The effects of privatisation on human resource management practices, organisational commitment and job satisfaction : a study of two Malaysian organisations

• Main Author: Yahya, Khulida Kirana
• Published: University of Strathclyde 1998
• Subjects: 658; Job security
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.248675

A study of the impact of privatisation on human resource management (HRM) practices was carried out on 319 employees of two privatised utilities in Malaysia, the telecommunication and electricity organisations. Employees were surveyed after privatisation, and two sets of data referring to before and after privatisation were obtained. Dependent variables comprised measures of organisational commitment and job satisfaction. Independent variables were human resource management practices concerning pay, promotion, benefits, performance appraisal, job security, physical working conditions and training and development. The sample comprised nonexecutive employeesw orking at the headquarterso f both organisations. Data were collected by questionnaires. The results were analysed using SPSS for Windows 6.1 using Mests, chi-square, correlation analysis and multiple regression analysis. The results supported some propositions. First, significant differences were found regarding the practi ces of job security, performance appraisal, and training and development before and after privatisation in both organisations. Second, both similar and different antecedents of the affective commitment (wanting to belong), continuance commitment (needing to belong), and normative commitment (obligated to belong) emerged in both organisations before and after privatisation. Third, the antecedents of intrinsic satisfaction (motivating factors) and extrinsic satisfaction (hygiene factors) also exhibited similarities and differences before and after privatisation. The practices of training and development was found to have strong relationship with employees' affective and normative commitment and also with intrinsic and extrinsic satisfaction before privatisation. After privatisation, the common antecedents in both organisations were: training and development for affective commitment, benefits for continuance commitment, and benefits and training and development for normative commitment. The antecedents of intrinsic satisfaction after privatisation in both organisations were training and development and job security, while for extrinsic satisfaction the antecedent practices were performance appraisal and pay. Further analysis of the change in practices in both organisations indicated that training and development was associated strongly with all the dependent variables except continuance commitment. The result showed that changes in training and development were highly associated with affective and normative commitment and with intrinsic and extrinsic satisfaction in both organisations. Results in this study showed that training and development practice has a strong association with organisational. commitment and job satisfaction both before and after privatisation. Therefore it could be inferred that training and development is related to many aspects of employees' attitude regarding the organisation and their job. Management must clearly make a great effort to underst and employees' needs and behaviour and to meet their needs and expectations in order to have committed and satisfied employees working in their organisation.