A PROJECT REPORT ON “THE LEADERSHIP STORY OF MARUTI SUZUKI” PREPARED BY: SUYASH MILIND RISBUD PROJECT GUIDE: PROF. RAJEEV DEO BRIHAN MAHARASHTRA COLLEGE OF COMMERCE, PUNE- 04 (A PROJECT REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF BACHELOR OF BUSINESS ADMINISTRATION DEGREE COURSE BY UNIVERSITY OF PUNE)
A PROJECT REPORT ON “THE LEADERSHIP STORY OF MARUTI SUZUKI”
Aug 08, 2015
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A PROJECT REPORT
ON
“THE LEADERSHIP STORY OF
MARUTI SUZUKI”
PREPARED BY:
SUYASH MILIND RISBUD
PROJECT GUIDE:
PROF. RAJEEV DEO
BRIHAN MAHARASHTRA COLLEGE OF COMMERCE, PUNE- 04
(A PROJECT REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF
BACHELOR OF BUSINESS ADMINISTRATION DEGREE COURSE BY UNIVERSITY OF PUNE)
DECLARATION
I the undersigned, Suyash Risbud, am a student of Brihan Maharashtra College of Commerce pursuing the degree course of Bachelors of Business Administration under University of Pune; hereby declare that the project report submitted is correct and original as per my knowledge and is not reproduced or copied from any source. I hereby also declare that this project work is not submitted to any other college/university.
SUYASH RISBUD
THE LEADERSHIP STORY OF MARUTI SUZUKI
BRIHAN MAHARASHTRA COLLEGE OF
COMMERCE
MARKETING PROJECT
ACKNOWLEDGEMENTS
I owe my sincere thanks and gratitude to Mr.Rajiv Deo who inspired me by his able
guidance and was a constant guiding light during the course of project study.
The support and knowledge provided by him has been a great value addition
for me and will go a long way in building a promising career.
Last but not least, I am also thankful to all the respondents of my survey without
whom the project would not have been completed successfully.
Suyash Risbud
INDEX
INTRODUCTION OF THE COMPANY
OBJECTIVE OF THE COMPANY
RESEARCH METHODOLOGY
LIMITATIONS
CONCLUSION
QUESTIONNAIRE
BIBLIOGRAPHY
INTRODUCTION OF THE COMAPANY
MARUTI UDYOG LIMITED
Maruti is India's largest automobile company. The company, a joint venture with
Suzuki of Japan, has been a success story like no other in the annals of the Indian
automobile industry.
Today, Maruti is India's largest automobile company. This feat was achieved by the
missionary zeal of our employees across the line and the far-sighted vision of our
management.
The Company Mission:
To provide a wide range of modern, high quality fuel efficient vehicles in order to
meet the need of different customers, both in domestic and export markets.
The Company Vision:
We must be an internationally competitive company in terms of our products and
services. We must retain our leadership in India and should also aspire to be among
the global players.
Their focus is on:
Building a continuously improving organisation adaptable to quick changes
Providing value and satisfaction to the customer
Aligning and fully involving all our employees, suppliers and dealers to face
competition
Maximising Shareholder's value
Being a responsible corporate citizen
At Maruti, they have a clear perspective on manpower. They see it as a unique
resource, in the sense that optimal productivity of other resources depends largely on
the way human resources are utilised. The basic philosophy of management that
underlies the Maruti culture is that all employees of the company should be moulded
into a team which then strives as one, to achieve commonly shared company goals
and objectives. To make this philosophy tenable, the Company takes several
initiatives. Inputs are sought from employees at all levels. They believe that
everyone should contribute to the formulation of company policies, goals and
objectives. Secondly, at Maruti, they encourage leadership in the best sense of the
word. According to us, a leader is one who must be impartial, must have the ability
to rise above his own subjectivity, and, most importantly, must practice what he
preaches.
They understand that the process of creating a sense of belonging that all employees
can identify with is a lengthy one. To ensure that this translates into concrete reality,
they have taken several simple but specific and well thought out measures. The first
step in this direction has been the introduction of a common uniform for all
employees. Another measure is the creation of a common canteen where all
employees have lunch, stand in common queues, and sit on the same table. Common
toilets, common transport and similar facilities for all levels of employees are other
measures that reinforce their emphasis on genuine equality in the workplace.
At Maruti They do not believe in the notion of organisational hierarchies. As a
matter of fact, the management structure and systems in Maruti have been designed
to promote decentralisation of authority. Maruti has a horizontal management
structure with only four functional levels of responsibility to facilitate quicker
decision making.
Another focus area of the Maruti culture is the maintenance of a smoothly
functioning communication network. Maruti believes that communication channels
between labour and management cannot simply consist of having a labour
representative on the Board of the Company. They have faith in the ability of labour
to effectively participate in management and make constructive suggestions. To
encourage this, they ensure that there is a thorough dissemination of information at
all levels, through newsletters or via a letter from the Chief Executive to all
employees. Meetings with the Union are held regularly, and programmes being
contemplated by the Company are discussed with the Union. The Sahyog Samiti, a
collection of representatives of non-unionised employees, training programmes in
Japan, Quality Circles, productivity-linked incentive schemes, and an ethos of
discipline and teamwork, all contribute to the Maruti culture.
Several measures of performance have made amply clear that Maruti has established
a truly healthy work culture. They have met all project and performance targets
since inception. Their productivity levels are constantly improving. The Company
has had good labour relations with employees from the very beginning, and they
have been successful in the export market. Yet, the Maruti culture is one that does
not believe in resting on its laurels. They adhere to the spirit of Kaizen, which states
that constant improvement is always possible. The most basic tenet of productivity
that they hold dear is that " Today should be better than Yesterday and Tomorrow
should be better than Today".
Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of
Parliament, to meet the growing demand of a personal mode of transport caused by
the lack of an efficient public transport system.
Suzuki Motor Company was chosen from seven prospective partners worldwide.
This was due not only to their undisputed leadership in small cars but also to their
commitment to actively bring to MUL contemporary technology and Japanese
management practices (which had catapulted Japan over USA to the status of the top
auto manufacturing country in the world).
A licence and a Joint Venture agreement was signed between Government of India
and Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982.
The objectives of MUL then were:
Modernization of the Indian Automobile Industry.
Production of fuel-efficient vehicles to conserve scarce resources.
Production of large number of motor vehicles, which was necessary for
economic growth.
Core Value
Customer Obsession
Fast, Flexible and First Mover
Innovation and Creativity
Networking and Partnership
Openness and Learning
Vision
The leader in the India Automobile Industry, Creating Customer Delight and
Shareholder’s Wealth; A pride of India”
Technological Advantage
We have introduced the superior 16 * 4 Hypertech engines across the entire Maruti
Suzuki range. This new technology harnesses the power of a brainy 16-bit computer
to a fuel-efficient 4-valve engine to create optimum engine delivery. This means
every Maruti Suzuki owner gets the ideal combination of power and performance
from his car.
Our other innovation has been the introduction of Electronic Power Steering (EPS)
in select models. This results in better and greater maneuverability. In other words,
our cars have become even more pleasurable to drive.
Production/R&D
Spread over a sprawling 297 acres with 3 fully-integrated production facilities, the
Maruti Udyog Plant has already rolled out over 4.3 million vehicles. In fact, on an
average, two vehicles roll out of the factory every minute. And it takes on an
average, just 14 hours to make a car. More importantly, with an incredible range of
11 models available in 50 variants, there's a Maruti Suzuki made here to fit every
car-buyer's budget. And dream.
Production Milestones
1st vehicle produced, December 1983
1,00,000 vehicles produced by August, 1986
5,00,000 vehicles produced by June, 1990
10,00,000 vehicles produced by March, 1994
15,00,000 vehicles produced by April, 1996
20,00,000 vehicles produced by October, 1997
25,00,000 vehicles produced by March, 1999
30,00,000 vehicles produced by June, 2000
35,00,000 vehicles produced by December 2001
40,00,000 vehicles produced by April, 2003
45,00,000 vehicles produced by April, 2004
AWARDS
2005
Number one in JD Power SSI for the second consecutive year
Number one in JD Power CSI for the sixth time in a row - the only
car to win
it so many times
M800, WagonR and Swift topped their segments in the TNS Total
Customer Satisfaction Study
Leadership in the JD Power Initial Quality Study - Alto number
one in its
segment for the 2nd time in a row, Esteem number one in its
segment for
the 3rd year in a row, Swift number one in the premium compact
segment
WagonR and Esteem top their segments in the JD Power APEAL
study
TNS ranks Maruti 4th in the Corporate Reputation Strength (CSR)
study
(#1 in Auto sector)-Feb 05
Maruti bagged the "Manufacturer of the year" award from Autocar-
CNBC
( 2nd time in a row)-Feb 05
First Indian car manufacturer to reach 5 million vehicles sales
Business World ranks Maruti among top five most respected
companies in
India-Oct 04
Maruti ranked among top ten (Rank7) greenest companies in India
by
Business Today - Sep '04
2004
Maruti Suzuki was No. 1 in Customer atisfaction, No. 1 in Sales
Satisfaction No.1 in Product Quality (Esteem and Alto) and No. 1
in Product Appeal (Esteem and Wagon R)
No. 1 in Total Customer Satisfaction (Maruti 800, Zen and Alto)
Business World ranked us among the country's five most respected
companies
Business World ranked us the country's most respected automobile
company
Voted Manufacturer of the year by CNBC
Voted one of India's Greenest Companies by Business Today-AC
Nielson ORG-MARG
2003
Maruti 800, Maruti Zen and Maruti Esteem make it to the top 10
automotive brands in "Most Trusted Brand survey 2003"
J D Power ranked 3 models of Maruti on top: Wagonr, Zen and
Esteem
Maruti 800 and Wagonr top in NFO Total Customer Satisfaction
Study 2003.
MUL tops in J D Power CSI (2001) for 4th time in a row
2001
MUL tops in J D Power CSI (2001) for 2nd time in a row: another
international first
2000
Maruti bags JD Power CSI - 1st rank; unique achievement by
market leader anywhere in the world
1999
MSM launched as model workshop in India; achieves highest CSI
rating.
Central Board of Excise & Customs awards Maruti with "Samman
Patra", for contribution to exchequer and being an ideal tax
assessee
1998
CII's Business Excellence Award
1996
Maruti wins INSSAN award for "Excellence in Suggestion
Scheme"
Awarded the Star Trading House status by Ministry of Commerce
1994-95
Engineering Exports Promotion Council's award for export
performance
1994
Best Canteen award among Haryana Industries as part of employee
welfare
1992-93
Engineering Exports Promotion Council's award for export
performance
1991-92
Engineering Exports Promotion Council's award for export
performance
WHY MARUTI SUZUKI
The Quality Advantage
A car is an engineering product, only as good as the technology used to make
it. Actual users of our technology are saying something very clearly Maruti
Suzuki is No.1 in quality:
Maruti Suzuki owners experience fewer problems with their vehicles than any other
can manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1
in the premium compact car segment and the Esteem in the entry level mid-size car
segment across 9 parameters.
The J.D. Power APEAL Study 2004 proclaimed the Wagon R. No. 1 in the
premium compact car segment and the Esteem No.1 in the entry level mid-
size car segment. This study measures owner delight in terms of design,
content, layout and performance of vehicles across 8 parameters.
Maruti Suzuki has a sales network of 307 state-of-the-art showrooms across
189 cities*, with a workforce of over 6000 trained sales personnel to guide
our customers in finding the right car. Our high sales and customer care
standards led us to achieve the No.1 nameplate in the J.D. Power SSI study
2004. The SSI study measures sales satisfaction across 6 parameters: deal
received, paperwork, dealer facility, salesperson, delivery timing and delivery
process. Maruti Suzuki has not only got the No.1 nameplate in the J.D. Power
SSI study 2004, but also ranked way above the industry average (Maruti
Suzuki was at 784 while industry average was at 760). What is significant is
that it was ranked above Skoda, Ford, Chevrolet, Mitsubishi and Hyundai.
To be really happy with the car you own, it should have a reliable service
network at hand and within easy reach. Their 1036 city strong service
network is equipped to service 20,000 vehicles a day. No wonder Maruti
Suzuki has been awarded the No.1 nameplate in customer satisfaction in India
for the fifth year in a row, a feat unprecedented for any automobile market
leader in the world.
In the J.D. Power CSI study 2004, Maruti Suzuki scored the highest across all
7 parameters: least problems experienced with vehicle serviced, highest
service quality, best in-service experience, best service delivery, best in-
service experience, most user-friendly service and best service initiation
experience.
In fact, 92% of Maruti Suzuki owners feel that work gets done right the first time
during service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti
Suzuki owners would probable recommend the same make of vehicle, while 90%
owners would probable repurchase the same make of vehicle.
A Buying Experience Like No Other
Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189
cities, with a workforce of over 6000 trained sales personnel to guide our customers
in finding the right car. Our high sales and customer care standards led us to achieve
the No.1 nameplate in the J.D. Power SSI Study 2004.
Quality Service Across 1036 Cities
In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7
parameters: least problems experienced with vehicle serviced, highest service
quality, best in-service experience, best service delivery, best service advisor
experience, most user-friendly service and best service initiation experience.
92% of Maruti Suzuki owners feel that work gets done right the first time during
service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki
owners would probably recommend the same make of vehicle, while 90% owners
would probably repurchase the same make of vehicle.
The Low Cost Maintenance Advantage
The acquisition cost is unfortunately not the only cost you face when buying a
car. Although a car may be affordable to buy, it may not necessarily be
affordable to maintain, as some of its regularly used spare parts may be priced
quite steeply. Not so in the case of a Maruti Suzuki. It is in the economy
segment that the affordability of spares is most competitive, and it is here
where Maruti Suzuki shines. The recent Auto car Survey conducted in August
2004 bears testimony to this fact. In the Maruti Suzuki stable, the Omni has
the lowest aggregate cost of spares followed by the Maruti-800. The Maruti-
800 has the cheapest spares of any Indian car with a basket of just Rs. 23,422.
In the Lower Mid-size segment as well, price-consciousness is very high,
where the cars have to be not only affordable on purchase price but also need
to combine quality, drivability and have comfortable interiors. In this
segment, the Maruti Suzuki Versa has scored particularly well with the lowest
cost of spares in the segment. In the Upper Mid-size segment, the Maruti
Suzuki Baleno has the segment's lowest prices on a majority of the spares.
Lowest Cost of Ownership
To be really happy with the car one owns, it should be easy on the pocket to
buy and to run-which is why the cost of ownership is so important. And here
again, a Maruti Suzuki is a clear winner, as shown by the recent J.D.Power
CSI study 2004. It is clear that a Maruti Suzuki delights you even when you
run it for years. The 6 highest satisfaction ratings with regard to cost of
ownership among all models are all Maruti Suzuki vehicles: Zen, Wagon R,
Esteem, Maruti 800, Alto and Omni. They are proud to have the lowest cost of
operation / km (among petrol vehicles) - the top 5 models are all Maruti
Suzuki models: Maruti 800, Alto, Zen, Omni and Wagon R.
Employee Quality Measures
Kaizen is based on the concept of making incremental improvements in our
products. It incorporates a series of continuous small and simple improvements,
which aim at involving employees at all levels.
The Suggestion Scheme is based on the same principle. Under this scheme,
employees are encouraged to make suggestions for improvement in any area of our
operation. Over 50,000 suggestions are received from employees every year.
Maruti has won the First place in "Excellence in Suggestion Scheme Contest
2003", which is the 6th consecutive award won in as many years. This contest is
organized by Indian National Suggestion Schemes Association (INSSAN). Since
1998 Maruti has won this award 10 times.
"Quality Circles" are groups of five to eight members from a particular work area
who work as a team to identify priorities and solve work related problems in the
area.
We believe that it is this unwavering commitment to quality that will lead to the
further growth of the organization as competition increases.
ISO 9001:2000
At Maruti, our approach to quality is in keeping with the Japanese practice--"build it
into the product". Technicians themselves inspect the quality of work. Supervisors
educate and instruct technicians to continually improve productivity and quality.
The movement of quality indicators is reviewed in weekly meetings by the top
management.
In 2001, Maruti Udyog Ltd became one of the first automobile companies
anywhere in the world to get an ISO 9000:2000 certification. AV Belgium,
global auditors for International Organization for Standardisation(ISO), certified
Maruti after a four day long audit, covering varied parameters like Customer
Focussed organisation, Leadership, Involvement of people, Process approach,
System approach to Management, Continual improvement, etc.
In May 1995, Maruti got ISO 9002 certification. The audit for this covered
quality assurance in production, installation, marketing and sales as well as after
sales services. We were also one of the first companies in the world to pioneer ISO
9000 certification for our dealers.
In October 1993, MUL passed the Conformity Of Production (COP) Audit,
which is based on a European Union Directive. This authenticated our quality
systems and testing facilities for export to Europe.
Their emphasis on total quality has meant that today they are in a position to guide
vendors and dealers in establishing and consolidating their individual quality
systems. This commitment to quality has ensured a consistently satisfying product
and world-class sales and after-sales services.
TS16949:2002 - A new feather was added recently in Maruti’s cap in the field of
quality when the Quality Management System of its Press Shop & associated
functions (collectively termed as Press Function) got certification for conformance
to the requirements of TS16949:2002 standard.
The need for TS certification of Press Function had its genesis in the prestigious
project that Maruti earned for the supply of stamped panels to General Motors India
for one of its forthcoming models.
As a part of Quality system requirements, GM requires all its suppliers to be
certified to either ISO TS 16949 or QS 9000.
These standards address Quality System requirements, which are particularly
specific to the automotive industry and requires an organization to be in compliance
with ISO 9000 systems as a basic requirement. However, whereas QS 9000 would
become defunct and cease to exist after Dec 2006, TS 16949 is going to be the
standard of the future.
The TS 16949 standard, brought out by ISO in the year 1999, is an extension of the
ISO 9001:2000 standard that prescribes Quality management system requirements
that are specifically applicable to the automotive industry.
TS 16949 has gained high popularity and almost all major automobile players across
the globe including GM, Ford, Daimler Chrysler, Nissan, Honda are embracing &
promoting it.
TARGET MARKETING
Target Marketing involves breaking a market into segments and then concentrating
your marketing efforts on one or a few key segments.
The beauty of target marketing is that it makes the promotion, pricing and
distribution of your products and/or services easier and more cost-effective. Target
marketing is the selection of customers you wish to service. The decisions involved
in it are
Which segments to target
How many products to offer
Which products to offer in which segments
There are three steps to targeting:
Market segmentation
Target choice
Product positioning
One of the first things you need to do is to refine your product or service so that you
are NOT trying to be 'all things to all people’.
Next, you need to understand that people purchase products or services for three
basic reasons:
To satisfy basic needs.
To solve problems.
To make themselves feel good.
The next step in creating an effective marketing strategy is to zero in on your target
market.
Target marketing is one of corporate America's most effective business strategies.
The idea is to increase sales by first identifying, and then targeting smaller, yet more
profitable customer groups within the total market.
Four Ways to Identify Target Markets
1. Geographic: The location, size of the area, density, and climate zone
of your customers.
2. Demographics: The age, gender, income, family composition and size,
occupation, and education of your customers.
3. Psychographics: The general personality, behavior, life-style, rate of
use, repetition of need, benefits sought, and loyalty characteristics of
your customers.
4. Behaviors: The needs they seek to fulfill, the level of knowledge,
information sources, attitude, use or response to a product of your
customers.
One of the best ways to identify your target market is to look at your existing
customer base. Who are your ideal clients? What do they have in common? If you
do not have an existing customer base, or if you are targeting a completely new
audience, speculate on who they might be, based on their needs and the benefits they
will receive. Investigate competitors or similar businesses in other markets to gain
insight.
TARGET MARKETING
Who are your best customers? Where should you direct your marketing
activities?
Where and how should you allocate your advertising and promotional
efforts?
Target Marketing, provides Focus for your business. It helps to establish
critical Operational goals and defines what must be done to achieve them
What Customers Want
Marketing is more than an activity, it is an attitude
Instead of trying to get customers to buy what the firm likes to make,
or happens to have on hand, the marketing oriented firm tries to
produce or sell what its customers want which can be sold at a profit.
Do not simply throw out everything that you now have and replace goods or
production machinery with completely new items.
HOWEVER, AS YOU ANALYZE YOUR MARKET AND
CUSTOMER PROFILES, AND SO GAIN AN UNDERSTANDING OF
THEIR WANTS, DESIRES, AND PERCEIVED NEEDS, YOU CAN
BEGIN TO REORIENT YOUR BUSINESS OVER TIME TO TAKE
BEST ADVANTAGE OF THESE NEW INSIGHTS. CONSIDER
BOTH THE SHORT TERM AND LONG-TERM IMPLICATIONS OF
DEVELOPING AND IMPLEMENTING THE RIGHT TARGET
MARKETING STRATEGY FOR YOUR BUSINESS.
Customer Attitudes
For a long time, people have believed that advertising can be used to change
people's minds about what they want. This is an incredibly difficult process
at best, and an extremely expensive one. Because of these two factors, it is a
process that smaller firms simply cannot afford to pursue. Instead, it is much
more productive for any size firm to tune in to target customer attitudes as
they currently exist. Once they have identified the actual prevailing attitudes,
they can begin to organize company resources needed to constructively
address and satisfy these attitudes the key question is,
"What are the existing customer attitudes?"
With this as an objective, developing an understanding of existing customer
attitudes becomes essential, and their identification becomes an important part
of the marketing process. Once these customer attitudes, needs or preferences
are identified, the entire firm can then organize itself to satisfy these needs as
completely and efficiently as possible.
Target Marketing
Comparison of Automobile And Consumer Durable At Dealership Level
S.No Attributes Automobile Consumer Durables
1 Turnover High Low
2 Margin 8%-12% 2%-4%
3 Penetration LevelMore in small or large towns or cities
More in Rural areas or in cities also
4Training of Sales Executives
Executives get Training after every specific period As such no training
5 Supply-Chain Co->Dealer->CustomerCo->Distributor->Dealer >Customer
6 Discount Margin CartelDepends on Dealer To Dealer
7 CSR Proper well organizedOnly Sales man is there to serve the customer
8 ASS Customer get 3free serviceCustomer have to go at manufactured level
9Brand Association
Customer first choice is more pertinent
Customer can change his or her choice
10 Payment Instantaneous PaymentMore focus on Finance & Installment
11Post-Sales Follow UP More Very Less
12Buying Procedure
Customer can wait for new model Instant buying
13 Database Large Few
14 Brand Transition Single-Tier Multi-Tier
15 AdvertisementParent Company & dealer both give advertisement
Only from Parent Company
16Loyality Programs Yes No
17
Customer Satisfaction Index
Well- Defined & Organized None
18 Promotion Free Service Camps None
19Customer Retention More Very Less
20 Maintenance
Only free service which customer can extend upto 4 years(first 2yr are free)
Annual Maintenance Contract (AMC)
MARUTI CULTURE
Their employees are their greatest strength and asset. It is this underlying philosophy
that has moulded their workforce into a team with common goals and objectives.
Their Employee-Management relationship is therefore characterized by:
Participative Management.
Team work & Kaizen.
Communication and information sharing.
Open office culture for easy accessibility
To implement this philosophy, they have taken several measures like a flat
organizational structure. There are only three levels of responsibilities ranging from
the Board Of Directors, Division Heads to Department Heads. Other visible features
of this philosophy are an open office, common uniforms (at all levels), and a
common canteen for all.
This structure ensures better communication and speedy decision making processes.
It also creates an environment that builds trust, transparency and a sense of
belonging amongst employees.
For Investors:
Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been
the leader of the Indian car market for about two decades. Its manufacturing plant,
located some 25 km south of New Delhi in Gurgaon, has an installed capacity of
3,50,000 units per annum, with a capability to produce about half a million vehicles.
The company has a portfolio of 11 brands, including Maruti 800, Omni, premium
small car Zen, international brands Alto and WagonR, off-roader Gypsy, mid size
Esteem, luxury car Baleno, the MPV, Versa, Swift and Luxury SUV Grand Vitara
XL7.
In recent years, Maruti has made major strides towards its goal of becoming Suzuki
Motor Corporation's R and D hub for Asia. It has introduced upgraded versions of
WagonR Zen and Esteem, completely designed and styled in-house.
Maruti's contribution as the engine of growth of the Indian auto industry, indeed its
impact on the lifestyle and psyche of an entire generation of Indian middle class, is
widely acknowledged. Its emotional connect with the customer continues.
Maruti tops customer satisfaction again for sixth year in a row according to the J.D.
Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) Study.
The company has also ranked highest in India Sales Satisfaction Study.
The company's quality systems and practices have been rated as a "benchmark for
the automotive industry world-wide" by A V Belgium, global auditors for
International Organisation for Standardisation.
In keeping with its leadership position, Maruti supports safe driving and traffic
management through mass media messages and a state-of-the art driving training
and research institute that it manages for the Delhi Government.
The company's service businesses including sale and purchase of pre owned cars
(TrueValue), lease and fleet management service for corporates (N2N), Maruti
Insurance and Maruti Finance are now fully operational.. These initiatives, besides
providing total mobility solutions to customers in a convenient and transparent
manner, have helped improve economic viability of The company's dealerships.
The company is listed on Bombay Stock Exchange and National Stock Exchange.
MUL is a Board-managed company. Currently the directors on the Board are:
Mr Shinzo Nakanishi, Chairman
Mr Jagdish Khattar, Managing Director
Mr Hirofumi Nagao, Joint Managing Director
Mr Shinichi Takeuchi, Joint Managing Director
Mr Kinji Saito, Director (Marketing and Sales)
Mr Osamu Suzuki, Director
Mr R C Bhargava, Director
Mr S V Bhave, Director
Mr Kumar Mangalam Birla, Director
Mr Amal Ganguli, Director
Ms Pallavi Shroff, Director
Mr Manvinder Singh Banga, Director
OBJECTIVE OF THE COMPANY
Maruti’s marketing objective is to continually offer the customer new
products and services that:
Reduce the customer’s cost of ownership of their cars; and
Anticipate and address the customer’s needs and preferences in all
aspects and stages of car ownership, to provide what they refer to as
the “360 degree customer experience.”
They sell ten models with more than 50 variants in segments A, B, C, and
utility vehicle segment of the Indian passenger car market. Of these, they
manufacture nine models and import the Grand Vitara as a completely built
unit from Suzuki in Japan. Their models and variants are designed to address
the changing demands of the market and are periodically upgraded in
technology, styling and features. To take advantage of the brand recognition
associated with their products, they retain the brand name of the product
through various stages of product upgrades over time. For example, the
version of the Maruti 800 brand currently sold in the market is a significantly
upgraded version, in terms of technology, design and styling, of the Maruti
800 launched in 1983.
A Maruti 800
A OMNI
B Zen
B Wagon R
B Alto
C Esteem
C Baleno
C Versa
C SWIFT
Utility Vehicle GYPSY KING
Utility Vehicle GRAND VITARA
ALTO
CERVO
A-STAR
MARUTI 800
OMNI
ESTILO
SWIFT
WAGON R
SWIFT DZIRE
SX4
GYPSY
GRAND VITARA
EECO
THE ALL NEW KIZASHI
RESEARCH METHODOLOGY
The nature of the project work has been exploratory as no hypothesis, is
taken to be tested. Though the conclusions drawn could be taken as the
hypothesis and further tested by the research work undertaken in the
relevant field. The reason for choosing the exploratory research design is
the fact the project report has been primarily based upon the secondary
sources of data and whose authenticity could be assured of.
The reluctance of the company's personnel in parting with much of
information led the project report to be based substantially on the
secondary source of data. The sources of data used in data collection are
the following:
Primary Sources
In order to gather information about the various products, I personally
visited a number of retail markets and collected data pertaining to the
prices of the products offered. The market visits were useful in knowing
the comparative prices and quality of the offered brands vis-à-vis the
competitive brands. Detail regarding the packaging of the products were
collected were collected and I also inquired about the various sales
promotion schemes followed by the three companies.
By interviewing these retailers valuable information was collected. I
inquired from them about their marketing advertising and distribution
strategies.
Secondary Sources
Information was collected from secondary sources such as public libraries,
newspapers, business magazines.
Beside these the use of Internet was also made in collecting relevant
information. The data collected from the above mentioned sources has been
adequately structured and used at appropriate places in the report. This
particular way of data collection was used because of its low cost (except
data collected through surfing the internet) and less time consumption.
The information gathered included:
Their annual reports (Procter & Gamble and Johnson and Johnson).
Pamphlets.
Posters.
Press clippings.
News releases.
Newsletters.
Pictures.
ORGANISATION STRUCTURE AT MUL
Maruti Udyog ltd. Has a flat organisation structure with a maximum of three levels.
Head office
MD
MFG FIN OTHER
DIRECTOR N CONTROLLER GM DGMS AGMS
GM/ DGMS DGMS AGMS MGRS/AMS
MGRS/AMS MGRS/AM SR GM/EX
ENGINEERS(EX) SR. EX./EX TRAINEES
J.E. (TRAINEES)
INTERNATIONAL BUSINESS
In August, 2003 Maruti crossed a milestone of exporting 300,000 vehicles since its
first export in 1986. Europe is the largest destination of Maruti’s exports and
coincidentally after the first commercial shipment of 480 units to Hungary in 1987,
the 300,00 mark was crossed by the shipment of 571 units to the same country. The
top ten destinations of the cumulative exports have been Netherlands, Italy,
Germany, Chile, U.K., Hungary, Nepal, Greece, France and Poland in that order.
The Alto, which meets the Euro-3 norms, has been very popular in Europe where a
landmark 200,000 vehicle were exported till March 2003. Even in the highly
developed and competitive markets of Netherlands, UK, Germany, France and Italy
Maruti vehicles have made a mark. Though the main market for the Maruti vehicles
is Europe, where it is selling over 70% of its exported quantity, it is exporting in
over 70 countries.
Maruti has entered some unconventional markets like Angola, Benin, Djibouti,
Ethiopia, Morocco, Uganda, Chile, Costa Rica and El Salvador. The Middle-East
region has also opened up and is showing good potential for growth. Some markets
in this region where Maruti is, are Saudi Arabia, Kuwait, Bahrain, Qatar and UAE.
The markets outside of Europe that have large quantities, in the current year, are
Algeria, Saudi Arabia, Srilanka and Bangladesh. Maruti exported more than 51,000
vehicles in 2003-04 which was 59% higher than last year. In the financial year 2003-
04 Maruti exports contributed to more than 10% of total Maruti sales.
MARKET SHARE
COMPETITION MODELS
SEGMENTMaruti Competition
A1 (Mini - Hatchback)
M800
A2 (Compact - Hatchback)
Zen, WagonR, Alto, Swift
Hyundai - Santro & Getz; Tata - Indica & Palio; GM - Corsa Sail
A3 (Mid Size) Esteem, Baleno Hyundai - Accent; Tata - Indigo & Petra; Honda - City; GM - Corsa, Optra, & Aveo;
Ford - Ikon, Fusion, & Fiesta A4/A5/A6
(Exec./Prem./Luxury) Hyundai - Elantra & Sonata; Honda -
Accord; GM - Vectra; Ford - Mondeo; Skoda - Octavia & Superb; Toyota - Corolla &
Camry; Daimler Chrysler - C,E, & S Class;C (Van Type) Omni, Versa MUV (Utility
Vehicles)Gypsy, Grand
VitaraMitsubishi - Pajero; Hyundai - Terracan &
Tucson; Ford - Endeavor; Toyota - Prado & Innova; Nissan - X Trail; Honda - CRV; GM - Forrester & Tavera; Tata - Sumo & Safari;
Mahindra - Jeeps, Scorpio, & Bolero
COMPETITIVE STRENGTHS
MUL believes that they are well positioned to maintain and enhance their leadership
position in the small car segment in India, while continuing to offer products in most
segments of the Indian market, on account of their competitive strengths, which
include the following:
Expertise in small car technology: As a subsidiary of Suzuki, they have
access to globally respected technology in the small car segment. They have
the advantage of Suzuki’s expertise in all aspects of small car technology and
design, with respect to their products, their manufacturing processes and
business practices, the development of their supply chain and the training of
their personnel.
Extensive product portfolio: Their diverse product range includes cars in
segments A, B and C, and utility vehicles. They manufactured five out of the
ten models that were sold in the combined A and B segments in India in fiscal
2002. They are the only manufacturer of cars in segment A (priced below
Rs.300,000) where they have two models, the Maruti 800 and the Omni. The
Maruti 800 has been the largest selling car in India for several years, and
continued to have the highest sales volumes of any model, with a market share
of 25.3%. The Omni, a versatile vehicle that can seat more passengers than
the Maruti 800 or be used as an ambulance or cargo vehicle, had a market
share of 10.5% in fiscal 2002. They are also the only manufacturer to sell
three distinct models, the Zen, the Alto and the Wagon R, in segment B
(priced between Rs.300,000 and Rs.500,000). They believe that
theirdominance in segment A and extensive product range in segment B
enables us to offer the customer a wider choice in the small car segment than
any of their competitors. In addition, the absence of other manufacturers in
segments A gives their dealers greater flexibility in promoting models in
segment B.
Quality products: In November 2001, they were one of the first automobile
manufacturers in the world to receive the ISO 9001:2000 certification. They
began to export products in 1988, primarily in order to benchmark our
products against international quality standards. They have exported products
to approximately 70 countries, including countries in Western Europe. Their
products for export are manufactured using the same assembly line as our
products for the domestic market.
Extensive sales and service network: They believe that they have the largest
network of dealers and service centers amongst car manufacturers in India. As
of March 31, 2003, we had 178 authorized dealers with 243 sales outlets in
161 cities. They estimate their car parc to be in excess of 3.5 million vehicles.
To service this car parc, at March 31, 2003, they had 342 dealer workshops
and 1,545 Maruti Authorized Service Stations, or MASSs, which covered 898
cities in India backed by Express Service Centers on 30 highways across the
country. In addition to the distribution of their cars, their dealership network
is a critical resource in our efforts to provide customers with a “one-stop
shop” for automobiles and automobile related products and services such as
automobile finance, automobile insurance, Maruti-certified pre-owned cars
available for purchase, and leasing and fleet management, in order to promote
customer loyalty.
Brand strength: They have been present in the Indian market for almost
twenty years and have built their brand on the basis of the values of trust and
reliability. Most of their principal competitors have been present in the Indian
passenger car market for a significantly shorter period. Certain manufacturers
have ceased to manufacture certain products shortly after introducing them, or
have left the market altogether. In contrast, they continue to support the
maintenance of their products. This has contributed to the strength of their
brand. In 2000, 2001 and 2002, J. D. Power Asia Pacific, Inc. ranked us No. 1
in the India Customer Satisfaction Index, which assesses customer satisfaction
with product quality and dealer service. They believe that this was the first
time that a volume leader in the automobile industry anywhere in the world
was ranked first on the JD Power Customer Satisfaction Index. NFO
Automotives 2002 Total Customer Satisfaction Survey ranked Maruti
products as No. 1 in the “Economy”, “Premium Compact” and “Entry
Midsize” segments respectively, for 2002.
Integrated manufacturing facility: Their manufacturing facility comprises
three integrated plants with flexible assembly lines located at Gurgaon in the
northern state of Haryana. Their facility has advanced engineering capability
and each plant is upgraded on an ongoing basis to improve productivity and
quality. As a result, their first plant set up in fiscal 1984 is technologically at
par with their newer plants and is also used in the production of their new
models. They believe that they are one of the most efficient among the vehicle
manufacturing facilities of Suzuki’s subsidiaries outside Japan in terms of
productivity measured as the ratio of number of vehicles produced to number
of employees. They have an installed capacity of 350,000 vehicles per year,
which is the highest among passenger car manufacturers in India and among
the passenger car manufacturing facilities of Suzuki’s subsidiaries outside
Japan. They have consistently produced in excess of their installed capacity in
the five fiscal years ended March 31, 002.
They believe that they would be able to expand their production to 500,000
cars per year with minimal additional capital expenditure. This would enable
them to benefit from significant economies of scale.
Strong vendor base and higher rates of localization: They work closely
with their vendor base for the supply of raw materials, components and spare
parts of their products. In order to improve quality and generate economies of
scale, they have reduced the number of their vendors of components in India
from 370 as of March 31, 2000 to 299 as of March 31, 2003, and intend to
continue to reduce the number of our vendors. 113 of their vendors at March
31, 2003 were in technical collaboration with foreign entities. As of the same
date, we had strategic equity interests through joint venture agreements in 13
of their vendors, who together supply a substantial portion of their purchases
of components. A number of their vendors are their dedicated suppliers in that
they account for a majority of their turnover. Vendors located within a radius
of 100 kilometers from their facility supply the majority of their components.
The production systems of their vendors are generally aligned to their need
for a reliable and timely supply of components that meet their quality
requirements. This has enabled them to increase the proportion of locally
sourced, lower cost components in their models, a concept they refer to as
localisation. They have been able, in collaboration with their vendors, to
increase the rate at which they are able to localise production of their new
models over time. This has helped them reduce the cost of their components.
Skilled labour and experienced management: Thei highly skilled labour force
has become increasingly productive in terms of vehicles produced per
employee and receives training on an ongoing basis, including training by
Suzuki. As of March 31, 2003, 1,900 of their employees had been trained at
Suzuki’s facilities in Japan. They have been present in the Indian passenger
car market for a significantly longer period than most of their principal
competitors. As a result, they have been able to build a highly experienced
management team that is familiar with conditions in the Indian passenger car
market. For instance, their managing director has almost ten years of
experience with them, and most of the heads of their divisions have more than
15 years of experience with them.
Capital resources: They have cash and bank balances and current investments
amounting to Rs.9,992 million. As of the same date, they had relatively low
levels of outstanding indebtedness, in the amount of Rs.4,555 million. As a
result, they have relatively low interest expense and flexibility to raise funds,
if necessary, for their working capital and capital expenditure in the future.
BUSINESS STRATEGY
They intend to continue to focus on the small car segment, while offering
products in most segments of the Indian passenger car market. They aim to
achieve their principal objectives by pursuing the following business
strategies:
Maintain and enhance their product range: They intend to utilize Suzuki’s
expertise in small car technology to produce new variants of their existing
models and to upgrade their products with contemporary technology and
features.
Increase reach and penetration: They plan to continue to utilize their
extensive sales and service network to increase the reach, in terms of
geographical spread, and penetration, in terms of sales volumes, of their
products across India.
Increased availability of automobile finance: They continue to seek
opportunities to expand the size of the Indian passenger car market, especially
in the small car segment, through facilitating easy availability of automobile
finance. To that end, they have recently entered into an agreement with the
State Bank of India.
Secure repeat purchases by offering a “360 degree customer experience”:
On the basis of their belief that securing repeat purchases from an existing
customer requires less expenditure than acquiring a new customer, they aim to
provide customers with a “one-stop shop” for automobiles and automobile-
related products and services.
Continue to benchmark their manufacturing capabilities: They plan to
continue to benchmark our manufacturing capabilities with the most efficient
car manufacturing facilities of Suzuki and its subsidiaries.
Continue to reduce costs to offer more competitive products:
Cost competitiveness has been, and continues to be, central to their strategy as
the leading manufacturer in the small car segment to expand the size of the
market by offering competitively priced, high quality products. The
components of this strategy are:
Higher levels of localization
Vendor participation in cost reduction
Cost reduction on warranties
Reduction in initial investment cost
Reduction in number of vehicle platforms
Achieve further cost reduction through higher productivity
Lower cost of ownership:
Through their business strategies, they seek to reduce the consumer’s cost of
ownership of their cars, which comprises the cost of purchase, the cost of fuel
and maintenance, including spare parts and repairs, during the life of the
vehicle, insurance, and resale value.
SALES NETWORK
Dealers: They offer their products to the customer through a network of 178
authorized dealers with 243 sales outlets across 161 cities. They believe that
this is the largest network of dealers amongst car manufacturers in India.
Their dealers employed more than 3,500 sales executives. They are linked to
their sales network through their secure extranet-based information network.
The sales of their spares, accessories and automobile-related services such as
insurance and finance serve as additional sources of revenue for our dealers.
They believe that the availability of these related products and services at
sales outlets also helps to attract customers to the outlets and promotes sales
of their cars.
Agreements with dealers: They generally appoint a limited number of
dealers for a certain geographical territory. Their dealers provide services to
customers such as pre-delivery inspection of vehicles, sales of cars, after sales
service, supply of spare parts and other services that promote sales of cars
within the territory for which they are appointed. They have the right to sell
their products and services through other dealers or intermediaries in any
territory, whether or not one of their dealers is already established in that
territory. Their dealers are required to maintain their outlets in accordance
with their specifications and employ well-trained sales staff.
Their agreements with their dealers usually have terms of five years. These
agreements are generally renewable for successive terms of three years, by
mutual agreement. The agreements typically permit termination by either the
dealer or them with six months’ prior notice.
Enhancing dealer performance: Their central office in Delhi, their
regional offices and their area offices monitor and assist their dealer network.
They have nine regional offices, five area offices and 187 sales and marketing
personnel. They follow the performance of their dealers and frequently
suggest improvements. In order to assist their dealers in enhancing their
performance and capabilities, they have introduced a concept of “Balanced
Scorecard”. Using this tool, they seek to measure the performance of a
dealership in several areas of operations, including sales, service, spares and
accessories, financial management and management systems. They reward
dealers who perform well on the “Balanced Scorecard” with a cash payment at
the end of the fiscal year. They believe that the “Balanced Scorecard” serves
as an effective incentive for dealers to enhance their performance.
Dealer training: They have established standard operating procedures,
showroom ambience and service quality standards for dealerships. They
provide periodic training through their training centres located at their
manufacturing facility and at Chennai, Kolkata, Guwahati and Pune. They
have trained more than 2,600 and 3,400 dealer sales personnel. Their
subsidiary, True Value Solutions Ltd., provides value-added services, such as
manpower recruitment and training, to their dealers.
AFTER-SALES SERVICE
Network
As on date there are 342 Maruti dealer workshops and 1,545 Maruti
Authorised Service Stations, or MASSs, covering 898 cities in India. In
addition, 24-hour mobile service is offered in 38 cities under the brand
“Maruti On-road Service”. They intend to extend this service to an additional
25 cities over the next three years. As a benchmark for dealers with respect to
service quality and infrastructure facilities, they have launched service
stations under the brand “Maruti Service Masters, or MSMs, in three locations
in India. They have service stations on 30 highways in India under the brand
“Express Service Stations”.
To promote sales of their spare parts and the availability of high quality,
reliable spare parts for their products, they sell spares under the brand name
“Maruti Genuine Parts”, or MGP. These are distributed through their dealer
network and through authorised sellers of their spare parts, to whom they refer
as stockists.
Many of their MASSs are at remote locations where they do not have dealers.
In order to increase the penetration, in terms of sales volumes, of their
products in these remote areas, they are exploring opportunities to integrate
some of the MASSs into the sales process in order to increase sales of their
cars and related products and services such as spares and accessories,
insurance and financing.
Genuine Accessories
They have also entered the business of marketing car accessories under the
brand name “Maruti Genuine Accessories”, or MGA, through their dealership
network. They seek to provide customers with the opportunity to customize
their vehicles with accessories such as music systems, security systems, car-
care products and utility products.
Warranty and Extended Warranty Program
They offer a two-year warranty on all their vehicles at the time of sale. Their
dealers are required to address any claim made by a customer, in accordance
with practices and procedures prescribed by them, under the provisions of the
warranty in force at that time. The dealers subsequently claim the warranty
cost from them. They analyse warranty claims from dealers and either claim
the cost from vendors, in the case of defective components, or bear the cost
ourselves, in the case of manufacturing defects.
They offer an extended paid-warranty program marketed under the brand,
“Forever Yours” for the third and fourth year after purchase. They have
entered into arrangements with insurance companies to cover the costs of
warranties offered under this program. The extended warranty program is
intended to maintain the dealer’s contact with the customer and increase the
revenue generated from sale of spares, accessories and automobile-related
services. An effort is made during the period of the extended warranty to
encourage the customer to exchange his existing Maruti car for a new Maruti
car, or upgrade to a new Maruti car.
NEW BUSINESS INITIATIVES
As the largest manufacturer and leader in the small car segment, they continually
seek new ways to utilize their vast car parc, range of products and extensive sales
and service network to expand the size of the passenger car market in India. They
have recently launched new initiatives to develop the market for automobile
insurance, automobile finance, leasing and fleet management, and pre-owned cars.
They aim to provide customers with a “one-stop shop” for automobiles and
automobile-related products and services, and build on their wide customer base and
extensive sales and service network to make available to their customers a wide
range of Maruti-branded services at different stages of ownership, which they refer
to as the “360 degree customer experience”.
Atithi Devo Bhava: One-stop shop
Inspired by the spirit of India. Atithi Devo Bhava, in Sanskirit, means “a guest is
like God”. It captures the Indian tradition of honouring guests. It's also the
inspiration for the welcome you’ll receive at a Maruti Suzuki dealership, and the
caring relationship they share with those who drive their cars. At Maruti Suzuki, you
will find all your car related needs met under one roof. Whether it is easy finance,
insurance, fleet management. services, exchange Maruti Suzuki is set to provide a
single window solution for all your car related needs.
That's why they have Maruti True Value, the best place to buy and sell
reliable used cars. Maruti Finance an agglomeration of the biggest finance
companies in India brought together by Maruti Suzuki to ensure that the
dream car is within everyone's reach. Similarly, Maruti Insurance brings
together some of the biggest names in the car insurance industry to provide
insurance solutions to every type of car consumer. Then, finally, there is N2N,
which offers fleet related solutions.
NEED FOR CRM IN AUTOMOBILE INDUSTRY
The global automotive industry exhibits most of the characteristics of mature
industries and closely follows their business cycles. While vehicle industry sales
have been strong for the past several years, they have started to slow recently due to
the current global economic slowdown. Deteriorating economic conditions result in
a drop in consumer confidence, which quickly impacts automotive sales due to their
big-ticket status and the relative low cost of extending the life of an existing vehicle
through maintenance and repair.
The advent of the Internet as a research tool (75 to 80 percent of auto consumers
research using the Internet) has shifted power to consumers, further increasing
pressure on prices. At the same time, government regulation and consumer demands
for sophisticated features have increased development, production, and marketing
costs. Regional economic fluctuations favor consolidation among car companies,
suppliers, and retailers -resulting in fewer, larger companies that have more
complete product lines targeted at existing and new markets. Consolidation has
heightened competition in all vehicle segments. Low-cost manufacturers are
expanding beyond their home markets with entry level vehicles, traditional
passenger car manufacturers are expanding into the light truck markets, and luxury
manufacturers are moving down market with passenger cars and SUVs. As a result
of these product and market extensions, consumers find it difficult to exhibit brand
loyalty because vehicles have unclear brand identities, similar features, and
comparable prices. In addition, an overpopulation of dealers has resulted in local and
regional competition among same make dealers. This further reduces margins and
damages the brand images the car companies spend large amounts of money to
build.
Relations between the car companies and their suppliers traditionally have been
difficult. In response to competitive pressure, suppliers have been forced by the car
companies to provide higher-quality components at constantly lower costs. The
resulting decrease in margins and the reduction in volume due to slowing sales have
increased the pressure to consolidate and forced some suppliers to the brink of
bankruptcy. Dealers too have a long history of adversarial relationships with the car
companies. Independent entrepreneurs who view some of the car companies with
skepticism or serious mistrust, dealers believe that many manufacturer-sponsored
customer satisfaction programs are actually designed to force smaller dealers out of
business or to gain control of customer relationships that the retailers believe they
"own."
These difficult relationships have prevented car companies and dealers from
maximizing the lifetime value of their combined customers. There are few
incentives or efficient methods for dealers and car companies to share critical data,
resulting in ineffective management of product, service, and household information.
In addition, consumers receive conflicting marketing communications from the two
groups, which results in reduced brand value.
KEY INDUSTRY PAIN POINTS
Decreasing sales and market share - The long-term battle for market
share continues to intensify. In the mature automotive industry, where
business cycles drive sales fluctuations, market share is critical to
survival. Consumers are less brand-loyal than in the past, and every
market segment has an increasing number of vehicle choices. To
increase sales and gain ground in the market share battle, companies
must improve their ability both to acquire first-time customers and to
develop customer loyalty to their current brands. To achieve these
related objectives, companies must set an aggressive goal -deliver the
best customer experience in the automotive industry.
Difficult dealer relationships and a lack of dealer collaboration -
As the consumer 's primary touch point ,the dealer network is a critical
component of customer-facing operations. Therefore, the integration of
the dealer network is absolutely essential to improving the quality of
the customer experience. Only with an infrastructure that enables the
effective flow of information to and from dealers can companies create
a complete view of their customers. Car companies must take the
initiative in understanding the customer’s perspective throughout the
buying cycle.
Lack of multichannel capabilities - With the advent of the Internet as
a research tool, the majority of customers are accessing the automotive
enterprises through several different channels. Many times, the switch
between channels happens very rapidly as a prospect or customer can
view a Web site, make a phone inquiry, and visit a retail store within
days or even hours of an initial contact. To improve customer
satisfaction and secure customer lifetime value, companies must be
able to capture these multiple interactions, provide seamless
management between channels, and leverage shared customer
information to create rewarding experiences and to develop and
execute highly targeted marketing campaigns.
Inefficient demand chain planning and high associated IT cost -
Cost reduction is an ongoing competitive requirement. Just as supply
chain management must be supported by a sophisticated information
infrastructure, effective demand chain management also requires the
right supporting infrastructure, enabling car companies to fully
leverage each customer relationship through exceptional customer
service, efficient lead generation and management, and effective
promotions and campaigns. In addition, global automotive enterprises
operate a wide variety of IT systems in their various business units and
functional groups. Rationalizing these systems offers significant cost
savings.
Lack of effective information sharing - Car companies must integrate
global operations in order to achieve the benefits of consolidation -cost
reduction, effective communication, and true integration of core
competencies. In addition, internal alignment between business units
and functional groups is required to create a unified view of
consumers, products, and services. Currently, each business unit,
functional group, and brand operates through independent systems,
programs, and touch points. As a result, there is limited synergy across
the ecosystem, leading to significant inefficiencies, lack of
coordination, and most important, an inability to maximize "share of
wallet "from every customer through well-targeted marketing and
cross-selling. Synergy between traditionally independent business units
such as captive finance companies and between functional groups such
as sales, service, and marketing is more critical now than ever before.
Only by sharing customer information can customer lifetime value be
maximized among different groups.
Complex data governance requirements - Global automotive
enterprises have large, complex information technology ecosystems.
While customer information must be shared within this ecosystem in
order to fully maximize global operations, it must also be protected.
Proper management of customer information requires a sophisticated
capability to manage a variety of access rules and to accommodate
legal restrictions that can change very quickly. The trust required for
successful collaboration between groups in the automotive enterprise
must be built by demonstrating that customer information can be
shared while observing these complex requirements.
Difficulty managing employee relationships - In today 's fast-paced
business environment, automotive companies need to ensure that their
most valuable asset -their employees -have immediate access to the
critical information, services, and applications required to be
productive. Organizations must enable employees to make better
decisions, work collaboratively, enhance customer relationships, and
maximize productive time. Global automotive enterprises must be able
to enact and enforce consistent policies across business units, instill a
common corporate culture across a geographically dispersed and
diverse workforce, equip employees with effective search tools to
access corporate knowledge bases, and provide employees with the
training necessary to service customers in a volatile and demanding
market.
CONCLUSION
The price of a car is just one-third of what it cost you over its lifetime. Running and
maintaining it make up the other two-thirds. Take into account resale value and its
real cost becomes clear. Maruti Suzuki stands for value as much as it stands for
performance. In spite of rising input costs, we try our best to keep prices down.
Their running costs and resale values are unbeatable too. Nothing matches the
delight their cars deliver. In the JD Power CSI study 2005, 85% of Maruti Suzuki
owners stated that they would definitely recommend the car they drive to someone
else. Infact, you don’t buy a Maruti Suzuki. You invest in it.
After the rash of new cars launches the past two years, the relative lull in the auto
industry is showing up in the customer satisfaction indices. According to the 2005
four-wheeler Total Customer Satisfaction (TCS) study conducted by the specialist
division of TNS Automotive, the automobile ownership experience or customer
ownership experience has declined in all areas compared to 2004. The study is one
of the largest syndicated automotive studies in India, representing the responses of
more than 7,000 new car buyers. The comprehensive study covers over 50 models
with customer evaluations taken in the key areas of sales satisfaction, product
quality, vehicle performance and design, after-sales service, brand image, and cost-
of-ownership. The TCS index score provides a measure of satisfaction and loyalty a
given model enjoys with its customers. According to TNS Automotive, the decline
is predominantly for older, small and entry mid-size car models. The ageing of these
models seems to be posing a stiffer challenge for manufacturers to sustain past
performance levels at a time when customer expectations are rising sharply.
The study reveals a significant increase in the importance of sales satisfaction,
product quality (both performance and design) and brand image since 2003,
indicating rising customer expectations over the years. This year's study shows the
Maruti Suzuki Swift and the Toyota Innova as the winners, with the two vehicles
achieving segment-best ratings by performing well in areas of greater relevance,
particularly product and brand image. Sales satisfaction is weak in both these
models, largely because of the longer waiting time for new deliveries.
Maruti Udyog Ltd is one of India 's leading automobile manufacturers and the
market leader in the car segment, both in terms of volume of vehicles sold and
revenue.
Good Technology
Uniform Pricing
Good Strength
More Coverage Area
Frequent /Regular Product Launch
Market Leader (with 47% share)
Oriented Driven Company
More Product Offering
Healthy Annual Report
Brand Image
Maximum Dealership as compared to other brands
Good Sale Service
Spare parts are cheap as compared to any other brand
Cheap & reliable quality
LIMITATIONS OF THE RESEARCH PROJECT
The research study suffers from following limitations:
The Indian market is a vast and it was not possible to cover each and
every customer in the available short span of time.
Generally, the respondents were busy in their work and were not
interested in responding.
Respondents were reluctant to disclose complete and correct
information about themselves and their organization.
Most respondents were reluctant to provide exact information as in
why they preferred particular company’s car.
The research was conducted in present prevailing conditions. There
can be some fluctuations in the market, which can offset the findings.
Measurement of customer satisfaction is complex subjects, which
uses non-objectives method, which is not reliable.
QUESTIONNAIRE
Q.1 Do you own a Car? Yes No
Q.2 If Yes, which brand and model you are using?
Q3. How long have you used it?A. Less than 1 yearB. 1-3 yearC. 3-5 yearsD. More than 5 years
Q4. What makes you happy to purchase the brand and model at that time?A. PriceB. LookC. BrandD. Engine capacityE. Seating spaceF. MileageG. Service availabilityH. QualityI. SpeedJ. Interior
Q5. Overall, how satisfied are you with your present car?A. Extremely satisfiedB. Very much satisfiedC. NeutralD. Very much unsatisfiedE. Extremely unsatisfied
Q6. If you find all the above features in a customized way,would you prefer to go for a new purchase?
A. YesB. NoC. Why
Q7. If yes, which brand and model would you like to replace it with?
Q8.Purchase details-A. From where did you purchase your last car?
B. Did the dealer meet their promise?
Q9. How would you like to purchase your new car?A. Direct cashB. Through easy finance system
Q10. Do you know the brand Maruti Suzuki?A. YesB. No
Q11. If yes, how did you come across Maruti Suzuki?A. TV B. HoardingsC. NewspaperD. Friends and relativesE. InternetF. Others
Q12. Would you like to have a test drive of Maruti Suzuki car?A. Yes B. No
Demographic profile- Name Age Income Occupation Designation Address for correspondence Signature
BIBLOGRAPHY
o Reference Books, Journals, Newspaper, Web Sites, Reports, etc are to be listed, out here
o Books
o Philip Kotler, Marketing Management Analysis, Planning Implementation & Control Edition 1998. Prentice hall of India Ltd. New Delhi
o Magazines Journals & Newspapers
o Business Today
o The Times of India.
www.google.com
www.yahoo.com
www.maruti.com
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