Management Practices and Productivity Benchmarking Findings

1. Findings from the Management Practices and Productivity Global Benchmarking ProjectApril 2010 Management Matters in New Zealand

2. Background • Developed by McKinsey and Co, and London School of Economics • Focused on key management practices • 152 NZ manufacturers with more than 50 staff • International research - 17 countries

3. Management Practices

4. Scoring Example

5. NZ Firms’ Performance

6. International Comparisons

7. Spread of NZ Respondents

8. NZ Firms’ Self Assessment

9. Management Practices impacts on …- Profit per employee- Sales - Number of employees

10. Labour-Management Practice Equivalency % Capital-Management Practice Equivalency % Contribution of management practice to the firms productive output is equivalent to large increases in existing labour or capital 177 +41% +77% 141 100 100 Base level of Capital and Management Practice Score at ‘25th percentile’ Level of Capital to achieve an equivalent level of firm output if Management Practice Score increased from the 25th to the 75th percentile Base level of Labour and Management Practice Score of ‘25th percentile’ Level of Labour to achieve an equivalent level of firm output if Management Practice Score increased from the 25th to the 75th percentile Improved Management Practices Impact on Capital and Labour

11. Speakers • Tom West • Ministry of Economic Development • Tom.West@med.govt.nz • Craig Armstrong • NZ Trade and Enterprise • Craig.Armstrong@nzte.govt.nz • Research report available on • www.med.govt.nz

12. NZ vs Australia

13. Business Assessment of PerformanceBusiness Operations Survey 2009

14. Business Assessment of PerformanceBusiness Operations Survey 2009

15. Business Improvement Practices Business Operations Survey 2009