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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. Today,it is the largest automobile company in India INTRODUCTION 1. Market leader in the car segment, both in terms of volume of vehicles sold and revenue earned . 18.28% of the company is owned by the Indian government, and 54.2% by Suzuki of Japan. 2. Targeting

Maruti was introduced targeting the middle class Its target segments are well depicted in its Product Pyramid profit model Targeting was based on a variety of factors such as style, color, price preference, features etc

3 5 lakhs 5 10 lakhs 15 30 lakhs < 3 lakhs Maruti 800, Alto, Omni Maruti Zen, Wagon R, Versa, Esteem, Swift Maruti Baleno, SX4 Maruti Suzuki Grand Vitara, 3. Strategies: 4. 1) PRICING STRATEGY

caters to all segment and has a product offering at all price points Their pricing strategy is to provide an option to every customer looking for up gradation in his car

5. 2) CREATING DIFFERENT REVENUE STREAMS


Maruti Finance Maruti Insurance Maruti Driving School (MDS)

6. 3) CORPORATE STRATEGIES: STABILITY

Maintaining status quo due to limited environmental opportunities for gaining competitive advantage Few employees will have opportunities for advancement

Critical that management identify key employees and develop specific HR retention strategies to keep them

7. 4) REPOSITIONING OF MARUTI PRODUCTS


Whenever Marutis brand grew old or its sales started dipping ,it made the following efforts in the same field: Omni interiors & exteriors, Omni cargo,& CNG Omni Versa slashed prices by decreasing engine power Esteem new look to boost sales Baleno price slash from 1999 (7.2lacs) to 2003 (5.46) WagonR modifications in engine and sporty look Zen- Modified 4 times and special editions Maruti 800- Introduced modified accessories .

8. 5) Differentiation

In order to demand a premium price from consumers By attempting to distinguish organizational products or services from other competitors Organization offers employees incentives and compensation for creativity HR strategy focuses on external hiring of unique individuals, and on retaining creative employees

9. SWOT ANALYSIS OF MARUTI UDYOG 10.


Threats Competition from second hand cars & TATA Nano Threats from Chinese manufactures Opportunities Increased purchasing power of Indian middle class category Government subsidies

Tax benefits. Prospective buyers from the two-wheeler segment. Weaknesses Lack of experience with foreign market Comparatively new to diesel cars. People resistant to upper segment models. Heavy import tariffs on fully built imported models. Strengths Established distribution & after sales network Understanding of the Indian market Ability to design products with differentiating features Brand image Experience & know how in technology

11. Product Life Cycle 12. PRODUCT LIFE CYCLE


1) Introduction Stage Market share and growth is slight. Substantial research and development costs have been incurred. Marketing costs may be high in order to test the market, undergo launch promotion and set up distribution channels. Highly unlikely that companies will make profits on products. Example- A-Star, Swift Dezire

13. Contd.

2) Growth Stage Characterized by rapid growth in sales and profits. Profits arise due to an increase in output (economies of scale).

Significant promotional resources are traditionally invested in products that are firmly in the Growth Stage. Cheaper for businesses to invest in increasing their market share. Example -Swift, Zen Estilo

14. Contd

3) Maturity Stage Competition is most intense as companies fight to maintain their market share. Any significant moves are likely to be copied by competitors. The Maturity Stage is the time when most profit is earned by the market as a whole. Any expenditure on research and development is likely to improve production efficiency and quality. Example -Alto, Wagon-R

15. Contd.

4) Decline Stage Market is shrinking, reducing the overall amount of profit. Possible to take out some production cost, to transfer production to a cheaper facility, sell the product into other, cheaper markets. Depending on whether the product remains profitable, a company may decide to end the product. Care should be taken to control the amount of stocks of the product. Example -Baleno, Esteem Dogs Omni Versa BALENO

16.

Cash Cows Maruti 800 Wagon R Alto Question marks SX4 A STAR Stars Maruti Zen Swift

BCG Matrix DIVEST DIVEST/ LIQUIDATE 17. OMNI BALENO VERSA HARVEST, DIVEST, LIQUIDATE LOW LOW, UNSTABLE LOW LOW Maruti 800 ALTO Wagon R Maintain MKT DOMINANCE & LEADERSHIP LOW HIGH, STABLE LOW HIGH SX4 A Star HARVEST, DIVEST HIGH LOW, UNSTABLE, GROWING HIGH LOW SWIFT, ZEN INVEST, INTEGRATE, TAKE OVER HIGH HIGH, STABLE, GROWING HIGH HIGH Egs: STRATEGY CASH NEEDS EARNINGS GROWTH RATE MKT SHARE 18. GE matrix Harvest OMNI Harvest VERSA Selectivity/ Earnings WAGON R Low Harvest BALENO Selectivity/ Earnings SX4 Investment and growth (G) SWIFT DEZIRE Medium Selectivity/ Earnings A STAR Investment and growth (G) ALTO Investment and growth (G) SWIFT High Low Medium High Business strength Size - Growth - Share - Position - Profitability - Margins - Tech. Position - Image - People Industry attractiveness Size, Market Growth, Pricing, Mkt. Diversity Competitive Structure, Industry Profitability 19. Porters 5 Forces Model 20.

Intense players Better

technology

- Presence of substitute inputs is high. -switching costs of suppliers is high Product differentiation is high.

- Buyers get incentives in the form of cost discounts and better after sales services. Government policies Patents & Proprietary knowledge Asset specificity Economies of scale Industry concentration High fixed cost Diversity Low switching cost

THREATS OF BARGAINING BARGAINING THREAT OF RIVALRY FORCES NEW POWER OF POWER OF SUBSTITUTE AMONG ENTRANT BUYERS SUPPLIERS PRODUCT COMPETITORS RESULT 21. McKINSEY 7s FRAMEWORK 22. McKINSEY 7s

Strategy : the plan devised to maintain and build competitive advantage over the competition. Structure : the way the organization is structured and who reports to whom. Systems : the daily activities and procedures that staff members engage in to get the job done.

23. Contd

Shared Values : called &quot;superordinate goals&quot; when the model was first developed, these are the core values of the company that are evidenced in the corporate culture and the general work ethic.

Style : the style of leadership adopted. Staff : the employees & their general capabilities Skills : the actual skills and competencies of the employees working for the company.