In the real world, nobody prepares decision trees and writes WAC reports

The title is a gem mentioned by visiting Prof Sunil Shah(PGP 1979, IIMA), who takes the elective on 'Family Business Dynamics'. As a consultant in the field with an amazing sense of humour, Mr Shah is maybe a heir to the renowned Prof Ravichandran when it comes to one liners/insights, albeit without that biting humour. Anyways, in the context of family business, he mentioned that like how an ounce of loyalty is worth a pound of wisdom, entrepreneurs would rely on their trusted ones for decision making, and that this leads to later problems.

This got me thinking that when we leave these red walls for brighter corporate pastures, we may have mastered the art of analysis, presentations and team dynamics. But in the corporate jungle of outside, these are quickly subordinated to that weird animal 'organizational dynamics'-scoffed at by most graduates as 'soft','fraud' etc. This post gives a flavour of stuff not taught at campus, but which is equally or more important. I know some others have written books on what is not taught at BSchool, so please excuse the overlap if any(since I did not read those books).

• Aspirations:-'Professional' management doctrine propounded by Bschools/regulators/corporate governance 'experts' seems to imagine that the promoter will give his heart and soul to the company, and then fade away post listing to give more power to the independent directors/professional management/minority shareholders. That will obviously not happen, but the whole corporate governance edifice in India seems to envisage a consultative process, which just happens on paper. Unless we realize and accept that promoters/founder directors are humans with their own aspirations and goals, any strategy based on changing that is bound to fail. For example, the noble intent of having independent directors has merely given jobs to plaint names/drinking buddies.
• Power linked to purse strings:- He who pays the piper calls the tunes. This is universally true, but more so in status conscious societies in India where the budget size/office furnishings would mean a lot to the manager than even compensation. Hence, decisions involving shifting of power hierarchies(like every major decision would involve) should factor in this aspect. This is more so for family business.
• Non financial factors:- Right from dealing with labour, environmental issues, ethical concerns etc, the manager must factor in other things, which case discussions rarely bring out. I've noticed that barring marketing/strategy cases, other disciplines(particularly finance) rarely bring out non financial aspects during the case discussion/analysis/presentations. But one should think of what is the new non financial elephant in the room. For instance, the 2011 India exposed several of these like fair land acquisition, IPCC carbon debate, political-business-media ugly underbelly etc.
• Path dependency: Much as one knows the virtues of zero base budgeting and all, the past will affect the future in more ways that one, and deviating from it will need solid reasons and support. 
• Old Guard:- Their years with the company often exceeds the age/total experience of the consultant/new joinee, and therefore they would legitimately feel that the newcomer knows nothing. While a new CEO can finesse them by giving them ceremonial appointments like Chairman, the old guard issue can often sink the first 100 days and beyond of new entrants.
• Stock v/s flow:-Projections are much easier on a flow basis(totally ignore previous year's impact on this year). But often, stock variables are more apt as any marketing major would tell you, especially for durables. Similarly, this ties into the path dependency argument covered above.
• Short on execution less on policy:-I've often noticed my classmates and others construct beautiful policy documents/suggestions which gloss over the implementation issues. They are often ignorant of the reports which came before them(often with same points) which are now gathering dust. And as the C&AG reports/Lokpal crisis would bring out, India needs better implementation of its existing policies/laws, not necessarily a new policy in itself.
• Sensitivity Analysis/Downside:-Being an eternal optimist is must in business, and even as a banker/consultant. But one should don the cynical act/be professionally skeptical to factor in the downside risk and value it accordingly. Otherwise, this will be a weak link in the chain for opponents to pick on and argue for shelving the whole idea.
• Acceptable v/s Right recommendations:-  The consultant's classic dilema is whether to do the right thing(suggest unpopular changes and have himself replaced) or whether to be politically correct by supporting their employer's unsaid views. While the public stance of consulting firms is that they add value by doing the right thing, there is no doubt that significant sugar coating/modification happens  to make the report more 'acceptable' 
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