Its successes demonstrate that it is possible to create high-performing public sector organisations

Rarely is an agency of the government of India associated with the development of cutting-edge technology and global standards in execution. The Indian Space Research Organisation (ISRO) is an exceptional case. In fact, by launching 104 satellites from a single rocket on Wednesday, it has now set the global standard in a field (or more accurately space) in which only a few nations even dare to dabble. But what is it about ISRO that makes it stand for excellence when a plethora of government agencies suffer from severe challenges in terms of capacity and execution? What makes ISRO tick could help show us the way to create other high-performing government organisations.

More autonomy

For a start, ISRO is fortunate that it reports to the Prime Minister and his office rather than a line ministry. This has been critical to its success. In line ministries, ministers and bureaucrats have a tendency to micromanage their turf, and this includes autonomous bodies, agencies and enterprises. More often than not, there will be a senior official along with a set of junior officials who have direct charge of supervising the affairs of an agency. The Prime Minister’s Office (PMO) works differently given that its remit cuts across all government departments. Its officials would certainly not have the time or the mindspace to supervise the affairs of a single institution. ISRO, therefore, has a real autonomy that most other government agencies do not.

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Location matters

The geographical location of the organisation also matters in terms of creating an appropriate ecosystem to nurture excellence. A number of critical government-run organisations and enterprises are either headquartered in Delhi (because it’s the seat of the Union Government) or are in places that have had some political salience to the ruling dispensation at the time they were set up. Neither scenario may be optimal from the point of view of an agency. Being located in Delhi will leave it particularly vulnerable to the diktats of the parent ministry and the slow-moving, cautious culture of an omnipresent bureaucracy. And a politically salient location outside Delhi may not have the ecosystem to feed knowledge creation and build capabilities. ISRO, headquartered in Bengaluru, is distant from Delhi and immune from the capital’s drawbacks. More importantly, it is located in the appropriate geography in what is India’s science and technology hub. It has the right ecosystem to attract talent and build its knowledge capabilities more than most government agencies do.

Needless to say, human capital is critical to the success of an organisation. Unlike many government agencies which are staffed by generalists, ISRO is staffed by specialists right from its technocratic top management. ISRO is also more agnostic than most government agencies about cooperating with and working with the best in the private sector. The building blocks of many of ISRO’s successes come from outside the government system.

Learning the right lessons from ISRO’s example is crucial for India. The conventional view is that the government is poor in project execution and if one looks at the state of infrastructure or of the quality of public services that is not an unreasonable conclusion to reach. What ISRO shows is that it is possible, indeed feasible, for the government to build high-performing organisations/agencies. This is not an argument for a big government. Instead, it is an argument for building top quality institutions in a limited number of areas where the government’s role cannot be substituted by the private sector. Cutting-edge research and development in spheres where there may not be ready profits is one area the government should focus on building ISRO-like institutions. Defence could be one such. A completely reformed Defence Research and Development Organisation based out of Pune or Bengaluru (not Delhi) which reports to the PMO and which actively collaborates with the private sector would be worth considering. Or a central vaccine agency, based in Ahmedabad or Pune, which focusses on solutions to under-researched diseases.

Of course, not every government organisation will be engaged in cutting-edge technology breakthroughs nor can every organisation report to the Prime Minister. Still, independence from line ministries is important for a high performing organisation.

The trouble is that it is not easy to change the nature of institutions by tinkering with them. There is a path dependency in the way institutions evolve. The creation of high performing government bodies requires starting from scratch and focussing on a few basics: real autonomy from ministries, right geographical location/appropriate ecosystem, a team of specialists, partnership with the private sector and operating only in spheres where there is no alternative to government. The creation of a handful of such agencies could have a transformative effect.

Dhiraj Nayyar is Officer on Special Duty and Head, Economics, Finance and Commerce, NITI Aayog. The views expressed are personal