Air NZ board may surprise but will have to watch its managers

Friday 8th March 2002

The recent appointment of four new directors to the board of Air New Zealand raised an issue which is fundamental to the business, governmental, social and even sporting control of organisations.

It perpetuated the myth that occupational and administrative ability in one activity can cross over to other areas. The proposition is based on the idea that technically experienced managers handle operational nuts and bolts while the chief executives and board members contribute a broad vision and general overseeing role to an organisation's governance.

The facts regularly proved the opposite, although the revamped Air New Zealand board could be an exception.

Starting with the government, we have academics with minimal experience of anything outside university life holding key positions in the cabinet.

Prime Minister Helen Clark and Foreign Affairs Minister Phil Goff have charged around the world lecturing other countries about international affairs.

The latest ludicrous example was Ms Clark's comment that New Zealand might "go it alone" with the application of sanctions against Robert Mugabe's regime in Zimbabwe.

The prime minister and her sycophantic colleagues should, and probably do, realise that what makes them, their supporters and an equally sycophantic joyriding New Zealand media self-satisfied carries no weight in the big scene. We can ban cricket and rugby teams and a few mineral imports. That is it.

This country has misguidedly persuaded itself that a small, insignificant nation which is a convenient workhorse for states with massive agendas has clout on the international stage.

We have a chief legal officer - the attorney-general - whose legal experience is confined to the lecture rooms of Auckland and Waikato universities.

The idea that Attorney-General Margaret Wilson could regularly lead for the Crown in court, unlike many of her predecessors, is as ludicrous as the wafflings of Ms Clark and Messrs Cullen and Goff.

It is a dismal reflection that the counter-balancing people on the other side of Parliament seem to have similarly limited capacities. MPs fail to recognise a point often made in this column: they are the equivalent current and alternative administrations of city councils in many cities worldwide.

Reverting to Air New Zealand, the board is heavy with people skilled in marketing, finance and exporting. Former Trade Union Council president Ken Douglas is outside that expertise range but anyone who holds a union organisation together has political and administrative skills.

The airline's board could surprise all outsiders and fix the current mess but it will have to watch operational managers who know aviation.

Several have gone. Others had to accept pay cuts but the remaining, ensconced people can be assumed to have personal agendas, possibly at odds with board goals.

Chairman John Palmer should be aware of the mythical idea that individuals can switch from one form of expertise to another. He is chairman of Wrightson, which went through a disastrous period when a professional "administrator" ran the rural services company and left a mess which has now been restructured.

Mr Palmer and other Air New Zealand directors should be mindful of the shambles that developed when "gun operators" from Brierley Investments were up in the air (pun intended) in corporate strategy.

There is nothing new in people being selected from one business administrative activity to another. It has gone on in the public service for generations, based on the idea that you can run a department focused on internal New Zealand activities if you were a successful diplomat or trade commissioner, the latter under the old public service system.

There has to be admiration for Air New Zealand board members. Their reputations will be shot if the company fails to recover but they will be corporate heroes if it returns to acceptable profitability.

It is undeterminable whether their new seats at the front of the aircraft will bring greater aviation wisdom than they had when their organisations were paying for up-front flying accommodation or (unlikely) making their people squeeze into cattle class.

The airline raised trans
tasman airfares and cut cargo operations out of the South Island to Asia, while operating a successful no-frills operation in Freedom Air.

Taxpayers own Air New Zealand, through the government. They, as the travelling public, might like to see board members and politicians travel down the back of the company's planes, or go "no frills." That will happen when pigs are flying alongside the flights.

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