Too Many Large NZ Companies Over-Managing

Media Release 25 June 2002

Too Many Large NZ Companies Over-Managing And Stilfing Growth

Larger New Zealand companies could increase annual turnover by 10-15% if they stopped over-managing staff and started treating their organisations like living systems rather than mechanical systems.

That’s the opinion of Bruce Holland, a Wellington-based independent consultant who works with large organisations to help them become fast, flat and flexible. He says his approach is part of an international trend towards a radical rethink of traditional management practices.

Prior to his current role Holland had more than 16 years experience in finance, strategic change and business strategy roles, including four years as group strategic planning manager for the Bank of New Zealand. He now works with medium and large sized New Zealand organisations that he says are prepared to stretch the traditional approach to management in order to improve performance. They include the Department of the Prime Minister & Cabinet, the Ministry of Agriculture and Forestry, Steelfort Engineering, Kapiti Cheeses, Plunket and the Motor Trade Association.

Holland says unlike smaller organisations which tend to be flexible with flat management structures, larger New Zealand organisations have some “quite devastating” management practices that stop people being effective and get in the road of creativity, growth and job satisfaction.

“Most managers in larger organisations get tied up in the technicalities of the job, whereas their real job should be about releasing energy and encouraging people. They see organisations as a mechanical system, like a clock or a car that you can take apart and fit people into boxes. But there is no doubt now that all the scientific research and forward thinking globally is that organisations are actually living systems, and they behave in quite different ways than mechanical systems.”

Holland says there’s a great deal of international evidence to suggest that with the right sort of management practices organisations will attract and retain higher calibre staff, things will happen cooperatively and there will be greater financial gains.

“What is needed is managers with a vision of something that’s really worth going for and understanding and communicating how each individual can contribute to that vision.
You only need 3-4 key rules, and if everyone has those rules in those heads that’s all it takes to drive a 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.”

Holland, who started his working life as an accountant, says his philosophy took shape during his years at the BNZ, when he saw how a visionary leader significantly improved the energy levels and the performance of the bank. He says some people see his approach as radical thinking and don’t want a bar of it, but a growing number of people think it is great and are prepared to be stretched.

“Clearly it’s an individual thing. Some managers see power and politics as the way an organisation should be run, they see themselves on top and controlling and limiting the people underneath. And there is another smaller group of managers who see themselves as working alongside their staff, support, encouraging.

“A limited number of larger New Zealand companies are already doing this very well. And they are high performers - getting the hard results doesn’t have to be at the expense of the people who work for the organisation. Job satisfaction and profitability can be totally consistent.

“Being a relatively small country without a rigid class structure, I think New Zealand has a natural leaning towards this way of management and could show the world a new and improved way of working.”

For further information
Bruce Holland, Virtual Group Business Consultants, phone 04 5700 727, email bruce.holland@clear.net.nz. Electronic photo available.

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