Enhancing performance through performance contracting - the Indian Government approach

Abstract

The Indian Government has taken numerous initiatives to ensure performance culture. Performance contracting (PC) in India is one such initiative of government. The Memorandum of Understanding (MoU) system is an age old PC process for central public sector enterprises (CPSEs) in India which underwent several modifications over the years and has ensured greater involvement of people with higher individual as well as organisational performance. Government of India has also introduced results framework document (RFD) which is another form of PC applicable to ministries and departments. Though MoU system and RFD system exists distinctly different yet, they are inter-related with regards to performance of India. The paper elaborates both the concept of MoU system and RFD process and its implementation in the India as a PC initiative and elaborates results framework management systems (RFMS) - MoU system which is a new online initiative of Indian Government. Secondary data is used to identify the relation between the MoU and organisational and sectoral performance.