. Business schools must continuously update courses, introduce new specialisations and redesign learning experiences to reflect changing market realities.

The Hidden Advantages of Multidisciplinary Universities

Yet, it would be a mistake to conclude that standalone institutions possess all the advantages. Multidisciplinary universities have strengths that standalone business schools often struggle to replicate.

The most important is access to intellectual diversity. Many of the most significant management challenges today sit at the intersection of disciplines. Artificial intelligence, sustainability, healthcare innovation, digital transformation, entrepreneurship and public policy all require collaboration across fields. Business schools embedded within strong universities can draw upon expertise in engineering, computer science, natural sciences, public policy and humanities.

This creates opportunities for distinctive academic offerings that standalone business schools may find difficult to match. A management student studying entrepreneurship can collaborate with engineering students developing technologies. Future healthcare managers can engage with life sciences researchers. Students interested in sustainability can work alongside environmental scientists and public policy scholars.

Universities also possess stronger undergraduate pipelines than most standalone MBA-focused institutions. High-quality undergraduate business programmes can become important sources of future master’s students, alumni engagement and institutional reputation.

A New Model for Business Schools

The future may not belong exclusively to either standalone institutions or multidisciplinary universities. The most successful schools of management will be those that combine the intellectual richness of the university environment with the autonomy traditionally associated with standalone business schools.

The lesson from India and abroad is that success depends more on decision-making autonomy than on organisational structure. Institutions that can attract talent, build employer relationships, innovate continuously and respond quickly to changing market needs will have a strongest chance of succeeding.

In management education, excellence requires both integration and independence.