29845973 Mahindra Case Study

7/31/2019 29845973 Mahindra Case Study

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xCase prepared by:-

xHarpreet singh wadhwa

xMba (g)

x2 sem

x Amity business school

[email protected]



The birth of Mahindra and Mahindra beganwhen K.C. Mahindra visited the United

States of America as Chairman of the Indiasupply mission. There he met:-

BARNEY ROOS ± Inventor of Jeep

Joined hands with Ghulam Mohammed.

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On 2nd October 945,Mahindra andMohammed was setup as a franchise for assembling jeeps from Willys,U.S.A.

After Independence renamed to Mahindra& Mahindra.

Total turnover of 6.7 billion dollars as of

2008.

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Initially setup to manufacture general purpose

utility vehicles, Mahindra and Mahindra wasfirst known for assembly of the iconic jeep inIndia.

The company later branched out intomanufacture of light commercial vehicles(LCVs) and agricultural tractors, rapidlygrowing from being a manufacturer of army

vehicles and tractors to an automobile major with a growing global market.

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³ INDIANS are second to none in theworld´

The founders of our nation and of our Company passionately believed this. Wewill prove them right by believing in

ourselves and by making Mahindra &Mahindra limited known world wide for thequality of its products and services.

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³ we don¶t have a group wise missionstatement. Our core purposes is whatmakes all of us want to get up and come to

work in the morning.

Our core values are influenced by our past, tempered by our present and will

shape our future.T

here are an amalgam of what have been, what we are and what wewant to be.

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TYPE : Conglomerate

FOUNDED : 945

HEADQUARTERS : Mumbai, India

KEY PEOPLE : Keshub Mahindra (chairman), Anand GMahindra (vice chairman and managing director)

INDUSRTY : automotive

REVENUE : US $ 6.7 billion (2008)

EMPLOYEES : 65,000 plus

WEBSITE : www.mahindra.com

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1945: 2nd October, Mahindra and Mohammedestablished.

1949: jeep assembly commenced

1956: shares listed on Bombay stockexchange.

1963: international Tractor Company of Indiaestablished- a joint venture with internationalHarvester Company, USA

1965: manufacture of light commercialvehicles commenced.

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1969: the Company entered the World

market with export of utility vehicles andspare parts.

1975: Mahindra Engines developed an

indigenous diesel engine for its vehicle tobeat the fuel crisis.

1977: International Tractor Company of India merged with Mahindra & Mahindra tobecome its Tractor division.

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1983: Mahindra & Mahindra became

market leader in the IndianT

ractor market,a position it has retained till date.

2002: Scorpio launched, a new generation,

world class sporty utility vehicle thatredefined the market and lived up itspositioning : µ NOTHING ELSE WILL DO¶

2004:Mahindra WorldT

ractor (75HP)launched in the International Market.

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2005: acquired 51% stake in SARTransmission Limited, a company engagedin manufacture of gears and transmissionshafts.

2008: project Ingenio is now MahinrdaXYLO.

2009: launch of Mahindra XYLO.

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The current trends of the global automobileindustry reveal that in the developedcountries the automobile industries are

stagnating as a result of drooping markets,whereas the automobile industry in thedeveloping nations, have been consistentlyregistering higher growth rates every

passing year for their domestic flourishingdomestic automobile markets.

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Degree of rivalry:-Despite the high

concentration ratio seen in the automotivesector, rivalry in the Indian auto sector isintense due to the entry of foreign companiesin the market.

Threat of substitutes:-The threat of

substitutes to the automotive industry is fairlymild. Numerous other forms of transportationare available, but none offer the utility,convenience, independence and valueoffered by automobiles.

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Barriers to entry:-The barriers to enter

automotive industry are substantial. For a newcompany, the startup capital required to establishmanufacturing capacity to achieve minimumefficient scale is prohibitive.

Supplier¶s power:- The industry is comprised of powerful buyers who are generally able to dictatetheir terms to the suppliers.

Buyer¶s power:-

In the relationship between theautomotive industry and its ultimate consumers,the power axis is tipped in the consumers¶ favor.

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Stars Questionmarks

Cash cows Dogs

MAHINDRA

ANDMAHINRA

H R

AJAJ

TVS N RA

M TORS

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· India ranks 1st in the global two-wheeler market

· India is the 4th biggest commercial vehiclemarket in the world

· India ranks 11th in the international passenger car market

· India ranks 5th pertaining to the number of busand truck sold in the world

· India is the second largest tractor manufacturer inthe world.

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Models

Mahindra thar

Mahindra boleroa) Camper b) Inspirac) stinger concept

Mahindra Scorpioa) Gatewayb) First

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Mahindra legend

Mahindra Renault Logan ( in cooperation withRenault)

Mahindra axe

Mahindra major a) Souvenir concept

Mahindra commander

Mahindra cab chassis

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Strengths:-

1. Over the years the company has emerged as oneof the top players in the world in terms of number of tractors sold. This gives a clear indication thatthe company¶s market share is one of its biggeststrengths.

2. The company¶s ability to introduce new productsin the market and to generate sales.

3. Government incentives for manufacturing plants.

4. Large domestic market.

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Weakness:-

1. Infrastructure bottleneck2. High interest costs and high overheads

make the production uncompetitive.

Opportunities:-

1. Rising rural demand2. Increase in the income level3. Commercial vehicles : ban on

overloading.

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Threats:-

1

. Rising input costs2. Cut throat competition.

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The company:-The operations of

Mahindra group of companies are guided bythe following committees:-

· Remuneration/Compensation Committee· Audit Committee·

ShareT

ransfer and Shareholders/InvestorsGrievance Committee· Research & Development Committee· Loans & Investment Committee

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The suppliers:-In Mahindra group of

companies there are a large number of suppliers. It includes both domestic andinternational suppliers. The Mahindra group

has a separate committee called Supplier Relationship Management (SRM).

The customers:-

Mahindra group has alarge customer base. As its operation lies indifferent sectors, it almost covers all type of people in the market.

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The competitors:-

In different area of operation, the group faces competitionfrom many companies. It faces globalcompetition.

Publics:-This environmental force is

similar for almost all business. It includesmedia etc.

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Bombay chamber good corporate citizenaward for 2006-07

Deming application award

Japan quality medal in 2007

Business world FICCI-SEDF corporatesocial responsibility award 2007.

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Automotive

Farm equipment

Systech

Trade and financial service

Information technology Infrastructure development

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Mahindra united world college of India

Mahindra united, a football club based inMumbai, Maharashtra.

Mahindra foundation

K.C. Mahindra education trust : nanhi kale.

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Mr. Anand Mahindra features in the top 20 inthe list of 50 Most Influential Indians inBusiness Week's edition dated August 13,2007.

Mahindra & Mahindra was ranked second inthe prestigious Most Trusted Car Company inIndia in a study conducted by TNS.

Mahindra was ranked 31st in BusinessToday's annual survey of India's mostvaluable companies.

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India¶s First Indigenously Developed SUV

It Was Launched In June 2002.

M&M Started Work On Project Scorpio From1997.

It Was Designed To Target Urban Market ToFulfill The Demand Of Passenger Car As Well As SUV Fans And Having Comfort AndElegance

The UV¶s Design Fall Between Passenger Car And SUV Called ³Car Plus´

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From the year 1992 company facedtremendous competition specially fromTelco.The sale from 1994 to 1997 was

Tata Sumo- 100000 units and M&M UV- 26321

units

M&M¶s vehicles are more suitable for rough terrainthan on urban road, works against it

Took benefit of the small size UV market which is15% of total vehicle market compared to Asianaverage (40%)D

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Made survey and collect customer preferenceand perception for designee and feature .

Introduction of Quality FunctionDevelopment(QFD) Process.

Created a benchmark according to world classSUV¶s

a) Big sizeb) Latest technologyc) Affordable Priced) Have thrill and passion in drivinge) Have Luxuryf) International vehicles define image

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Company involve its suppliers from beginning toend.

Company collaborated with suppliers on product

design and development.

Company make them partners in the scorpioproject.

The most important contact for Petrol Engines±With Renault Of France Diesel Engines -With AVL Of Austria

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M&M only gave specification about what they

wanted from the vendors & suppliers

Company decentralized its vendor systemand result better management resources and

higher quality .

Company Did Not Make Its Suppliers Wait.

Suppliers Setup Their Facility At CompaniesPlant.

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The Team Was Having 120 Members Of Average Age 27 Years Of 19 Teams.

Apart From Traditional Approach ,They Worked

Cross functionaly.

The Team Had Holistic View.

Teams Were Made Responsible For Cost , Quality

And Performance. Cost Target Was Given To Each Team,called

µDesigned To Cost¶.

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It Was Launched With Three Models.

1000 Units Were Booked Within The Launch Of FirstWeek.

In 2003 Companies Income Rose By 22%.

Breaking The Tradition Of UV, Scorpio Is Being UsedPrimarily As Personal Vehicle.

Survey In 2004 Shows That Scorpio Byers Were

Satisfied.

It Extensively Tested, so It Has No Run Time Defect After Launching In Market.

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First and foremost, they tried to provide astatus of Pajero in Scorpio at affordableprice.

Advertising, Public Relation, Massmedia«nothing was left to make brandpopular.

Scorpio adopted penetrative pricingstrategy positioned between 5-7 lakhs.

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As they were targeting urban areas,stronger distribution channels wereneeded.

Scorpio was launched in phase manner i.e. first in metros and then other citieswere covered so as to ensure the attentiontowards main market first.

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Revenue of Mahindra increased from Rs1827cr. to Rs. 2511cr. with better returns totheir share holders.

Profit also zoomed up from Rs. 102 cr. to

147 cr. in FY 03.

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29845973 Mahindra Case Study