Presentation On

Quality Plan for a Company

By
Mr. Pratik Prakash Bhosale

Course: Total Quality Management

Code: DBA 1011

Submitted to
ABMTC

In partial fulfillment of the requirement for the award of the degree of

DOCTORATE OF BUSINESS ADMINISTRATION [D.B.A]

Executive Summary

 In the current era of globalization and technological advancement it’s the need of
hour to be highly competitive and complex if you need to stay in the market.
 The customer's needs, wants and expectations are changing at an exponential
rate. For surviving and thriving in this scenario companies need to develop
effective brand positioning strategies.
 In the current global scenario of global automobile industry Tata struggled to cope
up with the advancements. While facing tough competition Tata needs to will need
to take preventive and preparatory action against these threats as well as expose
and capitalize on the different opportunities.
 The high barriers of entry results in a low threat of entry for new competitors,
but the access to affordable substitute goods makes competing in the auto
industry exceptionally difficult. The fact that Tata failed to work on TQM
ultimately resulted in poor workmanship, poor quality passenger vehicles,
resulting in a brand image maligned.
Indian Automotive Industry

 The Indian auto industry became the 4th largest in the world with sales increasing
9.5 per cent year-on-year to 4.02 million units (excluding two wheelers) in 2017. It
was the 7th largest manufacturer of commercial vehicles in 2017.
 The Two Wheelers segment dominates the market in terms of volume owing to a
growing middle class and a young population. Moreover, the growing interest of
the companies in exploring the rural markets further aided the growth of the
sector.
 India is also a prominent auto exporter and has strong export growth expectations
for the near future. Automobile exports grew 15.54 per cent during April 2018-
February 2019. It is expected to grow at a CAGR of 3.05 per cent during 2016-
2026. In addition, several initiatives by the Government of India and the major
automobile players in the Indian market are expected to make India a leader in
the two-wheeler and four wheeler market in the world by 2020.
Indian Automotive Industry
Indian
Automotive
Industry
Tata Group

 Founded by Jamsetji Tata in 1868, the Tata group is a global enterprise,

headquartered in India, comprising over 100 independent operating
companies. The group operates in more than 100 countries across six
continents, with a mission 'To improve the quality of life of the communities
we serve globally, through long-term stakeholder value creation based on
Leadership with Trust'.
 Tata Sons is the principal investment holding company and promoter of Tata
companies. Sixty-six percent of the equity share capital of Tata Sons is held
by philanthropic trusts, which support education, health, livelihood
generation and art and culture. In 2016-17, the revenue of Tata companies,
taken together, was $100.39 billion. These companies collectively employ
over 695,000 people.
Tata Motors

 Tata Motors Group, a USD 42 billion organisation, is a leading automobile

manufacturer with a portfolio that includes a wide range of cars, sports
vehicles, trucks, buses and defence vehicles.
 Their marque can be found on and off-road in over 175 countries around the
globe. Part of the USD100 billion Tata group founded by Jamsetji Tata in 1868,
Tata Motors is among the world’s leading manufacturers of automobiles.
 • Innovate mobility solutions with
Mission
passion to enhance the quality of life
• Be Among the top three in global CV
and domestic PV
Vision • Achieving sustainable financial
performance
• Delivering exciting innovations
• Integrity
• Teamwork
• Accountability
Values
• Customer focus
• Excellence
• Speed
Competition

 The top 10 competitors in Tata Motors' competitive set are Honda, Nissan,
Ford Motor, Ashok Leyland, Mandovi Motors, Maruti Suzuki, Eicher Trucks And
Buses, Suzuki Sport Owners Club, Hero Motocorp and SML Isuzu.
 Together they have raised over 756.0M between their estimated 605.0K
employees.
 Tata Motors has 81,090 employees and is ranked 4th among it's top 10
competitors. The top 10 competitors average 68,605.
 The top 10 competitors in Tata Motors' competitive set are Honda, Nissan,
Ford Motor, Ashok Leyland, Mandovi Motors, Maruti Suzuki, Eicher Trucks And
Buses, Suzuki Sport Owners Club, Hero Motocorp and SML Isuzu. Together they
have raised over 756.0M between their estimated 605.0K employees. Tata
Motors has 81,090 employees and is ranked 4th among it's top 10 competitors.
The top 10 competitors average 68,605.
Honda

 Honda is the biggest rival of Tata Motors. Honda is headquartered in Minato-

ku, Tōkyō Prefecture, and was founded in 1947. Like Tata Motors, Honda also
operates in the Automobile Manufacturers space. Honda generates 360% the
revenue of Tata Motors.
Nissan

 Nissan is Tata Motors's #2 competitor. Nissan is a Public company that was

founded in Yokohama-shi, Kanagawa Prefecture in 1933. Like Tata Motors,
Nissan also works within the Automobile Manufacturers sector. Nissan has
57,820 more employees vs. Tata Motors.
Ford

 Ford Motor has been one of Tata Motors's top competitors. Ford Motor's
headquarters is in Dearborn, Michigan, and was founded in 1903. Ford Motor
operates in the Automobile Manufacturers industry. Ford Motor generates
403% of Tata Motors's revenue.
https://www.owler.com/company/tatamotors
SWOT Analysis

 Strengths
 Tata Motors is one of the most established company in automobile sector in India
 Tata Motors has a wide & extensive distribution and service network
 Good market penetration in the taxi & rental segment
 Expert service professionals available
 Many associations like Jaguar Land Rover, Hispanso, Macropolo etc increases Tata
Motors' international presence
 Dedicated engineering and R&D department
 More than 70,000 employees are present with Tata Motors
 Highly diversified product portfolio
 Strong brand legacy owing to parent brand Tata
SWOT Analysis

 Weakness
 Limited international presence as compared to international car manufacturers
 Controversies like Singur plant for Nano etc hurt Tata Motors
 Weak Marketing Policies
 Indifferent to changes
 Lack of service to consumers
 Quality issues.
SWOT Analysis

 Opportunities
 Expanding automobile market can be a boon for Tata Motors
 Increasing per capita income and purchasing capability of potential customer base
 Leveraging customer engagement experience to acquire new customers can be
done by Tata Motors
 Leveraging mergers and acquisitions to acquire newer technology
 Tata Motors can boost business by augmenting the distribution and service network
in various countries
SWOT Analysis

 Threats
 Increasing fuel costs
 Competition from other big automobile giants means reduced market share
for Tata Motors
 Competitive products offering same level features at a lesser price
 Product innovations and frugal engineering by competitors
Importance of Quality

 The production of high-quality products helps to develop a positive image for

the brand. Superior quality products will increase the satisfaction level of
customers and will help to build customer loyalty.
 Quality products help to maintain customer satisfaction and loyalty and
reduce the risk and cost of replacing faulty goods. Companies can build a
reputation for quality by gaining accreditation with a
recognized quality standard.
TQM Benefits
 Total quality management (TQM) is a general philosophy of gradually improving the
operations of a business.
 This is done through the application of rigorous process analysis by every involved
employee and business partner. TQM is usually applied at the tactical, front-line
level, where production, clerical, and low-level managers are deeply involved.

 TQM Tools
 Benchmarking
 Failure analysis
 Plan-do-check-act (PDCA) cycle
 Process management
 Product design control
 Statistical process control
TQM Advantages
Cost Reduction
• When applied consistently
over time, TQM can
reduce costs throughout
an organization, especially
in the areas of scrap,
rework, field service, and
warranty cost reduction.
• Since these cost
reductions flow straight
through to bottom-line
profits without any
additional costs being
incurred, there can be a
startling increase in
profitability.
Customer Satisfaction
• Since the company has • TQM has a strong emphasis
better products and
services, and its
interactions with
customers are relatively
error-free, there should
be fewer customer
complaints. Fewer
complaints may also mean
that the resources
devoted to customer
service can be reduced.
• A higher level of customer
satisfaction may also lead
to increased market
share, as existing
customers act on the
company's behalf to bring
in more customers.
Defect Reduction
• The ongoing and proven
on improving quality
within a process, rather
than inspecting quality
into a process. This not
only reduces the time
needed to fix errors, but
makes it less necessary to
employ a team of quality
assurance personnel.
Morale
success of TQM, and in
particular the
participation of employees
in that success can lead to
a noticeable improvement
in employee morale,
which in turn reduces
employee turnover, and
therefore reduces the cost
of hiring and training new
employees.
Quality Costs

 Quality costs are the costs associated with preventing, detecting, and
remediating product issues related to quality. Quality costs do not involve
simply upgrading the perceived value of a product to a higher standard.
Instead, quality involves creating and delivering a product that meets the
expectations of a customer.
 Thus, if a customer spends very little for an automobile, he will not expect
leather seats and air conditioning - but he will expect the vehicle to run
properly. In this case, quality is considered to be a vehicle that functions,
rather than a luxury experience.
Quality Costs fall into 4 categories

 Prevention costs. You incur a prevention cost in order to keep a quality problem from occurring. It is
the least expensive type of quality cost, and so is highly recommended. Prevention costs can include
proper employee training in assembling products and statistical process control (for spotting
processes that are beginning to generate defective goods), as well as a robust product design and
supplier certification. A focus on prevention tends to reduce preventable scrap costs, because the
scrap never occurs.
 Appraisal costs. As was the case with a prevention cost, you incur an appraisal cost in order to keep
a quality problem from occurring. This is done through a variety of inspections. The least expensive
is having production workers inspect both incoming and outgoing parts to and from their
workstations, which catches problems faster than other types of inspection. Other appraisal costs
include the destruction of goods as part of the testing process, the depreciation of test equipment,
and supervision of the testing staff.
 Internal failure costs. An internal failure cost is incurred when a defective product is produced. This
appears in the form of scrapped or reworked goods. The cost of reworking goods is part of this cost.
 External failure costs. You also incur an external failure cost when a defective product was
produced, but now the cost is much more extensive, because it includes the cost of product recalls,
warranty claims, field service, and potentially even the legal costs associated with customer
lawsuits. It also includes a relatively unquantifiable cost, which is the cost of losing customers.
Recommendation
 The recruitment policies of the company must be changed or modified as per the current
trends of the market. Employees will shift to other companies if they found competitive
advantage in the required designation. However, Tata has many advantages in the schemes of
HR policies.
 However, there are lack of people that are eligible in the designations that are involved in the
internalization. Organizational culture is not followed properly in many verticals of Tata
automobiles. The senior management should focus on this issue particularly to cope up the gap
created by the officials of the organization.
 Tata motors have to formulate sustainable strategies related to the manufacturing sites that
are present in foreign location. It should also focus on formulating strategies that controls the
cost of production of the cars in the manufacturing sites of the company. Research and
development department should find some new features and systems that attract the
customers compared to other products of the market.
 Innovation in the field of the research and development is an example of development of new
products in the market. Various policies of management should be introduced in the
organizational level and its impact on other operational process of the company is essential for
the long-term success. Short-term policies are involved in the change of the environment and
process of operations in the manufacturing facilities of Tata motors at different foreign
locations.
 By

Mr. Pratik Prakash Bhosale