The Management of Senior Managers: How Firms in New Zealand Acquire, Defend and Extract Value from their Senior Managerial Resources

The main aim of this study was to develop an understanding of current practice in New Zealand firms with regard to the management of managers, in particular the senior management team consisting of the CEO and direct reports. Although theory drawn from organizational economics, human resource development and strategic human resource management do provide useful perspectives, there is not, as yet, a well developed or coordinated theory on the management of managers. In this study a theoretical framework is developed, which identifies three broad goal domains for the management of managers and the key strategic tensions that firms may have to deal with in order to achieve their goals within these domains. The theoretical framework also proposes a taxonomy of company styles that describes different patterns of practice that might be expected in firms at various stages of development or in different contexts. The empirical research is centred on case studies of practice in four mid-sized New Zealand firms selected to represent a cross-section of established companies in different sectors and with some variation in patterns of ownership. The main findings are that current practice is largely consistent with the predictions of the theoretical framework and that the firms in the study face pronounced challenges with regard to the recruitment and retention of managers. In particular, the difficulties are compounded by the relatively shallow pool of talent available in a small economy, which makes it difficult for firms to establish robust managerial internal labour markets capable of supplying the bulk of the firms' senior managerial needs. Other findings of note are that there is little evidence of clearly perceived agency issues of the kind raised by the organizational economics literature and that processes and systems for identifying managerial talent in general, and for developing managers at the senior level, are not well developed. The broad conclusions are that firms in a small economy face particular difficulties in making the transition from an emergent stage to having fully evolved internal capabilities to bring managers with superior talent through to senior positions.