He said changing the leader was not going to help.
"This is a problem that goes to the core of the party.
"At the centre is the New Zealand [Labour Party] Council and the system of sector groups that push Labour to the far fringes of the left and plunge it into identity politics.
"Remember the 'man ban', any leader that takes on the job will have to contend with small-minded interest groups."
He said Labour should try to represent all New Zealanders.
"If it wants to represent only a minority, then it should expect a minority status.
"The election of independent minded leaders such as Kelvin Davis and Stuart Nash is a good thing - the fact they won against the odds is a sign of what voters want.
"Labour will need to scrap, or seriously reform the sector groups, and then return to middle New Zealand values - fairness, hard work and respect."