MBA in India

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Why the Chairman and a Member of IIM Indore's board resigned last week

Speaking to both sides of the fence, it is clear that IIM Indore's director Dr N Ravichandran and chairman, Board of Governors LJ Jhunjhunwala never really hit it off that well.

IIM Indore director Dr N Ravichandran and chairman, board of governors LN Jhunjhunwala

On April 12, veteran industrialist of the LNJ Bhilwara Group Mr LN Jhunjhunwala, who is also the chairman of the Indian Institute of Management (IIM), Indore's board of governors put in his papers with the b-school citing major differences with its director Dr N Ravichandran. As an immediate reaction, another board member and Bhopal-based retired IAS officer Dr MN Buch also resigned, claiming that through his resignation he wished to facilitate a reconstitution of the entire board.

For those of us in the media, this was not a surprising development. Since the last one year, emails written by former IIM Indore employees and by anonymous senders have been constantly streaming their way to our inboxes, mostly highlighting alleged corruption charges and court proceedings against director Ravichandran as reported in the local Indore Hindi language newspapers. The first such email was sent by none other than the b-schools ex-public relations officer himself. The director too has in the course of time faced charges of mismanagement and plagiarism and generally gotten bad press.

Local Indore journalists arent quite fans of the director, who is not known to be very warm to reporters and outright refuses comment on news stories. Last year, Jhunjhunwala sought to fix this by organising an ice-breaker meeting on the campus between journalists and the director at the 2011 convocation ceremony, where the reporters were advised to convey their dissatisfaction with the directors no comments policy. According to an account of the meeting, Ravichandran took the rather confrontational stance that 'he was an independent person and would not run the institute according to the demands of journalists'. The meeting ended in increased mutual disrespect, with the journalists boycotting the tea gathering that had been arranged by the institute's board of members later.

Indeed, for this story too, Ravichandran refused to make a comment when contacted by PaGaLGuY, just as he has refused to provide his side of the story in all the national newspaper coverage around Jhunjhunwalas resignation throughout last week. Ravichandran's stoic silence makes the narrative against him a lot shriller than that which speaks for him.

We spoke to a number of people on both sides of the camp --- pro-Ravichandran and anti-Ravichandran, including the two key gentlemen who had resigned from the IIM board last week --- to piece together the sequence of events that led to a broken board of governors at the institute. This story perhaps does not do as much justice to N Ravichandrans version of events as it does to the more vocal anti-Ravichandran faction, for no reason other than the said silence on the director's part. Yet, we have tried speaking to people who have worked with Ravichandran closely in the past to understand at least some parts of his side of the story.

About six months ago, LN Jhunjhunwala received a letter signed by eight IIM Indore faculty members stating that the director had been functioning in a dishonest manner and had not been completely financially sound in his handling of the institutes money. The group requested the board of governors to look into the matter. Although not one to doubt the director, Jhunjhunwala reportedly conveyed to Ravichandran that he should react to the matter in some way, which the director did not take to very favourably. These estranged faculty members have then reportedly also written about their grievances to the Human Resources Development (HRD) Ministry on three separate occasions.

In early March 2012, more allegations against the director flew in with Ahmedabad-based researcher KR Narendrababu claiming that one of Ravichandrans research papers on the subject of'Euthanasia had been a 60% direct and indirect reproduction of a previous Supreme Court judgement on the topic.

Interestingly, Narendrababu is an ex-chief administrative officer of IIM Indore who had been sacked by Ravichandran in 2009 for alleged misconduct. While leaving, Narendrababu had leveled allegations of caste-driven 'mental torture' against the director to the National SC/ST Commission, which the institute had denied. Over the past couple of years, other senior faculty sacked from IIM Indore have been extremely vocal about their dislike for the man.

In February this year, two IIM Indore students were caught taking drugs on campus, following which they were rusticated. Jhunjhunwala, who is based out of New Delhi, claims to have been informed of this development not directly by Ravichandran or the institute's administration, but through newspaper reports the next day. This reportedly added to an already growing feeling of mistrust between the chairman and the director.

The director has also invoked dissatisfaction among some quarters in the school because of the perception that he had been holding IIM Indores overseas campus in the United Arab Emirates (UAE) too close to his chest instead of appointing an independent person to manage the affairs there.

IIM Indore runs a two-year Post Graduate Program in Management for Executives (PGPMX) at Ras Al Khaimah, UAE in partnership with a private agency called Global Education Mission (GEM), which is also the designated collection agent for the course fees. However, according to Jhunjhunwala, two cheques worth Rs 20 lakh and Rs 12 lakh submitted by the GEM in January and February this year against academic fee payable to IIM Indore had ended up bouncing. This only increased his mistrust of the director.

The chairmans attempts to intervene in the cheque-bouncing matter were allegedly halted by the director, who allegedly asked him to stay off the b-schools administrative functioning. Soon after, both Jhunjhunwala as well as the HRD ministry received a letter signed by twenty IIM Indore faculty members asserting that the director was being made a victim of false propaganda. The letter adjudged Ravichandran to be an excellent director and sought to be laid to rest the faculty members concern about rumours that the director was due to be sacked soon. The anti-Ravichandran group of course views this letter as a synthetic creation by the director to protect his image.

The non-intimation of the drug incident to the chairman as well as the handling of the cheque-bouncing episode were reportedly the last straws that led LN Jhunjhunwala to submit his resignation to the HRD ministry as chairman of the IIM Indore board of governors last week.

Those who have worked closely with Ravichandran over the past few years however have an entirely different story to tell. According to a faculty member at IIM Ahmedabad where Ravichandran previously taught, the man is 'without doubt incorruptible' and is 'exceptionally talented and sharp' but at the same time also carries 'a strong sense of wrong and right'. The director was also a very popular and highly regarded operations management professor at IIM Ahmedabad among students, the kind who had fan pages on the social networks of the time.

What we also do know about Ravichandrans tenure at IIM Indore is that he has taken perhaps some of the boldest steps that any IIM has taken, two of which are entering undergraduate education and starting the first IIM campus outside the borders of India at UAE. The director has been fighting to get the undergraduate course recognised by applying for deemed university status. All these are decidedly the works of an unusually proactive administrator at the helm of an IIM, somebody who would easily be seen as too fast for the sarkari culture that the IIMs inherit.

But Ravichandran is also described by his supporters as one with a highly accentuated sense of black-and-white and as an eccentric person with the kind of interpersonal skills that end up alienating people more often than they do elicit cooperation.

Dr MN Buch, the other board member who resigned soon after Jhunjhunwala did told PaGaLGuY that the directors chair demanded some respect and if anyone had a problem with Ravichandran's personality, such 'petty issues' should have been resolved informally rather than put on record. He has also called for strict action against those who had made financial fraud allegations against the director.

Supporting the decisions taken by Ravichandran over the past few months, Buch cited the example of IIM Bangalore, whose industrialist chairman Mukesh Ambani had reasserted the authority of the director over the institutes administration following a dispute at the time. If any of the board members had a problem with this, they were free to part ways with the IIM Bangalore board of governors. This point was driven home by the chairman and the board functioned in tandem with the director post this announcement, said Buch, implying that the IIM Indore chairman Jhunhunwala during his tenure had failed to establish the necessary clarity between his own role and that of the director.

The pro-director group also credits Ravichandran as being instrumental in steering the course of the school. He has acted like an Iron Man, bringing about innovative changes in the institute. While framing the proposal for the five-year integrated management programme, the director had faced a lot of opposition from the HRD ministry which was apprehensive about the IIMs entering undergraduate education. However, Ravichandran was positive about the outcome and if one takes a look at the numbers that have been enrolling in the course, it would seem as if he was right, said an official close to the director.

Adding up the accounts of people from both sides, it appears as if Ravichandran and Jhunjhunwala never really hit it off right from the beginning. It is also clear that the director's style of functioning and his perceived arrogant personality tends to invoke strong reactions among people who work with him --- the kind of person who you either like a lot or absolutely hate, and that has spawned a large number of people who would like nothing less than to bring him down. Whether their allegations are true or not is something that the courts will decide in time.

This current state of flux in IIM Indores board of governors is however irrelevant in the long term considering that the institute has already been earmarked by the HRD ministry to be provided with greater autonomy by way of a modified memorandum of association. Additionally, LN Jhunjhunwala's tenure was in any case supposed to end in June 2012.

In the modified structure of IIM Indores board, the number of board members would be downsized from the existing 25 to around 10 to 15. Under the old structure, the chairman could nominate two faculty members as well as four more members to the board. The new and leaner structure would restrict the chairmans nomination power to only two faculty members. The rest of the members would be selected using a collective decision in which the director would have a say. The pro-Ravichandran faction believes that the board reconstitution should be hurried up with so that the institutes governance is back on track.

Currently there has been no word from the HRD Ministry regarding the next course of action that they will take about the absence of a chairman at the helm of the school. The Ministry has still not even accepted Jhunjhunwala's resignation, and has requested him to provide a more detailed explanation for his decision to quit.

As written earlier, N Ravichandran refused to make a comment to PaGaLGuY for this story.

  • 30Comments
  • I completely agree with Allwin's first comment. :smiley:. 26 Apr '12.
  • good article Astha and have taken the effort t.... 28 Apr '12.
Ek baar jo maine commitment kar di... 8)
Priyadarshi Bhattacharya @starvoyager 598
@Rohit Phulsunge 'If an IIM is able to place all its 450 participants with decent enough packages...' If. @Devilishangel 1. Harvard and Kellogg doing something does not sanctify it automatically. How come they do not offer business admin at undergrad level (Wharton is one of the very few that does)? 2.Definitely, you can. By all means, pursue a B. Sc/B.A in economics, a B.Com with specialization in Marketing, a B. Tech in Industrial Engineering etc. Will definitely build depth. Further supplemented by the breadth provided by your MBA.
Nikhil Jalan @niks2012 42
Relieved to see that PagalGuy is operating the way media should. A Responsible, detailed, and most importantly BALANCED (emphasis supplied) article. At no stage trying to malign the image of one of the highest rated B-School in country, yet bringing out relevant facts. Very good article.
Biswajeet Mallik @biswakpl 432
Well done pg, this is the most neutral/balanced article I would say on the developments . In my opinion , a director is just not a guy for executing contracts and opening branches ,rather he should be a role model for the students on the campus . He is a chief of the society there , the students , the faculties and all the stakeholders . People take pride in saying XYZ is our director , just like they are being proud of being part of a tradition of an esteemed instituition , in this case "IIM-I" , Looking from the above angle , Prof. RaviC hasn't done enough justice to the role of director . His mercurial nature , refusing to coordinate or communicate with students / faculties /media is the testimony for that. And executing contacts , new programs abd expanding to other geographies , however good or bad isn't enough to cover this deficit. I am sure , there are enough people who does have a combination of all qualities , being a good executioner and popular.
Raju P @rajuwithu 286
after reading the article and the comments I understood one thing, "the more you read the more you get confused" . Problems will be everywhere we need not highlight this just because it is happening in IIM . Let the governing body resolve the issue among themselves, because being spectators all that we know is half truth :). We are none to comment on the issue, same applies to PG too offense is never intended in my comment, just reminding our scope and purpose of being in PG we here to discuss how to get the best out of IIMs but not to know if the drugs can be used in IIM or if there are differences among the faculty there it will serve no purpose I guess and also gives negative impact to the student even before he joins the institute . Anyhow nice analysis but on useless topic (to my opinion, I know many differ me ). Sorry Apurv I was not trying diminish/debase your efforts
Mahinder A @catterpiller 9
Cannot believe IIM-I director is happy with the increasing in students. Obviously students would come now, but such meaningless practices would result in dilution of the brand and possibly, the future batches would not get enough students(if these guys spoil the institute's name)
When Ravi joined IIM Indore as Director he was very humble and had all the best things in mind to take IIM Indore to world class standards something closer to Harvard. He thought he alone had the magic wand to create a Harvard like B school in India. May be he soon became greedy and puppet in the hands of some other greedy faculty & officers who followed him to IIM Indore. His mind got corrupted. He designed and premediated a plan to get rid of all the existing officers . Toady poor fellow stands challenged on every count in the courts.Perhaps he is the first Director to face worst allegations for an academician and so many court cases in the history of IIMs. All kinds of corrupt practices unheard of in IIMs have been reported against Mr. Ravi. It is said an organized looting is going on IIM indore and the present trend in IIM indore is Lootho. Baadh me dehka jayega. The quality of every thing that IIMs boast of, has gone down in IIM indore under Ravi c. There is said to be a 30 page complaint lodged against Mr Ravi c with the government. Finally the Chairman of the Board, has resigned citing Cheating Arrogance and Financial Embezelement as the reasons. Its high time the MHRD intervenes to inquire into all the allegations against my best friend Mr. Ravi c and declare him innocent . It will help him as well as end the deteriorating pretige of IIM Indore.
Krithika Venkataraman @chance 17
good article Astha and have taken the effort to present both sides of the story well!