16 lakh salary good for a 21 year old? A surprising answer on Quora

13

By Shikhar Mohan

When I was a student at Indian Institute of Management (IIM) pursuing the one year MBA, a candidate from the two-year PGP course once came to me for some advice on joining advertising. He shared that he had a huge interest in advertising and asked me if he should join an ad agency after graduating from IIM.

I asked him a simple question – Are you willing to work 16 hour days for one third of the salary you will get in a typical job after IIM, for the next three to four years? He responded in the negative.

As someone who joined advertising after his Bachelors degree and pursued an MBA many years later, I reflected on this situation. Here was a 23 year old young man with barely a year’s experience for whom management education had not only opened doors but had also closed many. And closed doors at the age of 23 did not make sense to me.

I chanced upon a similar discussion today on Quora which I felt many of our readers in India could benefit from – especially those considering rushing into management courses without gaining any work experience.

The question asked is “How good is a Rs 16 lakh per annum salary for a 21 year old”. Rupees16 lakh in dollar terms at a purchasing power parity rate of Rs 22-24/ dollar (a measure of the real value of a currency) is around $70,000. The answer to the question was surprising. The sentence from the answer that made a big impact was,“16 Lakhs per annum for a 21 year old is the worst thing that could possibly happen to you.” 

While the question has been asked by an engineering graduate, I felt the situation is equally pertinent to someone aspiring to the two-year PGP course in India.

For the benefit of readers who are unaware of management education in India, historically a bulk of fresh college graduates in India aspire to a two-year PGP course (a Masters in Business Management as per AMBA, UK accreditation) in India as a ticket to a good salary. Often the decision to join the course is not driven by an interest in the course or the kind of job that will follow but instead by the placements that accrue at the end of the course.

The placements for candidates graduating the course ranges between 10 to 12 lakhs per annum which is a reasonably good starting salary. A bulk of the candidates join companies in a junior profile such as a Management trainee.

The One year course is relatively newer in India and started about a decade ago. As opposed to the two-year PGP course, the one-year course in India is an MBA level course as per accreditation awarded by AMBA, UK. The course like its international counterparts mandates on an average 5 years of work experience for the joining class. Candidates graduating this course join companies as Senior Managers, Vice Presidents and CEO’s like their international MBA counterparts.

The mandate of 5 years work experience for joining the globally accredited MBA course is not just a diktat. One reason behind the stipulation is that work experience ensures that participants understand the nuances of what is being taught in class – most case studies for instance taught at business schools in India even in the two-year PGP course are sourced from Harvard, Kellogg, INSEAD and the like and typically revolve around the problems faced by middle to senior managers, something a class with work experience can relate too.

The bigger reason behind this stipulation and the one pertinent to this discussion is that an MBA level course gives you time to discover yourself before you manage others.

No one is born a manager. Neither can a manger be manufactured in a classroom. Past work experience shapes us into professionals who have both learnt the minute details of their craft and have also understood their own core desire and aim in life.

Becoming a manger after this follows naturally. The proper tools and framework gained at business school only provide a formal structure to such candidates.

Consequently, I would advise students to not simply aspire to a high salary and look at management education as a means to that end.

By no means do I intend to imply that a MBA course is always better than an Masters in Business Management (MBM/MIM). No, for some students who are sure of their aims in life an MBM may well be the right course. My advice is for the many others in India who rush into management education in order to bag a big salary.

I would suggest first discover yourself, then arm yourself with management knowledge and a great salary will follow naturally. Or for all you know, the high salary may just end up becoming a roadblock in your journey of exploration.

Without further ado, the conversation on Quora that sparked the chain of thoughts –

One year MBA in India executive MBA

One year MBA in India executive MBA

 

Share.

13 Comments

  1. Totally agree to that answer on Quora. I faced a similar decision (although not as highly paid) in the initial stages of my career. Left the MNC and joined a startup, traveled as a backpacker as much as I could, learned a new language, met awesome people, learned a lot professionally, spent quality time with friends & family, and yes improved at guitar :) Now after all that here at IIM – Indore, it’s time to get into the vicious cycle of work, money and more work!

  2. hey aditya,please throw some light in detail on your journey.i am shit scared that if i don’t go for higher studies now,i might never be able to motivate myself again to go for it.but on the other hand there is so much to do,so much to see,so much to learn,so much to experience in life;and these are our best years .i don’t wanna waste them sitting in a cubicle making spreadsheets and powerpoint presentations.throw some advise towards us also

    • Hi Kasturava,

      Although I don’t know your background, I would try to elucidate. I think that you have the answer with you. If you feel that you don’t want to sit in a cubicle and make presentation, then don’t! Go out, enroll in the program if you feel this is the best way you could learn at this point and sustain yourself going forward. For me, a MBA at that point didn’t make sense and the fact that I didn’t have any social responsibilities per se, joining a startup gave me more thrill and confidence. I agree with Dr.Monga, if one has a strong fundamental base amalgamated with practical exposure, a one year MBA makes a lot of sense.

  3. Very interesting insight for management students. Salary being paramount for many to join MBA may be a road block in expansion, observed rightly by you. One must look for one’s interest n a particular domain and then choose study course. This certainly would help in knowledge and intellectual growth and salary would automatically follow. I firmly believe that theoretical knowledge is a credo to success. When it is acquired after grinding oneself with 4/5 years of exposure to corporate culture, the one year MBA acts as catalyst in one’s expansion and growth and one does not care for salary but for internal satisfaction and joy on one’s positive contribution to the world of work and in turn to the society as a whole. Your views are an eye opener for all those aspiring for management education.

  4. Those who go for higher pay will always end up seeking more, and may even get more BUT they will never attain peace of mind. You are all aware, human needs are endless/never ending. One should know that life is never promised till tomorrow. So, why not live happily when you have control of your life, until you run out of control.

  5. Someone once said, Money is not everything but make sure you have enough of it before talking such nonsense!

  6. Hey everybody…do u think dat worrying about my future is not good as i am now just in class 12..but i constantly think that what course should i do to become rich,to accquire enough money so that my family becomes secure,so that we do not face any financial problems because i am very poor..i am from a middle class family and after giving my class 12 exam i have to work to support my family….so do anybody thinks that i am wrong because am i think about the courses which gaurentee money ?? What should my goal be? Even i know that i have interest in particular course but because i dont get money after doing them so thats why i have to do course which gaurentees me money??so what you guys can say?please suggest me what should i do…thanks in advanse

  7. It would be great if I can earn 6 lakhs per month !! Help me !! Thank you !! Best wishes from me !!

  8. I also turne 21 in June. And I feel MBA is actually a waste of time. I don’t completely agree with you saying that the person is not born with the management skills. Well let me put it this way.

    You certainly can’t market something just by reading books . There are great plethora of entrepreneurs who are successful and not MBA and are running Fortune 500 companies. So in a way I feel it is important to rethink what you really want to do in life.

    If you have an idea and a problem at hand. Go and find its solution and then market it accordingly who knows you might end up being next Elon Musk. Infact I read this article recently that most enterprenuers prefer non MBA’s . As traditional MBA’s basically revolves around theotrical fundas and case studies.

    And this trend forever started only few decades back. So even at that time we ha great companies which were being run by people who never even heard of MBA’s.

    It is all about one’s passion. Right now I also can go and work in an core IT company or go for MBA and then grind myself for years to climb the corporate ladder and become a CEO of a company which actually has someone else’s name on the letter-head.

    But I would rather develop my skills. Learn new things and find answers to question that really matter.
    Yes money is the key and you can make it by following your heart.

    I have some startup ideas and I am focusing on that as well.

    • Hi Sarthak, we don’t think an MBA is a waste of time – as long as you are pursuing the real deal. But Indian students have been and continue to be misled into believing that an MBA can be done without first getting real world experience. Any MBA outside of India like the globally accredited one year full time mba in India needs work ex. and that is because work experience sets you up for understanding the knowledge being disseminated in class which deals with solving issues faced by senior managers, not freshers. Giving students time for gaining work ex. also provides them a chance for exploring their interests.
      If an MBA is done at the right time, i.e after 3-5 years of work ex. there is a better probability of knowledge combining with real world know-how and helping the student advance his career. Check this for more:http://bit.ly/amendiimbill Without work-ex, one can only really do a MBM, which is what the two-year courses in india are. If more students knew this, maybe they would prefer to first spend some time working in professionals connected to their bachelors degree.

  9. Hi Admin.

    Well maybe to some MBA is important as they need to learn “Fundamentals”. And yes in India we do have a misconception. Infact there is rat-race when you ask fresh graduates(mostly engineers) on why they want to do MBA. They would say to get a higher package. I am pointing towards that.

    And MBA is not cheap. It costs over 25 Lakhs to do MBA from top IIM’s and some B_ schools charge over and above that?

    So this management knowledge according to me can only be gained through practical experience in real life environment. So yes I agree with you on that.

    And I feel asking my parents for 25-30 Lakhs or even taking a loan to pay for my MBA doesn’t give me a clear picture. I would rather love to invest that money in my startup which in a way can benefit others as well.

    And lest say someone takes a loan of that much money and doesn’t end up with the top-notch Package. Then he will spend over next 5-6 years paying back his loan. And then my friend youth will be over.

    • yes Sarthak, there certainly is a rat race which is what the article is telling students to guard against. You raise some good points. On the startup front, great idea, but just be aware that out of 100 startups 99 fail :-) Investing some amount in education can help develop a more rounded perspective which even the best corporate job doesn’t provide – in the corporate world, rarely does a finance guy get to do marketing, or a marketing guy get to do R&D. An MBA gives you a fairly good introduction into multiple areas which can be very useful both within the corporate world and while working on your own startup. With you on the fee though – 25 lakhs is certainly a lot! :-)