UNDERSTANDING THE NEW WORLD : Wanted – Great NZ leaders

New Zealand’s leaders must start asking the right questions and articulating vision of the nation’s future, Fletcher Building’s chief executive Jonathan Ling says.
Ling, the second Australian in succession to run the country’s second largest enterprise, thinks our business and political leaders should ask themselves why Australia’s economy and standard of living is about 30 percent ahead of New Zealand’s.
He says, until New Zealand gets its economy in shape “it can’t seriously consider doing the things it would like to do”. He draws parallels between the need for the nation to think and act much as he does in driving Fletcher Building.
“I am not politician and I don’t know how to run country,” he says. “But if I applied my business theories, I would advocate getting the right people in place, agreeing what to do and then creating the culture and support mechanism to make sure it happens. No one seems to have go at that sort of process.”
The differences between New Zealand and Australia are, says Ling, partly cultural. He found the cultural differences he faced moving to New Zealand greater than those he encountered when he moved from Australia to Malaysia.
The Australian psyche is, he believes, firmly rooted in its sports-dominated winning culture and, consequently they will do whatever it takes to win. “Even bowl underarm, if necessary,” he smiles. Doing whatever it takes to win is, says Ling, part of their cultural DNA.
New Zealand, on the other hand, is defined by its relationship culture, which is probably in turn linked to the nation’s smallness. Our need to get along with each other has steered people away from “making enemies” of those they might rub up against in business in the future.
He thinks one of the unintended consequences of the Kiwi relationship culture is that emotive, rather than factual responses, govern thinking. “Facts govern things in winning culture,” he says. In Ling’s experience, this difference accounts for the struggle New Zealand communities have with the “fact-based conversations” the country needs to have to get the outcomes it needs. “There is no right or wrong about winning versus relationship-based culture,” says Ling. “But you can see why some of the behaviours in the two countries are quite different.”
As Ling’s observations show, New Zealand, like most of the world, faces difficult and defining economic, social, environmental, organisational, structural and political decisions. Having the potential to survive and succeed will depend on the abilities of leaders at all levels to make complex and globally contextual decisions.
As Leading the Future report from the Swiss-based IMD management school has recently pointed out: “Leadership is in demand. The complex challenges that face teams, organisations and societies are demanding new ways of thinking about and shaping the future.”
Recent reports, some global and one the government-funded London School of Economics and McKinsey consultancy study of our manufacturing industry, Management Matters, suggest New Zealand has serious management and leadership competency problems.

Managing our resource potential
From resource perspective, New Zealand is, according to most business leaders, sitting in something of box seat. Solid Energy’s chief executive Don Elder, for example, thinks that when it comes to counting measurable and marketable resources, New Zealand is the “luckiest country in the world”. On per capita basis, we are richer in desirable and essential resources than any other country, he adds.
“But here’s the barrier,” he cautions. “We continually have the wrong discussions in New Zealand on almost every issue of major national importance. No sooner is an idea advanced for discussion, than one group or another hijacks the issue and redefines it in grossly, over-simplistic way.”
In Elder’s opinion, the right question is invariably not “should or shouldn’t we?”, but rather “what is the objective; what are the options; what are the criteria for ranking options; what are the real (not reactionary) consequences and risks? And what conditions could make for better outcomes against objectives and allow better overall result for New Zealand?”
A simplistic yes or no approach to issues effectively avoids any meaningful discussion of nationally important issues and threatens to keep New Zealand mired in “can’t do” rather than “can do” mindset he says. Implied in what he says is belief that New Zealand leaders, commercial and political, seem unable or unwilling to grapple with the resource development opportunities available.
New Zealand can, says Elder, achieve huge and permanent economic change by acting boldly on what he calls substantial “made in New Zealand, made for New Zealand once-only opportunities – unique in our history. And they are simply the result of our natural strategic strengths and competitive advantages.”
The initiatives won’t, however, happen on their own. The government and private sector must, says Elder, get on and make both the decisions and investments needed to deliver the promise and the future economy.
“Almost all the things the world will need more of but will be increasingly short of, we have in abundance,” he says. “Good agricultural land, fresh water, year-round growing climate, primary resources and energy.”
The issue for him is leadership and management of the national discussion that needs to take place for New Zealand to realise its economic potential.
Fonterra CEO Andrew Ferrier agrees with Elder’s assessment of New Zealand’s abundant and strategically desirable resources. But he is equally quick to identify the missing ingredients – leadership and, what he calls commercial acumen. When it came to recruiting Fonterra’s senior executive ranks he was, he concedes, forced to fill them with more non-New Zealanders than he would have liked.
“Our criteria required that we employ the best possible people we could get.” They were not, unfortunately, home grown. “At the top end of world-class executive talent, we still have way to go,” says Ferrier.
He would like to think companies like Fonterra, with the funds and scale to spend on executive development, can help raise the general level of leadership competency in New Zealand. But right now, the shortage of globally equipped and experienced leaders is an issue.
This reality surfaces every year in the IMD’s International Competitiveness Survey where New Zealand ranks among the lowest in management competency. The Management Matters survey confirms that New Zealand companies are weak on both strategy and management.

Stronger governance required
New Zealand’s generally poor-performing boards are legend. Directors are seriously risk-averse, draw their numbers from small and much-too closely connected governance gene pool, are disinclined to embrace innovation and, say their critics, focus on process and compliance rather than strategy, global opportunities and leadership. They are also reluctant to invite independents onto their boards.
Poor governance delivered the global financial crisis, and more. Governance as leadership function desperately has to change, not just here but globally.
Jon Mayson, former Ports of Tauranga CEO and now chairman of New Zealand Trade and Enterprise, would probably agree. In an interview with me for Leadership New Zealand’s Leaders magazine last year he said that he was “not convinced that New Zealand’s collective leadership is sufficiently aware of, or committed to solving the quite serious problems facing the country in the next 10 to 15 years”.
New Zealand leaders did not, he said, want to take the tough decisions that would make “quantum” difference to the nation’s economic performance. “We need paradigm shift in attitude and to embrace more bipartisan approach to leadership in this country.”
Mayson believes in the need for serious leadership debate to make things happen. “We

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