"We are endeavouring to minimise the impact of these changes and are starting the consultation process with potentially affected staff."
The institute currently employs more than 1400 staff to serve almost 32,000 students across the country.
Mr Mather said the changes were a part of the second phase of the redesign - Te Raumairanga - which aims to further enhance the structure and systems at the institute.
"We are making these changes to strengthen the wananga and provide more effective leadership to achieve high quality educational opportunities and outcomes for the thousands of students who come through our doors each year."
Mr Mather said the former business model was "overly complex and unsustainable in the long term.
"These changes will see the organisation better placed to provide an excellent educational experience."
The merger to three districts would not affect the ability of the institute in providing its programmes from certificate level to Masters, Mr Mather said.
Te Wananga o Aotearoa is the country's second largest tertiary institution and the largest Maori organisation in New Zealand.
