Innovation capability and effectiveness in public sector organisations: knowledge-based performance management practices

Globalisation and advancements in technology have caused a radical shift in political and economic landscapes, forcing companies and business alliances to rethink strategies. In a highly competitive scenario, firms are increasingly investing in technology, software, data and artificial intelligence to enhance capabilities and gain competitive advantage. The purpose of this paper is to analyse how knowledge-based organisations perceive effectiveness through innovation and performance management practices. A total of 200 employees in the Indian public sector were surveyed. Hierarchical regression analysis and correlation analysis techniques were used to analyse data. Results show that performance management practices are antecedents of organisational effectiveness. Innovation offers organisations greater competence and advantage over rival companies in the public sector.