OPER/008

IBS Center for Management Research

Mahindra & Mahindra Implementing BPR

This case was written by A. Mukund, IBS Center for Management Research. It was compiled from published sources, and is
intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of a
management situation.

2002, IBS Center for Management Research. All rights reserved.

To order copies, call +91-08417-236667/68 or write to IBS Center for Management Research (ICMR), IFHE Campus, Donthanapally,
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www.icmrindia.org

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OPER/008

Mahindra & Mahindra Implementing BPR

In our never ending quest for quality and increasing productivity at all levels, the various
projects initiated by the company including BPR are helping us achieve higher productivity,
reduction in costs and improved quality.
- Keshub Mahindra, Chairman, Mahindra & Mahindra (M&M), in 1996.

M&MS PROBLEM PLANTS

In the mid-1990s, Indias largest multi utility vehicle (MUV) and tractor manufacturer M&M was
facing serious problems at its Igatpuri and Kandivili plants in Maharashtra. The plants were
suffering from manufacturing inefficiencies, poor productivity, long production cycle, and suboptimal output. The reason: highly under-productive, militantly unionized, and bloated workforces.
The company had over the years been rather lenient towards running the plants and had frequently
crumbled under the pressure of union demands.
The work culture was also reportedly very unhealthy and corruption was widespread in various
departments. Alarmed at the plants dismal condition, Chairman Keshub Mahindra tried to address
the problem by sacking people who allegedly indulged in corrupt practices. M&M also tried to
implement various voluntary retirement schemes (VRS), but the unions refused to cooperate and
the company was unable to reduce the labor force.
During this period, M&M was in the process of considering the implementation of a Business
Process Reengineering (BPR) program throughout the organization including the manufacturing
units. Because of the problems at the Igatpuri and Kandivili plants, M&M decided to implement
the program speedily at its manufacturing units. The program, developed with the help of the UKbased Lucas Engineering Systems, was first implemented on an experimental basis at the engine
plant in Igatpuri. Simultaneously, an exercise was initiated to assess the potential benefits of
implementing BPR and its effect on the unions.
M&Ms management was not surprised to learn that the unions expressed extreme displeasure at
the decision to implement BPR and soon went on a strike. However, this time around, the
management made it clear that it would not succumb to union demands. Soon, the workers were
surprised to see the companys senior staff come down to the plant and work in their place. With
both the parties refusing to work out an agreement, observers began casting doubts on the future of
the companys grand plans of reaping the benefits of BPR.

BACKGROUND NOTE
Mahindra & Mahindra Ltd. (M&M) was the flagship company of the Mahindra group, one of the
top ten industrial houses in India. The companys history dates back to 1945, when two brothers,
J.C.Mahindra and K.C.Mahindra, decided to start a business of general-purpose utility vehicles.
The brothers formed a company, Mahindra & Mohammed Ltd., in association with their friend
Ghulam Mohammed. In October 1947, the first batch of 75 jeeps was released for the Indian
market. In 1948, the company was renamed Mahindra & Mahindra Ltd. 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 (Refer
Exhibit I for M&Ms history).
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Mahindra & Mahindra Implementing BPR

Though M&M had established itself in the markets and was among the leading players in many of
the segments it operated in, it realized that some of its businesses were not closely related to its
core business. This realization marked the beginning of the biggest change exercise since the
companys inception. In 1994, a major restructuring exercise was initiated as part of a BPR
program. M&M introduced a new organizational model, in which various divisions and companies
were regrouped into six distinct clusters of related businesses, each headed by a president.
M&Ms core activities, automotive and tractors were made autonomous business units. The other
activities of the group were organized into infrastructure, trade and financial services,
telecommunication and automotive components. According to company sources, the whole
exercise was intended to develop a conceptual map to provide direction for the future growth of
various business lines. It was decided that, in future, the group would confine its expansion to the
identified thrust sectors.
The two main operating divisions of the company were the automotive division, which
manufactured UVs and LCVs, and the farm equipment division, which made tractors and farm
implements. The company employed over 17,000 people and had six state-of-the-art
manufacturing facilities spread over 500,000 square meters. The plants were situated at Kandivili
(MUVs and Tractors), Nasik (MUVs), Zaheerabad (LCVs, Voyager, three-wheelers), Igatpuri
(Engines) and Nagpur (Implements and tractors).
The company had 33 sales offices supported by a network of over 500 dealers across the country.
These offices were connected to the companys plants by extensive IT infrastructure. By 2001, the
company had firmly established itself as one of the leading players in the Indian automotive
industry, with revenues of Rs 43.53 billion and profits of Rs 1.2 billion1 (Refer Exhibit II for a
summary of M&Ms operations).
The Kandivili and Nagpur plants were the production hubs for the farm equipment division. This
division, reportedly the single largest facility of its kind in the world, received the ISO-9001
certification in 1996. In 2001, the division marked its 16th year as the market leader; its products
were being used by over 600,000 Indian farmers. The division was a successful exporter to many
countries: the US, South Africa, Sri Lanka, Bangladesh, Nepal, Zimbabwe and several European
countries. The division had set itself the goal of becoming the worlds largest tractor manufacturer
in terms of volume by 2005, from its 2001 position of number four.
M&Ms decision to undertake BPR implementation at the plant was largely influenced by its
ambition to become the largest tractor manufacturer in the world. This was accompanied by a
decision to focus on enhancing productivity and delivering world-class quality at the least possible
cost. The company also decided to undertake a total quality management initiative. Various
initiatives such as supplier upgradation, strategic and global sourcing, product development,
channel management and lean manufacturing were also identified as thrust areas. Problems at the
individual factories played a major part in the managements decision to hasten the
implementation of the BPR program.

ABOUT BPR
The concept of BPR was popularized in the early 1990s by Michael Hammer and James Champy
in their best-selling book, Reengineering the Corporation. The authors said that radical redesign
and reorganization of an enterprise was necessary to lower costs and increase the quality of
service. According to them, IT was the key enabler for that radical change. Hammer and Champy
felt that the design of the workflow in most large corporations was based on assumptions about
technology, people and organizational goals that were no longer valid. They recommended seven
principles of reengineering for streamlining work processes and, consequently, achieving
significant levels of improvement in quality, time management and cost (Refer Table I).
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1

In September 2002, Rs 48 equaled 1 US $.

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Mahindra & Mahindra Implementing BPR

Table I

BPR Principles
1.

Organize around processes, not tasks Instead of work being divided among different
people, one person is given the responsibility for an entire process. Each persons job is
designed around an outcome, such as a finished component or a completed process, rather
than one of the tasks necessary for producing the finished component or completing the
process. This could mean replacing functional departments such as manufacturing and
marketing with interdisciplinary teams that concentrate on completing a particular business
process.

2.

Have output users perform the process Instead of departments functioning as distinct
specialized entities doing only their work, passing the output to someone else, BPR
requires each department to take full responsibility for one complete process.

3.

Have those who produce information process it People responsible for generating a
piece of information should be involved in processing all the information regarding it. For
instance, instead of the traditional way of receiving goods (involving receiving, accounts
payable and other departments), only one receiving clerk receives the goods using
specialized software.

4.

Treat geographically dispersed resources as centralized To provide better customer

service, companies decentralize operations. With current technology, a companys data can
be centrally located and yet be made available to all its geographically dispersed units.
This way, companies get the benefits of centralization as well as decentralization.

5.

Link parallel activities in the workflow instead of just integrating their results
Certain processes, such as product development, are performed in parallel and then
integrated at the end. However, quite often, the teams involved do not communicate well.
In such a scenario, BPR would put people from various functional areas on the team in
charge of a particular product.

6.

Empower workers and use built-in controls Most organizations have many layers of
personnel working and several more to manage, audit and control them. BPR empowers
the people actually doing the work by giving them the authority to take certain decisions.
This results in faster responses to problems and increases the quality of the task performed.

7.

Capture information once and at the source Different departments capturing their own
data at their own pace leads to inefficiency, resource wastage and data discrepancy errors.
By utilizing information technology effectively, data can be captured electronically at
source, entered once in an online database, and made available to all who need it.

Source: ICMR.

Simply put, BPR refers to a complete overhaul of the way an organization does its business.
Instead of focusing on improving or modifying processes, it focuses on reinventing the way the
company carries out its business. And instead of focusing on the existing business, it tries to
determine what business the company should be involved in. BPR thus results in dramatic changes
in a companys business activities. The kind of results the company looks for are not marginal in
nature, BPR results in dramatic and huge improvements in the processes being reengineered.
The most important aspect of BPR is the proper identification of the business processes. A
business process can be defined as a collection of closely-related tasks performed to create value
for the customers. According to analysts, in most organizations, processes have traditionally not
been earmarked or identified clearly. Thus, examining and dealing with business processes is a
radical change in the way organizations and managers have traditionally functioned.
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Mahindra & Mahindra Implementing 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 costeffective manner. Instead, it requires the organization to focus on the outcomes of its processes in
the way a customer would.
For instance, a customer of a furniture vendor who has asked for a wooden partition to be installed
in his house would be concerned only with the overall time taken for the work to be completed. He
would not be concerned about individual processes: the time the company takes to get the request
approved and dispatched to the carpenters, the time the carpenters take to finish their job, and the
time the painters take to finish their work. Once the company begins looking at the above
transaction from the customers point of view (i.e. getting the partition installed within a certain
timeframe), it will get a fresh perspective on customer expectations regarding quality,
responsiveness and cost-effectiveness (Refer Table II for the effects of BPR).
Table II

The Effects of BPR

Work units change from functional to process teams
Jobs change from simple tasks to multidimensional.
Roles change from controls to empowered.
Advancement criteria changes from performance to ability
Executives change from scorekeepers to leaders.
Performance measures change from activity to results
Source: www.geocities.com

BPR can be categorized into Process Improvement, Process Redesign and Business
Transformation. Process improvements involve improving processes that are part of a single
business function, and are not cross functional. They result in small improvements to the existing
process, usually through eliminating non-value-added activities.
Process redesign on the other hand, involves the total redesign of an end-to-end process. This
usually results in considerable performance improvement in terms of cost, quality and cycle time.
Business transformation begins with a study of the basic elements of people, processes,
information and technology involved by the top management. It is the highest degree of BPR. It
focuses on reinventing the business through a top-down reappraisal and redesign of the total
business. The organization has to evaluate itself and ask why it exists and what it is trying to
achieve.
A typical BPR implementation exercise can be divided into three phases comprising two stages
each (Refer Table III).
Table III

BPR Implementation Cycle

Phase 1

Phase 2

1. Business Understanding

3. Business Process Identification

2. Project Planning
Training

& 4. Process Envisioning

Source: www.geocities.com

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Phase 3
5. Process Redesign
6. Process Implementation

Mahindra & Mahindra Implementing BPR

According to analysts, companies usually opt for reengineering when they are in serious trouble,
have foreseen trouble or are taking proactive measures to avoid landing in trouble. Companies that
implement BPR to avoid landing in trouble usually have ambitious and aggressive managements.
As a result, they are able to implement BPR effectively and derive the benefits of reengineering.
Many BPR exercises fail because the concerned organizations do not ensure the presence of
critical success factors for BPR implementation (Refer Table IV). Often, BPR is confused with
practices such as automation, downsizing and outsourcing. However, such practices are only tools
that can be a part of the overall BPR program; they can never be the all of such an exercise.
Table IV

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).
Source: www.geocities.com

M&MS EXPERIENCE WITH BPR

By the mid 1990s, BPR had become a popular tool globally, with many leading organizations
implementing it. However, when M&M undertook the exercise, it was still a new concept in India.
M&Ms workforce, as mentioned earlier, resisted this attempt to reengineer the organization. Soon
after the senior staff began working on the shopfloors, the first signs of the benefits of BPR
became evident. Around a 100 officers produced 35 engines a day as compared to the 1200
employees producing 70 engines in the pre-BPR days.
After five months, the workers ended the strike and began work in exchange for a 30% wage hike.
As the situation returned to normalcy, BPR implementation gained momentum. M&M realized
that it would have to focus on two issues when implementing the BPR program: reengineering the
layout and method of working, and productivity.
M&M worked on the principle of cellular manufacturing.2 In this type of manufacturing, plant
layout is reorganized drastically and workers are required to do multi-tasking through multimachine manning. The plant and machinery layout at the company had to be revamped to reduce
non-productive activities and introduce cellular manufacturing. To enhance productivity, M&M
moved from a batch to a modular process3 and implemented TPM4 and Kaizen.5 The company then
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2

Cellular manufacturing allows companies to produce just what is needed with minimum materials,
equipment, labor, time and space. This translates to lower operating costs. In addition, a cell has a simple
and direct routing between operations, so bottlenecks can easily be identified and eliminated, reducing
lead times. As cells can accommodate small lots, quality problems are discovered and corrected sooner.
In the batch process, parts are accumulated and processed together repeatedly for manufacturing items of
a similar nature. Modular production aims to standardize both the methods of production system design
and the machine units for production system construction. This results in fully integrated component
production and assembly systems, which can be rapidly configured for producing a wide range of
products, thereby enhancing productivity.
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Mahindra & Mahindra Implementing BPR

revealed plans to enhance the capacities at its plants and asked the workers to start working harder
and become more flexible. A group of workers voiced their resentment against this and, at one
point of time, even halted production.
However, the management stood its ground and called the opposition as the dying gasp of any
resistance to the new model of working. Anand Mahindra commented, All said and done, I think
our point was proven though it meant a loss in production. It was necessary for the management to
show the required commitment without which everything would have come unwounded.
In line with its decision to adopt practices followed by international auto players, M&M decided to
replace its existing setup with the Platform Concept. The platform concept focuses on customer
requirements. It requires the formation of cross functional teams consisting of professionals from
R&D, manufacturing, processing, marketing etc. These teams jointly develop the product, keeping
in mind the needs of the final customer. M&M took the help of its 600 strong R&D team
consisting of engineering professionals with experience across industries, for this purpose. This
move was a complete shift from the traditional form of product development, which was
product/function centric (i.e. R&D, manufacturing and other departments worked in isolation at
the development stage and came together only at the assembly stage).
To focus on customer requirements, M&M had to bring in features of concurrent engineering6 at
the development phase itself. This was accompanied by the formation of three full-time teams to
bring the product development process in line with the platform concept. The teams were named
Horizon I, Horizon II and Horizon III. While Horizon I concentrated only on some improvements
in existing products, Horizon II specialized in the upgradation of existing products. Horizon III
was concerned with the development of new products. This initiative resulted in the introduction
of several new features like constant mesh gearbox for easy gear shifting and power steering to
reduce steering efforts (besides a range of improved as well as new products).
Continuing with the BPR exercise, M&M decided to utilize information technology (IT) to
seamlessly integrate all business functions and processes with each other. Several IT systems were
installed at various locations and various functions, and officers were directly linked with each
other. The IT solutions were integrated with an ERP package by SAP.7 The solution integrated
every facet of business operations to provide a complete update of all organizational activities, at
any point in time. ERP made customer requirements available. Every department and location was
connected through information technology. Since they were informed of the work at hand, they
could adjust their schedules and inventories accordingly. The whole system was designed to be
controlled not by the average user, not by IT professionals.
___________________________________
4

Total Productivity Management (TPM) is an approach for optimizing the effectiveness of production
means in a structured manner. It entails the effective use of all company resources to enhance customer
satisfaction, in the context of clear business direction, an integrated, visible improvement plan, a
consistent set of improvement strategies and an appropriate performance measurement system.

Japanese for change for the better or improvement. A methodology of continuous cost reduction,
quality improvement, and delivery time reduction through shopfloor involvement and rapid action now
practiced in businesses worldwide.

Concurrent engineering is a systematic approach to the integrated, concurrent design of products and
related processes, including manufacturing and support processes. This approach is intended to make
developers consider from the outset, all elements of the product life cycle, from conception through
disposal, including quality, cost, schedule, and user requirements.

ERP is a software-driven business management system that helps integrate all functions of a business
including planning, manufacturing, sales, and marketing. SAP R/3 is a popular ERP software from the
Germany based company Systems Applications & Products in data processing (SAP).
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Mahindra & Mahindra Implementing BPR

By April 2000, the BPR program was successfully implemented at M&M. At the Igatpuri plant,
even as the number of employees declined to 760, the number of engines produced went up by 125
per day. The 400 excess workers at the plant were redeployed at the assembly plant in Nasik. The
Nasik plant soon achieved a 125% improvement in productivity. Employee costs at these two
plants came down from 12.4% in 1994 to 10.1% in 1996. The number of vehicles produced overall
increased from 47,760 in 1995 to 65,405 in 1996 and 75,568 in 1997. A large part of this increase
was attributed to the improvement in productivity because of the BPR program. During the same
period, inventory levels also came down from 74 days of net sales to 56 days, and value added per
employee increased from Rs 0.3 million to Rs 0.46 million.
Over the next few years, the BPR initiatives enabled the company to maintain steady gross
margins, reduce working capital levels, and rationalize manufacturing processes. BPR not only
enabled M&M to achieve a new and modern working relationship with its employees (with
productivity as the main criteria), but also brought its manufacturing systems up to international
standards. The benefits of the BPR exercise included bbetter inventory control, better sourcing,
better order distribution across plants, online availability of data, transparent access to data,
process transparency and an integrated sales and supply chain.

THE FUTURE
Summing up the companys BPR experience, Anand Mahindra said, Let me put it in a simple
way. If we have facilities in Kandivili today, which are not just surviving but thriving, it is all due
to BPR. If you go back to the 1990s, there was no shortage of pundits telling us that it would not
be possible to manufacture in Mumbai due to the fact that the plants are old and depreciated,
workers are too highly paid and not producing good quality. In fact, some of our compatriots in the
city have met a similar fate. So BPR was a way of reengineering our plants and making them
viable in a competitive environment.
Having reaped handsome gains from the BPR exercise, M&M decided to adopt other globally
accepted practices to improve its business. Towards this end, the company hired McKinsey & Co
in 1997 to offer restructuring proposals. Following McKinseys recommendations, the farm
equipment division undertook Project Vishwajeet, a major restructuring exercise, in May 2000.
This project divided the tractors business into 38 business units classified under five business
divisions. The hierarchy structure in each of these divisions was limited to just five layers to
ensure autonomy and clear accountability.
The company continued with its efforts to further streamline its operations by undertaking a costsaving program in May 2001 to reduce break-even volumes in the automotive and farm equipment
divisions. The program, undertaken as part of the restructuring proposals made by McKinsey, was
expected to result in savings of 20-30% on business redesign, including sharing of resources to
prevent duplication of capital expenditure.
In addition, M&M envisaged 10-15% savings on process redesign and 5-10% savings on
engineering redesign. The company also started outsourcing non-core manufacturing activities,
sourcing most components of a particular model from the same vendor, and increasing the volume
of business transactions with a few select suppliers. M&M, however, continued to manufacture
critical components.
There was one unexpected, welcome change brought about by the BPR program and the
companys other initiatives aimed at the shopfloor and its workers. Commenting on this, Anand
Mahindra said, Today the atmosphere is so different that every morning all the workers recite the
company oath, which is a sea change from the situation ten years ago when workers used to play
cards on the shopfloor during working hours.
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Mahindra & Mahindra Implementing BPR

QUESTIONS FOR DISCUSSION:

1. Comment on the circumstances that led M&M to implement a BPR program. Why do you
think the company-faced resistance from the unions when it decided to implement BPR at the
plants?
2. Analyze the BPR implementation exercise at M&Ms plants. How do you think the platform
concept helped the company? Also, comment on the benefits M&M reaped as a result of the
BPR program.
3. How is BPR different from traditional improvement techniques like TQM? As a manager in
charge of a shopfloor undergoing such a program, what measures would you take to ensure its
success?

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Mahindra & Mahindra Implementing BPR

Exhibit I

M&M Milestones
Year
1948

Events
Steel trading business was started in association with suppliers in UK
Business connections in USA through Mahindra Wallace.

1949

WallaceSteel trading on behalf of European suppliers; Jeep Assembly.

1950

The first business (for 5000 Tons) with Mitsubishi Corporation for wagon building plates.

1953

Otis Elevator Co. of India established.

1954

Technical & Financial Collaboration with Willys Overland Corporation.

1956

Dr. Beck & Co. formed - a JV with Dr. Beck & Co. ,Germany.

1957

Mahindra Owen formed a JV with Rubery Owen & Co. Ltd., UK.

1958

Machine Tools Division started.

1960

Mahindra Sintered Products Ltd. (MSP) formed - a JV with the GKN Group, UK.

1961

International Tractor Co. Of India (ITCI), a JV with International Harvester Co., US formed.

1962

Mahindra Ugine Steel Company (MUSCO) formed - a JV with Ugine Kuhlmann, France.

1965

Vickers Sperry of India Ltd., a JV with Sperry Rand Corporation, USA

Roplas (India), a collaboration with Rubery Owen. Manufacture of LCVs commenced.

1970

Mahindra Engineering & Chemical Products Ltd.(MECP) formed.

1971

International Harvester collaboration ended.

1975

Switch over to diesel vehicles in-house development.

1977

ITCI merges with M&M, to become its tractor division.

1979

License from Automobiles Peugeot, France, for XDP 4.90 Diesel Engine.

1982

License from KIA for 4 Speed Transmission Mahindra of tractors; Siro Plast formed.

1983

M&M becomes market leader in Indian tractor market.

1984

Mahindra Hellenic Auto Industries S.A. formed, a JV in Greece to assemble and market
UVs in Europe.

1986

Mahindra British Telecom , a JV with British Telecommunications plc (BT), UK formed.

1987

M&M acquired International Instruments Ltd.

1989

Automotive Pressing Unit (now MUSCO Stampings) acquired from GKW.

1991

Introduction of Commander series.

1992

Triton Overwater Transport Agency Ltd. formed, Implementation of the Service Center
project at Kanhe.

1993

MC & NI invited to participate in Steel Service Center Project. JV signed, MSSCL formed.
Mahindra Acres Consulting Engineers Ltd. (MACE) formed - a JV with Acres
International, Canada.
MBT International Inc., USA, a wholly owned subsidiary
The companys maiden international offering the US$ 75m GDR issue.
Introduction of Armada.
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MBT

Mahindra & Mahindra Implementing BPR

Year

Events

1994

Mahindra Realty & Infrastructure Developers Ltd. (MRIDL) formed; Mahindra USA
Inc. formed for distribution of tractors in the US; EAC Graphics (India) Ltd., formed in
collaboration with The East Asiatic Company Ltd. A/S, Denmark.
Reorganization of the Group, creating six Strategic Business
MSL Division (Auto Components) hived off to form Mahindra Sona Ltd.

Units

Mahindra Nissan Allwyn Limited merged with the company.

1995

Mahindra Holding & Finance Ltd. (MHFL) becomes a subsidiary to carry out business
as an investment company.
Technical collaboration with Mitsubishi / Samcor to manufacture L300.

1996

Mahindra Ford India Ltd. (MFIL) - JV with Ford Motor, US, to manufacture passenger cars.
The company made a Foreign Currency Convertible Bond (FCCB) issue of US$ 115 million.

1997

Business connections in US through Mahindra Wallace; A new die shop was

inaugurated at Nasik.
Inauguration of the Mahindra United World College of India.

1999

Launch of Bijlee a battery-operated, 3-wheeler, environmental-friendly vehicle.

The largest online used vehicle website in India launched by Mahindra Network
Services.
The business of Intertrade Division and Mahindra Exports Ltd. combined and renamed
Mahindra Intertrade Ltd.
Mahindra USA Inc. enters into a strategic alliance with Tong Yang Moolsan to
distribute its tractors under the Mahindra brand name.
The company acquires a majority stake in Gujarat Tractors.

2000

The company unveils new logo.

Mahindra Auto Specialties Ltd., a new 100% subsidiary, is formed. M&M sets up its
first satellite tractor plant at Rudrapur.
The company launches New Age Tractor, the Mahindra Arjun 605 DI (60 HP tractor).
The company launches Bolero GLX, a UV, in response to the needs of the urban consumer.

2001

3-wheeler diesel vehicle Champion is launched by the company.

The company launches Mahindra MaXX an MUV positioned with the caption
Maximum Space, Maximum Comfort.
M&M ties up with Renault for petrol engines. M&M establishes a separate division to
provide Defence Solutions.

Source: www.mahindra.com

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Mahindra & Mahindra Implementing BPR

Exhibit II

M&M Summary of Operations

( in Rs million)
Year end 31st
March

1993

1994

1995

1996

1997

1998

1999

2000

2001

Income

14,896

17,151

21,135

28,996

36,205

41,280

42,250

44,760

43,529

8,194

9,218

11,457

15,790

19,668

21,514

22,274

22,102

23,586

272

322

260

328

441

491

431

455

489

Excise Duty (Net)

2,331

2,306

3,060

4,065

5,007

6,398

6,536

7,732

7,554

Personnel

1,841

2,098

2,339

3,002

3,417

3,875

3,853

4,094

4,156

Interest

595

562

447

482

805

1,229

1,519

1,415

622

Deprecation (Net)

321

351

336

423

630

993

1,120

1,233

1,401

Other Expenses

1,082

1,324

1,527

2,164

2,804

3,486

3,716

4,261

4,434

Extra-ordinary
items

(144)

84

104

36

PBT

261

826

1,792

2,846

3,283

3,295

2,801

3,505

1,286

Tax

148

623

1165

1190

780

515

870

880

Prior period items

(22)

(34)

(57)

(27)

Balance Profit

239

679

1135

1623

2093

2,515

2,260

2,635

1,206

Dividends

108

184

342

441

560

625

631

675

670

30

45

65

45

50

55

55

55

55

6.64

16.64

21.61

16.98

20.56

24.33

21.85

23.85

10.91

Vehicles Prod.
(units)

38,813

49,155

47,760

65,405

74,653

77,510

70,639

76,983

63,146

Vehicles Sold
(units)

38,887

48,292

49,235

63,623

75,568

76,954

70,548

76,437

62,927

Tractors Prod.
(units)

35,454

32,925

40,051

49,651

58,028

71,468

66,211

73,222

80,261

Tractors Sold
(units)

34,052

32,875

41,006

50,005

57,379

67,780

69,362

70,571

79,237

Material Direct
Material - Indirect

Equity
Dividend(%)
EPS (Rupees)

Source: www.mahindra.com

11

License for IBS Gurgaon, Sem II, Class of 2014.

Mahindra & Mahindra Implementing BPR

Additional Readings & References:

1. Radhakrishnan N and M Karthikeyan, The Remaking of M&M, Business India, June 16, 1997.
2. Strategic Management Case Studies on Indian Companies Volume IV, ICMR, 2000.
3. M&M Kicks Off Cost Saving Drive, Business Standard, May 17, 2001.
4. Mahindra & Mahindra Tough Road Ahead?, www.karvy.com.
5. Wadia Jamshed, BPR, www.geocities.com.
6. CRISIL Company Profile Mahindra & Mahindra Ltd., www.debtonnet.com.
7. Mahindra & Mahindra Farm Equipment Sector, www.managementor.com.
8. Company Annual Reports.
9. www.indiainfoline.com
10. www.mahindra.com

12

License for IBS Gurgaon, Sem II, Class of 2014.