We have a conversation with Professor Roy Green, Special Advisor and Chair of the UTS Innovation Council and Deputy Vice-Chancellor (Innovation & Enterprise) at the University of Technology Sydney, about how to manage high performing talent at work.

“Management Matters” research found Australians are mediocre at talent leadership. This is rather dire given that people management and its role in enhancing business performance and productivity can’t be over-emphasised.

What exactly are we doing wrong when it comes to our management strategy for talent? Is it the quality of leadership and management that is failing us?

Many people will be surprised that Australian managers lag the world when it comes to engaging talent and creativity at the workplace. Larger companies tend to do this better than smaller ones, and significantly, those with more highly educated managers also exhibit superior performance to those with less well educated managers. 

Here possibly lies the key to improvement, which is to step up education and training in key development areas for managers, including proactive management and reactive management, and to prepare them for more effective leadership. This in turn will contribute to the professionalisation of small and medium companies, especially those which are family owned.

Why do you think this is the case given there are few who wouldn’t agree that organisations today, no matter their size, are operating in an intensely competitive environment, and the only way they can have a sustained competitive advantage is by leveraging their most valuable intangible asset – their people?

We still think of innovation as the introduction and adaptation of new technologies, which it is. But most successful innovation is non-technological and involves new business models, systems integration and high performance work and management practices. 

These are the things that will provide a competitive advantage irrespective of technological innovation, even if we recognise that the latter also makes a difference.

Research indicated that family owned businesses were amongst the worst performing in terms of management practices. And that often management roles were given to family members based on nepotism rather than competence.

What are the key areas for attention and improvement for SMEs in particular? How can they lift their overall management performance?

As SMEs grow, it’s important they professionalise their operations, by which I mean the manager, often an owner manager, must devolve and restructure decision-making in the organisation, including strategic decisions. 

How often do we hear it said that a company manager ‘won’t let go’ as they have such a sense of self-belief, no one else can be trusted to contribute their ideas or aspirations to the business. 

This authoritarian approach to management is the surest path to paralysis and dysfunction within the organisation, and disengagement by the workforce.

Conversely, who are the top countries in this area and what are they doing right?

By contrast countries like Sweden, Germany, Japan and the US are characterised by a more dynamic and inclusive approach to management, despite their profound structural differences in terms of taxation, employment law and education systems. 

Of course they have mediocre companies too, but not as many of them as Australia as a proportion of the total. Their managers tend to be better educated, more open to participation by the workforce, better at collaborating with research and education institutions and better prepared with the essential skills for leadership.

Conversely, who are the top countries in this area and what are they doing right?

By contrast countries like Sweden, Germany, Japan and the US are characterised by a more dynamic and inclusive approach to management, despite their profound structural differences in terms of taxation, employment law and education systems. 

Of course they have mediocre companies too, but not as many of them as Australia as a proportion of the total. Their managers tend to be better educated, more open to participation by the workforce, better at collaborating with research and education institutions and better prepared with the essential skills for leadership.

What can we learn from these top countries?

The biggest lesson for Australia is that we cannot afford complacency as we transition to a post-mining boom economy. Other countries know that creating a knowledge based economy requires investment not just in innovation and technological change but also in people, whether managers or employees, rather than trying to minimise training costs. 

A good sign is that many of our young people don’t graduate to look for a job but they create their own by starting a new entrepreneurial venture. At UTS, for example, 40% of students report that they are likely to start a business and demand the skills to do so. These are often exactly the essential skills lacking in many established companies, including greater agility, resilience, and problem-solving skills.

Most successful innovation is non-technological and involves new business models, systems integration and high performance work and management practices.

Australian business faces some potentially difficult challenges over the next decade or two. Australia’s economic future will depend on how well we invest in management and workforce development, in particular how we can enhance the quality of this management within our SMEs. What strategies and tips would you advise SMEs seriously considering?

Of course there is no ‘one size fits all’ when it comes to improving the prospects of SMEs. But something most could do is try to visualise their objectives, and where they would like to be in the market place and as an organisation in five years’ time. 

Too many just live day by day without reflecting on and reimagining their future in a systematic way. Once they do, the next task is to examine the mechanisms by which they can achieve their ambitions, and build the internal capabilities and external networks that will contribute to their goals. At the heart of this exercise will be investment as you mention in management and workforce development.

And if they don’t?

I would not like to contemplate their future if they don’t because they simply won’t have one. The world is now highly competitive and globalised so there is literally nowhere for poorly run companies to hide. 

We hear a lot about failed brands as these are or were household names. Their failure stemmed from an inability to look over the horizon. Many SMEs have simply disappeared without even becoming a brand, let alone failing as such. 

Though new ones are forming all the time, they very rarely make the leap to recognised global status. Yes, there are some exemplars, but we need more of them for the critical mass that we see in other countries, and which will be vital to drive long-term growth and jobs in Australia.

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