Sir Roderick Carnegie, “Responsibilities,”
a talk at Australian Institute of Management Victoria, August 6, 1979.
Published as a pamphlet by Conzinc Riotinto of Australia Limited.
As the Modest Member and Modest Farmer, Bert Kelly, says in his latest book, “Even Members of Parliament behave in a surprisingly sensible way if they think no one is watching them.” Mavis would admit that managers can do the same.
Many of you would agree too much of our current public discussion is conducted from previously prepared defensive positions. It is like trench warfare.
Trench warfare is characterised by a no man’s land between two embattled armies. The senior officers on both sides spouting brave slogans. The man in the trenches hoping to survive the dangers and get back home to a better life. As the films about the 1914-1918 war show … there is an awful lot of noise and smoke. Severe casualties on both sides. And after the noise of battle has cleared neither side has advanced.
My thoughts today may be different from the usual rhetoric of prepared positions. But they may stimulate your frank discussion. And hopefully cause you to rethink your positions.
There are things we can do as managers. There are things we must do, as part of our individual personal responsibility. If we cut away the nonsense, the jargon, the politics of blame and envy, managers do something very important. We carry the real responsibility of making our social institutions serve us well. Our real value to the Australian community is to be sure that enterprises, both public and private, do not squander the nation’s talents and resources.
Today, gloom is fashionable. Each new day should be a new beginning. But all too often the papers start it as a wake.
Bad news travels faster than good news, and there is a market for it. Are we in a twilight age? Have we a loss of confidence in political institutions? The loss of a spirited and healthy economy? A breakdown of traditional authority and standards in education, in culture, in language, in the family?
Is it really that bad? We do have a responsibility, a particular one for members of the Institute. To help educate and persuade other Australians that many of our problems are illusory. Most problems have been caused by individuals fighting each other and most can be solved by working together as a community.
Fashionable gloom is the reason why I wanted to start with the subject of responsibility. Because responsibility is an unfashionable word. In all the fashionable gloom about the future, there is still a realistic case for optimism. We should all have greater faith in the good sense of ordinary Australians. We, the managers, must lead the community towards reasoning together.
We must be prepared to get out of the trenches and go at least a little way into No Man’s Land.
There are real trenches. There are those on the left, a minority, who want to change our system entirely.
There are, on the right, a minority just as damaging who want to destroy our capacity to make any change in the present for something better.
There is a silent majority of people in the middle who resent these extremes. The quiet and sensible Australians who are the real strength of our society. If we can reason together we will find that support from the community, which is already large, is capable of growing larger.
Rights and responsibilities are not just clichés in an argument about industrial relations. In our own families each member has both rights and responsibilities.
Every parent knows that problem of teaching children about what is a right and what is not. When we visit the milk bar children have the right to ask for an ice-cream, but not the right to get one each time.
Every parent knows of the cases in which children have been spoiled because nobody was willing to accept the responsibility to say no.
Every society deals every day with the problem of balancing rights and responsibilities. The answers are different from time to time, and from place to place. Traffic safety is an obvious example. The Victorian consensus for compulsory safety belts and breathalysers is not shared, and indeed vigorously opposed, in other communities.
Responsibility is the willing acceptance of reasonable discipline on our own behaviour and performance, assessed by the standards of the community in which we live. It is time we made responsibility more fashionable in action.
Too often, those in the trench on the left see only the benefits and arbitrary privileges of ownership. Too often those in the trench on the right see only the growing power and irresponsibility of unions. Both are looking through their periscopes with tunnel vision. Managers cannot afford tunnel vision. We must expose ourselves to the risk of reality. Breaking in upon our preconceptions by entering into No Man’s Land.
There are some things we can do. I want to concentrate on five points today.
ONE — A Manager’s job is to get things done, with and through people.
TWO — Success can only possibly come through working together, with mutual trust.
THREE — To solve the present difficulties of industrial relations, we have to reason together, not just shout. If we don’t reason, how can we expect others to do so?
FOUR — Managers must defend the freedom of the market system. All the more so if we are in statutory corporations or publicly-owned enterprises.
FIVE — We all have to get out and talk about what we believe in. Not sermons, but the much harder task of talking quietly together.
If we managers do our job, I am confident that Australia and Australians can and will beat the gloom.
ONE
Managers work with and through people. Vital: Vital to every productive enterprise. Vital to the community and the country.
With and through people. Without that essential element, what use are the national resources that we talk about? What use, indeed, are the human resources if they are not encouraged and helped to work in satisfying and productive jobs.
Let’s start making the Manager important. Management takes:
Neither genius nor heroism, but rather persistence, tough-mindedness, hard work, intelligence, analytical ability and — perhaps most of all, tolerance and goodwill.
We know that, even on our bad days, we are doing a creative and challenging job. That we are serving the community. That we are making the difficult decisions which create jobs from a mixture of complicated ideas and changing facts. It is time we told a few other people about it — and, as I said in Brisbane earlier this year, it would not be a bad idea to start with our own children!
With some exceptions, Australia’s performance is poor by world standards in two areas:
- International competitive efficiency, and
- Productivity growth.
Australia’s performance must be improved if our national cake is to grow to meet all our aspirations and expectations.
We need to make the concept of productivity properly understood. Productivity is not about forcing ordinary Australians to sweat in some nightmare horror of an ever-faster assembly line. It is not about frightened junior executives working back on rush figures. It means working smarter. It need not even mean working harder. It certainly means helping Australians to work more effectively. It means modern plants and equipment, new technology. Less production and administrative waste and more competitiveness by international standards are basic to the growth of Australian industry. Above all, more competitiveness and more exports mean more jobs to the young.
We know that. Does the ordinary Australian, who works in our enterprises, know it? We certainly don’t get the story through to our people effectively enough.
TWO
We need to encourage a community sense of mutual trust as a major and living responsibility. It is not simply in industrial relations that this is needed. It goes much further than that. It is the vital difference between going flat out but playing fair within the rules of the game, and bending the rules to win at all costs.
Mutual trust and respect for fair play is much less common in our community now than when we grew up. It will be a serious loss if all Australians do not strive hard to regain it.
I say, very soberly and with more than a little worry, that this aspect of working together and of mutual trust at all levels of an organisation is one in which we have much to learn. We can learn from the Japanese, the Germans, and from other communities which have had to rebuild consensus after it has been painfully destroyed.
I hope we do not come to that before we begin to learn. If as managers and decision makers in this community we do try a little harder, we do get out of the trenches, we may rebuild shared goals before we come to that point of national crisis.
All management and leadership finally depend on consent. We ought to remember the old Japanese proverb which goes roughly; that disaster comes when you pull the same old string but there is nobody at the other end.
Mutual trust comes from a sense of fairness and agreement on the basic aims and methods of an organisation. If managers and leaders fail to explain and persuade, their followers’ trust can break down. Bligh had his mutiny when his sailors lost trust. It can happen in nations.
Ordinary people want to have trust. There was a notable incident in the midst of the war at Christmas 1917.
The iron discipline broke down, and ordinary soldiers of both sides mingled peacefully in No Man’s Land. An officer, and a manager, cannot assume consent or obedience. We make a grave error, in whichever trench we happen to be, if we assume that everyone will stay there willingly fighting on our side forever.
Managers naturally think of segmenting a market as part of our professional skills. Let us be very conscious that we can not segment a nation in the same way, by artificial divisions between Liberal and Labor, or between management and unions.
We should remember that to a lot of ordinary Australians, the tendency to “union-bashing” in the last six months looks very much indeed like the “business bashing” which some of us went through in 1973 and 1974. While the community gets irritated by strikes, and polls suggest most Australians are anti strikes, the polls also show that they believe that strike action by their own union is completely justified. People don’t always vote one way simply because they happen to be labelled “managers” or “unionists” or “businessmen”.
When ordinary Australians begin increasingly to see their leaders as lacking in credibility, in long-term thinking, and in simple plain honesty — when that point comes, the mutual trust on which every society is built begins to be at risk.
There can be a better way. Every manager must keep on trying and trying until he or she finds it.
THREE
Industrial relations. Even to talk about this subject is risky unless you sit firmly in one of the two opposing trenches. Go into No Man’s Land, and the minimum risk is that you will be misquoted, more likely it will take you a long time to recover and you will show scars. Often the greatest risk you run is not from the other side but from misdirected sniping or massing shelling from your own.
You may remember the wound bashfully described to the visiting Queen Moth by the shy Highland soldier who was confined to his hospital bed by shots hitting the fleshy part of the lower back. It has happened to anyone who speaks out.
We have a legal wage setting system based largely on a work type union structure. Employers are broadly represented by associations in this system. But people — managers and craftsmen — work together in individual enterprises — some large some small. How can the enterprise relate better to its people? How can the legalism of our industrial arbitration system be best modified?
To keep looking for better ways is a responsibility for every manager, and we mislead ourselves if we think there is a single recipe which someone else can prepare for us.
It is critically important that we concentrate on the enterprise since this matters most in the long term — to the people who work with us. With us, not for us.
Too often we fail to mention these vital factors in the arid confrontations of industrial relations. Too often we overlook them in our relations with managerial staff.
The vital factors cannot be quantified, cannot be purchased, cannot be negotiated but can only be given when and if they are earned. They are intangible. They are important. They are things like loyalty; initiative; enthusiasm. The responsibility for achieving these lies with this audience.
This year Senator Rae attacked the incredible and apparently unsupervised spread and survival of statutory authorities. But he did not stop there. He call, in that same speech, for a continuous review of our private enterprise system.
He said very rightly:
The system has to be efficient, fair and supported by a large proportion of the population. If employees do not feel that they are involved in it or if they do not feel they have the opportunity to participate on a fair basis, then I believe they are more likely to be attracted to other approaches …
Let me quote from Professor Elliot Jacques in his important book A General Theory of Bureaucracy:
If a society values the work and creativeness of its people … in the same way as it values animals in a cattle market, there need be no surprise if people respond with consternation, confusion, apparent unreasonableness and greed, and eventually (perhaps over many decades) with hostile rejection of that society.
Our economic activity can and must be combined with respect for personal dignity and the value and importance of each individual, or are we indeed heading for a gloomy future, and we are avoiding a specific responsibility of management. We have to find new ways to solve industrial relation problems with these in mind.
FOUR
The market system. The way of adjusting the balance between demand and supply for good and services. Even if you are a member of the Institute who happens to work in administration rather than in the factory, or as an officer in the Armed Services rather than as a retail manager, the market system is important to you.
In supposedly command or planned economies, the market keeps returning in the cracks between departments and collectives and factories. When someone has something to exchange and others want it a market is soon created as the best way of achieving individual wishes.
The market system is the only way which can give people what they want in bewildering variety. To give people what they want, not what some self-elected or self-appointed group thinks people ought to want.
And, while each of us may be involved in political activity of some kind in our community, it is only the market system which permits people to prosper while being indifferent to politics.
It is only the market system which can solve distribution without queues and rationing.
Only under the market system is there respect for the individual rights of the eccentric and the dissenter.
Some people thing differently, pointing to the harsh choices in the market if it is too arrogantly applied to people or without responsibility by the seller. But I personally remain unashamedly pro-market and pro-private enterprise. All other systems seem worse.
Several hundred years of history remain the test for me. A record performance in creating riches for the individual and maximum freedom as well, of achieving a broad distribution of the results of growth, obtaining a constant renewal to meet the changing pattern of what people want. In the Jackson Committee work, we sent study teams into the planned economies of Eastern Europe. They, like China, envy the efficiency of the West and plan to copy the motive power, the free market for goods and services.
The market is not always popular with politicians or with the bureaucrats who serve them. That’s not a new problem. Every time you design a lovely new plan or a nice, tidy, well-organised, committee-drafted blueprint for the future, along comes some difficult shortsighted entrepreneur and does it differently, and generally better, and makes that lovely plan obsolete.
Not a new problem. If you go back 1700 years, the Emperor Diocletian was persuaded by his first and second division public servants that one good reform could cure it all. Diocletian’s great edict, from which many historians date the progressively more rapid decline of the Roman Empire, began with words that still represent what too many planners really think about the market. I quote:
Uncontrolled economic activity is a religion of the Godless.
The market beat Diocletian. The market will still beat the modern advocates of planning. But we ought, as managers, to think once a week at least whether we are really giving it a fair go. Are we trying to get government help for us, and really undercutting the strength of private enterprises in the long run? Getting the government out of the way and out of everyone’s pocket is a better way than seeking protective quotas, higher tariffs or subsidies.
FIVE
Getting out and talking. It can and must be done. It is unavoidable responsibility on every manager to talk and persuade people about what he believes. The manager must not just retreat to the dugout and grumble cynically about politicians and bureaucrats and union leaders.
My own concept of the responsibility or a business may be described as the “stakeholder” concept of the enterprise. Responsible managers of responsible enterprises can be our path towards success, not only in our individual stations but in Australian society as a whole.
Responsible private enterprise can accommodate individualism, and individual responsibility, and couple this with the recognition of the need for co-operation and partnership and concern for others.
I do say there is an overwhelming responsibility on managers like us to get out of the trenches and go into No Man’s Land.
I do say there is a responsibility to deny that individualism fights against community, in our organisations or in society as a whole.
I do say as you may have read in Management Review in June, that Reg Jones of General Electric is right about business when he says, “It is not enough to make more widgets at less cost.”
I do say we have a responsibility as managers to inform, communicate, educate; and, there is a difference between listening and hearing which we often ignore.
I do say that it can be lonely at first in No Man’s Land.
But if we reason together as Australians we are likely to find some remarkable agreement on priorities.
I want to mention one example of this in practice. We have to learn the courage of such people as Bert Kelly, who, almost on his own, pursued his mission for long-term economic good sense over twenty years. Twenty years of criticism and ridicule by people in both trenches whose major concern was next week or next year. Twenty years of critics who found his defence of a free market incompatible with their short term profits.
When we talk we should throw away business jargon and talk plain English. Bert Kelly has done more for private enterprise than all the sermons and White Papers in the world, with his homely point about governments meaning well and doing badly:
An economy is like a bucket of worms,
It is changing and turning all the time,
And if it isn’t changing it dies,
And the smell is awful.
FINALLY
Of course, there are potentially grave problems for Australia, internally and externally, over the next twenty-five years.
But gloom demands action. It is not a comfortable excuse to do nothing. Problems are there to be solved, not administered.
The country is strong. We have resources and vast opportunities. We have community strength in skills, in education, and (when we get through to the typical Australian) in co-operative working together. We have children and grandchildren for whom we have the responsibility to make a better future. We will find this achievement through consultation, not through confrontation.
It can be done.
I am going to end with the story of Exodus as summarised by Bert Kelly. It has particular force at the moment, when almost every night I can see friends like Tony Street and Bob Hawke being asked on the box questions like, “Have you stopped beating your wife?” I quote:
You can imagine the trouble that Moses would have had if he had had to face a press conference every night as he led the Israelites out of Egypt.
Moses would perhaps look a bit bedraggled after a hard day on the hoof, and that would not go unnoticed.
Then some bright young reporter would want to know how far they had come today; how far did he expect to get tomorrow; and was he sure there wasn’t a short cut somewhere. [Source.]
Well, there is no short cut. There is a need to take responsibility. And even if the Red Sea is unlikely again to part conveniently, or the Treasurer’s deficit problems unlikely to be solved by a fall of manna before August 21, we still have to keep trying.
I believe less concentration on rights, and more concentration on responsibilities, is a pretty good way out of the wilderness and out of the trenches. It is a problem squarely in front of every manager.
Thank you.
