"School is all books and theory. How much of it actually applies out there?"
The theory is not the problem. School simply never taught you how to apply it.
Even here in the UK, I assumed university would be full of interaction and argument. In practice it still runs on a classroom model several hundred years old.
Teaching application is not difficult
In an English class: learn vocabulary through flashcards and grammar through recorded lessons and exercises, all at home. Class time goes entirely on group discussion and role-playing real situations.
With a reasonable number of learners, pairing them up produces an enormous number of combinations. If a single word or structure has to be produced with five or six different people in one session, said and re-said, you cannot help but end up fluent in it.
The same applies to business teaching
Business classes get called hollow and theoretical more than any other, but again that is the teaching, not the subject.
The old way: lecture on academic frameworks for hours, then set an activity where students compare two companies using the model and present.
Another way:
Before class, point them at good channels, podcasts and authors to listen to and read. Anyone who does not do the reading fails. In working life, no client or colleague will sit for hours while you catch up on the documents.
In class, change the question to: "A friend of mine has a few billion to invest in one of these two companies. Use those frameworks and advise me." Then split them into opposing camps and let them argue.
The teacher sits there asking questions that are as naive as possible. Because when you later advise clients who are not specialists, that is exactly what you will face. Clients who already understand it do not need you.
Why this rarely happens
To be fair, universities now do set reading lists, research materials, sometimes detailed recorded lectures.
The first problem is that most students do not read them, and lecturers are under pressure to get students through the module. So most of them lecture the whole thing from scratch again, to be safe.
The second problem is that some lecturers have not worked through those materials closely either, so what they teach does not connect to them.