The signs are there. The next 12 months threaten to be economically tougher than the last. The year is off to slow start with retail sales and job advertising down shade, and less conspicuous indicators like the conference and training markets reporting slimmer pickings in the first four months. The world economy is still struggling to re-ignite. The war in Iraq has not yet captured the confidence of subdued United States business sector. The IT industry, fuel for two decades of growth, is currently out to lunch. Meanwhile, back here in New Zealand the energy crisis shaves production in heavy user industries. Management across an increasingly broad spectrum of activities is thinking yet again about tightening up. Tough decisions seem inevitable.
To understand what leaders think are tough decisions and how they make them is the focus of our cover story this month. Not surprisingly the tough decisions involve people, as so many management decisions do. We asked 10 of New Zealand’s most respected chief executives what decisions they find hardest to make; what equips leader best to cope with tough decisions; how they prepare themselves for making tough decisions; and does an ability to handle tough decisions define good leader? Without exception they rate people decisions the hardest to take. Making strategic and tactical decisions about, for instance, where best to invest shareholder funds isn’t easy because leaders must live with the long-term financial consequences of their decisions. But these decisions are generally more “matters of fact” than inherently tough, if the correct business disciplines are applied. Contributing writer Mark Story’s conclusion: the real test of any CEO’s ability to make hard decisions is how he or she handles the interpersonal stuff – and there could be some tough decision-making required over the next 12 months.
This issue of Management magazine includes the first edition of The Director, 32 page magazine within magazine, dedicated to in-depth and insightful coverage of the increasingly important topic of corporate governance. Published in association with the Sheffield Academy of Corporate Governance and leading law firm, Simpson Grierson, The Director fills an important editorial gap at the top end of the New Zealand organisational leadership hierarchy. The link between board and management is an increasingly important and converging one. Reporting on and explaining that relationship is the role of both publications – each will have different but equally valid perspective. We know many directors read Management, and have done so for almost 50 years. We expect even more managers to read The Director. Every successful manager should aspire to seat on the board.
