Business capability in Australia has continued to slip for another year according to the findings of the Australian Institute of Management’s 2015 Australian Management Capability Index (AMCI).
The latest findings reveal a further decline in the headline performance rating, with Australian businesses only operating at 67.7% of what they could be achieving compared to 69% last year.
This supports the latest Productivity Commission update which suggests business productivity in Australia remains well below historical rates.
The AMCI provides Australian business leaders with the opportunity to assess their management capability across a range of areas to benchmark performance against like organisations.
Australian CEOs and managers assessed their organisations as being most capable in:
- Integrity and Corporate Governance (82.9%)
- Financial Management (74.8%)
- External Relationships (71.5%)
They assessed their organisations as least capable in:
- Organisational Capability (62.9%)
- Application of Technology and Knowledge (64.4%)
- Visionary and Strategic Leadership (64.6%)
There was a distinct divergence in the AMCI scores reported for CEO’s and middle manager job levels however.
Although a high percentage of senior leaders thought there was a clear and inspiring vision within their business culture, many middle managers found it difficult to identify.
AIM’s General Manager of Policy & Advocacy, Sam Bell said this may indicate a failure to articulate a vision that resonates across different generational expectations of managers.
“What the AMCI findings clearly convey is that there is an urgent need for increased investment in building management capability right across the business, most acutely at the middle manager level,” Mr Bell said.
“A commitment by leaders to raise management capability, supported by appropriate strategic initiatives, will help deliver the productivity lift our organisations and nation dearly requires.”
About the AMCI
The Australian Management Capability Index (AMCI) provides a benchmark against which we can assess and track performance against a series of key categories of management capability at a company, industry or national level. The AMCI compares results by ownership type, industry, employee numbers, annual $ turnover, managerial level and gender. It tabulates and averages survey responses (of 429 CEO’s and senior managers in the 2015 AMCI) and uses prescribed weightings to generate a score out of 100.