BGR Takeaways for Sessioin 1

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Business Govt Relations, How they work

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Takeaways for BGR MBA Class of 2015

BGR - Session 1Roles and Relationships of Business & Government - HBS, May 26, 1988 (A synthesis of the work of several authors comparing the roles and relationships of government and business in a variety of situations)

Takeaways

Ideologically, a society is either primarily individualistic i.e. focused on the individual or primarily communitarian i.e. emphasizing the community. The authorities, whether formal or informal and whether disparate or aligned (referred to broadly as government) and all manner of commercial enterprises, whether formal or informal and whether private or public (referred to broadly as business) necessarily act and interact with each other in terms of the societys prevailing ideological norm.

Whatever be the societal paradigm individualistic or communitarian businesses must be pro-active in relating to governments. They have to seek a favourable government/regulatory profile, whether or not partnership or collaboration with government is a viable option.

Whatever be the paradigm, businesses must carry out a thorough due diligence of the government/regulatory scene affecting them, and the vulnerability of the business with respect to possible or probable government actions/policy this needs to be carefully mapped out. Astute businesses undertake a political mapping of this kind which also necessarily includes the identification of power centers that need to be dealt with.

Based on this mapping and a determination of government proclivities at different levels, a program of action has to be drawn up and implemented to neutralize government and/or garner its support.

It should be recognized that ordinarily the acceptance of any proposal by the dejure Government rests on:

first, full support and ownership at the technical level; secondly, approval and acceptance by the policy makers; thirdly, its potential to serve the vested interests of the political masters and relevant power groups; and fourthly, the fact that it is in alignment with the avowed philosophy and economic program of the Government.