Strategic Analysis of

Maruti Suzuki
(Project for SGMT)

Submitted to: Prof. Mohammed Shariq

Table of contents
01 Background
Company Overview and
02 Industry Background
Define the journey and Present
Structure of Organisation Statistics

Strategy and Forms

03 MVV-Maruti Suzuki 04 Plan of action and Methodology
Purpose, Mission, Vision, Value

05 Strategies 06 Internal Analysis

VRIO, Value Chain, TOWS,
SWOT, PESTLE, PORTER’S 5 FORCES 6 Character Strategy
 0
Background

1
Company Overview and Structure of
Organization
 Company
Background
• Passenger car company
• 50% of the domestic car
market
• The company annually
exports more than 50,000
cars and has an extremely
large domestic market in
India selling over 730,000
cars annually.

https://www.capitalmarket.com/Company-Information/Information/About-Company/Maruti-Suzuki-India-Ltd/5496
Organisation Structure
Board of
Top Level
Directors

Davinder
Managing Brar
Director
Kenichi Ayukawa
Osamo
Suzuki

Chairman Pallavi
R.C. Bhargava Shroff

Amal
Ganguli

Manvinder
Banga

Source: https://www.slideshare.net/aakashgupta1069/bluebook-of-maruti-suzuki
 Timeline Launched 1 Sedan-
st
1st Diesel Car- Zen D Highest Selling Car-Alto

Collaboration with Suzuki Maruti 1000

Sanjay Gandhi established as
a part of Govt. of India.

1981 1982 1989 1998 2004

2020 2016 2015 2010 2009

Discontinue all Green Award for

diesel variants Fuel Efficiency
with BS6 Made in India
emission 1 Compact
st CNG Tech, IGPI- MUV+Automatic-
norms MPV Eeco SX4
SUV- Vistara
Brezza
Source: https://gomechanic.in/blog/maruti-suzuki-the-history/ ; https://www.goodreturns.in/company/maruti-suzuki-india/history.html
 02
Industry
Background
Define the journey and
Present Statistics
 Automobile Industry
India was the fifth-largest auto market
Approx. 3.49 million units combined sold in the passenger
and commercial vehicles categories. (By 2020)

Domestic automobiles production increased at 2.36%

CAGR between FY16-20
Domestic automobiles sales increased at 1.29% CAGR
between FY16-FY20.

In January 2020, Tata AutoComp Systems, the auto-

components arm of Tata Group entered a joint venture with
Beijing-based Prestolite Electric to enter the electric vehicle
(EV) components market.

Source:
Source: https://www.ibef.org/industry/india-automobiles/infographic
https://www.ibef.org/industry/india-automobiles/infographic
 03
MVV-Maruti
Suzuki
Purpose, Mission,
Vision, Value
Organisation-Purpose, Mission, Vision, and Value

Purpose Mission
Increase its market share in the Production of fuel efficient vehicles to
lucrative sport utility vehicle (SUV) conserve scarce resources and build
relationship management, value chain, and
segment
value delivery network

Vision Value
To be the leader in the Indian Automobile
Industry, Creating Customer Delight, and Networking, Partnership,
Shareholder’s Wealth; a Pride in India Openness, and Learning
 04
Strategy and
Forms
Plan of action and
methodology
Strategies of Maruti Suzuki
Long Dimensional Range

Action Oriented

Value Addition
PORTER’
Goal Oriented SWOT PESTLE S5
FORCES
Flexible and Dynamic
FORMS OF STRATEGIES FOR ANALYSIS
Purposeful
 05
Strategies
SWOT, PESTLE,
PORTER’S 5 FORCES
SWOT Analysis
Strengths Weakness
•Recognized by •Heavy import
several awards in tariffs on fully
automobile built imported
segment. models.
••Established
Established • Lack of
•Lack
brand in Indian experience with
market foreign market.

Opportunities Threats
•Developing
• Developing •Ever
• Ever increasing
hybrid cars and fuel prices
fuel efficient cars •Second wave of
•Tax Benefits COVID-19 can
• Government have a negative
Subsidies impact on retail
sales
 PESTLE Analysis
Political Economic Social
• Impact of recent modification • Due to the Economic Downfall, • Launched Maruti Genuine
in labor laws by sales decreased by 32.7 % in Accessories which extends
Governement. August 2019. stereo systems, carpets, body
• Manufactures small cars so • Oil prices are rising and covers, and many other car
that it can target economically people are not willing to buy care products for huge
low-income consumers the cars and thus the sale customer base.
decreases

Technological Environmental Legal

• The company invests a lot in ••Maruti
Maruti Suzuki enables a continuous ••The
The company has evolved a legal
process of promoting recyclable and compliance scheduling and
research and development to reusable car parts management software by which
improve engine features •In August 2010, the company took an specific tasks are given to every
• The company developed the initiative to introduce environmentally individual.
friendly cars which are fitted with CNG
LPG/CNG/Hybrid system for option across the vehicle segment which
•Increased
• Increased level of regulations and
the MPI engine to use as the privatization of the automobile sector
included Eco, Alto, Estilo, Wagon R, and also affects the sale of Maruti Suzuki.
alternate fuel technology SX4.
 Porter’s 5 Force Analysis
Brand: Low
Financial Investment: Low
Competence: Low

Brand Identity: High

Company Growth: High Substitutes: Medium
Cost Rate: Low

Quality of Product: Medium

Price of Suppliers: Medium
Competition: High
Power of Suppliers: Low

Source: https://www.ukessays.com/essays/marketing/maruthi-suzuki-india-ltd-
marketing-essay.php
 06
Internal Analysis
VRIO, Value Chain,
TOWS,6 Character Strategy
 VRIO Analysis- Maruti Suzuki w.r.t its competitor Honda Motors

No. Resource or Capability Valuable Rare Inimitable Organised to Support Impact on Competitive Advantage

1 Customer network Yes, 23% of the customers Yes, firm has invested Has been tried by Company is leveraging Provides medium term
contribute to more than and built a strong competitors, yet only
the customer loyalty to competitive advantage
and Loyalty 84% of the sales revenue customer loyalty few of them are
inimitable like Tata good effect.
Motors.
2 Fuel efficiency Yes, Launching cars It is characterized by Needs to follow up its
with alternate fuel
No Yes, Electric vehicles,
being produced by Tata functional organizational
competitors, due to need of
factor segments like LPG
Motors, and other structure having Horizontal
competitors like
Chevrolet and Nissan are
linkages which are then based electric vehicles becoming a
powered wagonR and planning to come up on automotive engineering major demand by Indian
swift diesel with CNG, and Electric operations.
market in upcoming 3-5 years.
Vehicles.

3 Marketing Yes, firms are competing

based on differentiation in
No, as most of the
competitors also have
Pricing strategies Yes, firm is leveraging Temporary Competitive
are often matched its inhouse expertise
Expertise the industry decent marketing know
how by competitors
Advantage

4 Pricing Yes No, because, different

players in the market have
Difficult to Yes, firm has a pricing Temporary Competitive
imitate analytics engine
their own pricing strategy
as defined by their goals. Advantage

Brand Positioning Yes Temporary Competitive

5 No, because, players like Can be imitated by Yes, the firm has positioned
Tata motors, Honda,
competitors but it will its brands based on consumer
Hyundai, etc have become
quite popular, through their require big marketing behavior Advantage
positioning strategy. budget
 Value Chain Analysis

Firm Infrastructure: Consists of general management, planning, finance, accounting, legal, government affairs and quality management
-Adopted the Japanese management concept of Kaizen that resulted in the improvement of the in-house capabilities. For example, they had manufactured 25
multi-axis robots and 16 multi-spot welders.
Human Resources: Activities associated with recruiting, training, development and compensation of employees.
-conducts programs such as "Bulandi" and "Chunauti" for the workmen and technicians
Activities associated with recruiting, training, development and compensation of employees.
-Conducts programs like "Family Connect" and "Parivar Milan", family members of the employees are invited to interact with top management
Technology Development: Includes research and development, process automation, and other technology development used to support the value chain.
-Value Analysis/Value Engineering (VA –VE)
-Capabilities being strengthened in areas of alternative fuels like Diesel, CNG and LPG.

Margin
Procurement: Function of purchasing raw materials and other inputs used in the firm’s value creating activities.
-About 110 foreign technology collaborations were facilitated and Maruti Suzuki engineers worked closely with the vendors' engineers to enable to deliver cars which are both
high quality and cost competitive.
Inbound Logistics: Operations: Outbound Logistics: Marketing and Sales: Service:
-Receiving and -Transformation through -Get the finished product to the
machining, packaging, assembly, customer, including collecting,
-Means by which buyers can -Enhance or maintain the
warehousing of raw purchase the product such as value of the product, such as
equipment maintenance, testing, storing, physically distributing,
materials, and their material handling, delivery through advertising, promotion, installation, repair, training,
printing and facility operations. parts supply, and product
sales force, quoting, channel
distribution to -7,000 pairs of hands along with vehicle operation, order
selection, channel relations, and
processing and scheduling. adjustment
manufacturing. robots produce 3,100 cars per
-Jointly developed with the
pricing.
-Experimented with many
-Raw material includes day – about 2.15 cars per -Provide“360 degree customer
Indian Railways, special Auto new initiatives by way of
minute. experience”
rubber, glass, steel, -Maintain 98% efficiency with
Wagons, to support a high kaizens (continuous
capacity, high speed and safe car -Offers an extended paid-warranty
plastic, aluminum. Tyre, less than 1.8 minutes of program marketed under the brand, improvements) that ranged
transportation system.
windshields, and airbags assembly line stoppage in a 480 -commissioned a dedicated Roll- “Forever Yours”. from product design and
are example of parts or min shift. on Roll-off car terminal at -Offers a two-year warranty on quality to network expansion,
-Focusing on lean manufacturing Mundra sea port in partnership all the vehicles at the time of and included new service
components. The along with excellence hinges sale.
with MPSEZL (Mundra Port and programs.
company has implemented around four important pillars-
tierization of suppliers and Cost, Quality, Safety and
Special Economic Zone Limited)
and it houses a state-of-the-art
-Pre-delivery inspection of --Car pickup & delivery
vehicles, sales of cars, after facility for women car owners
Just in Time supply Productivity 'Washing and Waxing Inspection'
sales service, supply of spare -Setting up "Express Service
centre, a car stockyard and a
logistics. parts and other services Bays" & "2 - Technician
parking area.
Bays"
TOWS MATRIX
STRENGTHS OPPORTUNITIES
• Largest manufacturing • Untapped Tier 2 and Tier
capacity
• Distribution network 3 cities
• Recognized by several • E-vehicles
awards in automobile • Tax Benefits
segment.
• Established brand in
Indian market SO Strategy To
WO Strategy
ST Strategy To bring
capture untapped rural and youngistan
THREATS new and innovative
To launch a car likemodels
CERVO WEAKNESES
market
• New entrants • Heavy import tariffs on fully
• New emission norms built imported models.
• Lack of experience with foreign
• Ever increasing fuel prices
market
• Second wave of COVID-19 can
have a negative impact on retail
sales
6 CHARACHTERISTICS OF STRATEGY
We can study this, for Maruti Suzuki on the basis of following parameters:-

Long Term Decision

Scope

Advantage over competition

Strategic Fit with business environment

Organization resources and competencies

Values and Expectations

N Characteristics
o 6 CHARACHTERISTICS OF STRATEGY

1 Long Term Decision It is planning to launch 15 to 20 products in the next five years. It will still focus on low cost products with around 70% to 80%
models being small cars. Suzuki is planning to combine its R&D unit with India which will give India a big role to play in
development of products. It is going to invest approximately 1500 crores on development of products.

2 Scope The company sold 17.79 lakh vehicles in FY18, a gain of 13 per cent YoY. Based on the volume
guidance, it appears that Maruti expects further market share gains. It has an order backlog of 1.1 lakh
units of recently- launched vehicles such as New Swift, Dzire, Baleno and Brezza.

3 Advantage over competition Founded in 1981, Maruti Suzuki was India's leading automobile manufacturer and the market leader in
the car segment, both in terms of volume of vehicles sold and revenue earned. The major competitive
advantage of the firm is in terms of Price, Service and Quality. ... Developing cars faster and selling
them for less.

4 Strategic Fit with the business Marketing strategy is the plan of action designed to satisfy the needs and wants of customers,
clients, partners and society. In this study, the marketing strategy of Maruti Suzuki India Limited
environment is based on the marketing-mix, the PEST analysis, the SWOT analysis and the BCG matrix.

5 Organisations resources and Resources of an organization can be categorized into two categories - Tangible resources and Intangible
Resources. Tangible resources of Maruti Suzuki include - physical entities, such as land, buildings, plant,
competencies equipment, inventory, and money. Intangible resources of Maruti Suzuki are –skill and administrative level of
managers, brand names and goodwill of the company, intellectual property rights, copyrights, trademarks, and
special relationship with supply chain partners.

6 Values and Expectations Maruti Suzuki has truly lived up to its core values of Customer Obsession, Fast, Flexible & First Mover,
Innovation & Creativity, Networking & Partnership and Openness & Learning .
 CONCLUSION
• Since, Maruti is not the oldest car manufacturer in India, yet it is the leading company that has
control over all the segments of cars. It is because of its intelligence and its understanding of
Indian customer needs.
• It has expanded its business in all the areas that would comprise within the realm of automobiles.
• Its service, performance, and viability, is one of the core reasons for its success and that is why
other companies are left behind by Maruti.
• To fight the inflation which is the prime reason for the decrease of car sale…Maruti came up with
a plan that it will give a discount of rs40,000 if the customer brings a old car and wishes to buy a
new car.
• Through such initiatives and coming up with different strategies as in competition with other
players, so, it has a long way to go.
 
“Whatever status quo is, changing it gives you the
opoortunity to be remarkable.”

—SETH GODIN
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