20 year check-up: what’s changed and what hasn’t in the Australian business landscape?

Tuesday, April 12, 2016 - 18:18

By Professor Danny Samson

Back in the 1990s, as the “recession we had to have” drew to a close, Paul Keating’s government commissioned the Karpin Taskforce to come up with ideas to improve leadership and management in the Australian economy. I was part of that project, and our many recommendations from 1995 were categorised against five major challenges. Twenty years on, looking at how Australia’s business world has risen to those challenges (or not) is illuminating.

Enterprise culture

The first and overriding challenge in the 1990s was to create a ‘positive enterprise culture’. Our taskforce thought Australia’s business culture had been living too well for too long off the sheep’s back. Since the Karpin Report was published in 1995, the wool industry has contracted, and wheat has had its ups and downs, but we were shielded by our decade-long mining boom.

I believe we have only partially progressed towards the enterprising cultures we saw 20 years ago in Singapore, New Zealand, Israel and China. Let’s face it, in industries where there are few competitors, organisations grow comfortable and change is difficult. We have relatively few innovative disrupters forcing incumbents to become more entrepreneurial.

There are some shining beacons that prove it can be done, such as biotech company CSL, which has systematically innovated and consequently outperformed the ASX index for a decade. But when we look across the economy, I can only concur with Prime Minister Malcolm Turnbull, who declared we are not yet systematically innovative and must strive to get much better at it.

Better Vocational Training

The second challenge was upgrading vocational education and training. On this one, there has been a lot of progress, with the government encouraging widespread growth of private sector training providers, such as the Australian Institute of Management. In 20 years, some half a million supervisors and managers have upgraded their skills in everything from effectively managing people to project management. A great achievement.

Workforce diversity

Improving workforce diversity was the third challenge: providing equal opportunities for women and capitalising on Australia’s multicultural workforce. While there has been only a little progress in boardrooms and CEO offices at the big end of town, bright young women and people from non-Anglo cultures are now rising through the ranks.

An end to parochial vision

Yet there are two overarching positive changes: one is a much improved approach to doing business internationally; the other is the move from management by ‘command and control’ to a more consultative approach.

Twenty years ago, our research showed a parochial mindset, and low skills and interest in global markets. Now businesses large and small – from ANZ to Textor, CSL and Atlassian – consider the world their domain.

And when it comes to managerial style, I’m thankful that the dinosaur-like leaders, who treated subordinates as if they were a different species, have largely retired and been replaced by leaders who can strategise and managers who realise that their main job is to help their staff to excel.

In this Asia-Pacific century we face new challenges such as globalisation and free trade, sustainable development and climate change. It’s important we have the capabilities to seize the opportunities these changes present.

Danny Samson is a Professor of Management at the University of Melbourne. He is also Chair of AIM’s Academic Board