Effects of privatization on organizational effectiveness

Psychological perspective

Scientific Study , 2016 , 219 Pages

Psychology - Work, Business, Organisation

The study tested “Effects of Privatization on Organizational Effectiveness”, using 7 null hypotheses at P<.05. Cluster sampling of 372 participants from the Utility industry of 73,526 population were used. Fully privately-owned, commercialized, and fully State-owned organizations were studied, using “Organizational Effectiveness Inventory”, and “Organizational Effectiveness Model Inventory” that measured organizational effectiveness, and efficiency of the models of pursuing organizational effectiveness respectively. They attained interval scale on 5-points rating. The “Organizational Effectiveness Inventory” validations were concurrent Cosine Absolute Proximity .96; convergent Rescale Cosine Proximity .63; Image Factoring Extraction 1.137 of Oblimin with Kaiser Normalization Rotation Method .482. The Parallel Model Reliability for Reliability of Scale was .97, and Unbiased Reliability of Scale was .97. The Guttman-Lambda Model Reliability had strongly agree .96, agree .99, may be .97, disagree .98, and strongly disagree .96. The “Organizational Effectiveness Model Inventory” had convergent .89, and discriminant .31 validations; with test-retest .73, alternate-form .94, Cronbach Alpha .96, and split-half .78 reliabilities. There were randomization, quality control, and statistical control measures; as well as 3x4-control-group survey design, and multivariate analyses. Privatization affects organizational effectiveness, and models of organizational effectiveness. Sensitivity to organizations’ environment could have caused the outcomes. More psychological studies are needed on organizational effectiveness paradigms of privatization.

TABLE OF CONTENT

ABSTRACT

CHAPTER ONE
INTRODUCTION
STATEMENT OF THE PROBLEM
RESEARCH QUESTIONS
PURPOSE/AIMS OF THE STUDY
SCOPE OF THE STUDY
SIGNIFICANCE/RELEVANCE OF THE STUDY

CHAPTER TWO
THEORITICAL REVIEW
BACKGROUND PSYCHOLOGICAL THEORIES OF THE CONCEPTS OF PRIVATIZATION, AND ORGANIZATIONAL EFFECTIVENESS
Katz And Kahn's Open Systems Theory Supporting Privatization
Classic Theory Of Organizational Effectiveness
Equity/Exchange Theory Supporting Public Organizations
LITERATURE (EMPIRICAL) REVIEW
ATTRIBUTES OF PRIVATIZATION
Economic Attributes Of Privatization
Organizational Attributes Of Privatization
Socio-Political Attributes Of Privatization
STUDIES SUPPORTING ORGANIZATIONAL EFFECTIVENESS OF PRIVATIZATION
STUDIES AGAINST ORGANIZATIONAL EFFECTIVENESS OF PRIVATIZATION
ORGANIZATIONAL EFFECTIVENESS GOAL PARADIGMS VIS-AVIS PRIVATIZATION
HYPOTHESES
VARIABLES AND THEIR DEFINITIONS

CHAPTER THREE
METHODOLOGY
POPULATION
SAMPLE AND SAMPLING METHODS
INSTRUMENT
VALIDATION
Concurrent Validity
Convergent Validity
Exploratory Factor Analysis
RELIABILITY
Parallel Model Reliability
Guttman-Lambda Reliability
DESIGN
STATISTICS
CONTROL OF EXTRANEOUS VARIABLES
PROCEDURE

CHAPTER FOUR
RESULTS/FINDINGS
Hypothesis One
Hypothesis Two
Hypothesis Three
Hypothesis Four
Hypothesis Five
Hypothesis Six
Hypothesis Seven

CHAPTER FIVE
DISCUSSION
Hypothesis One
Hypothesis Two
Hypothesis Three
Hypothesis Four
Hypothesis Five
Hypothesis Six
Hypothesis Seven
CONCLUSION
RECOMMENDATIONS

REFERENCES

APPENDICES

ABSTRACT

The study tested “Effects of Privatization on Organizational Effectiveness”, using 7 null hypotheses at P<.05. Cluster sampling of 372 participants from the Utility industry of 73,526 population were used. Fully privately-owned, commercialized, and fully State-owned organizations were studied, using “Organizational Effectiveness Inventory”, and “Organizational Effectiveness Model Inventory” that measured organizational effectiveness, and efficiency of the models of pursuing organizational effectiveness respectively. They attained interval scale on 5-points rating. The “Organizational Effectiveness Inventory” validations were concurrent Cosine Absolute Proximity .96; convergent Rescale Cosine Proximity .63; Image Factoring Extraction 1.137 of Oblimin with Kaiser Normalization Rotation Method .482. The Parallel Model Reliability for Reliability of Scale was .97, and Unbiased Reliability of Scale was .97. The Guttman-Lambda Model Reliability had strongly agree .96, agree .99, may be .97, disagree .98, and strongly disagree .96. The “Organizational Effectiveness Model Inventory” had convergent .89, and discriminant .31 validations; with test-retest .73, alternate-form .94, Cronbach Alpha .96, and split-half .78 reliabilities. There were randomization, quality control, and statistical control measures; as well as 3x4-control-group survey design, and multivariate analyses. Privatization affects organizational effectiveness, and models of organizational effectiveness. Sensitivity to organizations’ environment could have caused the outcomes. More psychological studies are needed on organizational effectiveness paradigms of privatization.

CHAPTER ONE

INTRODUCTION

The organizational effectiveness of public enterprises in Nigeria has not been successfully attained (Ali 2010). This is why privatization is perceived as a strategy to stimulate efficiency and effectiveness in the public organizations (Anumihe, 2011; Ibiyimi, 2010). It is the focus of this study to investigate the effects of privatization on organizational effectiveness in Nigeria.

Privatization is an organizational change to instill organizational effectiveness through sensitivity to changes, reducing government’s interference, as well as allowing private participations in the social, economic and industrial activities of the public organizations (Jonathan, 2010; Obilo, 2010; Olu, 2010). Such sensitivity leads to effective utilization of resources, redesigning of the organizational system, and stimulation of organizational development (Aluko, 1998; Fried, 1992; Obilo, 2010; Shirley, 1988). Privatization provides enabling environment for organizational partnership, corporate cooperation and other elements of organizational effectiveness (Faforiji, 2010; Faruk, 2010; Financial Times, 1996; Mike, 2010; Nwosu, 2010; Polyakov, 2010; Salau, 2010;).

Privatization ensures innovation and reengineering strategies that promote organizational effectiveness (Abolarin & Irabor, 2003; Sekibo, 2003). Inefficiency and ineffectiveness of the public organizations are often protested through mass demonstrations (Njoku, 2010). The same mass actions are employed by some workers to protest public organizations’ privatization (Adegbuji, 2001; African Report, 1986; NLC, 2010; Oyadiran, 2009). Organizational effectiveness in the forms of quality service delivery in products, services, and performance are the hallmark of successful privatization (Anuro, & Nartey, 2009; Starr, 1998).

Organizational effectiveness refers to various aspects of an organization’s overall performance. Organizational effectiveness can be defined as the extent to which an organization achieves its objectives or goals, achieves the needs and the objectives of its stakeholders, and sustains itself over time. Consequently, an organization can be effective or ineffective in many ways. Organization can be assessed for its effectiveness in four major ways as identified by Cameron (1980). Firstly, organizations that successfully accomplished its goals are regarded as being effective. The accomplishment can come in form of quality output or production. Secondly, an organization that is successful in acquiring the resources it needs from the environment is considered to have achieved organizational effectiveness (Shirley & Nellis, 1991). Thirdly, an effective organization has its internal functioning operating smoothly and free of major problems. Fourthly, effective organizations are capable of keeping and satisfying its strategic constituencies and interested partners like workers, customers, shareholders, and stakeholders (Cameron, 1980; Lakemfa, 2010; Okeke, 2010). Effective organization is not deceitful (Atufe, 2010).

Basically, there are no global factors that influence organizational effectiveness (Cameron, & Whetten, 1981). Organizational effectiveness has drastically reduced in public organization in Nigeria, due to their (public organizations') self-centeredness (Animasaun, 2010). Public organizations were efficient in their operations in their early days. This is unlike their present performance which is built on faulty perception and foundation (Duke, 2010) of parochial interest. Privatization infuses reforms needed in the public organizations to promote organizational effectiveness (Onwuka, 2010).

The interface between privatization and organizational effectiveness can be witnessed in the private-public partnership. The government plays its role by providing organizational subsidies, while the private sector compliments this by extending the organizational products/services to the targeted users (Adediji, 2010; Okonji, 2010; Ukaoha, 2010). Ironically, the role of the government in the privatization process in Nigeria is that of policy initiator, implementer, and partaker all at the same time. This tends to shroud privatization in secrecy and ambiguity (Abass, 2009; Adeniji, 2009), and limits the independence of the public organizations to experiment organizational effectiveness.

Privatization can be done fully (Iheme, 1997) or partially. In fully privatization, the entire ownership and control of public organizations are transferred to the private individuals (Falae, 1986; Nankani, 1990). On the other hand, partial privatization entails limited transfer of this ownership and control. An instance of total privatization is a total selling of public enterprise, while commercialization is an instance of partial privatization. In commercialization, public organizations are reorganized in such ways as to maximize profits through commercial activities (Oyesola, 2010). Profit maximization is only one out of the many qualities of an effective organization.

McShane and Von Glinow (2003) identified six elements of an effective organization. They are the reward systems, open communication systems, safe physical space, enhancing organizational environment, well coordinated organizational structure, and stimulating organizational leadership. Likert (1961) and Pelz (1952) similarly identified organizational leadership that is characterized by supportive relationship as influencing organizational effectiveness positively. Many public organizations in Nigeria experience poor work ethics and low productivity (Uhuo, 2010), nonpayment of salaries (Olayinka, 2010), and neglect (Talba, 2010), which are indicators of the organizational ineffectiveness. Privatization is therefore perceived as the needed organizational change strategy for personnel development and organizational effectiveness (Animasaun, 2010) of the public organizations.

Privatization promotes organizational productivity (Ebe, 2009), which a major organizational effectiveness value envisaged for public organizations (Adeloye, 2010; Uchehara, 2008) in Nigeria. Privatization introduces organizational attitude of accountability, information flow (Ekhater, 2010; Taiwo, 2010), and responsibility (Usman, 2003) in the management of public organizations. Through this, privatization enhances organizational leadership that focuses on achieving organizational goals. Organizations that are able to adjust and cope with competition are effective organizations (UNCTAD, 1995). Effective organizations are also very sensitive to the environment. Privatization sensitizes public organizations to competition, their environment, and wealth-creation strategies (Ndiyo, 2010). Privatization enhances organizational effectiveness elements like customers care, productivity, and improvements in the corporate social responsibilities (Olajide, 2010), products and services (Gibson, 1997; Osuagwu, 2010; Salako, 2010).

Poor corporate governance, and lack of effective risk management practices (Moghalu, 2010), as well as corruption (World Bank, 2003; Olaoye, 2010) are some inhibitors to organizational effectiveness of the public organizations. Privatization is usually associated with prudence and effective risk managements, so as to satisfy its relevant constituencies like shareholders. Organization is considered effective when it is able to satisfy its constituencies (Cameron, & Whetten1981; Human Synergistics, 2010). Organizations ineffectiveness in public organizations manifests in losses, budgetary burden, redundancies, "ghost workers", poor products and services (Etukudo, 2009), non-productive expansions (Bankole, 2010), and absence of transparency (Mkpume, 2010). Privatized organizations adopt strategic intent and effective risk management (Ogbonna, and Knight, 2010). Privatized organizations tend to be more flexible, pragmatic, and adaptive to volatile business environment (Animasaun, 2010; Ogunbanjo, 1983). These performances promote organizational effectiveness.

As some people oppose privatization, many of the challenges of privatized organizations are already being practiced in Nigeria. Some of the challenges include removal of subside on some public organizations’ goods/services, reduction in expenditure on public organizations, removal of protectionism on public organizations, as well as tight control of credit and lending opportunities (Borodo, 2010). An effective organization is the one that can withstand the dynamics of business (Adulugba, 2010), and not the one that is heavily protected by the government’s interests (Imoke, 2010) and regulatory agencies (Adesina, 2010; Ndukwe, 2010; Onwuemenyi, 2010). Organizational effectiveness arises when an organization is able to sustain its growth, development and achievement. A major goal of privatization is for the public organizations to attain organizational effectiveness of self-sustenance.

Privatization facilitates organizational effectiveness through strategic growth and achievements (Shankar, Malik, & Dangote, 2010). Through this, organizational effectiveness is achieved in the areas of optimum productivity, enhanced operations, and increased cash flow. Privatization also enhances organizational effectiveness through disclosure, effective monitoring, and supervision (Oni, 2010). Protectionism results in immature organizations that are unable to achieve results (Fischer & Reissen, 1993). Protectionism also leads to managerial failure (Gibson, & Tsakaloto, 1996), fraudulent financial deals (Ajiboala., 2009; Akyuz & Kotte, 1991). Privatization increases organizations’ savings system that yields interest in the short or long run (Akyuz, 1993; Bethelemy, 1996). Through this, privatization helps to sustain organizational effectiveness.

Information management helps tremendously in achieving organizational effectiveness. Privatization helps in effective information and knowledge management, in the management of human resource, and maximization of profits (Ilesanmi, 2010), as well as financial literacy (Smith, 2010). Management and resources requirements in public organizations are very expensive (Obasanjo, 1999; Onwuemenyi, 2010). Yet, organizational effectiveness from such huge in-take of resource is not impressive (Babalola, 2010; Ozumba, 1999) for public organizations. The major objectives for privatizing public organizations are to restructure them for productivity, improved performance, viability, efficiency, and overall organizational effectiveness. This will enable them create more jobs, acquire new knowledge and technology, as well as become self-sustainable (Bureau of Public Enterprises, BPE, 2000). Privatized organizations are more entrepreneurial in the areas of intuitiveness, creativity, and rational decision-making (Khatri, 2000). These make privatized organizations to have work systems that enhance wealth-creation (Nwankwo, 2008).

Privatization helps to minimize the endemic political interferences (World Bank Research, 1995) that are usually the prevailing organizational problems of public organizations. Incessant political interferences, distorted and inflated budgetary proposals affect organizational effectiveness of public organizations (Lal, 1983). Firm management of resources in the public enterprises tends to be problematic due to the dual responsibility witnessed in the public companies. The decisions taken by the board of directors usually take a long period to be approved by the Minister, if at all they get approved. It is the norm for the Minister to dictate every aspect of the public organization, even where this conduct deviates from the Minister's duty. These are among the numerous internal problems of the public organizations that hamper organizations effectiveness which need to be tackled (Mazou, 2010) through privatization.

Privatization promotes organizational effectiveness of financial prudence (Mosley and Week, 1993) and partnering (Singh, 1995). Even the prices of the basic needs and standard of living are moderated through privatization (Agada, 1998; Hosakins, 1991). Hence, the perceptions that privatization leads to organizational exploitation and adverse to the poor are erroneous (Omeata, 2003). Privatization also stimulates organizational social responsibility which hitherto has been discharged by the government (Eleweke, 2010; Nya-Elok, 2010). Ability to discharge social responsibility is one of the indicators of organizational effectiveness.

One of the objectives of privatization is to promote organizational effectiveness through the adoption of new technology, production processes, and organizational growth (Kalu, 1999). Through Privatization, organizational effectiveness is compared and improved according to the approved standard elsewhere. Critics of privatization however often argue that it has not enhanced organizational effectiveness in private organizations better than the public ones (Ola, 2000). In response, Ejiofor and Ekezie (2000) observed that one major problem with public organizations is that they are owned by the government. These organizations are overprotected, and are not exposed to the stiff competitions that characterize organizational effectiveness. Privatization of public organizations is a way of infusing the much needed organizational effectiveness in them (Anaeto, 1999; Ani, 1997).

Effects of privatization on organizational effectiveness manifest in various dimensions. Privatization reduces redundancy as it eliminates the continuous struggle to work in the Federal Government establishments (Atiku, 1999). Again, privatization can be used to revive public organizations that are moribund (Elechi, 2010; Okigbo, 2000). Privatization liberates organizations to adapt to changes and business environment timely (Vernon-Wortzel, & Wortzel, 1989). Privatization reduces the “thin-god” attitude and alienation associated with public organizations (Business Times, 2003), which affect their organizational effectiveness. Mismanagement, corruption and nepotism affect the organizational effectiveness of public organizations. Consequently, frustrating services are provided by public organizations which adversely affect the organizational effectiveness of other organizations that depend heavily on the services of the public organizations (Bureau of Public Enterprises, "BPE", 2000).

Privatization promotes organizational effectiveness through performance accountability and profitability (Baumol, 1980; Berg, 1990; Brett, 1988; Cook & Kirkpatrick, 1988; Jackson & Palmer, 1988; Lesser, 1991; Mansoor, 1988; Obadofin, 2003). It is erroneous that privatization leads to staff dehumanization. Well developed human resources are too indispensable for the survival of private organizations (Mohammed 2001). Privatization of public organizations is a major remedy to many factors that retards organizational effectiveness. Such as workers’ poor attitudes to work, lateness to work, loitering, closing before time, bribery, and outright failures or refusal to do official duties (Akpan, 2000), as well as embezzlement (Okoye, 1999). In privatized organizations, employees are charged to set up, since organizational effectiveness is enhanced through hard-work and ethical standards, improved the revenue base and customers patronage of any organization (Eyo, 2002). Individuals that own an organization are seen as being more meticulous and committed in running the organization, since they do not want their investments and ingenuity to collapse.

Public organizations in Nigeria are characterized by too many psychosocial problems like prejudice, stereotype, discrimination, and ethnicity (Burns, and Gimpel 2000). There is also a serious structural adjustment problem in Nigerian public organizations (Aylen, 1987; Bienen, & Waterbury, 1989; IMF, 1986; World Bank 1981, 1983), which is not in accordance with organizational effectiveness trends. Public organizations in Nigeria lack the autonomy to venture and experiment along the path-goal of organizational effectiveness. Logically, if countries A, B, C have large private sector, and have experienced relative organizational effectiveness, then privatization is believed to be responsible for these (Hughes, 1982; Wilson, 1986).

STATEMENT OF THE PROBLEM

This study investigates the effects of privatization on organizational effectiveness in Nigeria. As the world experiences globalization, protectionism turns from an advantage to disadvantage for public organizations. Public organizations are not owned by anybody in particular. So people may assume that there is no need of involving self-sacrifice in public organizations (Okoye, 1999). This affects the organizational effectiveness of public organizations. There is poor service delivery in many Nigerian public organizations that their privatization is considered inevitable to restore their organizational effectiveness (Elechi, 2010; Iliya, 2010). It is also believed that the government, especially the politicians, who are in charge of the public organizations that render these public organizations very impotent (unable to produce result). There is also the perception that public organizations are still important in the lives of Nigerians (Buhari, 2010). The government still has its welfare responsibilities to discharge through public organizations.

Oppositions to the privatization agenda are based on the rationalization that it is an imposition by foreign powers for economic (Baumol, 1980; Hanke, 1987; Lesser, 1991, Van de Walle, 1986), and political benefits (Brett, 1988, Sandbrook, 1988). Another school of thought emphasizes that morbid organizational ineffectiveness, inefficiency and corruption culture of public organizations (Iliya, 2010) necessitate their privatization. The poor services/products delivery of many public organizations is intolerable. There have been mass protests against and for privatization of the public organizations in Nigeria. Even the Nigerian Labour Congress is against the privatization of public organizations for fear of its adverse implications on the workers (NLC, 2010), such as retrenchment.

Mass actions for and against privatization are influenced by subjective perceptions. This study is therefore crucial in order to investigate the effects of privatization on organizational effectiveness. Rigidity of control and determinism influence of the government in the performance of public organizations in Nigeria are at variance with organizational effectiveness models. These models are enshrined in competitiveness, change, adaptation, and sensitivity to experiment success.

RESEARCH QUESTIONS

The following research questions served as the guiding tenets for the study.

1. Will organizational effectiveness in Nigeria be enhanced by organizations’
privatization status?
2. What is the extent to which privatization status significantly influences the achieved macro areas of organizational effectiveness?
3. Are the organizational effectiveness elements of “Coordination and Adaptability” significantly influenced by privatization status?
4. Does privatization status significantly influence the achieved organizational elements of “Quality of Service”?
5. To what extent does privatization status influence organizations’ ability to overcome adverse work characteristics of “Employee Outcomes-Negative Indices”?
6. Is there any significant influence of privatization status in promoting organizational effectiveness facilitators arising from “Employee Outcomes-Positive Indices”?
7. Does privatization status significantly influence organizations’ efficient applications of the models of pursuing organizational efficiency?

PURPOSE/AIMS OF THE STUDY

Privatization of public organizations in Nigeria seems rather too technical to understand by many people, even among the educated ones. Among those who do understand it, the programme seems commendable. Others tend to attribute corruption with it (Olaoye, 2010). With this backdrop, this study therefore specifically focuses on investigating the effects of privatization on organizational effectiveness in Nigerian. The study will help determine which aspects of organizational effectiveness are affected for better or worse by privatization.

Again through the study, it will be clear whether privatized organizations perform better than public organizations. It is again one of the cardinal objectives of the study to investigate areas of organizational performance where organizational effectiveness is lacking for the fully privately-owned, commercialized, and fully State-owned organizations. The study will also be a veritable source of knowledge in determining whether privatization is a lever for change for Nigerian public organizations' poor performance culture. Through the study, an insight will be built on the areas of organizational effectiveness that can be sustained or improved upon. Finally, the study is to be used to compare organizational effectiveness for the three categories of organizations namely the fully privately-owned organization, commercialized (partially-privatized organization), and fully State-owned organizations.

SCOPE OF THE STUDY

The study is about the effects of privatization on organizational effectiveness. Three types of organizations are studied. They are the fully privately-owned, commercialized (partially privatized organization), and fully State-owned organizations. All are Nigerian organizations from the Utility industry (the broadcasting organizations).

SIGNIFICANCE/RELEVANCE OF THE STUDY

This study is very relevant for the following reasons:

1. Undoubtedly, empirical psychological studies on privatization in Nigerian context seem very scanty. It is even inconceivable that Psychology can venture into studying privatization. If it does, how is it going to do that, or come out with credible results? This study is a worthwhile effort toward contributing psychological paradigms to privatization, by exploring the effects of privatization on organizational effectiveness.

Most studies on privatization are done from the economic perspectives (Baumol, 1980; Borodo, 2010; Hanke, 1987 Lesser, 1991, Van de Walle, 1986), and political perspectives (Brett, 1988; Sandbrook, 1988). This study therefore considers it relevant exploring the psychology dimensions of privatization through its influence in achieving organizational effectiveness in Nigeria.

2. The study is very relevant for it is crucially timely. Many of the Nigeria’s public organizations are presently being privatized. The cardinal goal of privatization is to infuse organizational change that brings about organizational effectiveness. Therefore, this study will be a significant source of psychological knowledge on privatization and organizational effectiveness. Privatized organizations in Nigeria will find the results (findings) of the study as invaluable source of knowledge in coping with the challenges of attaining organizational effectiveness. Organizational elements that influence organizational effectiveness in fully-privatized, partially-privatized, and fully State-owned organizations will be understood from the study.

3. The relevance of the study also lies in the fact that it will determine which aspects of an organizational effectiveness are affected for better or worse by privatization. Such knowledge will make adjustments to privatization easier. The study will bring into focus tested knowledge that will assist avoid organizational and policy failure. Some previous policies of the Government like the Structural Adjustment Programme (SAP), and Austerity Measure could have failed because they might not have been tested on seasoned psychology paradigms that influence behaviour. The findings of this study will help avoid such a failure with privatization.

4. The findings of the study will give the policy makers and implementers of the privatization programme insights on which privatization status to adopt. This is as regards whether Nigeria should embrace full privatization or partial privatization (commercialization). Protectionism on the Nigeria's public organizations cannot be sustained for too long. Organizational element like competition, globalization, volatile business environment, and market determinism exert attrition on the Nigeria's public organizations. This makes change inevitable for the Nigeria's public organizations. As privatization is a typical instance of that deliberate change, the findings of this study will serve as guides on the privatization.

CHAPTER TWO

THEORITICAL REVIEW

This entails an examination of the requisite theoretical and empirical knowledge on organizational effectiveness and privatization.

BACKGROUND PSYCHOLOGICAL THEORIES OF THE CONCEPTS OF PRIVATIZATION, AND ORGANIZATIONAL EFFECTIVENESS

Psycho-organizational theories serve two basic functions or uses. They serve Prescriptive, and Heuristic functions (Saal, and Knight, 1995). For the prescriptive functions, psycho-organizational theories can be used to suggest how an organization should be structured or changed. This is to improve the performance status of the organization. Thus, the prescriptive function of psycho-organizational theories therefore finds its relevance in the on-going privatization in Nigeria. Essentially, privatization and organizational change are two sides of the same coin. Heuristic function of psycho-organizational theories entails that such theories can be used to suggest how organizations should be studied. The heuristic perspective is concerned with the examination and appraisal (researches) of the organizations performance modalities, and suggests ways of implementing the findings or other relevant options. Examinations of the poor performance of public organizations in Nigeria have necessitated the suggestions for their privatization.

Katz And Kahn's Open Systems Theory Supporting Privatization

Generally, the open system theory of organizations emphasizes that enterprises are carried out in a dynamic environment (Katz, and Kahn, 1978). By implications, organizations should exhibit pragmatic, flexible, and adaptive personality qualities, so as to make the requisite adjustments and cope with the inevitable changes that can occur in the business or operating environment. (Obi 2008).

Privatization is undoubtedly a socio-organizational change. The privatization programme is synonymous with the business operating environment notion of the Katz and Kahn's Open Systems Theory (Katz, and Kahn, 1978). Elements of privatized socio-business environment like competition, risk management, cost management, profit-motive, customers' care, effectiveness, strive for success, and exploitation are also elements of an open system. These elements are natural inclinations of any system that is a going concern (continues to be in existence). Strive for private ventures and self-fulfillment are also natural inclinations. The open system encourages venturesome which is the hallmark of privatization.

Huge resources are invested into the public ventures as inputs (Onwuemenyi, 2010). Ironically, the public sector is not efficient in utilizing these resources to achieve effective performance. Even the Government contributes towards making business difficult (Mike, 2010). It is therefore the belief that large private sector should be promoted, since privatization which promotes large private enterprises is responsible for countries' organizational success and development (Hughes, 1982).

Comparisons between the public and the private sectors show that the private sector is more sensitive to business dynamics. Public organizations enjoy too much protectionism form the Government. That is why there is a serious structural adjustment difficulty in the public organizations (World Bank, 1981). The protectionism inhibits the public organizations from experiencing competition and business experimentations that help in growth. Many public organizations in Nigeria have experienced entropy (the tendency for systems to “run down” and eventually die) (Buhari, 2010; Elechi, 2010), that their privatization is one major and plausible option to revive them.

Wrong information inputs are made available to the public organizations through distorted and inflated budgetary proposal (Lal, 1983). Public organizations’ responsiveness to changes and challenges are very slow. This is an adjustment problem (Aylen, 1987) caused by lack of interest and commitment to the changes that affect public organizations. On the other hand, private entrepreneurs, their organizations, and employees are very sensitive to changes that affect efficiency and success (Hanke, 1987). Public organizations in Nigeria are too fixated on division of labour as its structural system that efficiency is forgotten (Bienen, and Waterbury, 1989). Private enterprises structure and restructure their organizational system, so as to adjust and adapt to emerging business trends and requirements. This responsiveness is very imperative to the private sector so that private enterprises can adopt the business strategies that are necessary in achieving success. The private sector experiences less bureaucratic interference that it tends to be more efficient, and effective in pursuing goals (Marsden, 1986).

In due course, the attrition of the open system will wear down the protectionism advantage of the public organizations. Consequently, the public organizations will be exposed to the forces of the open business environment that are privatization characterized. Privatization of the public organizations in Nigeria is therefore a credible policy of improving the performance expectations of the public sector. Truly, organizations always dread new entrants and substitutes in the industry (Uchehara, 2008). However, the public organizations need to be privatized immediately because in the open systems, the entrance of the private sector into the industry occupied by the public sector is just a matter of time.

Classic Theory Of Organizational Effectiveness

Classic theory emerged as a response to the changes in business organizations that resulted from the Industrial Revolution. The industrial revolution made business to grow larger that the practice of managing family-owned business could no longer be applied in managing large manufacturing processes and corporations. The transition from the managerial practices of the family-owned business to that of the large corporations created organizational chaos. On seeing the typical organization of his day as being a chaotic place to work, Weber (1947) developed the classic theory of organization, from which Bureaucracy as its sub-theory of the organizational theory emerged, as a way of guiding towards effective and efficient organization performance. Actually, the theory of bureaucracy was postulated based on the need for job assignments, promotion, discipline, power and authority that would help in focusing organization towards effective goal attainments. The principles of the theory of bureaucracy were in no way intended for the bureaucratic bottleneck, and stagnation (Benyon, 1984), corrupt and negative connotations of large, impersonal, and wasteful organizations of today.

There is no doubt that organizational effectiveness arises when an organization ensures that all machineries for excellence are in place for quality and efficient service delivery to all the interest groups in the organization (Oshadiya, 2010). Ironically, bureaucracy is not the cause of the organizational ineffectiveness, but the negative attributes and corrupt applications of bureaucracy are the causes (Iliya, 2010).

Basically, public organizations in Nigeria are characterized by large span of control. This is caused by the creation of numerous departments in the public sector, and this increases the challenges of using the available resources to sustain the survival of the system (Osagie, 2010). In circumstances like this, organizational efficiency and effectiveness could be compromised. Efficient cost and risk managements usually compel the private sector to maintain smaller span of control. This helps the private sector to strive to achieve effective monitoring and supervision processes that lead to organizational effectiveness in tasks completion, service delivery, achieving organizational goals and objectives, as well as customers' care.

The Nigerian public organizations are characterized by complex structures, which lead to duplication of responsibilities, and role rivalry and frictions (Ibiyemi, 2010). In Nigeria, public organizations adopt what Feldman (1981) called a system that maintains balance of power. Psychosocial strategies like "Disadvantaged Area", “Federal Character", and "Quota System" policies, which Nigeria uses in injecting the people into the public sector show the prevalence of the hybrid structure in the Nigerian public organizations. By implication, jobs can be redesigns, organizational hierarchy and span of control reformulated (Ibiyemi, 2010), Ministries multiplied, organizations established, and the public sector departments increased (Osagie, 2010) as Nigeria wishes to accommodate personal, parochial, and socio-cultural interests.

In long organizational structures of the public sector there is a barrier that militates against the theory of supportive relationship. In such circumstance, organizational information is not shared, and mutual assistance is not rendered (Eze, Agoda, & Maduekwe 2010). Consequently, organizational effectiveness reduces drastically.

Equity/Exchange Theory Supporting Public Organizations

Equity/Exchange theory is based on individual's perceived inputs, or what they believe are their contributions to their jobs or organizations; as well as their perceived outcomes, or what they acknowledge their jobs or organization provides them in return. This makes equity/exchange theory a cognitive-balance theory of organization. Trading inputs for outputs gives equity theory the name exchange theory (Adams, 1965).

The Government (the State) is an institution that is expected to take care of everybody. A social contract exists between the State and the people, in which the State represents and seeks collective good of the people as opposed to selfish interest of all (Nwoye, 2002). It (the Government/the State) strives to live up to this responsibility through the provision of public enterprises. These public organizations are assigned their requisite tasks of discharging these responsibilities expected from the Government (the State). Public organizations are wealth jointly owned by the entire population (Daniel, 2010). Therefore, it is expected that the public organizations should provide effective and efficient service delivery to the people in return, no matter where they live. This is unlike private organizations that are established where it is only profit motivated (Ukaoha, 2010). It is not surprising for the citizens to protest when such impressive and expected performance are not received from the public organizations (Njoku, 2010).

It is in compliance with this equity requirement that the public organizations are established to reach the remote areas of the country, where the private sector ignores. Failure of the public enterprises to render the required duties becomes a compelling factor for their criticism and privatization suggestions. In the event of privatization, quality of services rendered to customers would determine their patronage to organizations (Albertville, 2010).

It is believed that only the Government (the State) can embark on capital-intensive public enterprises (Onwuemenyi, 2010). There is Social Contract theory propounded by Jean-Jacques Rousseau (1712-1778) that justifies the establishment of public organizations. The philosophy of the theory enables the Government to fulfill its own part of the contractual obligations to the people. It is the idea of the theory that individuals (the people) have formed a "General Will" that the interest of the community should be paramount. And that private interest should not run contrary to this "general will". Consequently, the "general will" represents the collective good of all as opposed to the selfish or private interests of some (Rousseau, 1776). Public organizations are therefore created and used to reach the people equitably. Despite the encroachment of privatization on the welfare roles of public organizations, the Government is still perceived as being under the public good contractual obligations (Obilo, 2010; Otop, 2010). Thus, Section 16(a and b) of the Nigerian 1999 Constitution provides that the State (Government) shall harness the resources of the nation and promote national prosperity and an efficient, a dynamic and self-reliant economy. This gives credence to the establishment of public organizations.

Ouchi (1981) in his Theory Z emphasized that effective human relations in the organization are the bases for the attainment of organizational effectiveness. This is supported by the observation of Aliero (2009) that elements of the society interact in the pursuit of the economic development programmes. Unfortunately, it has been observed that there is a total absence of supportive relationship in the Nigerian public organizations (Ngige, 2008). Organizational effectiveness can still be achieved even with bureaucracy (Wall Street Journal, 1982). This is because organizational effectiveness is determined by the knowledge management efficacy and organizational culture prevailing in an enterprise (Amaeshi, 2008).

LITERATURE (EMPIRICAL) REVIEW

ATTRIBUTES OF PRIVATIZATION

Attributes of privatization reflect the dimensions the privatization manifests. Basically, privatization has three attributes. These are the economic and organizational attributes (Baumol, 1980; Hanke, 1987; Lesser, 1991; Van de Walle, 1986), as well as sociopolitical attributes (Brett, 1988, Sandbrook, 1988).

Economic Attributes Of Privatization

It is the view that privatization is an industrial scheme imposed on Africa, Nigeria inclusive, by International Monetary Fund (IMF) and World Bank often through devaluation processes. In Zambia, the interest rate of 30-33% makes it very difficult for domestic entrepreneurs to access credit, obtain bank loans, and access foreign exchange. Again, in a country like the Cote d'lvoire, the 40% tariffs reduction adversely affected the Ivorian shoe, textile, chemical, and automotive industries, as they could not cope with foreign competitions. The October 1980 devaluation of the Kenyan currency led to under utilization of resources, and borrowed fund could not be repaid (Adam. Cavendish, & Mistry, 1992).

Economic recovery in African depends so much on stimulus assistance from abroad. This makes African economic success/growth and general performance to be very fragile or at least very modest. Socioeconomic growth of 0.9% in 2009 to 4.6% in 2010 for the whole Africa (Bloomberg, 2010) is not encouraging. There is the need to stimulate export opportunities and investment partnership that aid private ventures. This fragile economy was well experienced in Mali, when the 14 Government-owned industries were hastily privatized. Unfortunately, the weak management of the privatized organizations inherited obsolete technology as well as inadequate working capital (World Bank Research Report, 1995).

Some public organizations operated at a profit during their early periods. In Nigeria, the Railway Corporation, the Electric Corporation of Nigeria, the Commodity Boards, and the Regional Marketing Boards all earned enough income which was reinvested in other socioeconomic ambitions. For instance, the Eastern Nigeria Marketing Board offered $5 million (5 million pounds) for the establishment of the University of Nigeria at Nsukka (Udoji, 1970). Public organizations in Nigeria then were very conscious of the fact that they were in business and the public was their customers. They were serving the public with dedication and commitment. They were also very profitable. This is contrary to the self-centeredness that kills organizational success (Animasaun, 2010), of the present Nigerian public of organizations.

In Tanzania, the Tanzanian Development Corporation initially had 60 subsidiaries that engaged in such industrial activities like manufacturing, agriculture, mining, commerce, construction, and services. The corporation invested about $4.5million (4.5 million pounds) in 31 projects in 1967. In Uganda, the Ugandan Development Corporation in the same 1967 had a turn-over of $22 million (22 million pounds) with investments of $5 million (5 million pounds) in 7 projects. Kenya in the same vein in 1970s had its State-owned banks gingered up socio-economic/industrial growth, through the establishment of non-banks financial institutions and rural banking (Udoji, 1970). These show that on inception, the public organizations had performance effectiveness. Consequently, their present very poor performance demands a strategy that is adaptive to the contemporary industrial effectiveness, which is envisaged in their privatization. This is bearing in mind that the private entrepreneurs are capable of managing and competing with State-owned organizations to a profitable performance (Shofolu, 2010). That is why the capital market is a critical institution for a nation's privatization success (Oteh, 2010).

The viability of the Lusaka Stock Exchange (LUSE) was mad possible by the market turnover that increased from the $300,000 it averaged in 1994-1995 to $2.6 billion. This huge success lured foreign investors tremendously in 1996. Hence, over 48 foreign investors invested over 40% in the Zambian sugar equity. The value of the investment in the industry was over $1.4 million. Foreigners accounted for over 90% investors in Zambian capital market business in 1996, in which the value of the trades was estimated to $2.4 million (Etukudo 2009). This shows that both the capital market and privatization have mutual enhancing effects on each other.

Comparative analyses of stock market performance as stimulated by privatization policies from 1980-1989 for various developing countries are highlighted bellow. Malaysia had the largest private investments in the listed companies from 50.6% in 1980 to 106.3% in 1989. For Jamaica, it was from 2.0% in 1989 to 24.6% in 1989. Sri Lanka had 0.0% to 6.1%. Trinidad had 0.0% to 11.0%. Nigeria had 3.0% to 4.6% (Adam, Cavendish, & Mistry, 1992). The implications of the above are that the more a country has productive and effective privatized organizations in its socio-economy, the more they are listed in the capital market. Consequently, more investors are attracted to the market according to the companies of their interests. Hence, for socioeconomic/industrial development of Nigerian to be attained, there should be privatization and deregulation of the economy (Kuye, 2010).

Effectiveness in the privatization of public organizations is usually limited by the fact that purchasers do not pay the full prices of the assets they bought. This is known as Unconsummated Transactions (transactions whose processes have not bee completed). This was witnessed in Ghana between 1990-1994, in which only 34% was paid of C63.1 billion worth of gross sales of the equity and assets of the Government-owned organizations. Other countries like Burkina Faso, Guinea, Madagascar, Nigeria, and Uganda experience unconsummated transactions in their privatization programmes (Etukudo, 2009).

Across Africa, various economic activities formerly engaged in by the Government have been privatized since 1980-1995. The agricultural sector witnessed 127(11.0%) privatization activities through the following processes: Sale 96(10.7%), liquidation 19(11.8%), and diffused system 12(12.8%). Forestry also witnessed 2(0.28%) privatization activities through 1(0.1%) sales, 0(0%) liquidations, and 1(1.1%) diffused system. The fishing industry had 15(1.3%) through 15(1.7%) sales, 0(0%) liquidation, and 0(0%) diffused methods. Similarly, the trading sector experienced 66(5.7%) privatization activities from 47(5.3%) sales, 17(10.6%) liquidations, and 2(2.1%) diffused methods (Bennell, 1996).

On the part of the real estate, there were a total of 10(0.9%) privatization activities of 6(0.7%) were from sales methods, 3(1.9%) from liquidations methods, and 1(1.1%) from diffused systems or methods. There were also various 121(10.7%) socioeconomic activities that experienced privatization in the 1980-1995 through 72(8.0%) sales, 43(26.7%) liquidations, and 8(8.5%) diffused methods (Bennell, 1996). The above records show that privatization has been going on in many African countries for over 3 decades/30 years. Consequently, the present formalization of privatization policies ought not to induce anxiety among the citizens, since they have been living and coping with privatized socio-economy for several decades.

It is the observation of Vernon-Mortzel, and Wortzel (1989) that privatization is no longer a solution to the societal, economic and industrial problems of the public enterprises of the less developed countries (LDC).

Obviously, privatization in essence easily brings into cognition that the societal, economic and industrial development of any nation should embrace public and private entrepreneurship (Orji, 2010).

Removing the public sector from influencing the economy may not significantly contribute towards the growth of the already very poor economic situations of most sub-Saharan African (SSA) countries. The newly industrialized countries of South-East Asia attained economic success with the ruthless use of the States' interventions and subsidies, which were well designed to give international advantages to their home industries. Even the European Union countries and Japan subsidize and protect their industries and agriculture when the need arises. On the contrary, they educate African countries to lay bare their socioeconomic and industrial capacity to foreign and international invasion. Thus, the US Trade and Development Agency (USTDA) while granting $162,000 to the IHS Nigeria Plc, a telecommunications infrastructure provider, highlighted that "the USTDA advances economic development and US commercial interests in developing and middle-income countries" (Akwaja, 2010).

As the argument goes on that Africa has been de-industrialized under the IMF pressures, some schools of thought believe that the benefits of privatization are becoming very evident in Africa. They perceive privatization as a sure way of removing the unmerited patronage public organizations receive. One time chief executive of the Zambia Privatization Agency (ZPA) emphasized that privatization should not be only judged by the money received. Considerations should also be made to the capital investment made, jobs created, the transformation of the inefficient and subsidized companies into profit-making, and competitive businesses. Privatization in Zambia has also been observed to have resulted in exporting coffee and cotton. The export of cut flowers has also increased from $5million in 1991 to $54 million in 1996. On the part of Uganda, it is argued that her manufacturing sector has experienced improved capacity utilization under private sector management. This has also resulted in regular tax payments and revenue (Etukudo, 2009).

There is also demystification of the capital market that ordinary Nigerians no longer perceive it as exclusively meant for the elites, and the very wealthy population of the society (Etukudo, 2009). The Bureau of Public Enterprises (formerly known as Technical Committee for Privatization and Commercialization) when it stated functioning in 1989 witnessed about 15 stockbrokers in Nigeria. The number rose to about 53 in 1994. Presently, there are about 186 receiving agents or stockbrokers through whom dealings can be done in the Nigerian capital market (Fidelity, Bank, 2007).

Privatization has succeeded in reviving many of the Ghanaian enterprises to modernization and productive capacity. The ABC Brewery doubled its production between 1992 and 1995. The Ghana Agro-Food Company (GAFCO) employed more workers from 500 to 700 by July 1996. The Ghana Tropical Glass Company is rapidly becoming the leading producer of beer bottles in West Africa. Just like in Zimbabwe, the Grain Marketing Board came from a loss of more than $100 million to a profit of $21 million in 1995 (Etukudo, 2009). Ironically, the case of the Nigerian textile industry witnessed the opposite reviving effect and action that are not in consonance with privatization formula.

Instead of selling and allowing the forces of privatization to revive and bring about the development of the textile industry, the Nigerian Government has decided to be actively involved in resuscitating the moribund textile industry in Kaduna State, Nigeria. To put into action the Government's resolution, a total of N100 billion has been earmarked for the rehabilitation of the company, and N10 billion has already been given to the organization (Buhari, 2010). This goes to show that the Government cannot stand lamely and watch the manufacturing sector of the society deteriorate.

Organizational Attributes Of Privatization

In essence, privatization is a model of organizational change with the objective of stimulating organizational and industrial development. Such motivated development invariably often involves the entire organization. Employing too many but irrelevant human resources such as obtainable in Nigerian public organizations leads to high turnover. In 1913 Ford required about 13, 500 human resources to do work at one time, but in that year alone the turnover rate were more than 50,000 personnel (Benyon, 1984). This type of situation can be remedied through privatization, which curbs redundancy.

There are four broad classifications of public organizations in Nigeria (Ngige 2008). Firstly, there are regulatory agencies public organizations. Some of them are the Standard Organizations of Nigeria (SON), Nigeria Communication Commission (NCC), National Agency for Food and Drug Administration and Control (NAFDAC), and others. Secondly, there are welfare or service agencies public organizations. Instances of them are the Nigeria Postal Service (NIPOST), Nigeria Television Authority (NTA), Federal Radio Corporation of Nigeria (FRCN), and others. Thirdly, there are also commercial and industrial public organizations. Some of them are the Nigeria Port Authority (NPA), Nigerian Steel Authority, Power Holdings Corporation of Nigeria (PHCN), Nigerian National Petroleum Corporation (NNPC), and Nigerian Railway Corporation (NRC). The final classification is the State-owned limited liability companies. They include the National Insurance Corporation (NAICON), Nigeria Breweries PLC (NBL), Anambra Motor Manufacturing Corporation (ANAMCO), West African Distilling Company, various Government-owned transportation companies, and others (Olisa, 1980).

In Nigeria, a number of public organizations have been earmarked for full commercialization. Some of them are the National Insurance Corporation of Nigeria (NAICOM), Nigerian Port Authority (NPA), Nigerian Telecommunications Limited (NITEL), and others. On the other hand, the public organizations that are to undergo partial commercialization include the Nigerian Railway Corporation (NRC), Power Holding Company of Nigeria (PHCN), Nigerian Airport Authority (CAP), National Provident Fund (NAPF), and others. As it concerns the Nigerian Railway Corporation (NRC), there is a plan to breakup the corporation into four operational sub-organizations. These are the Nigerian Railway Plc, Nigerian Railway Engineering Ltd, and Nigerian Railway Track Authority, and Nigerian Railway Inspectorate Board. There is also an implementation committee that was inaugurated on 5 April 1993. It is known as Railway Restructuring Implementation Committee (RRIC), which was given 30 months to implement the partial commercialization reform packages. On the part of the Nigerian Telecommunications Ltd (NITEL), the first effort to give it a full commercialization almost revived the enterprises from its poor performance. It recorded a turnover of N6.3billion in 1993, with an after tax profit of N679 million approximately $8million (TCPC, 1995).

The huge success expected from the commercialization strategy has not been actualized. As a result, the Bureau of Public Enterprises (BPE) attributes the cause to the perverse political interference in the affairs of public organizations in Nigeria. This could be the reason why an effective regulatory body has not been established by the Government to administer the operations of the commercialized public organizations (SNES, 1995). Possibly, this could be the plausible reason why the banking industry in Nigeria tends to prefer outright privatization as a more effective economic reform strategy than commercialization and leasing (Business Times, 1997). Yet privatization programme that is not well articulated leads to inefficiency. This is a counterproductive action. It has been noted that about 75% of the fully commercialized or privatized organizations in Nigeria are not performing well. This is because the investors in these organizations have refused to comply with the laid down procedures. Suggestions are therefore being put forward to reacquire the organizations for fresh privatization (re-privatization), which had already been done with the Nigerian Telecommunication Plc (Nitel) (Anyawu, 2009).

However, the Nigerian Labour Congress (NLC) opposes deregulation on the basis that there are certain pre-deregulation preparations that must be carried out by the Government. These include rehabilitating the 4 refineries, the roads, and the railway. There should also be a reorganization of the Nigerian National Petroleum Company (NNPC), which bought over 120 filling stations nationwide, and has over 25 depots in Lagos State alone, and yet is very unable to attain 80% domestic production, or supply and 20% importation of petroleum products (Okougho, 2010).

Privatization across the African public organizations for over 3 decades/30 years has penetrated various State-owned enterprises. Within the period of 1980-1995, the mining industry had witnessed a total of 19(1.6%) privatizations activities through the processes of 13(1.5%) sales, 3(1.9%) liquidations, and 3(3.2%) diffused systems. The manufacturing organizations had witnessed 5.38(46.5%) privatizations through 466(52.1%) sales, 42(26.1%) liquidations, and 30(31.9%) diffused systems. On the part of the utilities enterprises, there had been 14(1.2%) privatization through the methods of 7(0.8%) sales, 1(0.6%) liquidations, and 6(6.3%) diffused methods. The construction industry also witnessed its own privatization activities with a total of 20(1.7%) privatization experiences from 1980-1995. Privatization of the construction industry occurred through the processes of sales 16(1.8%), liquidation 3(1.9%), and diffused methods 1(1.1%) (Bennell,1995). The foregoing analyses show clearly that privatization has become an inevitable and inherent aspect of developing African socio-economy/industry. Thus, various African leaders who initial rejected privatization ended up embracing its various aspects (Kuye, 2010).

Similarly, the recreational industries of hotels and tourism had 77(6.7%) privatization activities through 57(6.4%) sales, 3(1.9%) liquidation, and 17(18.0%) diffused methods. Across Africa, privatization had also witnessed 65(5.6%) in the transport and storage industries through 35(3.9%) sales, 17(10.6%) liquidation, and 13(13.8%) diffused systems. In the same vein, the financial enterprises had 54(4.7%) privatizations through 47(5.3%) sales, 7(4.3%) liquidation, and 0(0%) diffused methods. Many other service-oriented State regulated ventures had witnessed 20(1.7%) privatization activities through sales 17(1.9%), liquidation 3(1.9%), and diffused methods 0(0%). In general, 1980-1995 African development motivation has witnessed 1150(99.5%) privatization exercises that occurred through 895(100.2%) sales, 161(100.2%) liquidations, and 94(99.9%) diffused methods (Bennell, 1996). The mismanagement of many State-owned ventures has made it very compelling for the Government to adopt privatization policy as a way of ensuring the survival of the ventures. This is very necessary bearing in mind that the Government has failed to use committee strategy to restore transparency and accountability in the State-owned properties and ventures (Nwakaudu, 2010).

To ameliorate the adverse effects of adjustment to privatization exercise, as well as compensate those hardest hit, the Ghanaian PAMSCAD (Programme of Action to Mitigate the Social Costs of Adjustment) is to compensate for adjustment related to job losses by generating about 40,000 work opportunities. These are expected to be attained biennially through the application of credit for small-scale enterprises. The PAMSCAD also has a component known as the "basic needs" such as the primary health-care service. It is responsible for the provision of essential drugs linked to primary health-care, treating parasitic diseases of the school children and supplementary feeding (nutrition enhancement) (Weisman, 1990). All these agencies are designed to assist the members of the society who will be adversely disadvantaged by the privatization of the very essential public organizations. Bearing in mind that 93% of Nigeria are poor (Onele, 2008), privatization should therefore not be paid in the blood by sacrificing workers (Hasokins, 1991).

Inasmuch as privatization is characterized by fear of retrenchment, studies have shown that the degree of the employment loss is marginally low in Zambia from 1992 to 1994. This study was carried out on different types of industries. The industries with their respective percentages (%) in employment after privatization are highlighted as follow, bearing in mind that more staff were employed before the privatization exercise that after it. As regards Autocare, Chilanga Cement, Crushed Store Sales, Eagle Travel, General Pharmaceuticals, Indeco Milling, National Breweries, National Home Stores, and Poultry Processing, their respective employment percentage (%) changes due to the impact of privatization are -10.3%, -6.9%, -6.6%, -7.8%, -15.5%, -91.0%, -30.9%, n.a (not available), and 0.0% respectively (Bennell, 1996).

Other public enterprises that were used in the study with their corresponding indices of the impacts of privatization on employment are Prima Marble (-100.0%), Zambia Breweries (-54.5%), Zambia Engineering and Construction (-88.7%), Zambia Mailings (-88.8%), Zambia National Wholesale (n.a.), and Zambia Sugar (-30.3%) as was reported by World Bank (1993), and Bennell (1996). The above statistics show truly that privatization has unemployment consequences irrespective of how minimal that may be. Hence, there is the need to have programmes or schemes that can be used to ameliorate the situations of the laid-off staff.

The United Bank for Africa (UBA) has initiated staff rehabilitation loan schemes with which it assists its laid-off staff to embark on private small-scale engagements (Sunday Times, 1997). These show that privatization is not a socioeconomic programme that is devoid of human compassion and understanding as well as appreciation, in which workers are treated as tools to be "used and dropped".

Very few workers can accept retrenchment even when they have nothing to do in the public employment, or even when their public employments give them job dissatisfaction. Hence, the Government occasionally comes up with policies that may be beneficial to the workers. For instance, the Nigerian Government has earmarked N20 billion for the federal workers life insurance (Anule, 2010). This type of employment policy entices workers to subvert retrenchment policies. The Government is therefore requested to include the labour unions in the high-powered committees to examine the options available to the Government before further privatization exercise (Singh, 1995).

The privatization should not be politicized because it is the most effective commencement point for the development ambitions of Nigeria to attract foreign and domestic investments (Daily Times. 1997). Unfortunately, a critical appraisal of some public organizations that are undergoing privatization in Nigeria shows that no standard procedures are followed. This had manifested in the scandal that followed the aborted sale of the Nigerian Airways to the United Kingdom's Airwing. The latter company had no solid capital base, nor the required experience that qualified it to take over the former (Igbuzor, 2003). Critical observers have however noted with this that the Nigerian Government is at the cross-road on how to restore performance efficiency in Nigerian public sector (Omotoba, 2010).

Again, the privatization of some public organizations in Nigeria is shrouded in secrecy, lack of transparency, and confusion. When the Bureau of Public Enterprise (BPE) opened a public bid (Okwe, 2010) for the sale of NITEL, and Mtel, a telecommunication consortium known as the New Generations Telecommunications Limited emerged the preferred bidder with $2.5 billion (Mkpuma, 2010). It is being alleged that a crisis of confidence threatens the unity of this consortium, as some of the partners are warning of backing out of the privatization deal (Mkpuma, 2010). This is a potent case of inefficiency in the privatization process. It is paradoxical to the efficiency goal being propagated as one of the main objectives for embarking on the privatization exercise.

Inconsistency and hypocrisy seem to be one of the major features of the Nigerian privatization agenda. The government privatizes public enterprises, yet it simultaneously invests and builds both the new and old public enterprises. Typical instances of this Nigerian Government's unreliable position on privatization manifest clearly in the cases of Ajaokuta Steel Company, and Railways. Even the Delta State Government, in Nigeria, announced the purchase of African Timber and Plywood (A.T. and P.) Sapele. Just like the Osun State Government in Nigeria, also announced that it would start the production of drugs (Igbuzor, 2003). Again, the Nigerian Government is making sustained efforts to resuscitate the Kaduna Textile factories (Buhari, 2010).

Socio-Political Attributes Of Privatization

The motive and value system attached to public organizations by various African countries influence the perceptual attributions made to the privatization. Workers in Tanzania sued their Parastatal Sector Reform Commission to the Court during 1994 and 1995 concerning the sale of four large Government-owned organizations.

Again, in Mozambique, workers strongly and regularly resist the Government's sale of some the State-owned enterprises. In Sierra Leone, there is an opposition to privatization by the citizens who labeled public enterprises "Our Own". In Swaziland, Government-owned industries are qualified as belonging to "Every Swazi Born and Unborn". The Ghanaian Trade Union Congress also tends to emphasize that the public service belongs to he citizens, while private service belongs to them. Thus, effort should be made to protect the public service from the private greed. With the same mind-set and disposition, the Nigerian labour congress opposes privatization by emphasizing that "Nigeria is not for sale" (African Report, 1986; Sonko, 1994; Tangri, 1991). The training of 11, 1 00 Nigerian workers by the Government (Nwezeh, 2010) shows the relevance of the State in industrial policy.

Privatization is basically a policy that is at variance with the developmental theory of the 1940s and 1960s, when the Government was the engine of socio-economic/industrial characteristics. During the industrial development of Kenya in 1955, there were 246 new business organizations owned by the Europeans with a nominal capital base of $8.9million. There were also 99 business organizations owned by the Asians with a nominal capital base of $250 million. The Kenyan Government therefore considered it very imperative to establish some parastatal to execute the indigenization policy (Eckert, 1987).

[...]

• Course: PSYCHOLOGY
• Author: Okechukwu Dominic Nwankwo (Author)
• Publication Year: 2016
• Pages: 219
• Catalog Number: V343449
• ISBN (eBook): 9783668336605
• ISBN (Book): 9783668336612
• Language: English
• Tags: effects, psychological