Magazine article New Zealand Management

NZIM: Signposts to the Future; Management Thinkers Are the Direction Finders for Business. That's Why NZIM Works at the Point Where Theory and Practice Interlock

Magazine article New Zealand Management

NZIM: Signposts to the Future; Management Thinkers Are the Direction Finders for Business. That's Why NZIM Works at the Point Where Theory and Practice Interlock

Article excerpt

Byline: Reg Birchfield

Managers are confronted with a fast-changing world. The collective impacts of globalisation, the internet and social change have made it that way. There's more to come because, as the cliche says, change happens -- constantly.

Wise managers commit themselves to keeping in touch with management thinking to make sense of what is going on around them and, hopefully, to capitalise on the opportunities change presents. Management theory, then, provides context. But, nothing quite matches the experience provided by watching, listening to and working with successful managers and leaders. Experience converts theory into fact.

Management theory has its critics. But as Adrian Wooldridge, author of Masters of Management and Schumpeter columnist of The Economist writes, "the vitality of business ensures that the study of business is equally vital... management theory is not the intellectual desert that many critics imagine".

True, there are charlatans lurking among the inflated ranks of management theorists. However, a thorough investigation by two reputable economists, one from the London School of Economics and the other from Stanford, on the impact of management ideas on productivity in many countries discovered that they do dispense more than snake oil.

The researchers found that companies which use the most widely accepted management techniques outperform their peers in all meaningful measures, such as productivity, sales growth and return on capital. And it's impossible to dismiss the impact American quality gurus like W Edwards Deming and James Juran had on Japan's devastated manufacturing industry after the Second World War. That truly was management theory turned to account.

Management theorists are now grappling with the most complex organisational issues the world has ever seen. Managers and organisational leaders can't, in addition to their day-to-day duties, be expected to get their heads around the myriad ramifications of this changing world without a little help.

As Wooldridge also points out, it's not just who, what and how managers manage or leaders lead that is changing: corporate forms and business models are simultaneously imploding and exploding.

Management theorists provide windows on a fast-changing management and organisational landscape. They are direction finders helping to signpost routes to the future.

"Theorists are essential to management development and to explaining organisational evolution," says NZIM chief executive Kevin Gaunt. "We identify and distil some of their most useful and relevant work, and bring it to the attention of [NZIM] members and managers generally and then, overlay it with exposure to practical management programmes. Theory and practice are as interlocking as, say, management and leadership."

Management theory is, of course, based on the observation of management and leadership in action. That's why it can boost productivity. Good companies, just like good managers, borrow ideas from better companies and more successful managers.

Jim Collins, author of Built to Last, Good to Great and other similar titles, relies on his researchers' observations of the best performing businesses to identify their leadership, innovation and new production techniques. The result of all this constant searching for enterprises that excel is higher productivity and sometimes happier workers.

Admittedly, some management theories generate more heat than light. (See box story "Get with the programme, stupid" for American business writer Geoffrey James' pick of the eight worst fads of all time. …

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