Too Much Management = Less Growth

Sit too hard on your staff and what you’re likely to stifle is your annual turnover, according to Wellington business consultant Bruce Holland.

He reckons some of the management practices employed by larger New Zealand companies are “quite devastating” in terms of limiting rather than fostering employee effectiveness and creativity.

Problems include overly rigid structures which are slow, functionally based and hinder information flow. Such organisations take what he describes as more mechanistic approach to management – over-emphasising technicalities, and employing too many rules.

The best-run organisations, he says, operate more like living systems.

“The key ability of living system is that it can self-organise. You don’t have to control it with rules and regulations but you must trust the system will work without them.”

With more than 16 years’ experience in finance and strategic planning under his belt, Holland is now working with range of government and private organisations, which are prepared to explore management practices more conducive to growth.

What’s needed, he says, are managers with vision of something really worth going for and the ability to understand and communicate how each employee can contribute to that.

“You only need three to four key rules and if everyone has those in their heads, that’s all it takes to drive really good company. But these management practices are often quite different from key performance indicators and monthly reporting type activities that many larger organisations favour.”

While some managers see power and politics as intrinsic to running an organisation, others are now taking more supportive and encouraging role. Those large companies doing it well are the high performers.

Embracing more flexible structures could, he reckons, boost company’s annual turnover by 10-15 percent.

“Job satisfaction and profitability can be totally consistent.”

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