A hydraulic system includes an engine; at least one hydraulic pump operatively coupled to the engine for transfer of mechanical power therebetween; and a controller operatively coupled to the engine and the at least one hydraulic pump. The controller is configured to determine a lug speed error as a difference between a target lug speed value and a speed of the engine, set at least one closed-loop gain to zero when the speed of the engine is greater than or equal to the target lug speed value, set the at least one closed-loop gain to a non-zero value when the speed of the engine is less than the target lug speed value, generate a pump control signal by scaling the lug speed error by the at least one closed-loop gain.