Why do firms participate in the IIM campus placements at all? After all, the IIMs charge a substantial participation fee, as well as a recruitment fee for each student who joins the firm. Also, firms are required to visit the campus for interviews on a designated time slot along with several other firms, however inconvenient the date may be for some of the firms. Instead, why donat firms recruit IIM graduates from the open market through advertisements rather than from an IIM campus? Why donat the firms, many of whom are sought after employers worldwide, call for direct applications from graduating IIM students and recruit them without paying any fee to the IIMs?
The reason is that, despite the inconveniences and the cost, there is considerable value that accrues to the firms in the IIM campus placement process that far exceeds the direct costs it incurs in terms of placement fees and logistical costs. The direct and indirect costs of recruiting IIM students off-campus is far higher than doing so on campus, even after factoring the placement fees charged by the IIMs. In any case, the recruitment fee is payable only for a student who actually joins the company. In effect the total costs incurred by a typical company for an IIM student recruited on campus are far lower than the equivalent costs of directly recruiting that student off campus. Off campus recruiting is also risky in that there is less certainty that such offers will be accepted.
Assuming that the firm is interested in recruiting IIM graduates, placing recruitment advertisements in newspapers are expensive and typically attract large volumes of applications from graduating students across all campuses. The high volume of applications takes up substantial time of HR executives to sort out potentially good applications and errors of omission are likely. The potentially good applicants are also likely to be shortlisted by a number of other firms simultaneously. The recruiter often has to pay the shortlisted candidates for travel and has to book a hotel room or an office room to conduct the recruitment process. After all this, when the company makes an offer, the candidate may not join the firm and may also use the offer to bargain for a better position in some other firm. The campus placement process solves many of these problems and thus reduces direct and indirect costs for the participating firms.
First, the positions for campus placements are only advertised by the firm within the selected IIM campuses and not to all graduating students in the country. The applications are therefore fewer, usually in a common single page format and of assured high quality due to the high selectivity of the IIMs in admissions. Given fewer applications, even if all graduating students in an IIM apply to a firm, each resume can get greater scrutiny than if the same positions were advertised in the press. However, students who are not keen on the company usually do not apply, as they do not want to go through the process and probably waste a “roll-over” when they could be interviewing with other more preferred firms in that same time slot. Therefore the firm is required to scan and shortlist only those applications where the student clearly has a prior interest in joining. All resumes are scanned by the student placement representatives for accuracy. Short listing of students and final selections are easier to do on a comparative basis from a fairly large pool of campus applicants.
Second, the company’s interaction with the student placement representatives, their interaction during the pre-placement talk and the recruiting slots that it gets, are key sources for the firms to gauge the potential success of their recruiting efforts. This enables the firm to plan its recruiting efforts better in terms of estimating the number of students they would recruit from each campus and their propensity to join the firm. The recruiting firm also gets a good idea of other companies in their slot and the nature of offers that they are likely to make a this may enable the firm to suitably revise its offers across the board or do so for specific individuals at the time of the interview so as to make its offers more competitive in that slot. Even if a company eventually decides not to participate in campus placements, the allotted recruiting slots at the IIMs are a good indicator of the company’s chances of recruiting graduating students from IIMs later in the open market.
Third, the campus provides adequate rooms on campus for conducting interviews, ensures that all candidates are available and manages a smooth flow of candidates to the recruiting teams. The company therefore needs to depute only the actual interviewers to the campus and no other staff is required to manage the schedule, the flow of candidates, deal with absentees and clear the travel bills of candidates as required in direct recruiting by he firm. This considerably reduces the cost for the firm compared to conducting recruitments in hotels in major cities or in their own office. Also, the entire interview process is completed in just one or two days at each IIM campus and across major IIM campuses within a week a this reduces the overall time spent by managers in recruiting and enables the firm to send more senior managers to IIM campuses.
Fourth, the rules for students in campus placement ensure that no student holds more than one offer at the end of the process and all students in the recruiting process with a company in any slot are available for recruiting by that company at that time. The one offer at a time and rollover rules considerably reduces recruiting time for firms and the time spent on interviews is usually not wasted. It also leads to a high conversion of offers into acceptances and accepted offers into the student actually joining the company. There is a less likelihood of any student bargaining with an offer on hand or scouting for better offers off campus, if he/she has already had a fair chance of selection with all the firms of his/her choice that were recruiting on campus. Student placement representatives also provide current information to recruiters to ensure higher conversion of offers.
Fifth, the placement representatives try to ensure that students who are most interested in a firm get an early chance to interview with that firm so that they have a better chance to secure an offer. If the recruiting team makes more offers in the first half of the day, it may become more cautious with later interviews and students more keen on the firm may lose out. This sequencing also benefits a student keen on that firm as he/she meets a recruiting team that is fresh rather than tired. Further the student who is keen on joining that firm is likely to impress the recruiting team and those initial interviews may influence the firm to recruit more students from that campus over the recruiting day. On the other hand if a firm bargains to get into a slot above the slot based on actual preference, it may find itself with almost no students to interview in the first half of the day as all students may have given that firm as their least preferred firm in that slot. The firm may also find that all its offers are refused by students who usually get better offers of their preference in that slot.
Sixth, placement representatives play a significant role in ensuring that firms do not end up wasting offers or leaving with fewer students than they had planned to recruit as some students may get overlapping offers. This is done by placement representatives cross-checking the list of offers by all the firms before the list is finally released against the priority order that was given confidentially by the student. If a student who is keen on a firm get his/her coveted offer from one firm, then the other firms that have also made him/her an offer are informed that they may lose one or more students in the list without naming him/her and requested to make additional offers or add more students to the waitlist. When recruiters cooperate, this process ensures that most offers are not wasted, unless the recruiter refuses to make waitlist offers or make additional firm offers.
Seventh, most students who accept offers during campus placements actually join the firm, as they have effectively exhausted all their more preferred options within the placement process and have tried their chances with almost all firms that they had higher preference for. This holds if all major recruiters participate in the IIM campus placements. However, if some sought after firm opts out of campus placements, students may apply directly to that firm after placements and join that firm over the campus offer that they have accepted. However, such cases are relatively rare in the IIMs as most firms that are recruiting IIM graduates do participate in IIM campus placements.
Eighth, successful recruiting by a firm at the IIMs is widely reported in the press and acts as a strong signal to the entire business and investing community on the current status of participating firms as potential employers of high caliber people. Successful participation in an IIM campus placements acts as a strong market signal to graduating students and alumni that the company currently has the potential to absorb high quality MBAs and offer them exciting career opportunities. On the other hand, non-participation in IIM campus placements or the inability of a company to get acceptances of their offers on IIM campuses, is a clear negative signal to students and alumni a indicating that the company is either not worth applying to, or does not currently offer good enough careers for high caliber MBAs. Thus participation in IIM campus placements can have positive payoffs for the company’s recruitment efforts at even the middle and top management level.
Nineth, the IIMs usually release the names of prominent recruiters as well as all new recruiters in their placement press release. This along with the number of offers they made on each IIM campus gives the recruiting firm substantial indirect publicity through the press. Placement data is also seen by the financial magazines and newspapers as a signal of the growth and health of the industry.
Tenth, some of the recruiting firms have become employers of choice at the IIMs by building their brand name over the years through their pre-placement talks, regular recruitment of graduating students and feedback from IIM alumni who work with the company. They are aware that such a brand name on the IIM campuses creates high value for the company’s recruiting efforts, as it creates a mind-share for the company among graduating students as well as IIM alumni who may be contemplating job changes anytime in the future. To create a positive impression of a company as an employer, or to correct a negative impression of a company as an employer, in an off-campus mode is clearly far more expensive, as some past recruiters at the IIMs have realized to their dismay.
Firms that have stopped recruiting on IIM campuses have found that their brand name among graduating students at the IIMs as well as among IIM alumni has deteriorated fairly rapidly, leading to remarkable low numbers applying dire ctly to them within a few years and even fewer joining them and staying on. The firms that schedule their recruitment off campus prior to the campus placements schedule, may find that students typically bargain for better deals, given their campus placement fall back option, and collect one or more off-campus offers only to bargaining for better offers on campus, rather than with an intension to join. On the other hand, those firms that schedule their recruitment off campus after the IIM campus placements find that the best students have got their choice of offers on campus from the wide range of firms available and they simply do not apply.
While the IIM campus placements provide an efficient and effective mode for potential recruiters to recruit IIM students, the recruiters may often not find the process smooth enough and are often not happy with the limited time they get with candidates during final placements. The placement process may be disrupted by the adverse tactics of some recruiting firms who engage sought after students in long winded interviews that essentially block them from interviewing with other competing firms in that slot. This may result in unfair delays for all other firms in the slot and such unfair tactics may backfire on the firm when the student has other options. Other tactics such as insisting on immediate acceptance of offers, have over time been eliminated through enforcement of placement rules on all the recruiting firms. These rules effectively void such unfair tactics.
Placement rules for students and recruiters are designed such that no recruiter gets unfair advantage and no student is pressurized by a recruiter to accept an offer before he/she has interviewed with all recruiters of his/her interest. While stress does exist, students who get pre-placement offers or get placed in an early slot in a firm of their choice are the ones who largely escape from the high stress in placements. However, the student experience of the IIM process is far from satisfactory for the ones who do not get placed early as they are required to go through several stressful interviews at a fast pace and take major decisions on career choices at short notice. There is considerable pressure on students who do not get offers in the initial slots a their interview performance does suffer over time as they get more tired going through more interviews with lesser preferred companies. Spreading the interview slots over a longer period does reduce the physical strain but may not reduce the mental strain of not having a job on hand when most others in their batch do. Fellow students often help their friends in this difficult situation and the IIMs also have counselors to help students redirect their efforts towards options that they may not have considered earlier. The IIMs also seek to reduce external pressures from parents and friends by restricting the media from releasing interim reports about IIM placements till the entire process is completed.
Overall the IIM campus placement process is both efficient and effective for recruiting firms that utilize this annual opportunity to get high quality talent. It is also both efficient and effective for the IIMs to rapidly place all graduating students in jobs of their choice with the best of recruiting firms available. Though stressful and tiring, it is both efficient and effective for the graduating students to secure jobs of their choice with the recruiting firms available and it does ensure that all graduating students are placed with offers that are reasonably good if not the best.
The IIM campus placement is a meritocratic yet equal opportunity process that effectively and efficiently enables all graduating students of the IIMs to seek opportunities with the recruiters of their choice without negatively impacting the prospects of any of their fellow students. Thus IIMs are able to satisfactorily place their entire graduating batch even in the worst of times, though this record may be tested as the batch size in each IIM grows substantially over time. In contrast the aopena recruitment process followed in many business schools can be more time consuming and resource intensive for both recruiters and candidates and may result in top students collecting multiple offers while others from their campus remain jobless several months after graduation.