Tony is a consultant with expertise in innovation and sustainable development. He has a different perspective to a lot of economists and other experts, and is particularly interested in national culture. It is Tony’s findings on what he calls “national culture” that make him such a compelling speaker.
Tony’s findings show that we cannot expect to achieve significant productivity gains until we understand and address factors in our national culture (the national psyche, if you like) that limit our ability to innovate. Tony has used international studies and business models to measure certain cultural traits that most New Zealanders have.
These traits include:
- a reluctance to accept feedback. We hate feedback from others. This means we are averse to listening to what our customers actually want
- an emphasis on individualism, rather than the collective. We’re not good team builders and have a reluctance to use specialists. This leads to people trying to do everything themselves. That’s why we work such long hours (compared to most other countries) and yet remain unproductive, compared with other countries
- a lack of flexibility in how we do business
- aversion to risk
- a dislike of those who are wealthy
- a lack of enjoyment of business (this is partly a consequence of our lifestyle: we’d much rather be on the beach)
- a reluctance to build relationships with others, and a narrow legalistic approach towards doing business.
We actually do quite well in inventing things and coming up with good ideas. But the critical stage is innovation. And there we generally fall well behind others in the OECD.
We believe in the Number 8 wire myth, and that we are great innovators. We aren’t. We’re very good at making things work, but generally poor at making money out of our inventive effort.
And as a nation we’re lousy at licensing others to use our intellectual property assets. We are world leaders in agriculture, aquaculture and horticultural science. Yet we don’t protect our innovation (i.e. by patents), and if you don’t protect you have nothing to license to others.
Tony quotes a GEM study that found we are regarded as second in the world for early stage entrepreneurial activity. But the same study found we ranked 30th out of 36th for high growth businesses.
Our poor performance can be illustrated by the following GDP figures:
© Forte Business Group Limited
We rank low in the OECD for GDP per capita.
© Forte Business Group Limited
And we've been sliding down for some time now, with little prospect of a decent increase.
© Forte Business Group Limited
And our productivity is poor.
Tony talks about a culture of “satisficing” – because an enjoyable lifestyle is easily achievable in NZ, compared with other countries, most businesspeople will be satisfied once they’ve got the “boat, beachhouse and beamer”. But our competitors in other countries continue to strive for material wealth. This arises partly because people in New Zealand don’t aspire to vast material wealth. In fact, generally we despise the rich. And because we enjoy our lifestyle, we think of work as a chore.
That’s not to say we should all strive to be rich, or that we shouldn’t enjoy a nice lifestyle. But if we are going to seriously examine why we are poor economic performers we need to look at the whole picture.
This all sounds very depressing, but we are not slaves to national culture. We can’t expect to change the way we are as a society, but we can build processes into the way we do things to negate or moderate those unhelpful traits. When the government makes policy it needs to be aware of the way people think and behave.
Even if one is suspicious of attempts to use business modelling to explain human behaviour, there's still something compelling about Tony's arguments. I'm involved with inventors and innovators on a daily basis, and I have seen a large number of the negative behaviours Tony refers to.
* the link to his dissertation is broken at present - I'll link to it when/if it is fixed, and if I remember!
I wrote a thoughful reply to this word, but your site won't let me cut and paste. :(
ReplyDeleteReally? Odd. Must be something to do with the Blogger platform. But I've never had trouble copying and pasting from blog text before...
ReplyDeleteI'm a complete technophobe, so if there is a problem I wouldn't know how to fix it anyway... :)
Hey, works now. Odd.
ReplyDeleteAnyway, my views... I don't believe in cultural determinism. People do things differently, but they can achieve the same outcomes. I do believe though that past plays itself differently country by country, and our problems have more to do with our history than our culture.
1/ Management in this country more than any other area exhibits the effects of the brain drain. Large organisations inevitably promote their best and brightest offshore for mid-career opportunities. What are left behind are largely the self made men (who don't necessarily have the academic underpinnings of good management skills) and the time servers.
2/ Our isolation, lack of experts and well trained staff and generally our small population means we generally seek to pool our knowledge and we therefore seek collective decision making model as the ideal. This creates a culture of excessive politeness which makes open feedback difficult.
3/ In the eyes of most middle management in this country, New Zealand Corporates do not exist to make money. Their primary purpose is to perpetuate the middle managements oligarchy, a goal which may - or may not - align with profitability and good decision making.
4/ To much power makes you a lazy thinker, and The ECA has produced a generation of intellectually lazy and arrogant managers, whose status of demi-Gods means they needn't actually think about innovative solutions. They simply impose solutions and blame someone else if it doesn't produce the desired result. This may be the genesis of the idea that "we" hate feedback. Staff hate feedback because it always one way. Management hates feedback because they are unused to being challenged and interpret as a personal attack.
5/ Poor management inevitably creates a blame culture in the workplaces, which reinforces conservativism when it comes to taking risk.
6/ I don't think we dislike the wealthy. Workers tend to dislike the well paid middle management elite with whom they have contact with. We somehow manage to simultaneously culturally under-value this group and over-pay them for their shockingly performance.
7/ NZ staff are chronically under trained and management usually regards training as little more than a paid holiday.
8/ Staff aversion to risk is a manifestation of lack of training, of management laziness and of staff reluctance to be the sacrificial volunteer to the latest managerial whim. Better to be the "grey man" who doesn't complain, looks like he is mighty busy all the time (even if you are only as productive as everyone else) works an extra five hours a week for free and agrees to everything immediately than be the chirpy guy with an challenging opinion, and who is smart enough to get everything done within an eight hour day then reads the paper when the boss is thinking about who to cut in the next redundancy round.
8/ People often talk of unions as primarily being useful in bringing higher wages through collective action, but I believe unions - especially well trained delegates - also perform the important function of keeping management on it's toes by offering an alternative centre of power and ideas in the workplace.
9/ We will only achieve significant productivity gains when we increase the skills and accountability of our middle managers. This group is self-serving, so it will not reform itself. An immediate way of forcing change is encouraging strong unions, but fat chance that will happen.
I always enjoy your comments. I'll respond to some of what you said, but haven't time to deal with all of it. I don't disagree with anything you said, though.
ReplyDeleteSmale's argument was that we exhibit the cultural traits we do because of our history and the way our early settler society was created. But as our society becomes more ethnically diverse some of these negative cultural elements may in time disappear, or at least be reduced in influence. He is not a determinist and asknowledged he was simply looking at general trends. Every person is different, however.
I agree with much of what you say about poor management, and it is an area where we do poorly.
I don't know whether a lack of available expertise is a critical problem. Studies show we have plenty of bright people and that we do well when it comes to inventing and creating. But there is a relunctance to engage experts. I also think there is something bigger involved - a distrust of intellectual or academic people generally: people who use their brains rather than their hands (that's not to say people who use their hands don't use their brains when working - but it's a different kind of thinking). That's why our heroes are sports stars and mountaineers, and why many of our business idols have humble backgrounds (e.g. Graeme Hart was a towtruck driver).