Critical Review of Performance Management in Major PSUs & their Private Sector Peers

Abstract

Recently the Indian Government has initiated a new public sector policy wherein PSUs would co-exist with private companies in the strategic sector while non strategic sector PSU would be privatized. Hence, it is important to review the Performance Management policy of the PSUs in order to compete with their private sector peers, motivate staff to perform better and also enable them to retain their exceptional talent. This will stop the talent drain since currently they tend to migrate to their competitors in the same sector under private ownership owing to the fact that these companies have better policy and flexibility to do so. Even the Companies Act 2013 and DPE guidelines should be in line with each other so that the current differential between the two do not impede the level playing field between the PSU and their private sector peer. Hence, PSUs needs to have much better Policy and flexibility in this regard.