The impact of the relationship between supervisors and local government employees post the implementation of NPM: a social capital perspective

This paper uses social capital theory as the lens to examine local government employee’s satisfaction with different types of communication with supervisors because the implementation of NPM (particularly, the duo of cost-cutting and increased control) may have affected overall organisational effectiveness in the longer term. The official reason for implementing NPM was to improve efficiency and effectiveness, however, the way it has been implemented has changed the relationship between employees and supervisors - and as a result, it has probably eroded social capital. These findings suggest that the employee’s communication relationship with supervisors does significantly affect organisational outcomes. In particular, the findings suggest that it not only negatively affects the level of ambiguity that employees experience in relation to customers, supervisors, promotion and ethical issues, it also significantly affects job satisfaction and productivity and these findings have implications for the longer term organisational effectiveness. These findings suggest that the social capital that should develop based on the quality of organisational relationships has been compromised for local government administrative employees.