Both MBA and PGDM are postgraduate programmes, but they are often used interchangeably leaving the candidates in a dilemma. Those who are not aware of the differences may end up making an uninformed decision. The full form of MBA is Master of Business Administration, and that of PGDM is Post Graduate Diploma in Management. Due to the word ‘diploma’ attached to PGDM, it is often considered a lower rung programme than MBA. However, this is an incorrect and baseless assumption.

Let’s understand how the MBA degree is different from PGDM and what factors should make the premise for choosing one over another.

1. Affiliation

The first and key difference lies with respect to the affiliation. As per the UGC Act of 1956, autonomous educational bodies cannot issue degrees to students.

MBA is a degree course offered by colleges that are affiliated to state or central universities with power to award degree certificates.

PGDM is offered by autonomous institutes, and they do not require affiliation to any university. Hence, they can offer only PGDM and not MBA. However, these autonomous institutes are duly recognised by the All India Council for Technical Education (AICTE) which is a statutory body. AICTE falls under the purview of Ministry of Human Resource Development.

In the eyes of the Association of Indian Universities (AIU), MBA accreditation is considered equivalent to PGDM.

2. Exams and Curriculum

MBA students are required to follow the exam schedule laid down by the university which governs the MBA institute. PGDM institutes can conduct exams at their own discretion – they do not have to adhere to any predefined schedule.

MBA curriculum strictly follows the guidelines issued by the university it is affiliated to. The MBA institute does not have any say in the curriculum design and content. This acts as a major drawback because MBA institutes lack the flexibility to update their curriculum without the university’s prior permission. Therefore, MBA curriculum is usually updated only once in 3-5 years due to which it fails to accommodate industry trends proactively. Moreover, MBA curriculum has high theoretical and academic orientation – the focus on practical concepts and new-age subjects is less.

On the contrary, PGDM institutes have complete autonomy in how they want to design their curriculum. They modify it at regular intervals and realign it more often with industry expectations and market scenarios to prepare job-ready candidates at any point in time. These days, many PGDM institutes are also offering niche courses tailor-made to the needs of specific sectors such as technology, telecom, agriculture, entrepreneurship, etc. So, students have more choices to choose the subject of their specialisation. Moreover, PGDM institutes also take their students through case studies, presentations, internships and cultural exchange programmes to help them develop soft skills in addition to technical skills.

3. Cost and Facilities

 The fee of an MBA programme is comparatively lower than that of a PGDM programme and hence, more affordable for students. However, due to the low fees, a large majority of MBA institutes are unable to meet their expenses which results in the poor quality of education, infrastructure, faculty and other resources.

On the other hand, PGDM institutes make up for higher fees by making the best-in-class education and amenities available to its students. It in turn also attracts qualified faculty because they get better salaries.

4. Further Education Opportunities

 Some students prefer to pursue double postgraduation, PhD or other higher education courses in foreign universities after completing their MBA or PGDM. While the eligibility criteria for admission vary from one foreign institute to another, PGDM graduates have higher chances of acceptability because of their strong conceptual, technical as well as practical educational background.

 Job Opportunities

The ratio of campus placements in PGDM institutes is higher than their MBA counterparts. PGDM institutes have a strong network of alumni, employers and industry associations, and hence attract some of the most reputed companies for placements. Most students can get rewarding jobs during campus placements itself. If not, they can still get better job opportunities outside campus placements.

Most employers and foreign universities consider MBA and PGDM equivalent. However, during the selection, they do pay attention to the institute’s reputation as well as student’s academic knowledge and employment fit. Also, there is no doubt that PGDM has an edge over MBA because of higher-quality education, curriculum, infrastructure, faculty and placements. Some of the top-ranking institutes in India offer PGDM and are quite popular among students.

Authored by Ritesh Goyal, managing director and CEO, GIBS Business School.