The history and evolution of management ideas and practices, is signposted by seminal ideas, wealth of literature, trends, fads and economic cycles. Theory and process was, until the 1920s, less clearly defined and more ad hoc. Scientific management prevailed and gave birth to ideas like decentralisation and even human relations.
The great depression ushered in an age of government regulation. That lasted until the end of the war, bringing with it concepts of the modern corporation and private property which, US theorists Berle and Means said, signalled stockholders’ loss of influence over managers.
Toward the end of the war, Abraham Maslow published his “Hierarchy of Needs”, framework for gaining employee commitment that was soon after taken up by marketers. And so, from about 1947, the age of marketing and diversification dawned and corporate growth and confidence blossomed. New Zealand too benefitted from its exports to reconstructing British and European markets and suppliers to the escalating Korean War.
The war and its subsequent economic boom highlighted the need to train supervisors and develop managers. NZIM was established for just that purpose. It introduced membership grading which recognised management attainments and individual contributions to management as profession.
As former NZIM national president Doug Matheson has pointed out, the impetus from both NZIM training and grading in the 1940s and 1950s significantly influenced management skills and abilities and lifted both business and other organisational performance.
Marketing’s influence on growth strategies took hold in the 1950s and 1960s, as did the practice management thinking of arguably the most influential management guru, Peter Drucker. But with the exception of few top managers who were influenced by overseas developments or worked for multinationals, management practice at home focused more on supervision and management activities.
Insight
In 1961, Drucker’s book The Practice of Management had significant impact on the perception and practice of management in many countries, New Zealand included. Matheson thinks the book’s opening paragraph is still one of the most insightful explanations of the manager’s role.
“The manager is the dynamic, life-giving element of every business,” Drucker wrote. “Without his leadership ‘the resources of production’ remain resources and never become production. In competitive economy, above all, the quality and performance of the managers determines the success of business, indeed they determine its survival. For the quality and performance of its managers is the only effective advantage an enterprise in competitive economy can have.”
Management’s distinctive role became increasingly apparent. The influence of multinationals in the New Zealand economy grew during the 1960s. NZIM understood the growing array of education opportunities that management, as profession in its own right, offered. It introduced qualifications that could be gained through specialised training courses or by attending study courses at technical colleges. More than 20,000 students still register each year for NZIM papers.
Unzipped
But management stagnated through the later years of the 1960s, and through the 1970s and 1980s. New Zealand’s heavily-regulated economy bred administrators, not managers or leaders. In 1991 we were unzipped by an American Harvard academic Michael Porter. His book, Upgrading New Zealand’s Competitive Advantage, exposed both the state of our economy, the short-sightedness of our (political) leaders and the impact managers without real management competencies were collectively having on the nation’s economic fortunes.
“As result of New Zealand’s long period of protectionism, there is tendency for business to be administered rather than led,” Porter wrote.
Meanwhile, eras of strategy and social change; competitive challenge and restructuring; globalisation and knowledge all moved through the decades to this millennium. The consequence of our commercial and political history is that measures of management competency, as defined by NZIM’s own Management Capability Index (MCI), show that Kiwi managers perform to something like 73 percent of their potential across range of performance indicators. And, according to Matheson, who developed the MCI, this is simply not good enough for us to successfully compete on the world stage.
For its part, NZIM is now moving to lift its game and enhance its impact on the management and leadership development market. The structure of NZIM is an accident of history. It grew regionally, with little central accountability. Its four separate incorporated societies (NZIM Northern, Central, Southern and the central NZIM Inc) are moving to form single legal entity. The deficiencies of separate entities are both obvious and many-fold, including slow decision-making and an increasing inability to provide seamless customer service across the country. Integration will improve these shortages and enhance the organisation’s strategic direction.
The members of the four entities voted last year to move to single legal entity. The process for completing the legislative change involves the passing of pathfinder, authorising and confirming motions. The pathfinder motion has already been adopted. The second two are technical requirements under the Incorporated Societies Act.
The Canterbury earthquakes, however, destroyed the Southern region offices and so its involvement in the new integrated body will be deferred for 12 months while it deals with its earthquake recovery priorities.
Northern and Central held their required authorising Extraordinary General Meetings last month. They will hold their confirming motion meetings this month. Following this the two regions will voluntarily liquidate and transfer their assets to NZIM Inc. NZIM Southern will remain as regional society holding an NZIM brand licence until it integrates.
NZIM Inc also held an extraordinary general meeting in August to adopt revised Constitution that encompasses the integration provisions. The updated constitution can be viewed on http://www.nzim.co.nz/Site/members/whats_hot.aspx
NZIM Mark 11 will have one board and single chief executive. The move will undoubtedly provide stronger and more effective leadership structure. Enhanced decision-making and customer service will follow.
“The National Board will appoint chief executive immediately after Northern, Central and NZIM Inc have integrated,” says NZIM National chair Gary Sturgess. “We will then assess NZIM’s current business model with view to re-aligning it with the needs of all stakeholders.
“The focus will be on building NZIM capability, its staff and its systems, to deliver relevant and high value services to the management community across the country. The Institute is already successfully using social media to enhance its dialogue with managers, to identify stakeholder needs, build intellectual property, and conduct research into trends in management and best practice.
“The move to integrate is very positive one for an organisation that has served New Zealand well for almost 70 years. It will take the brakes off and enable NZIM to innovate and transform effectively for the future,” says Sturgess. M
