Management Matters

While athletics and business are not completely synonymous, both tend to require effective leadership.  Witness the University of Michigan football team.  A once great power had clearly fallen on hard times and the prospects for the 2015 season were not generally considered to be much better.  At this writing the team is ranked 12th or 14th, depending on the poll.  What happened?  New management with a proven track record!  There were no material changes in players; new recruits would not be available until the 2016 season.

The concept that “management matters” is not a new idea.  Alexander the Great has been quoted as saying “I am not afraid of an army of lions led by a sheep; I am afraid of an army of sheep led by a lion”.

This is not to imply that the U of M team were sheep, but rather to point out that effective management/leadership, can motivate a group to perform at a higher level, exceeding the expectations of others and perhaps those of the group too.

Investors take note.  Management is frequently the critical variable in business.  Working effectively with the workforce you have can often make the difference.

All comments and suggestions are welcome.

Walter J. Kirchberger, CFA®, University of Wisconsin