Turnaround Challenges of a State-owned Enterprise: A Case Study of Orissa Remote Sensing Application Centre, India

Orissa Remote Sensing Applications Centre (ORSAC), an autonomous technology organization established by the Government of Orissa, had grown tremendously; developing competencies in the fields of remote sensing, geographic information system (GIS) and space technology. Since ORSAC was established by the Government of Orissa, ORSAC’s relationship with the state, Department of Science (DoS), National Remote Sensing Agency (NRSA) and Space Application Centre (SAC) helped it to secure remote sensing and GIS projects effortlessly, thereby ensuring a steady revenue stream for ORSAC during the early days of its inception. Upon assuming the role of Chief Executive Officer (CEO), Amiya Kumar Mohapatra, an Indian Forest Service officer, realized that he was unable to bring desired changes within the organization. Low motivation amongst the employees prevented the organization from growing and winning large-scale projects. ORSAC faced stiff competition from private players and other government agencies in the ever-advancing remote sensing and GIS market in India. The CEO realized that dependence on the government for patronage and funding had had a detrimental impact on ORSAC. The organization was unable to recognize the need for developing competencies in marketing its products and services to users until it was too late, and it had already lost large-scale projects in the manufacturing industry to private players. However, an increase in the salary expenses and the salary shortfall in comparison with Department of Science and Technology funding was forcing ORSAC to sustain its operational expenses by securing more projects from the open market. The organization was facing diverse challenges ranging from high operating costs, especially salary expenses, to low productivity of employees, which were affecting ORSAC’s competitiveness negatively. Additionally, the organization faced a near-permanent recruitment ban by the state government preventing it from sourcing key competencies from the market to keep pace with the changing technologies and customer demands. Thus, this case study aims to present diverse challenges of a state-owned enterprise by highlighting internal factors such as structural, financial and human resource challenges, as well as external factors such as technological change and competition in the industry, which influences organizational competitiveness and makes organizational turnaround a difficult task.