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Why private business is key to New Zealand’s prosperity

 

New Zealand’s many private businesses drive growth and are the foundation of the country’s long-term success.

New Zealand is a nation of private business owners, large and small.

Whilst NZX-listed companies and large corporations receive most of the attention, it’s worth noting that nearly two-thirds of our economic output comes from private businesses and they are the cornerstone of employment in New Zealand.

New Zealand is also a great place to do business. That rare combination of a true entrepreneurial spirit, a free market economy and a country that embraces innovation, provides many of our private businesses with a great environment to prosper.

But, for some reason, many of our privately-owned businesses get to a certain stage and fail to push on and reach their potential. The end result is we lack enough businesses that have sufficient scale to grow their sights beyond New Zealand.

 

How our medium-sized enterprises could propel New Zealand’s prosperity to a new level

We have a reputation for innovation and punching above our weight in everything we do, but have not cracked the productivity challenge (IMF estimates the gap to where we should be is equivalent to 40 percent of GDP or $80 billion per annum).

If we can turbo-charge the growth rate of NZ Business over the next 10 years, and in particular the growth rate of medium sized enterprises, we will go a long way toward bridging that gap.

 

TURBO GROWTH (THE MATHS PER 10 YEARS)

  1. Move 1% of medium firms to large firms
  2. Change the growth rate for 10% of medium firms (increase by 10%)
  3. Change the growth rate for 10% large firms (increase by 10%)

 

From insight to Action

KPMG Enterprise DNA research has analysed the best performing companies in the country to understand more about the keys to success. The key conclusion — high value enterprises are not created by chance — they grow from a set of conscious decisions and do things in a particular way.

Embedding excellence into an organisation is a cultural issue that cannot be imposed on people through meetings or PowerPoint presentations.

Changing culture requires leaders to work closely with their teams to demonstrate the desired behaviour, celebrate milestones, be open and honest about failings, and hold each other to account.

This takes time and requires investment to equip people with the skills and tools they need to have an impact. Most critically, any cultural change requires clear communication, starting from the top of the organisation.

Download the full KPMG Enterprise Report to find out more.


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