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    Perhaps Board composition does matter after all?

    Governance Performance Research
    An interesting article appeared in the Financial Times about a week ago. I've been pondering it for a few days now, because it challenged my perception that Board composition has relatively little bearing on company performance outcomes.

    The article reported the results of a comprehensive survey into US company performance in the decade 2000–2009. The results revealed that the prevalence of lawyers on Boards increased from 24% (2000) to 43% (2009)—and that the levels of litigation, malpractice and corporate risk-taking declined markedly—through the decade. The results are not that surprising, given the introduction of Sarbanes-Oxley and other compliance measures in the survey period.

    On the surface, this study suggests that the presence of lawyers on Boards does make a difference in some areas (and therefore composition may matter). But what about the big question: Does the presence of lawyers lead to increased company performance? The study enhances the case for lawyers on Boards for their contribution to the risk conversation. However, this should not be misunderstood as providing evidence to link the presence of lawyers with increased company performance. Increased performance is dependent on innovation, the taking of risks and the making strategic decisions—all of which are somewhat of an anathema to many members of the legal community.

    So, does Board composition matter when it comes to company performance? On the evidence provided by  this study, we still can't tell—but I doubt it.
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    Proud to be a Kiwi

    Societal Wellbeing
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    Hannah Stilborn (Piopio, left) and Megan Crow (Wellington, right) reading "The Ridge"

    New Zealand is a small country of some 4.4 million, nestled in the south-western Pacific. On the world stage, we cast a reasonably small shadow most of the time. However, from time-to-time, our contributions belie our scale—like when women gained suffrage (first in the world), Rutherford split the atom, Hillary scaled Everest, and Jackson made the Lord of the Rings trilogy.

    Today, a group of New Zealanders joined a group of Flemish people at Messines Ridge Cemetery, to rebury the remains of a soldier that fell in World War 1, and remember New Zealand's contribution to defending the Western Front. We don't know who the soldier was, but do know that he was fighting for freedom. Commander of the Defence Force, Lt. Gen Rhys Jones, Ambassador Paula Wilson and many other New Zealand and Flemish dignitaries were present. Also, two young New Zealand AFS exchange students currently in Belgium, including our daughter Megan, laid a wreath and read a poem. The ceremony was reported in the Dominion Post and the NZ Herald.

    The weather was cold, but the moment moving. It's at times like these, when we remember the contributions of our forebears, that I'm proud to be a Kiwi.
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    Can the domino effect be avoided?

    Management Performance Societal Wellbeing Strategy
    Every time a major company fails, smaller suppliers and associated companies are at risk of the domino effect—of becoming a statistic themselves. It's through not fault of their own, save choosing to do business in good faith with the failed company. This was highlighted in fairly stark terms in the last week, when companies either sub-contracted to, or associated with, New Zealand's third largest construction company, Mainzeal, started suffering.

    The domino effect has major implications on economic performance and the wellbeing of communities. When major companies succeed and grow strongly, many smaller and associated companies also gain considerable benefit. Sadly, the domino effect also applies when major companies struggle or, worse still, fail.

    While suppliers are generally very happy to benefit from upswings, downsides are something to be avoided. But can the downside of the domino effect be avoided? Thankfully, suppliers do have options. Here's two for starters:
    • Diversify their customer base, so that they are not reliant any one customer for a major portion of their business. 
    • Negotiate more favourable commercial terms, which may well include fortnightly invoicing and payment cycles (although this can be very difficult to achieve).

    What other "defence" mechanisms can put in place to avoid the domino effect?
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    Adding a string to my bow

    Research Teaching Time Management
    I added a new string to my bow (so to speak) today—by becoming a Tutor at Massey University. So, with tutoring in the mix, I now have six strings to manage and keep in tune (Doctoral candidate, advisor, director, husband/father, cyclist, tutor). The task I've taken on is to teach the 115.108 Organisations and Management paper on the Wellington campus. It's a core paper in the BBS programme, and should be a lot of fun.

    Preparing for weekly lecture and tutorial sessions will be a new experience for me, one that promises to be both demanding and fulfilling. I'll need to organise my time in a more structured manner than I've been used to—to ensure I meet the weekly cycle and provide space for students to visit to ask questions. On the upside, the idea of contributing to the learning and development of the next generation of business men and women is quite neat.

    One initial observation: the systems and processes Massey has in place for new staff—even part-timers on fixed term contracts like me—are amazing. When I visited the campus today, I discovered access to key on-line resources had already been configured, an office had been assigned, access keys and cards were waiting for collection, and staff were bending over backwards to be helpful. If today is any guide, I'm in for a fulfilling semester ahead. Hopefully, the students agree!
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    ICMLG Conference: Post-conference summary

    Conferences Governance Management Performance Research Societal Wellbeing Strategy
    I've just arrived home after a demanding but highly enjoyable trip to attend the ICMLG Conference in Bangkok. On the long flight back to New Zealand I found myself reflecting on the conference overall. Here's a selection of what I wrote down in my notebook:
    • While diverse in topic, research methodology and scope, the general calibre of papers and presentations was impressive. ACI did a great job pulling together and running the conference.
    • Input-output research designs and quantitive data sets continue to dominate the research landscape, despite qualitative data and empirical data being more well suited to understanding and explaining social dynamic phenomena (like governance).
    • The case study approach appears to be gaining ground as a credible methodology for governance and leadership research.
    • Those researchers who are using qualitative methods are attempting to move from purely descriptive (exploratory) studies towards explanatory studies. (One of my objectives in attending ICMLG was to gain a better understanding of contemporary research methodologies.)
    • Relatively few researchers are investigating the link between governance and company performance.
    • I met some wonderful people! The conference was a melting pot of cultures. People from many different nations, religions and cultures were in attendance—a true "global village".
    Overall, I learnt a lot and the investment was well worthwhile. ICMLG 2014 will be at Babson College in Boston, Mass. On the strength of this year's conference, expect to see me in Boston in 2014!
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    ICMLG Conference: Reflection #6

    Conferences Management Performance Research Strategy
    Gender diversity: a new competitive advantage?

    Manasi Shukla (Bangkok University) and Aurilla Aurelie Arntzen (Buskerud University, Norway) presented a conceptual paper which explored gender diversity in management and systems design as an important element for competitive advantage.

    They outlined the challenges many women face, whereby many systems and products are designed by men, without any significant consideration for female cognitive or physical elements. They suggested that a woman's response to "design shortfalls" is to dismiss or avoid using a particular product.

    Shukla and Arntzen tentatively proposed a leadership practices inventory, to assist organisations design for, and accommodate, the needs of women. They asserted that organisations that take such steps have the opportunity to secure a competitive advantage in the marketplace. This is an interesting assertion—one that merits further research via the analysis of empirical data to determine if/how the practices they suggest are indeed significant. I look forward to reading more about this in the future.