Analyzing a Business System

8/2/2019 Analyzing a Business System

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ANUPAM SINGHPGDM10003


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Analyze the business carried by TATA MOTORS

and determine the input, processes and

outputs of the organization

Determining system from the three ends

organization, management and technology

Importance of the system to the companywill be analyzed


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India's largest automobile company

leader in commercial vehicles in eachsegment & among top three in passengervehicles

World's 4th largest truck manufacturer, andthe world's 3rd largest bus manufacturer

Manufacturing units in Jamshedpur, lucknow,pune and pantnagar

Tata Indica India's first fully indigenouspassenger car

In January 2008, Tata Motors unveiled itsPeople's Car the Tata Nano


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It still has a 60% share of India's commercial-

vehicle market.

The Indian car market grew 17% last year,

and Tata Motors' volume grew 27%


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TATA Motors used manual dealer

management system, where every dealer

managed details

Produced inconsistent data, makinginterpretations difficult, resulting in

inefficient planning for capacity and spare

parts

The basic challenge was to provide a DealerManagement System (DMS) solution


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Increase in sales and profitability by easy

management.

Improved accuracy of dealer-captured

information.Collaboration between vehicle manufacturers

and dealers.

A strong feedback mechanism and interface

for communicating with customers.


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IBM created a Siebel solution to provide a DMSsolution for TATA Motors and then provided areliable and scalable IT infrastructure fordeveloping and deploying its DMS application

The benefits include - low total cost ofownership, a more comprehensive view ofcustomers, enhanced customer experiences andimproved loyalty. the company can also analysecustomer interactions and other information

more accurately, improve capacity planning andincrease profitability.


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For TATA MOTORS

Inputs are in the form of Raw materials,

machines, land, people and the

infrastructure The process involves the conversion of raw

material in a useable form of product that is

Quality automobiles

Output is fully equipped automobiles


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PULL SYSTEM TO AVOID OVERPRODUCTION.

Because of demand uncertainty and lead-times, in many cases inventory is necessaryto allow for smooth production.

Hence TATA MOTORS follows the supermarketmodel or keeping a small amount in stock. Assoon as customers take products away, theyare replenished.

Each demand instance triggers a part beingpulled from upstream

The triggering mechanism is called Kanbanwhich means cards, signboard or a poster.


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At TATA MOTORS, empty bin (a kanban) is send upstream after ademand instance.

It is a signal to refill it with a specific number of parts or sendback a card with detailed information about the part location

Instead of using sophisticated computer scheduling techniques,this is a simple, effective and visual system of managing andensuring the product flow and JIT production system.

Suppose we have four kanban cards for particular products. Oneeach for four bins of products. TPS will conduct studies in whichone of the kanban cards (along with the corresponding bin) is

thrown away. Now, if the machine breaks down, the downstream process will

run out of parts 25% faster.

The stress in the system will cause production shutdowns, andwill force teams to come up with process improvements.


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Challenges &Opportunities

Replacement for homegrown legacy systems

Build a single location-independent integratedenterprise

Richer quality of data and real-time access todatabase

Objectives

Rationalize business processes across allmanufacturing units

Improve efficiency by reduction in effort-duplication

Reduction in operational costs

Reach and respond to the customer rapidly


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Why SAP

It was the clear leader in the market for such solutions

It was the best package available for automotive industry

Multiple functionalities were Covered

Benefits Enterprise integration

Financial benefits of reducing inventories

Better control of receivables

Significant reduction in time taken for financialconsolidation

A single unified database


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Existing Environment

Database : Oracle

Hardware : Pre-dominantly IBM with

a smattering of HP and Sun

Operating System : Unix


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Benefits

With the SAP ERP Solution in place, Tata Motors hasexperienced significant benefits in productivity and costcontrol.

The number of servers as well as the number of different

applications run on them has been greatly reduced. Thedisaster recovery management is being done only for oneentity rather than for every application.

Non-value-add activities have been lowered. Theimplementation of a single SAP instance forced a muchrequired change in the organization.

A BPR to achieve uniform processes with business userstalking the same language was the outcome.

There is significant reduction in inventories and bettercontrol overreceivables and other credit control. A sharedservices platform has also been created for IT and sharedfinancial services.


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Analyzing a Business System