Human Resources Management in New Zealand
- HR Practice in New Zealand
- New Zealand - A Unique Story
- Human Resources in New Zealand - A Brief History
HR Practice in New Zealand
General Recruitment practices
Recruiting practices in New Zealand have taken the same path as most other western countries. Over the last fifty years we have seen the emergence of the recruitment industry as a service offering in its own right and in the last ten years we have seen rapid change as service providers merge, divest and re-invent themselves.
The 1990’s marked the onset of a trend towards acquisition of home grown agencies by large global operations. While some agencies have maintained their brand identity they are commonly part of a wider global network. This trend will continue in the future and we will see the gradual disappearance of mid range recruiting organisations as the market becomes based on local presence of large global players and small niche players with tightly focused specialist markets.
The Online World - The impact of the Web on Recruitment
First we saw the job boards, and then came the interactive job boards and now we have the next generation of applications that have workflow and auto notification email and online assessment. The growth of web enabled processes and the emergence of eRecruitment is having a major impact not only on the process of recruitment and selection, it is also transforming the nature of relationships between recruitment service providers and their customers.
The internet has disintermediated the recruitment industry, enabling a recruiting manager to have a relationship directly with potential candidates. For many years the power and value of a recruitment agency lay in their relational database of people and they added value to a customer by advertising, screening, assessing and short listing. Who you knew, having a relationship with them, and being able to introduce them to a customer provided a revenue stream to a recruitment provider. It matters less who you know now because the Internet can do all these things at a fraction of the cost. The value chain for recruitment services is changing from a candidate placement model to one of providing unbundled services.
Most major companies in New Zealand have job pages on their websites and some have highly interactive recruitment software with associated workflow enabling fast and personal interaction with candidates.
HRINZ has its own HR Job Board which advertises current HR Vacancies throughout New Zealand.
Listed on the HRINZ Resources, there are a number of recruitment agents that specialise in HR recruitment.
General Training and Development practices
Training and development practices in New Zealand are consistent with those of most other western business environments. Most large organisations have organic training functions although there is a trend towards outsourcing these functions to specialist consultancies. The major global training providers such as Forum, DDI, Siebel, and Achieve Global are all represented along with a plethora of smaller local training vendors who can provide a full and diverse range of learning solutions.
The emergence of web-based learning is also strongly apparent in New Zealand with most major organisations establishing online learning capability via Intranet/Internet portals.
General Performance Management practices
Performance Management processes vary across the NZ HR community. There is an emerging trend away from form based appraisal systems to processes that focus on regular dialogue and employee participation through such means as employee initiated quarterly updates and online systems that enable visibility of progress against objectives and reporting using self service Intranet sites.
The management discipline of setting SMART goals and objectives and providing effective coaching and feedback remains a challenge and HR professionals continue to ‘try and build a better mouse trap’ when it comes to systems that drive effective management behaviour in this domain. Like most approaches all over the world, effective performance management processes work best when they are explicitly aligned and engaged with the business planning process and cascade out of the key strategies and core systems of the organisation. The McKinsey 7S approach is a model being used by some of the top performing organisations and provides a framework for looking at performance management as part of a systems perspective. This is a shift away from the dysfunctional ‘annual ambush’ exercise policed by an HR function distant from the reality of the lines of business.
New Zealand - A Unique Story
New Zealanders’ are a nation of independent and innovative people. We claim a vital history of achievement, leadership and endeavour out of proportion to our number. We claim many firsts:
- First to give women the vote in September 1893.
- First to split the atom in 1918.
- First to climb Mt Everest in 1953.
- Bill Hamilton, a Canterbury sheep farmer, invented the Jet Boat in 1955.
- Winners of the inaugural trans-Atlantic rowing race
We pride ourselves in being fast followers and early adopters
- We carry out the most EFT-POS transactions per head of population in the world
- Our Capital city Wellington is the most net connected city in the world per head of population.
- At home we are New Zealanders, but being globally literate and keen travellers we can be found all over the world and rouse to the title ‘Kiwi’ after our distinctive indigenous bird.
A small country in the south - west Pacific, New Zealand was first settled over a thousand years ago by early Polynesian navigators sailing south from the island cultures of the Pacific Ocean.
The first European visitors arrived in the 15th Century when the Dutchman, Abel Tasman first charted the coast of the country. It was not until the late 18th Century that English mariner and explorer, Captain James Cook completed comprehensive charts of New Zealand and made substantive contact with the indigenous Maori people who had established a thriving and rich culture throughout the two main Islands. Early whaling and seal hunting activity led to sporadic European settlement and in 1840 New Zealand was annexed by the British Government initiating planned European settlement in earnest.
The founding document of New Zealand as a bicultural nation is the Treaty of Waitangi signed in 1840. This document is unique. It remains the only binding written Treaty between an imperial power and an indigenous people that works as a living legislative protocol promoting partnership. By the end of the 19th century a thriving agricultural economy had developed and the pattern was set for New Zealand to become a key player in the primary produce market of wool, meat, fruit, dairy products and timber.
The tyranny of distance demanded innovative approaches to establishing export capability and pioneering developments were made in the 1890’s for transporting refrigerated products.
Politically, New Zealand had been a self governing Colony since 1852. It became an independent Dominion within the British Commonwealth in 1907. Throughout the 20th Century, New Zealanders made their mark in science, in war and in politics. Today New Zealand is a democracy governed by a Parliament voted in by proportional representation.
A Great Place
New Zealand is situated in the South Pacific Ocean, 1,600 km to the east of Australia. It has a distinctive geography made up of two main islands North and South and a number of smaller islands. The total land mass is 268,021 sq km. with a diverse landscape comprising alluvial plains, mountain ranges and hill country dissected by numerous lakes and rivers. New Zealand is situated in a unique maritime latitude and climate that creates an intriguing environment - it is the only place in the world where glaciers descend through temperate rain forest.
We have a temperate climate with average temperatures ranging from 8°C in July to 17°C in January. Winter lows drop below 0°C and summer highs can reach well into the 30’s.
With the exception of some early Chinese and Dalmatian immigration in the late 19th Century, New Zealand’s ethnic mix remained largely British and Maori up to the 1940’s. The mass of displaced people following the Second World War saw an influx of Europeans particularly from Greece, Italy and the Netherlands. A further wave of British immigrants and a rapid rise of both Indian immigration and Polynesian migration from Samoa, the Cook Islands and Tonga lead to a rich cultural mix by the 1960’s.
In September 1999, women made up 45.2 percent of the labour force. This compares 42.6 percent in 1989. Male participation in the labour force is higher than female participation at all age groups with the main gap occurring in the 25 and 34 year age group. For the year ended September 1999, participation rate for males was 73.4 percent compared with 57.4 percent for females across the entire labour force.
New Zealand’s economy has developed through success on three key fronts; global marketing of primary produce, harnessing natural energy resources and tourism. We have been quick to adapt and push internationally for free trade and where we were once essentially a farm for the United Kingdom, we are now a global player in the export of Dairy, Meat and Fruit produce across both commodity and niche/gourmet markets.
Recent research on global business literacy identifies New Zealand as having a high level of global literacy. While large organisations from Europe, Asia and the United States tend to define globalisation within a context of operating their businesses offshore, New Zealand like other small economies, define globalisation in terms of the opportunity to create and market our products across the diversity that makes up our varied trading partners.
New Zealand has a long history of providing high quality education with a wide range of professional and vocational study opportunities.
New Zealand secondary schools provide a broad spectrum of education to students aged 13-18 years. While most secondary schools are state funded, there are also a large number of private schools including those with special philosophical or religious traditions.
The New Zealand Qualifications Authority (NZQA) defines the entry levels and programmes and standards of all secondary schools
The NZQA co-ordinates national qualifications. Its role is to develop a national qualifications framework and to approve non-university degrees.
The Authority does not create curriculum but deals with the provision and quality of qualifications. The Authority is a Crown Entity established under the Education Act 1989 and is appointed by the Government Minister of Education and is accountable through the Minister to Parliament. The Authority’s mission to promote improvement in the quality of education in New Zealand through the development and maintenance of a comprehensive, accessible and flexible National Qualifications Framework (NQF). The framework is the means by which national qualifications may be recognised throughout New Zealand and overseas and includes processes for recognising prior learning or matching overseas qualifications with New Zealand equivalents.
New Zealand has eight Universities offering undergraduate and postgraduate degree programmes in academic and professional studies. All universities offer a broad curriculum including commerce, science and the arts. Each university has also developed its own specialist reputation for professional subjects, such as engineering, computer studies, business studies, mining, medicine, veterinary science, pharmacy and agriculture.
|University of Auckland||Auckland|
|Auckland University of Technology||Auckland|
|Massey University||Palmerston North, Auckland, Wellington|
|Victoria University of Wellington||Wellington|
|University of Otago||Dunedin|
Other tertiary establishments include 25 Polytechnics and four Colleges of Education (Teacher Training). As well as the Universities, many of the Polytechnics also offer undergraduate degree programmes.
Human Resources in New Zealand - A Brief History
The development of HR practice in New Zealand has progressed along similar lines to other western democracies. New Zealand’s colonial experience in the 19th century naturally led to the adaptation of British practices and assumptions in managing employment. We inherited the assumption of inevitable conflict between labour and capital (DJB) and a number of employment laws were enacted in the 1890’s that would set the scene for the next hundred years.
A key founding piece of legislation was The Industrial Conciliation and Arbitration Act, 1894. This Act was designed ...’to encourage and to facilitate the settlement of industrial disputes by conciliation and arbitration’. It would be fair to say that major industrial disputes have been comparatively rare in New Zealand’s history. There have been some notable events such as the Mining Strikes early last century and the 1951 Waterfront dispute however conciliation and arbitration have consistently been the means for the resolution of disputes.
The last forty years have seen a significant shift in the nature of the employment relationship. The Industrial Relations Act, 1973, The Human Rights Commission Act, 1977, The Holidays Act, 1981, and The Wages Protection Act, 1983, all sought to regulate the relationship between employers and the labour market. This legislation legitimised the assumption of conflict and enshrined in law the requirement to seek legal resolution to disputes. The Trade Union movement thrived under this legislative regime, however in 1989 The Employment Contracts Act (ECA) was passed into law. This Act was a radical departure from previous approaches and enabled employees to negotiate individual contracts with their employers. The result was a sharp decline in Union membership and a virtual absence of industrial action. The focus of the Act was on the rights of the Parties involved and challenged the polarising Marxist/capitalist assumption of inevitable conflict between labour and capital.
The ECA was repealed by the incoming Labour government in 2000 and the Employment Relations Act, 2000 was enacted. The Act has reinstituted a focus on collective contracts, mediation based on the interests of the parties and bargaining in good faith. It is too early at this point in time to assess the impact of the legislation on although the behaviour of parties in recent subsequent industrial action has not appeared to demonstrate an ability to grasp the code of good faith and has tended to focus on a distributive rather than integrative lines of mediation.
Into the 21st century... HR here and now
The Employment Relations Act
The legislation governing employment relationships is the Employment Relations Act, 2000 or ERA. The object of this Act is to build productive employment relationships through the promotion of mutual trust and confidence in all aspects of the employment environment and of the employment relationship. The Act aims to do this by recognising that employment relationships must be built on good faith behaviour; and addressing an assumption of inequality between the parties to the relationship in terms of bargaining power.
The Act promotes collective bargaining; and the protection of the integrity of individual choice. It also sets out to promote mediation as the primary problem-solving mechanism with the aim of reducing the need for judicial intervention. The Act promotes the observance of the principles established by the International Labour Organisation Convention 87 on Freedom of Association and Convention 98 on the Right to Organise and Bargain Collectively.
The ERA follows 10 years of an employment relations environment that promoted individual employment contracts and a desire to provide more freedom for employees to negotiate their own contract. This had led to a sharp decline in the number and membership of Trade Unions.
Looking Ahead - A future perspective
Dr Andrew West, Director of New Zealand’s Tertiary Education Commission, has put forward a thesis that in the new economy it will be the new knowledge owners who will have relevant knowledge and use it wherever possible to create measurable value in which they expect to share. They will be a person:
- in their 20s, 30s, even 40s,
- casually dressed
- a member of a profession
- likely to have a technical background related to expansion of sophisticated exports
- commensurately well-educated
- as likely to be female as male
- of a complex ethnic background
- well connected and highly “wired”
- with a liking for life in a warm climate
Dr West proposes that New Zealand’s low population density, remarkable landscape and temperate climate represent the greatest of our natural endowments. These he suggests are key advantages for a new economy and our challenge is to lever greater wealth from our natural resources while also building new value propositions and initiatives that blend comparative advantage with competitive advantage.
New Zealand’s rapidly growing film industry and eco-tourism industry are examples of the new industries that depend on our landscape and climate. There has been a rapid rise in the number of films and television series being produced by offshore sponsors in New Zealand, taking advantage of our unique unpopulated landscape and the light conditions.
Increasingly value will not just be found in tangible assets. We will need to get increasingly better at measuring intangible value such as intellectual and structural capital. This change also challenges the accepted wisdom and business models of today where labour works for capital. This will tip over to capital working for labour as talented people with choices make selective decisions about how they work and whom they work for. We are already seeing this role reversal with talented people with choices, reference checking and selecting organisations and leaders.
In light of these propositions, there are new challenges emerging for New Zealand HR professionals:
- Achieving growth in a highly competitive marketplace.
- Value chain analysis of employee motivation, customer satisfaction, product to market processes, distribution and service channels.
- Evaluation of the strength and relative quality of internal processes.
- The capabilities that will create value for organisations are typically found in formal and informal networks of people and communities of practice working together across business and organisational boundaries. People will innovate, adapt and overcome if they are allowed to.
- Focusing on relationships between business units and teamwork between people to get results.
Organisations will have to migrate to critical new capabilities, requiring new sets of talent that is not presently available in high concentration. Early identification of these talent sets will provide a key competitive advantage.
Organisations will need to develop the ability to deploy and redeploy the right people quickly.
There is a ‘new deal’ emerging in the labour market. This is happening quickly and is characterised by:
- a readiness to challenge the accepted wisdom;
- a shift from a labour economy to a knowledge economy;
- less people in big organisations and more people in small organisations;
- a casualisation of the labour market as individuals begin to manage their personal brand value and take accountability for determining the kind of relationship that they have and how they work... people are reference checking prospective senior managers and selecting organisations rather organisations selecting people.
- the challenge of maintaining a coherent organisational brand in terms of employer value propositions while catering for the emergence of personal brranding amongst educated, talented and marketable people. This reflects a fundamental shift in the power from the employer to the employee/contractor, particularly in high demand, strategically imperative capability areas.
We are moving into a labour market where there are now sellers as well as buyers.
To accommodate the new deal, the capacity to engage the people who deliver value will become critical. The way organisations work with people will need to consider the following elements:
- engagement with strategic intent will replace alignment and control
- identify and remove barriers to innovation
- act with integrity to create credibility and trust
- demonstrate learning agility - learning faster than the pace of change
- value and retain human capital
- recognise the influence of personal brand
- develop virtuality to enable online communities of practice
- deliver capacity for speed - harnessing the resources of being big but acting small
- create capacity for renewal - build and structure the business for change
- as a constant
- understand that Brand is everything
Regional Similarities and Differences
New Zealand is often closely associated with Australia, particularly in the minds of people unfamiliar with the region. While there is strong economic cooperation and historical bonds forged in international affairs, the two countries have quite distinct histories and experiences. This has created significant diversity in HR practice and our views of the world and our place in it. Innovation, experimentation, collaboration and strong networks are key features of the HR community in New Zealand. We have been described at the business laboratory of the South Pacific.
Global Literacies: Lessons on Business Leadership and National Cultures. Robert Rosen. Simon & Schuster, 2000.
Personnel Practice: Managing Human Resources. P.Boxall, R. Rudman and R. Taylor. Longman Paul, 1986
 DrAndrew West. The future of wealth and who will generate it. HRINZ Annual Conference 2000
Crispin Garden-Webster FHRINZ
Past Vice President
Tina Nation AFHRINZ
Past National Councillor