Roger Martin, the dean of the Rotman School of Management, and author of The Opposable Mind, gave an insightful talk about the shortcomings of MBA programs today, and how to change them. One of the things he mentioned is how students tend to be taught a shallow understanding of models, and more often than not apply them blindly even when no longer valid. Not surprisingly, this can lead to catastrophic results.

He gives the example of the famous and widely used Black-Scholes options pricing model, whose inventors received the Nobel prize in economics for. What most people don’t realize is that the model, like all models, has stated limitations. It only applies to so-called European-style options, which can only be exercised at expiration, vs. American-style ones, which can be exercised at any time (and which make up the vast majority of options in the market). Furthermore, it also assumes non-dividend paying stocks, a stable interest rate, and of course efficient markets, among other things.

Just like the warning label on over-the-counter medication, these limitations are generally ignored, and this formula along with others like it are liberally applied every day to all manner of trades outside their limitations. The problem with a shallow understanding of a model is false confidence: Bankers confidently buy and sell shady derivatives thinking they are rock solid, and pass them on to an unquestioning public. Everything seems fine as long as circumstances don’t change too much, but they inevitably do, and everything comes down all at once.

It’s probably better to not to use a model at all, rather than blindly take it as gospel. At least this forces you to think harder about the risks you are taking.

Harvard just published their list of the top 100 CEOs. Not very surprisingly, Steve Jobs is #1, having being credited with adding $150B to Apple’s market cap since he took over as CEO (again) in 1997. Most people probably have never heard of the #2 CEO, Yun Jong-Yong, who oversaw a $127B increase in Samsung’s market cap over roughly the same period.

The thing that always gives me a chuckle about Harvard’s publications is how they like to point out if someone has an MBA or not – as they did so in this ranking (in their case studies, they tend to also point out where someone got their MBA from). Can’t blame them for subtly promoting their industry. What is striking is how few of the top CEOs have MBAs. Out of the top 50, only 13 have them. What does this say about MBA and real-world leadership?

Of course, everyone also knows that Steve Jobs himself was a college dropout, just like the previous decade’s CEO poster child, Bill Gates.

Like many other companies, HTC has chosen to get in line to try to beat Apple at their own game. This strategy has no hope of success. No other manufacturer can hope to beat the iPhone’s level of integration between hardware, software, and services. Despite their proven success in design and manufacturing, their direct assault on the market is doomed from the start. They need a different approach.

Here are 3 strategies HTC should consider instead:

Alternative Strategy #1: HTC Inside

das antiga by vcheregati

In the early days of PCs, Intel faced a similar challenge to HTC: How can an anonymous component manufacturer build a consumer brand? Their solution was Intel Inside: Give PC manufacturers a discount to co-brand products, which resulted in Intel becoming one of the most recognized brands in the world. Instead of direct advertising, HTC could do the same thing to promote their reputation as a world-class device design firm.

Alternative Strategy #2: Focus on Accessories

What’s in my gadget bag by Neil T

HTC could leverage their expertise in hardware and firmware engineering to expand the connectivity of their phones. They could define a common docking standard (like the iPhone has), and a suite of high-quality accessories. This will allow them to establish a reputation for design and quality in a market they are able to dominate, then leverage that for the assault on phones.

Alternative Strategy #3: Focus on road-warriors

Marchard d’abat-jour, rue Lepic by George Eastman House

While everyone is busy trying to copy all aspects of the iPhone, from the touch interface to the App Store, millions of business customers are being ignored. Even RIM has caught iPhone envy and have taken their eyes off the corporate suite spot: Road warriors. For people whose livelihoods depend on high mobility, all-day working battery life, and real-time productivity, there are plenty of opportunities to improve over what the iPhone delivers. Real phone security would be a nice start. Tethering without hacks is another.

While virtually all road warriors depend on both a phone and a notebook PC today, they will be able to do more with just the phone in the future. Today, email is a basic feature, but it’s still difficult to access other corporate data from your phone; That’s slowly improving. Productivity will always be limited on small form factors, but there are opportunities to re-think how we can do more with less. For example, micro projectors allow you to present directly from your phone. What would it take to run a whole meeting with just your phone, with remote participants, notes, and slides? Wouldn’t that be a killer feature?

Taking advantage of iPhone tunnel vision

With everyone overly fixated on Apple, now’s the chance for an agile and innovative company to capture the corporate market. HTC has that opportunity, if they realize it in time.