Changes in organisational design in New Zealand privatised organisations

Abstract

Between 1985 and 1995, the New Zealand economy went through comprehensive changes. Economic reforms were oriented towards macro-economic adjustments, economic stabilisation, and market-oriented development policies. The public sector was the main arena of the reforms with great emphasis on reducing state intervention in economic affairs. Deregulation and privatisation were recognised as the instruments of macro-economic policies, introducing a market-oriented approach into the public sector economy. By 1988, twenty-four government trading enterprises including utilities, transport, and finance were corporatised. In a seven-year period, the government sold most of its commercial assets, including seventeen government-owned organisations, accounted for a total sale of NZ$ l3 billion. The objective of this thesis is to elaborate theory about changes in organisational design as initiated by changes in ownership nature, and to reflect on the complex interaction of political, economic, management, and technological factors in influencing organisational structure. The central purpose of the research is to explore the different pathways taken by New Zealand organisations through the process of transition from government departments to state-owned enterprises, and then to privately-owned companies. The research is undertaken through multiple case studies, the cases selected from the population of New Zealand corporatised and privatised companies. The resulting representative sample consists of sixteen organisations. The analysis relates to the 1985-1995 period, with data collected retrospectively from different sources. Content analysis of organisational documents is performed using QSR NUD*IST computer software. The research suggests three pathways of restructuring: incremental, radical, and reductive. It is shown that diversity in organisational pathways through the process of transition depends on the organisations' embeddedness in their institutional and technical environments, historical conditions of their existence, the indeterminacy of government actions, and the new owners' strategic intents. The incremental pathway refers to changes that occurred in the state-owned enterprises that had historically operated in a competitive environment. For these entities the shift to private ownership meant selective organisational movements towards efficiency improvement and further market expansion. The radical pathway refers to those organisations that after the status change experienced dramatic changes in all areas of business activities. The shift in ownership status made possible significant development of the organisations, from those operating in protected domestic markets, to large, internationally recognised corporations. The reductive pathway refers to those organisations that, in the period before status changes, were totally dependent on the public sector as both customer and supplier. The strategic orientation of their new owners reduced their business activities and resulted in them losing their independent organisational identity.