Purpose – Effective engineering asset management is essential in delivering public services safely whilst avoiding breakdowns and accidents. The purpose of this paper is to ensure asset safety and sustainability, public sector firms have to adopt new processes and practices. It is the role of supervisors to implement the changes, and as part of the new public management (NPM) public sector reforms, public sector asset managers have more discretionary power to implement further changes related to increased accountability.

Design/methodology/approach – The paper explores the impact of management practices on supervisor-employee relationships and employees’ perception of autonomy, employees’ attitudes towards change and their perceptions of organisational culture within Australian public sector engineering asset management organisations, and in the context of NPM reforms and consequent changes in supervisory discretionary power. Social exchange theory provided the theoretical framework and a self-report survey was administered to 149 employees.

Findings – The findings from a structural equation model indicate positive and significant relationships between the variables in this study. A finding of significant interest was that public sector employees are on average slightly dissatisfied with their supervisors and feel they have a minimal amount of autonomy in the workplace. This may represent an unintended consequence of NPM reforms.

Research limitations/implications – The implication of the findings is that an effective relationship between supervisors and employees is a necessary ingredient for achieving change, and ensuring asset safety and sustainability. Social exchange theorists argue that the low level of satisfaction with the supervisors evident in this study is one factor compromising asset safety and sustainability.

Originality/value – The roadblocks to good supervisory relationships in the post NPM environment must be dismantled and the findings clearly indicate a need for targeted development of supervisors/management skills to ameliorate the negative effects of the NPM regime and enable effective change management.