Mahindra & Mahindra

Challenges in BPR Execution

Sanjay Kumar (2D - 56)

Preeti Saini (2D - 54)
Nandita Katiyar (2B - 54)
Anand Tuteja (2B - 40)
Col D B Pany (2E - 74)
 How we had gone about…
• Collection of various case studies- By Preeti, Nandita, Sanjay
• Collection of specific materials on Challenges- By Col Pany
• Finalisation of Case - All Gp Mates
• Preparation of Broad framework of Case - By Col Pany
• Mapping the case to a Model - By Nandita
• Mapping the Challenges to a Model - By Sanjay
• Tackling the Challenges - By Preeti
• Identifying the benefits - By Anand
• Enriching with a movie - by Preeti
 Why choose this Case…..
• First Indian company to implement BPR
 Why ???
• Compelling Circumstances
• Ambitious plan for BPR and tried to Implement
• But, lot of Challenges faced , massive trade union problems
• Faced failure of BPR execution
• Recovered and all challenges tackled
• Finally, became successful
 A Harvard Business School Case study
Ø So, it is a holistic case study to analyse the challenges faced in
BPR execution and unique approach to tackle to achieve
success.

 The Journey……
• Brief Profile of M & M
• Circumstances lead to implement BPR

• Salient features of BPR Plan

• What Challenges faced

• How Challenges tackled

• What Benefits achieved from this BPR

• Group Learnings



 Brief Profile of M&M
• Established 1945 - by J C Mahindra & K C Mahindra
• 1947 - first batch of 75 jeeps released
• Next few decades…..
• Diversified into other segments
• viz. Hotels, Financial services, Auto Components, IT,
Infrastructure Devp, Trading etc.
• Undisputed Leader in Tractor Market since 1983
• UV - Armada, Bolero, MaXX
• 3 wheeler segment - “ Bijlee”
• 6000 Crore M & M Group

•
 BPR EXERCISE : 1994

 Discovered some of its businesses not related to the CORE

businesses
• Plants at Igatpuri and Kandivili had
• Manufacturing Inefficiency
• Low Productivity,
• Long Production cycle,
• Sub optimal output
Reasons
•
Unhealth
y work
culture
•
Corruptio
n was
widesprea
Management d. lenient
& often
• crumbled
under
Militantly
pressure
 BPR EXERCISE : 1994
Designed in two Parts
 Ist Part - Restructuring of M&M Group
 Regrouped in six distinct clusters of related
businesses as SBU
Each headed by a President
 Infrastructure
Trade & Financial services
 Tele communication
 Automotive components
 Automotive Div (UV, LCV, 3 wheelers)
 Farm Equipment division (Tractors)
II ndPart -
Implementatio
n of
BPR at
Igatpuri &

Kandivili
 BPR EXERCISE : 1994
Developed with help UK based Lucas Engineering System
 Re-engineering the entire layout & processes of working
•Cellular Manufacturing
–Multi-tasking through Multi-machine manning
–Reduction in non-productive Activities
 Implementation of TPM and Kaizen
 Formation of 3 cross functional teams
– Horizon 1: Improvement in existing Product
–Horizon 2: Upgradation of
existing Product
–Horizo
n 3:
Deve
lopm
ent
of
new

Prod
Barriers/Challenges Model
 Soft Barriers

Soft Barriers are People Problems.

•Employee & Union Resistance
•Vendors Resistance

•Top mgmt commitment •Fear of downsizing

lacking •Several jobs combined into one
•Mgmt skepticism •Fear of Job losses – Key
personnel
•Idle Time available due to unorganized
processes
•Inflexibility of Workers
•Uncontrolled Rumors
•Structure
• and culture
•High Corruption
•Mgmt accepting union demands every time
•Lenient
•1st Indian
approach
company to go for BPR
•Censorship
•Resistanceoffrom
disclosure
Vendors
Hard Barriers

•Legal Obstacles
•IT problems

•IT Integration

•Lead to lot of Legal obstacles

•Existing bureaucratic structure & power

equation

•Business partners i.e., vendors apprehensive

 What happened then….

 Strong Resistance , Union went on strike for 5 Months


Management Demonstrated
 KeshubMahindra, the Chairman became firm
•Top Mgmt decided not to succumb to demands
–Sacked Corrupted Employees
–Introduced VRS
•Formation of 3 Core full-time Teams
– Production related team
– BPR Execution team
–Handlin
g
“Unres
t”
team

 Deploy
 Testing the new improved processes and demonstrated
•Around 100 officers produced 35 Engines a day as
compared to 1200 Employees producing 70 Engines in
pre-BPR days.
•Implementing new improved processes in regular
operations of organization

 Union called off Strike

 BPR further gained Momentum
 Benefits reaped due to BPR
• Igatpuri Plant : Employees declined by 400 but productivity went
up by 125 Engines per day

• Nasik Plant : 125% Improvement in productivity

• Reduction in Employee costs

– 1994: 12.4% & 1996: 10.1%

• Value added per employee increased from 0.3 million to 0.46 million
i.e., increase of 53.33 % per employee.

• Better Inventory control

• Better order distribution across plants

• Online and Transparent access of data

• Integrated sales and supply chain


 Group Learnings
• Barriers to be identified correctly
• Sustained top management commitment and
leadership
• Formation of exclusive core team
• Personal involvement of CEO must
• Cultural resistance must be tackled
 Conclusion
BPR implementation in M&M had seen radical
change for the better not only in its functions but also in
its results.

This can be summed up with the statement of Anand

Mahindra

"Let me put it in a simple way. If we have facilities in Kandivili

today, which are not just surviving but thriving, it is all due to
BPR.”
 Biblography
• ICMR Case study on “BPR at M & M”
• SUCCESSFUL BPR IMPLEMENTATION STRATEGY
by Dr. S. Balasubramanian, Ph.D. DEPARTMENT OF
MANAGEMENT STUDIES
• Business Strategy for a Leading Automotive Manufacturer in
India By Sataym Computer services
• SAP success story by M & M by the Best run Business
SAP
• http://hosteddocs.ittoolbox.com/SB41806.pdf
• http://www.icmrindia.org/casestudies/catalogue/Operations/Mah
indra-Implementing%20BPR-Operations%20Case
 THANK YOU

Any Questions ? ? ?