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    ICMLG'14: Opening keynote

    Conferences Leadership Management Performance Research
    The opening keynote speaker at the International Conference on Management Leadership and Governance (ICMLG) was Dr Dan Isenberg. His topic was A Critical Path to Entrepreneurial Ecosystems. Isenberg described entrepreneurship, challenged a few folklore beliefs and introduced a concept he called an entrepreneurial ecosystem.

    Many scholars, business leaders, community leaders—and much of the popular press—would have us believe that the Google, Facebook, LinkedIn perspective of entrepreneurship is somehow the normal model to be pursued. (This being the rapid growth from nothing towards an IPO event 6–8 years later.) Isenberg challenged this view, and did so very strongly. He cited many examples of successful entrepreneurial businesses that are not necessarily startups or innovative or youthful or owners of small businesses. The data shows that many startups simply don't grow. Further, entrepreneurial businesses are far more likely to come from ideas that are written off as dumb or worthless by 'experts'. In contrast, entrepreneurial businesses are more commonly found in older, basic industries, and that they achieve sporadic growth over time.

    According to Isenberg's research (and experience from several working examples), some of the critical characteristics of successful entrepreneurial ecosystems are actually quite different from those that are commonly regarded as being crucial:
    • a few local success stories which are highly visible
    • a high quality of life, such that talented people desire to stay
    • there is a plethora of usable assets (people, finance, supportive large companies)
    • an anxiety, sense of urgency and fear of the future exists in the culture

    Those characteristics that are commonly regarded as being desirable, but are actually much less important in reality include:
    • having lots of startups in an incubator or cluster context
    • the presence of economic development agencies
    • tax incentive frameworks and supportive government policies

    Isenberg's comments will unsettle many folk, particularly those with an involvement or association with incubators, clusters, angel clubs or local EDAs. However, the evidence is compelling (and not dissimilar to the thoughts on innovation that Dr Bob Brown shared at ANZAM in Dec'13). Folk associated with these groups could do far worse than to take stock, because the current approaches aren't working. 

    Isenberg's talk set an expectant tone for the conference. It challenged much conventional wisdom, and was a breath of fresh air.
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    Feltex: A lemon with the juice squeezed out?

    Governance Leadership Management Performance
    Feltex Carpets, once a great New Zealand business went public a decade ago, in May 2004. However, the business was mismanaged and it went bust within two years. The $185m case against the board, brought by a former shareholder, is now before the High Court in Wellington. The primary defendant is the board (actually, the directors). The second and third defendants are Credit Suisse Private Equity (promoter of the sale) and Credit Suite First Boston Asian Merchant Partners (CSPE parent).

    During submissions yesterday it was revealed that the company was likened to a lemon from which most of the goodness had been squeezed out. Further, one director referred to "these lousy shares" in an email several months before the company's IPO. These startling revelations place the defendants is a rather awkward position. How material will these pieces of evidence be to the overall case?

    The case, which is expected to last nine weeks, is being watched closely by company directors, the IoD and many others, for it will more than likely set a precedent against which future cases of mismanagement and poor governance are measured.
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    On entrepreneurial thought and action: getting the low down

    Conferences Governance Leadership Management Performance Research
    Delegates at the International Conference on Management Leadership and Governance are in for a treat next week. Dr Leonard Schlesinger, Professor of Business Administration at Harvard and leading company director (including Forbes and Demandware), is the keynote speaker on Fri March 21. He'll be talking about the entrepreneurial thought process and the conversion of thinking into action.

    Dr Schlesinger is highly regarded in the business and academic communities, and I'm looking forward to hearing what he has to say. I'll post a summary of his talk here, as part of my commitment to provide reflections and comments throughout the ICMLG'14 conference, for the benefit of those that can't attend.
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    ICMLG'14: just around the corner

    Conferences Governance Leadership Management Phd Research
    The International Conference on Management Leadership and Governance (ICMLG) is only a week away. This year, the conference is being held at Babson College, just outside Boston. The programme looks really interesting. I'll post reflections and comments here during the conference, so please check back if you are interested.

    I leave home on Mon 17 on the Air New Zealand evening flight to San Francisco, to meet a United flight across to Boston. The conference dates are 20–21 March, so I will have some time beforehand to reacquaint myself with a city that I last visited 20 years ago, and to attend meetings with some highly regarded governance advisors who are based in Boston. My paper will be presented on the first day of the conference, and I will chair a session the second morning.

    Immediately after the conference, I fly out to northern Minnesota, to visit the family I lived with as an exchange student 35 years ago. It'll be my first trip back since 1990, and possibly the last time I see my now elderly host parents. While the schedule is tight, I am looking forward to this trip very much. I'll keep you informed.
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    On women in leadership, the glass ceiling and statistics

    Governance Leadership Management Performance Research Societal Wellbeing
    The glass ceiling seems to be alive and operating well in New Zealand—or so a reporter's interpretation of a recently published report by Grant Thornton would have us believe.

    Whereas New Zealand was the first country in the world to embrace universal adult suffrage, it now ranks 15th in terms of the proportion of senior executive positions held by women (down from fourth a decade ago). The reporter seems to have used this statistic to make the glass ceiling claim. The Grant Thornton spokesman has made similar claims. However, when one reads the Grant Thornton report more carefully, the picture is actually somewhat different. The global average has also stalled. The proportion of women in senior executive positions jumped from 19% to 24% in the three years from 2004 to 2007 but has remained largely static since. (The New Zealand proportion is 31%.)

    Rather than make speculative claims, of a glass ceiling, the discussion needs to centre on why the proportion has stalled. It could be that a quarter to a third is representative of the number of effective female leaders available to contribute. Or, it could be that more are willing, but they lack the expertise to be truly effective when measured against male counterparts. Or, it could be due to a myriad of other contributing factors. Whatever the reason, business and society would be well served by finding out. Notwithstanding this, simplistic approaches (like counting things) are unhelpful. They cannot produce anything more than correlations, statements of what 'is' and emotive claims. The problem is complex, so a different research approach is required to reveal the underlying mechanisms. However, such research is typically slow and demanding, as I've discovered in my own research work. In the meantime, reporters like Mr Foreman would be well served by taking a little more care in their reporting.

    * For the record, I am a strong advocate of appointing the best and most capable person to any role, regardless of their gender or any other diversity variable.
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    Healthy team dynamics trumps individual performance

    Governance Leadership Performance
    A new piece of research, about boards and performance, confirms what many people already know: the power of 'team' is more conducive to performance than individual brilliance is. You see it all the time in team sports. Whether it's the Seattle Seahawks, Sky Procycling or the All Blacks of New Zealand, the collective power of a cohesive team, working towards a single goal, is a much stronger proposition than a team of individuals, as brilliantly capable as some of the individuals may be.

    Boards of directors are no different. Celebrity directors or notables with important political, investment or other business connections are no match for a cohesive board that works as one towards an agreed goal. Given the widespread knowledge of this principle, why do so many shareholders and activist investors continue to promote candidates that play as individuals the moment they enter the boardroom?