Mahindra and Mahindra –

Implementing BPR
Introduction
• The Mahindra Group ‘s history dates back to
1945
• In October 1947, the first batch of 75 jeeps was
released for the Indian market.
• Over the next few decades, the group promoted
many companies in areas as diverse as hotels,
financial services, auto components, information
technology , infrastructure development and
trading to name a few.
• However, the two main operating divisions were
the automotive division and the farm equipment
division.
• Mahindra employed over 17,000 people, had 33
sales offices with a network of over 500 dealers
across the country.
• The Kandivili plant was the production hub for
farm equipment division. In 2001, this division
marked its 16th year as the market leader, with
its product being used by over 600,000 indian
farmers.
About BPR
The philosophy that BPR follows is that
radical redesign and reorganization is
necessary to lower costs and increase
the quality of service.

Instead of focusing on existing

business, it tries to determine what
business the company should be
involved in.

Thus BPR results in dramatic and huge

improvements.
Reasons for Implementing BPR

To enhance productivity
M&M’s ambition to become
and deliver world class
the largest tractor
quality at the least possible
manufacturer in the world.
cost.

M&M’s plants were

suffering from The plants at Kandivili and
manufacturing Igatpuri in particular were
inefficiencies, poor under-productive,
productivity, long militantly unionized, and
production cycles and sub- had bloated workforces.
optimal outputs.
BPR Principles
PRINCIPLE EXPLANATION
Organize around processes, not tasks Keep interdisciplinary teams that
concentrate on completing a process.
Have output users perform the process Have one department responsible for
one complete process.
Have those who produce information One person generating a certain
process it information also processes it till end.
Treat geographically dispersed An organization’s data should be
resources as centralized centrally located and made available
to all.
Link parallel activities in the workflow Improve communication through
instead of just integrating their results inter-linkage to better all processes.
Empower workers and use built-in Give more authority to those working
controls directly to enable quicker decision
making.
Capture information once and at the Store all data electronically to avoid
source inefficiency, resource wastage and
data discrepancy errors.
Effects of BPR
BPR seeks to remove the belief that by focusing on the efficiency of the
tasks involved in carrying out a piece of work, the organization is doing its
best to complete the task in a timely and cost-effective manner. Instead, it
requires the organization to focus on the outcomes of its processes in the
way a customer would.

The effect of BPR

Work units change from functional to process teams
Jobs change from simple tasks to multi-dimensional
Roles change from control to empowered
Advancement criteria changes from performance to ability
Executives change from scorekeepers to leaders
Performance measures change from activity to results
Phases involved in BPR
• Understanding of the entire business cycle.
Process • Improvements through eliminating non-
Improvement value –added activities.

• Total redesign of an end-to-end process.

Process • Considerable performance improvements in
Redesign terms of cost, quality and cycle time.

• Study of basic elements of people, processes

Business and IT involved by top management.
Transformation • A top-down reappraisal and redesign of the
total business.
BPR success factors
Reengineering is usually opted when companies are in trouble, have
foreseen one or are avoiding landing into one. BPR exercises generally fail
because the concerned companies do not ensure the presence of critical
success factors.

Such factors are:

BPR SUCCESS FACTORS

Strong and consistent top management sponsorship.
Addressing cultural transformation through effective change management.
Proven methodology including a vision process.
Reengineering team composition (in both breadth and Knowledge).
Compelling business case for change (with measurable objectives).
Strategic alignment with company strategic direction.
Line ownership (pair ownership with accountability).
M&M’s experience with BPR

After BPR’s implementation After the union strike ended

around 100 officers produced 35 M&M could then focus on major
engines a day as compared to issues such as reengineering the
the 1200 employees producing layout and method of working,
70 engines in the pre-BPR days. and productivity.

The entire company was

synchronized with the notion of
customer satisfaction, wherein
the end product was made
keeping the customers in mind
rather than going about their
usual way of being product
centric.
 The R&D department was
Features of concurrent
divided into three phases,
engineering were brought
with each having their
in.
specific requirements.

IT was implemented soon

thereafter to integrate all
the information gathered
so that all departments
were up to date at all
times.
Results of implementing BPR
After the
The excess workers
implementation of BPR
could now be deployed
the number of engines
at different locations
produced went up by
where the workforce
125 per day on an
was indeed needed.
average.

Employee costs got

The number of vehicles
reduced significantly
started increasing
from 12.4% in 1994 to
rapidly per annum.
10.1% in 1996.
 BPR initiatives enabled the
company to maintain steady
gross margins, reduce working
capital levels and rationalize
manufacturing process.
The manufacturing systems
were brought upto
international standards.

There was better inventory

control, better sourcing, better
The workers became more
order distribution across
productive where, instead of
plants, online availability of
earlier disputes during the pre-
data, transparent access to
BPR days, now they worked
data, process transparency and
more diligently.
an integrated sales and supply
chain.
The Future
The programs implemented
saved 20-30% on business The company also started
redesign, 10-15% on process outsourcing its manufacturing
redesign and 5-10% on activities to improve quality
engineering redesign.

Future

The company continued with its

efforts to further streamline its
M&M decided to adopt other
operations by undertaking cost
globally accepted practices to
saving programs to break-even
improve its business.
volumes in the automotive and
farm equipment divisions.