Program & Batch: PGDM (2018-20)

Term: Term V

Course Name: Market-Oriented Strategic Planning

Name of the faculty: Dr Prantosh Banerjee

Topic/ Title : Mahindra and Mahindra

Group Number: Group 7

Group Members: Sl. Name Roll no

1 Pranit Naik 180103149

2 Madhav Marwania 180103120

3 Parvinder Singh 180103146

4 Ruturaj Birje 180103171

5 Saransh Mani 180103184

6 Manul Agarwal 180103127

7 Nitin Tomer 180103141

 Mahindra and Mahindra

Vision: 'We don't have a group-wide mission statement. Our Core Purpose is what makes all of
us want to get up and come to work in the morning.' - Anand G. Mahindra

Mission: To be on the forefront for increasing global presence in developing countries through
acquisitions and mergers

Purpose:

We’ve made humanity’s innate desire to Rise our driving purpose. We challenge conventional
thinking and innovatively use our resources to drive positive change in the lives of our
stakeholders and communities across the world, to enable them to Rise. This purpose is why we
exist, come to work every day, and strive continuously in delivering our promise.

Core Values:

 Professionalism:

We have always sought the most appropriate people for the job and have given them
the freedom and the opportunity to grow under our wings. We support and celebrate
innovation, out-of-the-box thinking, well-reasoned risk-taking and reward performance.

 Good corporate citizenship:

Mahindra is known in the business community for being an ethics-centric organisation.

We have always believed in doing business with a larger social purpose, keeping in mind
the welfare and growth of the communities we serve.

 Customer first:

At Mahindra, we follow an internal metric called the ‘Customer as Promoter Score’. This
is one of the ways in which we measure the success of our businesses by their level of
customer-centricity. This is designed around our goal to create and sustain a positive
experience for our customers, because of whom we exist and prosper.
  Quality focus:

We put quality at the forefront, not just in our products but also in our actions and
interactions. Each of our businesses achieves its goal through individual strategy, while keeping
a close eye on maintaining quality, in every step of the way.

 Dignity of Individual:

For us, the cornerstone of our business is our human resource – our people. This is not
something we merely preach, but something we truly believe in and practice, at all times. We
respect the time and efforts of our stakeholders and all our policies are designed, keeping their
well-being and betterment in mind.

BHAG : To be among top 10 likeable brands in global arena by 2040.

Vivid Description: Strive to enable people everywhere to rise. Create value by leveraging the
interlinkages between these interdependent resources. Aligned its businesses to the nation's
needs and priorities and globalization through entering the developing countries.

Mahindra Automotive and farm equipment:

Vision: We aim to always make journeys smooth, hassle-free and an experience like no other.

Mission: To equip and empower farmers to ensure their prosperity and to raise productivity in
farms across all continents on earth

BHAG: To have equal contribution of domestic and foreign revenues in total revenue of
automotive and farm equipments.

Vivid Description: We strive to enable people everywhere to rise. Globalization is an important

goal for your Company, and towards this, your Company is pursuing both organic and inorganic
routes .It will continue its efforts to grow and draw synergies from the alliances and
acquisitions with different countries across the globe.
Strategy for Mahindra & Mahindra
 Hambricks And Fredickson Five Elements Models for Mahindra and mahindra

Arenas

 Targets key geographies like

India, Middle East, Africa, South
Asia, USA and Turkey
 Business Oriented customers

Staging Vehicles

- Creates ecosystem Economic Logic -Technology driven

through enabling overall business
Value for money
financial and IT development
products achieved
business by low-cost model -Growing globally
- Nation building and economies of through alliances
market through scale and acquisitions
utility vehicles&
-
tractors

Differentiator

-Penetration in developed
markets and diversification in
new markets

- Main focus on utility vehicles

SWOT Analysis

Commercial Vehicles: Mahindra’s CV business largely comprises of heavy & intermediary

trucks, buses and light commercial vehicles like Supro & mini-trucks. These products come
under the commercial vehicle segment.

Opportunities Threats

 O1: High industry growth in China  T1: New government regulations like:
and European countries, where  Change in axle load norms
Mahindra is well established  Push for fully covered heavy
trucks
 O2: High growth in HCV segment
 T2: With 100% FDI, new global
 O3: Government initiatives like
players are investing more, thus
Pradhan Mantri Gram Sadak Yojana increasing the competition
and Golden Quadrilateral highway  T3: Due to fall out of IL&FS, NBFC
network to improve industry growth became cautious in lending thus,
denting new purchases

Strengths

 O3S1: More than 40% growth rate for

Weaknesses
Mahindra CV’s in FY2018-19
 T1S2: High investments in R&D  O1W1: Lower investments in foreign
helped to come up immediately with markets as compared to the Indian
products considering these regulations market
 O2S3: Product range extension in ICV  T3W2: Fall in Light CV growth rate
to become a full range player, catering because of the lesser financing options
to all kinds of customers
 T2S1: High brand awareness
Personal Vehicle Business: Includes SUVs (Scorpio, XUV500, etc.) and Hatchback (Verito)

Opportunities
Threats
 O1: With rise of aggregators like
Ola/Uber, new market is  T1: Government regulations like
developing New Motor Vehicle Bill and BS VI
 O2: Various state governments
norms
buying more cars for government
officials and police patrolling  T2: Increased excise duty on diesel
 O3: Bigger middle-class with personal vehicles
higher disposable income, as GDP
 T3: Recent slowdown in the Indian
growth increases
 O4: Government initiatives like automobile industry with a growth
Pradhan Mantri Gram Sadak Yojana rate of only 5% in FY18-19
and Golden Quadrilateral highway
network to improve industry growth

Strengths

 O2S1: Good relations and past

experience with government Weaknesses
institutions
 T1S2: High investments in R&D  T3W1: Most of the high selling

helped to come up immediately with brands are diesel vehicles

products considering these regulations  O3W2: Low penetration of service
 T3S3: Strong presence in European centers and costly spares, thus
(specially German) markets, decreasing value for customer
driving the growth
 T3S4: Presence in high-end
segment, which was less affected
by the slowdown
 Porter’s Five Forces Analysis: Sedan Product Line
The sub-4 meter sedan segment, wherein Mahindra & Mahindra has its product ‘Verito’ and its
variants, grew by 12% in FY-19. But overall sedan sales dropped 40% (yoy) in June 2019. This
is in line with the automobile industry slowdown in the country. In comparison with the sedan
industry, Verito sales have dropped by 85%.

The threat due to rivalry among existing competitors is high due to various reasons. There are
huge number of competitors who are coming up with new models in this field and making heavy
investments. Many foreign companies are entering the market with new and technologically
advanced products. The industry growth has slowed down and many huge companies are
reducing production due to decrease in demand. Also, product differentiation is low, and M&M
does not have any established PoDs in this product category. Barriers to exit are in this industry
are high due to huge investments that have been made earlier and hence, involves a high cost.
The Barriers to entry in this category are high due to huge capital requirement, government laws,
and product differentiation. Hence, M&M has low threat from new entrants. The biggest threat is
due to availability of substitutes as a large number of similar products are available at customer’s
disposal. Threat due to bargaining power of suppliers is low as there are a lot of substitutes
available and the industry being huge, it is important to the supplier. The threat due to
government actions is also large as government may come up with new laws and regulations, and
also heavy custom duties on exports.
Strategies that can be adopted by M&M in Sedan category:
1. From the Porter’s Five Force Analysis, we come to a conclusion that M&M should
discontinue the sedan product line and stop the production of Verito and Verito Vibe.
2. The company shall invest in production of e-Verito as it can be branded as a good option
for commercial use and implement a B2B strategy for the same. A lot of emphasis has
been put by the government on electric vehicles, and the company has a good R&D
capacity in this segment. Hence, M&M must continue to invest more in this category to
develop e-Sedans.
 Porter’s Five Forces Analysis: SUV Product Line
Mahindra and Mahindra was first known for assembly under license of iconic willys Jeep in
India. At present M&M is largest SUV maker in India. The government policies on Indian
automobile industry have been framed in order to aid in the expansion of the automobiles sector
in India. At present, the automobiles sector contributes 4 % to the GDP. The share of SUV sales
across the country was approximately 25 percent in fiscal year 2018, up from around 16 percent
in fiscal year 2014.

The SUV segment in automobile industry is characterised by stiff competition with major
players like Hyundai, Maruti Suzuki, TATA occupying a major part of the market share. In
Indian automobile sector there are more than 500 suppliers in organised market and more than
5000 in unorganised market. Along with that, there are globally available sources, which have
excelled in technology. Hence, we can say that suppliers have low to moderate bargaining power
in the market. The Consumers enjoys the greatest power in this relationship due to the
standardized nature of the product. We also notice the availability of various modes of transport
such as Two-wheeler, Bus, Train, Airplane, Cabs etc. substitutes for SUVs along with used cars,
which are becoming popular. Hence, threat of substitutes is high. Since huge investments are
required for automobile manufacturing, assembly, distribution etc. the cost of exit is also high
and thus leads to lower attractiveness of this industry.

Thus the major strategies that can be adopted by Mahindra Automobiles in the SUV category:

1) Mahindra and Mahindra needs to maintain their Leadership in SUV segment by through
innovation by introducing new age technology features in their SUVs. The introduction
of SUV world can be coupled with exciting new features such as Voice Control, Parking
Assist etc.
2) Mahindra and Mahindra as a brand is highly renowned and has good amount of brand
loyalty in SUV segment. This can be substantiated by M&M’s plan of launching six
models in near future, which will be introduced in Compact SUV segment. However
there is more amount of strategic spending required for brand building, awareness and
promotional activities needs to be done in order to aggressively market its compact SUVs
and build Mahindra SUVs as stylish and ergonomic car brand along with the sturdiness
and cost effectiveness it is known for.