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NewsletterTell Me Now Review, Issue 4, March 2003Welcome to the fourth issue of the Tell Me Now Review. In this issue we take a look at trends in executive development, their effect on major business schools and also how organisations are coping with an increasing need for strong leadership. To put this into context we also examine changes in management development since the publication of the Karpin report in 1995. We have undertaken both primary and secondary research to answer the following commonly asked questions and hope that our findings will be of interest and value to your and your organisation. At the end of the Review you will a rich digest of links to recent articles and other resources for further reading. Questions
Remember, Tell Me Now is the leading online research and business information firm specialising in answering research questions you can’t – or simply don’t have time to – find for yourself. We look forward to working with you again soon. Happy reading! Cindy Tschernitz, Director Tell Me Now Trends in Executive Development in Australia Contents
Australia’s leading business schools have been suffering from the downturn in expenditure on executive education programs. Corporate training budgets are being cut, not just in Australia, but globally. The leading business schools have relied heavily on short courses for executives, but this market has dropped dramatically across all institutions. The leading providers of programs aimed at the senior executive and CEO level are the Australian Graduate School of Management, Macquarie Graduate School of Management, the Mt Eliza Business School and Melbourne Business School. These institutions are also the acknowledged leaders in the MBA programs delivered in Australia. Leadership skills are essential in the decade of the noughties. Also of key importance are corporate governance and board communication, cultural change and work/life balance issues, strategic business planning, financial management and developing and managing global opportunities. Other areas include conflict resolution and negotiation, managing stress, performance management and giving and receiving feedback. Personal coaching is becoming more pervasive, with coaching and mentoring used to develop leaders. 1 Executive development and Australian Business School? In the past, business schools have traditionally offered short courses in a range of strategic management and leadership disciplines. They have also given executives opportunities to network with peers in similar or different industries. Now there is a demand for programs which are tailored to the needs of company executives and this is changing the way that the business schools deliver their programs. The development of tailored corporate programs and the establishment of partnerships with companies is a growing area. Some of our larger companies have internal training centres and can offer a ‘corporate MBA.’ For example, Coles Myer, Qantas, Ford and BHP offer their staff access to such programs. At Coles Myer, executives have been able to participate in programs run by the Mt Eliza Business School and the University of Queensland. That arrangement will change later in 2003 when Deakin University, in conjunction with the Coles Institute, will assume responsibility for all training for Coles Myer staff. This will extend the operation of the Coles Institute, a training operation established for Coles Myer supermarket employees. Described as Australia's first corporate university, the Coles Institute was launched in 1999 by Coles Supermarkets and Deakin University. It was based on a new model created by Deakin to meet the education and training requirements of government and the private sector, delivering customised curricula while maintaining academic standards and award accreditation. Deakin’s commercial wing, Deakin Australia, supervises the institution, offering certificates, competency-based diplomas, graduate diplomas and certificates, and master’s degrees. The Coles Institute could be seen as similar to other corporate universities operating in the United States and Britain, such as McDonald's Hamburger Universities and those connected to Motorola and the Body Shop. Other companies with their own executive learning centres include Optus, RACV and Esso Australia. Optus conducts executive development and leadership development programs in conjunction with the Australian Graduate School of Management. Its Executive Development Program provides for the development of key business capabilities for its executive managers and has particular relevance to the telecommunications sector. The program runs for four months and involves both residential and non-residential modules totaling 11 days. Topics include strategy, finance, valuation of options, managing change, tracking strategic performance and marketing. The Leadership and Management Development Program at Optus reflects an extensive range of approaches and includes development centres, executive coaching, mentoring, 360 feedback and in-house and external face-to-face leadership programs linked to the company’s core organisational capabilities. Customised programs are also on offer at the Macquarie Graduate School of Management (MGSM). Clients who have partnered with MGSM include ANZ Bank, Coca-Cola Amatil, Pfizer, Qantas, St George Bank and Woolworths. Roche Products and MGSM have developed a Senior Management Development Program for Roche companies in Australia and Asia. The AGSM has developed customised leadership and management development programs with clients such as Qantas, Austrade, Freehills, Telstra and Westpac. Other clients with whom the Mt Eliza Business School has worked include the National Australia Bank, Australia Post and Honda. 3 The Karpin Report and Management Development The Australian Industry Task Force on Leadership and Management Skills, 1995, chaired by Professor David Karpin, concluded that Australian business needed to develop a more positive enterprise culture through education and training. Since the report was published, Australia has risen in the world competitive rankings from 21st to 9th, ahead of Singapore, Japan, Hong Kong and New Zealand. Professor Karpin says that Australian management still suffers a lack of vision and its viewpoint is often short-term. Other problems are poor people skills, lack of strategic perspective, inflexibility and poor teamwork. Inadequate education and training, focus on current skills and an over-reliance on short courses are some of the reasons for this shortfall in management and leadership. The Australian Institute of Management recently conducted a survey which shows that management development is now linked to enhanced organisational performance. The key factors affecting management development practices are attracting and retaining people, the need for ‘soft skills’, contributing to business performance and developing leaders. Informal channels are used for 50% of all management development practices and coaching and mentoring have become much more important over the past seven years. The Karpin report identified an emerging trend for in-house training which has become well entrenched in many organisations. Eighty-six percent of organizations provide in-company training with in-house or external facilitators. It is interesting to note that management development at the senior executive level is not so well defined as it is for lower levels in organizations. The AIM found that at the senior levels, management development was left up to the individual to initiate, as opposed to the prescribed management development programs for lower-level managers. Respondents were vague about the specific capabilities important in the senior management ranks. Networking activities with peers and through industry forums tend to be more important at the senior executive level. 4 The Role of Leadership The leadership role has become far more challenging and complex with the downturn in global economies and the fallout from the high-profile corporate collapses. According to a Workforce online poll conducted in the USA in September 2002, 83% of almost 700 respondents believe there is a leadership vacuum in their organizations. And a survey by Watson Wyatt showed only 45% of employees have confidence in the job being done by senior management. There are varying opinions on the traits required for effective leadership, for example, a profile of the 21st century executive by Stanton Chase International lists ‘ethics and morality’ and ‘results orientation’ as the top two characteristics of upper management. One thing agreed on is the need for leadership development. A company needs leaders at different levels in the organization, not just at the top. It is unrealistic to expect that one person can be solely responsible for executing a company’s vision. This needs to be a shared responsibility. There is a view that a company’s culture doesn’t always support the development of leadership. A survey on Australian leadership by AIM and Monash University found that today’s executives appear to be more likely to use transformational leadership behaviours to achieve results. These are behaviours based on motivating and influencing people to improve performance and contribute to the achievement of organisational goals. There is also a focus on the individual and on coaching and mentoring. Inspired leadership is associated with a strong and supportive organisational culture. The Mt Eliza Leadership Index survey at the end of 2002 of more than 500 Australian and New Zealand managers shows that work-life balance is the most important future priority for executives. This marks a strong shift since the inaugural survey in 2001 where achieving a work-life balance was not rated among their top five challenges. A program at Mt Eliza called the Executive High-wire is a response to this quandary of sorting out work and life priorities. The desirable characteristics of leadership will vary according to the nature of the organization and its business, and the talent and processes needed for its future operations and success. Successful leadership development programs are described as having the following characteristics: 1. Transference - ensuring participants in leadership programs can transfer knowledge & apply it on-the-job. 2. Follow up & support -holding leaders accountable to their development plans and supporting them as they grow. 3. Target individual needs - ensuring the program takes into account each participant's unique background and learning needs. Coaching has become big business in the USA. Around 10,000 people now class themselves as executive coaches. In many companies, the CEO is also involved in coaching and mentoring his or her senior staff. The AGSM has a Manager as Coach 2-day program. Macquarie Graduate School of Management (MGSM) has an ‘Individual Development & Coaching’ program as part of its executive education short courses. The Mt Eliza Business School has been coaching executives and managers formally and informally for many decades, both individually and as part of executive teams, using its network of skilled and experienced coaches. Melbourne Business School offers corporate coaching to its customised clients and organisations. Australia developing world-class managers. WREDO News, May 2002 (The Western Melbourne Regional Economic Development Organisation) Coaching takes to the couch. Chief Executive, December 2002; Chris Sandlund. p42-45 Corporate & Executive Education Guide 2003 MGSM, Macquarie University, 2003 Enterprising Nation: reviewing Australia’s managers to meet the challenges of the Asia Pacific century : international best practice in leadership and management development : research and report of the overseas study tour by the Industry Task Force on Leadership and Management Skills. David S. Karpin (Chairman), AGPS, 1995 Helping Leaders Lead: the role of business coaching CEO Forum Spring 2002 p20-21 Discussion on the implementation and impact of coaching at Lion Nathan Management and Leadership should not be confused ENR; 2 December 2002 Management Development Practices in Australia: key findings. Australian Institute of Management January 2003 Management has come a long way since Karpin The Australian Institute of Management, Press release, November 2002 Moving learning from the classroom to an executive's workplace, Rosanne Baumhard Canadian HR Reporter 2 December 2002, p11 Australian Business Leadership Survey: key findings. Based on the AIM-Monash University Leadership Report 2001 by Professor James C Sarros, Dr Judy H Gray and Dr Iain Densten. Management Research Series No 1/2002. Australian Institute of Management, 2002. Where have all the leaders gone? Shari Caudron Workforce, vol.13 no.81 December 2002, p28-32 What makes a successful global executive? Business Strategy Review, George P Hollenbeck;Morgan W McCall Jr, vol.4 no.12 Winter 2001, p49-56 Australian Graduate School of Management Macquarie Graduate School of Management Melbourne Business School, University of Melbourne
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