its a presentation about the general problems faced by Public Sector Undertakings in India..

1. A
PRESENTATION
ON
PROBLEMS FACED BY THE
PUBLIC SECTOR UNDERTAKINGS IN INDIA
SUBMITTED BY:
Kratika Dhoot
MBA 3RD SEM

2. AGENDA
1. What is Public Sector Enterprises?
2. What are the Problems faced by the Public
Sector Undertakings?
3. Conclusion

3. PUBLIC SECTOR
UNDERTAKINGS
Owned ; Managed and Controlled by the Govt.
Funded by the Govt.
Welfare Oriented
The public sector includes such services as
Police,
Military,
Public roads,
Public transit,
Primary education and
Healthcare for the poor

4. Problems Faced by PSUs
Under-utilization of installed capacity
Capacity utilization becomes an important criterion to judge the
performance of an enterprise.
But, in most of the cases, a major part of the installed capacity of
manufacturing units in the public sector remains unutilized.
Poor Planning & Delay in implementation of projects
Cost escalation was due to changes in the project sites some times
due to belated recognition of product mix that is unsuitable to
Indian Market conditions

5. Problems Faced by PSUs
Insufficient growth in productivity
•Productivity can be increased only if employee satisfaction level is
achieved.
•While in PSUs, this concept of satisfaction & Motivation is extinct
•Performance Appraisal is done only as annual recording of
character rolls
Overstaffing
•Recruitment is done in PSUs on daily basis & termination or
retirement rate is less.
•Hence, overstaffing causes conflicts & clashes which results in
hindrance to the growth of enterprises

6. Problems Faced by PSUs
Objectives & Role
•Perennial Problem for the policy makers to set the role of the public
sector in the Indian Economy & it would continue to be so
•Objectives of public sector have been defined & goals being set not
very systematically. Even at macro level have been mixed up with
number of propositions

7. Problems Faced by PSUs
Extent & Coverage
•Whether PSU should extent to wide variety of economic activities or to
be confined to a selected few only, is a very crucial decision
•The problem is consistently persisting in the Indian Polity
Organization & Management
•“Trial & Error “ ever since independence in the country.
•Initially, organized as departmental undertakings owing to their
simplicity of operations & management.
•The govt. burdens the governing board with the civil servants

8. Problems Faced by PSUs
Autonomy & Accountability
•Autonomy implies “FREEDOM TO ACT” & is related to “FREEDOM
IN INTERNAL MANAGEMENT”.
•In case of PSUs, it doesn’t imply full freedom to act as desired
•PSUs are accountable to Parliament through the concerned minister &
therefore can’t act freely

9. Conclusion
Thus, it is evident that PSUs were:
1. Incurring losses continuously due to the
presence of numerous financial & nonfinancial problems.
2. Policy Makers; Bureaucrats; managers & also
Researchers have not given due weightage &
importance

10. THANK YOU …