Amortization … Impairment… and IIM degree

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A MBA degree/diploma is like patent; it has limited shelf life and should be amortized over a period of time. Does knowledge of IIM graduates who did MBA in 80s have any relevance today? What they learned was in pre-liberalization era, post 10 years after getting degree India and world changed drastically.

What they learnt then may not be of any relevance today. Infact those who obtained degree in 1990, would find that by 2000, value of their degree was zero. So advertisements asking for IIMs candidates from pre 90s era are treating degree like brand name, something that is not subject to amortization or impairment.

Today, it is lot easier for Indian students to join top universities in US and get degree from there. Also some disruptive innovation can result in making same education accessible to a very large section of population. IIMs face problem of internal politics, lack of quality faculty, and dilution of brand by opening too many IIMs, in light of this IIM degree should at least be subject to impairment if not amortization. Since students joining these institutes are brilliant, they will succeed even if quality of faculty is poor. They get good grades, even without attending classes.

To assume that IIM brand will not impair over a period of time is not correct. As for lesser institutes, most will not survive beyond 10 years.

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