How firms can ‘grow’ own bosses

Press, 10 March 1984, Page 20

How firms can ‘grow’ own bosses

preceding ticket

By

Neill Birss

Firms which wish to “grow” their own top executives should give promising employees, still in their twenties, responsibility for subordinates. This is one of the conclusions of a survey of Canterbury managers by the Department of Business Administration at the University of Canterbury for the Canterbury Division of the Institute of Management.

The survey report says that people who become chief executives begin their move into management early in their careers.

“Chief executives are given responsibility for subordinates in their early twenties and are exposed to challenging tasks. “During this period they begin to acquire the crucial people skills, and administrative skills that will be so important in their later general management positions.”

A second finding was that those who become chief executives generally move from specialist functions in their organisations to general management while in their late 20s or in their early 30s. It appeared that solecharge positions produced

the generalists that management so badly needed, Dr S. R. Dakin, a senior lecturer in the department, said in his report on the survey. His advice to firms which wish to develop their own managerial talent is to:

• Ensure those with potential have early responsibility for subordinates, good contact with clients, and plenty of challenge.

• Provide ready access to sole-charge jobs, and to keep people moving through these posts. Such jobs include those of plant mana-

ger and regional and branch managers. These posts were too valuable for training future managers to tie them up with people parked until retirement, Dr Daken said yesterday, elaborating on this point. The survey covered all chief executives on the mailing list of the Canterbury Division of the Institute of Management, and chief executives of all firms with a staff of more than 50 in Christchurch and listed in the “New Zealand Business Who’s Who.” A questionnaire was sent to 275 general managers in and around Christchurch. Busi-ness-administration students followed up each questionnaire with telephone calls and picked up the completed forms. The response rate was 64 per cent. Most of the non-respon-dents were from small private companies. “Almost without exception, the general managers of the larger businesses did take part in the study,” Dr Dakin says in the survey report. The survey found that, over all, chief executives are a well-educated group who reach their first gen-eral-management position by the age of 38, on average, having first had subordinates when they were 24, on average, and reaching senior management at an average age of 31. During their careers they typically have held five different positions in three different organisations. “This very sketchy description suggests a group, which moves fairly rapidly through the ranks and is moderately mobile,” says the report of the survey. “However, mobility tends to occur relatively early in the career. Most had quite long experience in their present company before succeeding to the top job.”

The report says that closer examination shows that the top executives’ careers seemed to proceed in two steps which were roughly equivalent to the development of two major sets of skills. General managers seem

to move through two career phases, the report says: • Early to mid-twenties: learning to assume responsibility for others, to deal with the pressures of work deadlines, and to develop organisational skills. • Mid to late twenties and early thirties: Learning to manage a whole operation, developing over view and weaning themselves from a specialist base into a general management role. Christchurch managers proved to be a fairly highly educated group. Thirty-one per cent had a degree; 55 per cent had some university education; 21 per cent had undergone full-time management training. However, the report suggests that the educational background is a springboard from which more important development can occur. Sixty-three per cent of the managers said they had actively planned a career in management. “It seems possible that the decision to make a career in management is largely influenced by their first experience of line responsibility; that is, people decide to be managers after their first taste of it,” the survey report says. Where do managers get their specialist experience? Contrary to popular belief, accountancy is not the main background of heads of firms.

The survey indicated that only 7.6 per cent of chief executives had come from the specialist area of finance and accounting before their general administrative careers. Specialist administration, including the job of company secretary, was the specialist function of another 11.4 per cent.

But by far the most common background of chief executives was regional and branch management preceded by specialist work in production.

■ The third most common background was regional management and specialist work in marketing.

Dr Dakin believes that the emergence of company

“head-hunting” — the poaching of executives — shows there is a shortage of chief-executive talent in New Zealand.

The survey showed that chief executives were not “grown” through the education system, but through the school of hard knocks, Dr Dakin said yesterday. “The main development comes through sole charge.”

But Dr Dakin’s overwhelming impression of the chief executives of Christchurch firms is that they love their jobs.

“For most of them their work is a hell of a lot of fun,” he said yesterday. “They are very enthusiastic about what they are doing. They are people who are doing what they want to do, and enjoying themselves.

“I had thought that with the recent economic climate they might be reflecting that they had been under a good deal of pressure. But this did not come across in the survey at all.”