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HRM Maruti Suzuki Ltd.

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Intoduction of Human Resource Management

Human beings are social beings and hardly ever live and work in isolation. We always plan, develop andmanage our relations both consciously and unconsciously. The relations are the outcome of our actions

and depend to a great extent upon our ability to manage our actions. From childhood each and every

individual acquire knowledge and experience on understanding others and how to behave in each andevery situations in life. Later we carry forward this learning and understanding in carrying and managingrelations at our workplace. The whole context of Human Resource Management revolves around this

core matter of managing relations at work place.

Since mid 1980s Human Resource Management (HRM) has gained acceptance in both academic and

commercial circle. HRM is a multidisciplinary organizational function that draws theories and ideas from

various fields such as management, psychology, sociology and economics.

There is no best way to manage people and no manager has formulated how people can be managedeffectively, because people are complex beings with complex needs. Effective HRM depends very much

on the causes and conditions that an organizational setting would provide. Any Organization has three

basic components, People, Purpose, and Structure.

In 1994, a noted leader in the human resources (HR) field made the following observation: Yesterday, the

company with the access most to the capital or the latest technology had the best competitive advantage;2

Today, companies that offer products with the highest quality are the ones with a leg up on the competition;But the only thing that will uphold a companys advantage tomorrow is the caliber of people in the

organization.

That predicted future is todays reality. Most managers in public- and private sector firms of all sizes

would agree that people truly are the organizations most important asset. Having competent staff on the

payroll does not guarantee that a firms human resources will be a source of competitiveadvantage.

However in order to remain competitive, to grow, and diversify an organization must ensure that itsemployees are qualified, placed in appropriate positions, properly trained, managed effectively, and

committed to the firms success. The goal of HRM is to maximize employees contributions in order to

achieve optimal productivity and effectiveness, while simultaneously attaining individual objectives (suchas having a challenging job and obtaining recognition), and societal objectives (such as legal compliance

and demonstrating social responsibility).

Definitions of HRM

Human resources management (HRM) is a management function concerned with hiring, motivatingand maintaining people in an organization. It focuses on people in organizations. Human resource

management is designing management systems to ensure that human talent is used effectively and efficiently

to accomplish organizational goals.

HRM is the personnel function which is concerned with procurement, development, compensation,

integration

and maintenance of the personnel of an organization for the purpose of contributing towards theaccomplishments of the organizations objectives. Therefore, personnel management is the planning,

organizing, directing, and controlling of the performance of those operative functions (Edward B. Philippo).3

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According to the Invancevich and Glueck, HRM is concerned with the most effective use of people

to achieve organizational and individual goals. It is the way of managing people at work, so that they give

their best to the organization.

According to Dessler (2008) the policies and practices involved in carrying out the people or human

resource aspects of a management position, including recruiting, screening, training, rewarding, andappraising comprises of HRM.

Generally HRM refers to the management of people in organizations. It comprises of the activities, policies,

and practices involved in obtaining, developing, utilizing, evaluating, maintaining, and retaining theappropriate

number and skill mix of employees to accomplish the organizations objectives. The goal of HRM is to

maximize employees contributions in order to achieve optimal productivity and effectiveness, while

simultaneously attaining individual objectives (such as having a challenging job and obtaining recognition),and societal objectives (such as legal compliance and demonstrating social responsibility).

In short Human Resource Management (HRM) can be defined as the art of procuring, developing and

maintaining competent workforce to achieve the goals of an organization in an effective and efficient.

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Introduction to Maruti Suzuki Ltd.

Maruti Suzuki India Ltd. is a leading manufacturer of four-wheeler in India. Born in 1983 with the mission to

motorise India, Maruti was a joint venture between Government of India and Suzuki Motor Corporation,Japan. It quickly grew into the largest compact car making company of India and remained so till 2004. The

company started with Suzuki holding the minor stakes of the company while GoI holding the major stakes.

As of present, GoI has disinvested its stakes in the company completely, and handed over the management of

company to Suzuki Motor Corporation. Today, Maruti and its partners employ more than 75000 employees.Its manufacturing facilities are located at two locations, Gurgaon and Manesar, both south of New Delhi.

History[

Maruti Udyog Limited was established in February 1981, though the actual production commenced only in

1983. It started with Maruti 800, based on the Suzuki Alto kei car which at the time was the only modern car

available in India. Its only competitors were Hindustan Ambassador and Premier Padmini. Originally, 74%of the company was owned by the Indian government, and 26% by Suzuki of Japan. As of May 2007, the

government of India sold its complete share to Indian financial institutions and no longer has any stake in

Maruti Udyog.

Chronology

BeginningsMaruti's history begins in 1970, when a private limited company named 'Maruti technical services private

limited' (MTSPL) is launched on November 16, 1970. The stated purpose of this company was to provide

technical know-how for the design, manufacture and assembly of "a wholly indigenous motor car". In June1971, a company called 'Maruti limited' was incorporated under the Companies Act and Sanjay Gandhi

became its first managing director. "Maruti Limited" goes into liquidation in 1977. On 23 June 1980 Sanjay

Gandhi dies when a private test plane he was flying crashes. A year after his death, and at the behest of IndiraGandhi, the Indian Central government salvages Maruti Limited and starts looking for an active collaborator

for a new company. Maruti Udyog Ltd is incorporated in the same year.

Suzuki entersIn 1982, a license & Joint Venture Agreement (JVA) is signed between Maruti Udyog Ltd. and Suzuki of

Japan. At first, Maruti Suzuki was mainly an importer of cars. In India's closed market, Maruti received the

right to import 40,000 fully built-up Suzukis in the first two years, and even after that the early goal was to

use only 33% indigenous parts. This upset the local manufacturers considerably. There were also someconcerns that the Indian market was too small to absorb the comparatively large production planned by

Maruti Suzuki, with the government even considering adjusting the petrol tax and lowering the excise duty in

order to boost sales.[15] Finally, in 1983, the Maruti 800 is released. This 796 cc hatchback is based on theSS80 Suzuki Alto and is Indias first affordable car. Initial product plan is 40% saloons, and 60% Maruti

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Van. Local production commences in December 1983.[11] In 1984 the Maruti Van, with the same three-

cylinder engine as the 800, is released. Installed capacity of the plant in Gurgaon, reaches 40,000 units.

In 1985 the Suzuki SJ410-based Gypsy, a 970 cc 4WD off-road vehicle, is launched. In 1986 the original 800

is replaced by an all-new model of the 796 cc hatchback Suzuki Alto/Fronte. This is also when the 100,000th

vehicle is produced by the company.[14][dead link] In 1987 follows the company's first export to the West,when a lot of 500 cars were sent to Hungary. Maruti products had been exported to certain neighboringcountries already. By 1988, the capacity of the Gurgaon plant is increased to 100,000 units per annum.

Market liberalization

In 1989 the Maruti 1000 is presented after having been shown earlier. This 970 cc, three-box is Indias first

contemporary sedan. By 1991 65 percent of the components, for all vehicles produced, are indigenised.

Meanwhile, the liberalisation of the Indian economy opens new opportunities but also brings morecompetition to the segments in which Maruti operates. In 1992 Suzuki increases its stake in Maruti to 50

percent, making the company a 50-50 JV with the Government of India the other stake holder.

A flow of new models begin in the early nineties. In 1993 the Zen, a modern 993 cc, hatchback which is later

exported globally as the Suzuki Alto. In 1994 the 1298 cc Esteem appears, a more luxurious redesigned

Maruti 1000. This and other Marutis begin appearing in a plethora of different equipment levels, to better suit

India's increasingly discerning consumers. A Zen Automatic arrives in 1996, as does the Gypsy King, a 1.3liter version of the compact off-roader, and a minibus version of the Omni (the Omni E).

In 1994 Maruti Suzuki produces its 1 millionth vehicle since the commencement of production, being thefirst company in India to do so. This is still not enough in a booming market and the next year Maruti's

second plant is opened, with annual capacity reaching 200,000 units. Maruti also launches a 24-hour

emergency on-road vehicle service, the first of its kind in the country. In 1996 the United Front government

is formed, with Murasoli Maran new Industries Minister. On 27 August the following year the governmentnominates Mr. S.S.L.N. Bhaskarudu as the Managing Director, as the then current Managing director R.C.

Bhargava, was completing his tenure. This creates a conflict with Suzuki, discussed closer in the Joint

venture related issues section.

In 1998 the new Maruti 800 is released, the first change in design since 1986. This is simply a facelift of the

existing model, to ensure steady sales. Also, the two millionth vehicle is produced. Other news include theZen D, a 1527 cc diesel hatchback and Maruti's first diesel vehicle. The Omni van and microbus is also

redesigned. The next year the Omni bus arrives in a high roof version, the Omni XL. The 1.6 litre Maruti

Baleno three-box saloon, advertised as the 'Maruti Suzuki Baleno', also appears. This is Maruti's biggest car

yet. Finally, in what is a very busy year, the Wagon R is launched.

In 2000 Maruti becomes the first car company in India to launch a Call Center for internal and customer

services. The new Alto model is also released, somewhat larger and more modern than the 800. The estate

Baleno Altura is also shown, while IDTR (Institute of Driving Training and Research) is launched jointlywith the Delhi government to promote safe driving habits. In 2001 Maruti True Value, selling and buying

used Maruti Suzukis, is launched in Bangalore and Delhi, later in Mumbai and elsewhere. In October of the

same year the Maruti Versa sees the day, a bigger engined and more luxurious microbus than the Omni. Itnever catches on in the market and is discontinued by late 2009, only to be replaced by a cheaper, stripped-

down version called Eeco. Customer information centers are also launched in Hyderabad, Bangalore and

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Chennai. In 2002 the Esteem Diesel appears, as does Maruti Insurance. Two new subsidiaries are also

started: Maruti Insurance Distributor Services and Maruti Insurance Brokers Limited. Suzuki Motor

Corporation increases its stake in Maruti to 54.2 percent.

In 2003 the new Suzuki Grand Vitara XL-7 appears, while the Zen and the Wagon R are upgraded and

redesigned. The four millionth Maruti vehicle is built and they enter into a partnership with the State Bank ofIndia. Maruti Udyog Ltd is Listed on BSE and NSE after a public issue, which is oversubscribed tenfold. In2004 the Alto becomes India's new best selling car, overtaking the Maruti 800 which had been number one

for nearly two decades. The five-seater Versa 5-seater, a new variant, is created while the Esteem undergoes

cosmetic changes and is re-launched with a price cut. Maruti Udyog closed the financial year 2003-04 withan annual sale of 472,122 units, the highest ever since the company began operations 20 years earlier, and the

fiftieth lakh (5 millionth) car rolls out in April, 2005, with overall sales growing by 15.8%. The 1.3 L Suzuki

Swift five-door hatchback also appears. 2004-05 marked another record year (487,402 domestic sales) and

exports reached 48,899 cars to about fifty different countries. The United Kingdom took the lion's share, with10,623 deliveries.[16]

In 2006 Suzuki and Maruti set up another joint venture, "Maruti Suzuki Automobiles India", to build twonew manufacturing plants, one for vehicles and one for engines.[16] Cleaner cars were also introduced, with

several new models meeting the new "Bharat Stage III" standards.[16] In February 2012, Maruti Suzuki sold

its ten millionth vehicle in India.[11] For the Month of July 2014, it has a Market share of >45 %.[17]

Marutis Green Philosophy

Marutis Green Philosophy stems from its use of Three Rs: Reduce, Recycle and Reuse policy in itsplants, so that there is a minimal stress on natural resources. The company has launched a number of

initiatives under its Three Rs umbrella to make the plants more efficient in terms of resource usage. It is also

certified with ISO 14001:1996 for its Environment Management System programme and uses the principle

of Smaller, fewer lighter, shorter and neater for its operations.

MarutiSustainable Operations through Internal Efficiency

Maruti in recent years, owing to several innovative measures like investing in green equipments, its

employee-driven campaigns and Kaizens (shop floor improvements), has drastically reduced the

consumption of power and water and the waste generation in its facilities. Company also credits this decreasein utility consumption to its adoption of just-in-time approach towards operations. Some of the facts and

figures supporting Marutis claims are (figures available for year 2007):

Total energy consumption per vehicle is down by 26 % over the last six years.

Power Consumption has come down by 31 % over the last six years. Water Consumption per vehicle has dropped by 63% over the last six years.

Landfill waste has come down by 67 % over the last six years.

Carbon Dioxide emissions per vehicle (produced during manufacturing) are down by over 39% in last

five years.Maruti is not only working towards implementing environmental best practices in its facilities, but also takes

active part working in collaboration with its suppliers to implement best practices in their facilities through

its Environment Management System (EMS), bringing benefit to the entire value chain.

Initiatives Taken By Maruti

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Initiatives taken by Maruti that helped the company bring down its utilities consumption and waste

generation levels are listed below. To honor its green philosophy, Maruti labels the initiatives under itsThree Rs.

Reduce Reducing water usage in its air-conditioning plant: Water use is eliminated by introducing air-cooledair-conditioners and closed cycle cooling towers.

Reducing water consumption: An employee-driven initiative that works on the principle of just-in-

time which aims for a relentless focus on zero water abuse. Reducing consumption of raw paints: Company has started using automation in paint shop, increasing

efficiency and thus reducing raw paint consumption. This has also reduced paint-sludge (industrial waste)

generated from the plant.

Rightsizing of equipments: In its new facility, Maruti has ensured to use right sizes of equipments,saving a lot on energy front.

Three-coat-one-bake painting system: This state of art system uses only one baking step as compared

to conventional system of having two baking steps, thus reducing the consumption of energy levels andincrease efficiency.

Use of solar energy in form of solar lamps and heaters helps in reducing power consumptions.

Use of natural ventilators: These ventilators use wind energy as against electrical energy to keep the

rooms cool, thereby saving on power consumption. Reducing noise pollution: Company has installed many noise curtains in its facilities, creating

enclosure for high noise generation equipments and hence providing a safer working condition to its

employees.

Reuse

Waste Heat Recovery: Company is reusing the waste gases, generated during power generation, in its

manufacturing process, resulting in a saving of almost 4225 MWH per year. Sheet metal crap utilization: Parts of unused steel sheets during manufacturing process i.e. scrap, is

reused within the value chain (like making smaller components). This results in lower industrial waste

generation and better returns for the company.

Reuse of sewage treatment plant sludge: This waste is used in horticulture, resulting in a significant

reduction in landfill wastes. Reuse of packaging material: Maruti ensures almost 100 % of domestic components come in

collapsible boxes, making them easy to reuse and in turn reducing wood and cardboard wastes.

Recycle Recycling groundwater: Maruti uses techniques like soak pits, recharging shafts, rain-water

harvesting and water lagoons that help in recharging ground water from the rainfalls.

Recycling Water, 100% recycling: Through technologies like Reverse osmosis and tertiary

treatment used in its Effluent Treatment Plant, Maruti recycles almost 100 % of its waste water, bringingdown the need for fresh water by almost 28%.

Other initiatives Secured land fills for non-incinerated wastes: Maruti maintain special land-fills to dispose non-

incinerated wastes, such that no wastes leaks out and pollute nearby areas.

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Pollution check camps: Maruti holds many pollution check-up camps in collaboration with its dealers

and petrol pumps to check on their vehicles emission levels.

CFLs: Has converted many of his traditional lights to CFLs and encourage their employees to do thesame in their houses.

Information Portal: Maruti maintains an internal portal illustrating best environmental practices and

other informative practices to run plant efficiently.

Drivers for Maruti to implement Environmental Friendly Practices

The main objective for Maruti in implementing eco-friendly measures is to reduce the operating costs, thusreducing the average car making cost. In these competitive markets, Maruti is trying to be competitive by

cutting on its energy consumption costs. Rising prices of steel have made all car companies to minimize on

its steel scrap losses. Another major driver that forces Maruti innovate on their cars is the emission norms

imposed by government. Also with the changing fuel specifications, the automobile companies are forced tochange the engine designs so that cars can run more efficiently. Other than that, Maruti has ISO 9001:2000

and ISO 14001:1996 certificates and have to follow them ardently. Maruti also has to comply with other acts

setup by the government like Environment Protection Act (1986), Water (Prevention and Control ofPollution) Act and the Air (Prevention and Control of Pollution) Act. Also Government has announced

environmental policy for automobiles which each automobile manufacturer has to follow.

Threats and Opportunities for Maruti

Threats: With increasing raw material prices, and increasing competition and increasing environmental

concerns, the road is not smooth for Maruti. Already foreign players are entering the market with theirenvironmental practices which more often than not, surpasses what are prevalent in India, placing them in a

much more advantageous position in terms of operating cost reductions and reputation in front of public.

Technological advancement of foreign players also places them in a favorable position in meeting the strict

emission standards set by the government.

Opportunities: There is a growing market for environmental friendly Hybrid electric vehicles which have an

alternate fuel arrangement along with the traditional one, saving a lot on emissions and increasing fuelefficiency. It also places lesser burden on the petroleum based natural resources. Another opportunity is to

bring in the state of art technologies followed by foreign players, thus saving a lot on the long run.

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Various Product

Maruti Suzuki alto 800Maruti Suzuki omni

Maruti Suzuki Eeco

Maruti Suzuki Alto k10Maruti Suzuki Wagon R

Maruti Suzuki Celerio

Maruti Suzuki swiftsMaruti Suzuki Rits

Maruti SuzukiWagon R Stringay

Maruti Suzuki Swift Dzire

Maruti Suzuki GypsyMaruti Suzuki Ertiga

Maruti Suzuki Ciaz

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4ps

Product Strategy:

Product Line A1 800A2 Alto, Zen ,Wagon R, Swift, A-star A3 D ZiRE, Sx4SUV Vitara, GypsyC - Class

Omni, EECO

Price Strategy:-

The price of the Maruti car is between Rs. 210000 to Rs. 1500000. Maruti 800 is the lowest price car of

this company. Alto, Omni, Wagon R, are also the low price car of the company, Zen& Esteem are the midprice car of the company. But Grand Vitara is the high price model of thecompany. The price of car is

decided according to its product variety, quality, design etc.

Place strategy:600 New car sales outlets covering 393 cities.265 Maruti True Value outlets spread across 166 cities.2628

Maruti Authorized Service Stations, covering 1220 cities.Tie up with Adani group for exporting 200,000

units through Mnudra port Gujara

Promotion Strategy : Since the late 1980s, Maruti had been the market leader in the passenger car industry in

India. However, after the liberalization of the Indian economy in 1991, the Indian passenger car industry

became extremely competitive.

Marketing Management Case Studies | Case Study in Management, Operations, Strategies, Marketing

Management, Case StudiesFrom the mid 1990s, foreign automobile companies started entering the Indian passenger car market. Maruti

started losing market share as its competitors launched new models that proved very popular with Indian

buyers. Between the financial years 1997-98 and 1999-2000, Maruti's market share declined from 83.1

percent to 60.8 percent

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Human Resource

HR VISION Lead and Facilitate continuous change towards organizationalexcellence ; create a learning and

vibrant organization with highsense of pride amongst its members.HR INITIATIVESPrepare MUL

Strategic Business Plan-2000-2003; To achievethe Vision & GoalImprove the performance Appraisalsystem - its process, skill& usageIntroduce a Potential Appraisal SystemImprovements in internal & external Training & its effectiveutilization. Training need identification

Recruitment on an All India Basis no sector or regionspecific.

Engineers CAMPUS - IITs/RECs/Rorkee /HBTI ALL-INDIA TESTMBAs IIMs/XLRICAs - RankHoldersIndia Exam & Apprenticeship In MULLateral Entry for Experienced Professionals.MATTER

USUALLY DISCUSSED IN THE MARUTIINDUCTION

Overview of Maruti and SuzukiBuilding understanding of the car market in India and

varioussegmentsUnderstand MULs product range and positioning in eachsegmentUnderstanding thebasics in the automobile industryRole of financing as a sales tool and the various financingoptions

availableEnsuring personal effectivenessUnderstand the attributes of a good DSEOverview of each Maruti

model and the MUL AdvantageOverview of the selling process and how to uncover needs of acustomer todo need based selling

Induction programObjective:The objective of this program is to facilitate smoothinduction of the new DSEs into their place of work i.e.

Marutidealerships. This program attempts to orient the new DSEs on a fewimportant parameters, which are

listed below:Overview of Maruti and Suzuki

Building understanding of the car market in India and varioussegments

Understand MULs product range and positioning in each segment

Understanding the basics in the automobile industryOverview of each Maruti model and the MUL Advantage

Overview of the selling process and how to uncover needs of acustomer to do need based selling

Role of financing as a sales tool and the various financing optionsavailableEnsuring personal effectiveness

Understand the attributes of a good DSE

RECRUITMENT PROCESS OF MARUTI UDYOG LTD

The recruiting procedure at a Maruti dealership is as follows:For a particular city For a particular Dealership

The dealership should release an advertisement.

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Competitors of Maruti Suzuki ltd.

Two of the main competitors for Maruti Suzuki ltd.are Honda and Tata Motors. The players in the sector aremostly ISO 14001 credited, which implies that the sector is sensitive towards the environment protection.

Some of the practices followed by Marutis competitors are:

Honda: Honda is known for its environment friendly practices and is recognized by many governments

across the world. Honda calls his commitment to environment enviornmentology defining it as an

ongoing commitment to environmentally responsible technology. Honda spends a lot of R&D on green cars

It was the first company to bring in the concept of fuel cars and hybrid cars. Honda is awarded ISO 14001certification for its environmental practices.

Tata Motors: Tata motors actively engage in the sustainable environment practices. It ensures that itsproducts are environmentally sound in a variety of ways. These include reducing hazardous materials in

vehicle components, developing extended life lubricants, fluids and using ozone-friendly refrigerants. Tata

motors endeavors towards environment protection are soil and water conservation programmes and

extensive tree plantation drives. Tata Motors is also awarded ISO 14001 certification for its environmentalpractices.

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Conclusion

CONCLUSION AND LEARNINGA detail analysis on the business of Maruti Suzuki is done based on thevarious theories laiddown under business strategy. The analysis included applying various concepts and

theorieswhich include Porters five forces to understand portfolio analysis, value chain of thecompany, cost

component, willingness to pay and growth prospects of the company in nearfuture.It can be concluded thatMaruti Suzuki is expanding its product basket by offering value(swift, sx4) at different income level. MarutiSuzuki stands for value as much as it stands forperformance. In spite of rising input costs, Maruti Suzuki

always tries to provide cars atreasonable cost. Their running costs and resale values are unbeatable too. This

enabledMaruti to become Market leader. Suzuki gaining globally on back of small car portfolio.Economiesof Scale make India attractive destination for Maruti Suzuki. With the passengercar sales over spiraling fuel

prices and high interest rates, Indias largest car manufacturer,Maruti Suzuki India, is working on customer

specific marketing strategy to increase its salesamong the first time buyers. The company have maximum 47

per cent market share amongthe first time buyers.Maruti Suzuki is far behind in luxury and SUV car, theother player like GM, TATA, Mahindra,Honda and Toyota are already established in the market, so

replacing them would not beeasyLearning can be put as understanding of various theories of business

strategy and practicallyusing them to comprehend on economic, industry and financial details. Page | 13

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