Mergers of government departments are designed to increase efficiency and reduce cost, but may lead to severe cultural tensions.
New research published by UNSW Sydney into the merger of two New South Wales government departments shows that cultural tensions significantly impacted operations, service provision and staff. Furthermore, senior leaders often lacked awareness or understanding about how problematic these cultural tensions were for staff. The research is published in the Australian Journal of Public Administration.
Mergers and acquisitions create cultural tensions that ripple through organisations and impact business operations. Cultural change during Machinery of Government (MoG) restructures disrupts operations and therefore customer service levels, which impacts members of society who rely on government services.
Dr Anna Kiaos, an ethnographic researcher in the Discipline of Psychiatry & Mental Health at UNSW Medicine & Health, analysed the ‘DNA’ culture of Service NSW during and after its merger with the Department of Customer Service. This involved ethnographic methods and extensive interviews conducted with employees and senior leaders.
“The degree of intra and interpersonal tensions experienced by Service NSW employees were opaque to senior leaders responsible for the restructure,” Dr Kiaos says.
Dr Kiaos found that commonly used methods such as focus groups would not reveal the cultural tensions that employees were experiencing. Instead, employees were more comfortable speaking freely during in-depth interviews, some which were planned, and many that were not.
“During MoG restructures, leaders and practitioners responsible for mergers should fully understand the changing nature of employee language and behaviour,” Dr Kiaos says.
More importantly, Dr Kiaos suggests that leaders and practitioners responsible for cultural change should not ignore these intra- and interpersonal changes.
“It is advisable they act on the assumption that employees are experiencing tensions resulting from the organisation’s disturbed social reality.”
This research provides a rare insight into how MoG restructures impact organisational cultures. The approach used could be adopted in future MoG mergers and restructures, to pre-empt, identify and reduce cultural tensions by diffusing microcultures.
