TATA MOTORS and its CRM

technology

Presented to: Compiled

by:

Prof. Pranay Verma Mohd.

Shayakh Mirza

FT-08-684
Acknowledgement
Before we embark upon the details of this project, let me take this opportunity to
express our heartiest gratitude towards the people who have provided invaluable
help & support through the entire duration the project. I am thankful to our
facilitator Mr. Pranay Verma for his continuous guidance & support.

I would like to thank him for giving us excellent suggestion and affectionate,
encouraging through development of project and for devoting their precious time.
We offer thanks to them for co-ordination and grateful to all our well-wishers who
extended their support and to the entire staff of IGSM for their valuable help
throughout the work
OBJECTIVE
To understand the CUSTOMER RELATIONSHIP MANAGEMENT in automotive industry
(in passenger cars) & than sync it with CRM of TATA motors.

INTRODUCTION OF TOPIC
To understand the real business scenario about the practice of CRM in Indian
Automotive industry & than compare it with TATA motors in passenger cars.

The automobile industry in India is the tenth largest in the world with an annual
production of approximately 2 million units—is expected to become one of the
major global automotive industries in the coming years. A number of domestic
companies produce automobiles in India and the growing presence of multinational
investment, too, has led to an increase in overall growth. Following the economic
reforms of 1991 the Indian automotive industry has demonstrated sustained growth
as a result of increased competitiveness and relaxed restrictions. The monthly sales
of passenger cars in India exceed 100,000 units. According to Society of Indian
Automobile Manufacturers in 2008-09 the cumulative growth of the Passenger
Vehicles segment during April 2008 – March 2009 was 12.17 percent. Passenger
Cars grew by 11.79 percent, Utility Vehicles by 10.57 percent and Multi Purpose
Vehicles by 21.39 percent in this period.

BRIEF ABOUT COMPANY

Tata Motors Limited is India’s largest automobile company, with revenues of
Rs. 35651.48 crores (USD 8.8 billion) in 2007-08. It is the leader in commercial
vehicles in each segment, and among the top three in passenger vehicles with
winning products in the compact, midsize car and utility vehicle segments. The
company is the world’s fourth largest truck manufacturer, and the world’s second
largest bus manufacturer. The company’s 23,000 employees are guided by the
vision to be “best in the manner in which we operate best in the products we deliver
and best in our value system and ethics.

Established in 1945, Tata Motors’ presence indeed cuts across the length and
breadth of India. Over 4 million Tata vehicles ply on Indian roads, since the first
rolled out in 1954. The company’s manufacturing base in India is spread across
Jamshedpur (Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh) and
Pantnagar (Uttarakhand). Following a strategic alliance with Fiat in 2005, it has set
up an industrial joint venture with Fiat Group Automobiles at Ranjangaon
(Maharashtra) to produce both Fiat and Tata cars and Fiat powertrains. The
company is establishing two new plants at Dharwad (Karnataka) and Sanand
(Gujarat). The company’s dealership, sales, services and spare parts network
comprises over 3500 touch points; Tata Motors also distributes and markets Fiat
branded cars in India.

Tata Motors, the first company from India’s engineering sector to be listed in the
New York Stock Exchange (September 2004), has also emerged as an international
automobile company. Through subsidiaries and associate companies, Tata Motors
has operations in the UK, South Korea, Thailand and Spain. Among them is Jaguar
Land Rover, a business comprising the two iconic British brands that was acquired
in 2008. In 2004, it acquired the Daewoo Commercial Vehicles Company, South
Korea’s second largest truck maker. The rechristened Tata Daewoo Commercial
Vehicles Company has launched several new products in the Korean market, while
also exporting these products to several international markets. Today two-thirds of
heavy commercial vehicle exports out of South Korea are from Tata Daewoo. In
2005, Tata Motors acquired a 21% stake in Hispano Carrocera, a reputed Spanish
bus and coach manufacturer, with an option to acquire the remaining stake as well.
Hispano’s presence is being expanded in other markets. In 2006, it formed a joint
venture with the Brazil-based Marcopolo, a global leader in body-building for buses
and coaches to manufacture fully-built buses and coaches for India and select
international markets. In 2006, Tata Motors entered into joint venture with Thonburi
Automotive Assembly Plant Company of Thailand to manufacture and market the
company’s pickup vehicles in Thailand. The new plant of Tata Motors (Thailand) has
begun production of the Xenon pickup truck, with the Xenon having been launched
in Thailand at the Bangkok Motor Show 2008.True to the tradition of the Tata Group;
Tata Motors is committed in letter and spirit to Corporate Social Responsibility. It is
a signatory to the United Nations Global Compact, and is engaged in community
and social initiatives on labor and environment standards in compliance with the
principles of the Global Compact. In accordance with this, it plays inactive role in
community development, serving rural communities adjacent to its manufacturing
locations.

METHODOLOGY
We collected information from both primary & secondary data. We divided our
group of 6 members into 3 groups of 2 each and visited various dealer’s showroom
of TATA motors, MARUTI & HYUNDAI and asked their respective relationship
managers about the company’s offerings, to get detailed knowledge of CRM
applications & practice in real business scenario.

Findings & Analysis:

BUSINESS STRATEGY & CRM

Three key phases:

• Customer Acquisition.

• Customer Retention.

• Customer Extension.
Three contextual factors:

• Marketing Orientation.

• Value Creation.

• Innovative IT.

Customer Acquisition
This is the process of attracting our customer for the first their
first purchase. We have acquired our customer.

Customer Retention
Our customer returns to us and buys for a second time. We keep
them as a customer. This is most likely to be the purchase of a
similar product or service, or the next level of product or service.

Customer Extension
- Our customers are regularly returning to purchase from us. We
introduce products and services to our loyal customers that may
not wholly relate to their original purchase. These are additional,
supplementary purchases. Of course once our loyal customers
have purchased them, our goal is to retain them as customers for
the extended products or services.
 Marketing Orientation
- Means that the wholes organization is focused upon the needs of
customers. Customer needs are addressed by the Three Levels of a
Product whereby the organizations not only supplies the actual,
tangible product, but also the core product and its benefit, and also the
augmented product such as a warranty and customer service.
Marketing orientation will focus upon the needs of consumers for all
three levels of a product. (N.B. 'market' orientation and 'marketing'
orientation are not the same).

Value Creation
- Centers on the generation of shareholder value based upon the
satisfaction of customer needs (as with marketing orientation) and the
delivery of a sustainable competitive advantage.

Innovative IT
- is exactly that - Information Technology must be up-to-date. It should
be efficient, speedy and focus upon the needs of customers. Whilst IT
and/or software are not the entire story for CRM, it is vital to its
success. CRM software collects data on consumers and their
transactions. Huge databases store data on individuals and groups of
individuals. In some ways, CRM means that an organization is dealing
with a segment of one person, since every consumer displays different
purchasing habits and preferences. Organizations will track individuals,
and try to market products and services to them based upon similar
buyer behavior seen in other individuals (e.g. When Amazon tells you
that customers that viewed/bought the same product as you, also
bought another product).In

AUTOMOTIVE industry , Companies focus upon the needs of customer, not only
providing the tangible product i.e. CAR but also augmented product such as
warranty, customer service, providing more services than competitors,
distributing free gifts, free vehicle check-up, etc & now-a-days almost every big
company use CRM software in collecting data on consumers & their transaction,
providing them customized service . After every new launch of a car, companies
give information about that same product to their loyal customers. Not only
companies stick to that car only but tries to sell accessories also like seat covers,
Alloy wheels, music system so that customer doesn’t have to go to several
places & quite often dealers give discount also in these items as a CRM business
strategy .
Tata Motors has taken a phased approach to the implementation, with the goal
of achieving success in each phase before moving forward. Phase 1, currently
under way, focuses on capturing customer and vehicle data and automating
routine tasks. Phase 2 will focus on leveraging data to improve customer
interactions and streamline product development and planning. Phase 3 will
focus on tuning the system and delivering additional value-added services to
customers. To address its competitive challenges, Tata Motors began
standardizing its customer-facing business processes companywide, laying the
foundation for stronger dealer relationships, improved operational efficiency and
effectiveness, and a better customer experience. This has posed numerous
challenges, as it involves working with 250 dealer organizations and more than
1,600 locations staffed by more than 10,000 salespeople across India.

CUSTOMER KNOWLEDGE
Customer knowledge refers to understanding your customers, their needs, wants
and aims is essential if a business is to align its processes, products and services
to build real customer relationships. Customer knowledge can be approached
from two ends. Firstly, you could say that customer Knowledge is the "collection
of information and viewpoints that an organization has about its customers".
Using this definition, the role of customer knowledge management is to capture
and organize this data to allow it to be shared and discussed throughout the
organizational alternative definitive of customer knowledge is that it is the
"collection of information and insight that you need to have to build stronger
customer relationships". From this point of view what you currently know about
your customers may not be sufficient. You may need to put in processes and
systems to gather more information and data about who your customers are,
what they do and how they think.

CUSTOMIZATION:
Customization bonds approach suggest that customer loyalty can be encouraged
through intimate knowledge of the individual customers and through the
development of one-to one solutions that fit the individual customer’s needs.
TATA MOTORS believes in 'Customer is THE KING', and also knows well how to
make them feel One. They have an extensive follow up programme and prompt
service. This helps them to change their strategies and customize their services
to fit developing customer needs. For this purpose, they always request the
customers to fill in their feedback form that follows the service/repair visit. If a
low score is received on their feedback form, they would go outof the way to
apologize for the error. Simultaneously, they provide technicians who visit their
home place in order to attend the issues and rectify them to their satisfaction
level. Follow up calls are made to ensure that how efficiently their problems
were resolved.
RELATIONSHIP POLICY:
The customer is tied to the company primarily through financial incentives –
lower prices for greater volume purchases or lower prices for customers who
have been with a firm a long time.

• As we know, the acquisition cost is not the only cost one faces when
buying a car. it may not necessarily be affordable to maintain, as some of
its regularly used spare parts may be priced quite steeply. Tata Motors
provides very good after sale services to its customers. It is in the
economy segment that the affordability of spares is most competitive as
compared to others.
• It also provides its long term customers either with stable prices or lower
price increases as compared to the new customers.
• TATA motors provides financial incentives and rewards to the customers
who bring more business to their service station by recommending and
spreading good word of mouth to others about their services.
• TATA Motors provides free of cost servicing to customers having Tata cars
within a twoyear warranty time period. TATA motors also offers an extend
ed paidwarranty program marketed under the brand, “Forever Yours” for t
he third and fourth year after purchase. The extended warranty program h
elps in strengthening contact with the customer and also increase the rev
enue generated from sale of spares, accessories and automobilerelated se
rvices.

CRM Systems and Implementation

These are some of the key features for which AUTOMOTIVE SECTOR applies CRM
software:

• Sales management shares customer information between sales, service

and parts departments
• Vehicle management gives complete vehicle data along with sales,
service and financial history, as well as dealer and license information and
owner and contact information
• Activity and e-mail management systems link e-mails with associated
contacts, leads and opportunities
• Service management increases customer loyalty by enabling consistent,
personalized interaction across all customer touch points including,
telephone, e-mail, Web, wireless devices and in-person meetings.
Tata Motors implemented Oracle's Siebel Automotive, a comprehensive
customer relationship management (CRM) solution designed specifically for
companies in the automotive industry. Seamlessly integrated with Tata Motors’
dealer management system and SAP back-office applications, Siebel Automotive
has delivered significant benefits across the extended organization, including
improved customer satisfaction, increased revenue and productivity, and
reduced costs. By tightly integrating Siebel Automotive and its dealer
management system, TATA has streamlined transactions and ensured that
dealers capture customer data as a part of their normal operations. The solution
provides a 360-degree view of customers to the extended organization, with
appropriate visibility controls to ensure that one dealer is not privy to
information from another. To further enlist dealer support, Tata Motors involved
dealers throughout the solution configuration and deployment process.
“Integrating Siebel Automotive with our dealer management system ensured
that our dealers would immediately see the value in the solution,” Sreenivasan
explains. “This has helped us overcome the usual resistance to change and gain
rapid acceptance from our dealers.” Siebel Automotive has been closely
integrated with a wide array of SAP back-office applications, including
applications inventory management, fulfillment, and parts location. Pricing and
tax calculations can be adjusted for each dealer’s requirements. In addition,
comprehensive sales and reporting functionality built into Siebel Automotive
enables TATA to distribute sales targets to its dealers and roll up sales numbers
across the country.
Tata Motors also liked the fact that Siebel Automotive provides multi-
organization support, can be deployed easily over the Internet, and provides
robust partner management capabilities—ideal for Tata Motors with its far-flung
dealer network. Further, the user-friendly interface has simplified the process of
training Tata Motors’ 10,000-plus dealer sales force. Covering a country with an
area of 3.3 million square kilometers (or about one-third the size of the U.S.) also
required an innovative communications solution. Tata Motors links its 1,600
customer touch points with its centralized data center in Mumbai using a
combination of VSATs and high-speed virtual private networks. Siebel
Automotive has already begun to deliver benefits for Tata Motors’ dealers
throughout India. “Overall, Siebel Automotive has transformed our organization
and made it truly customer-centric,” says Sreenivasan. “We’ve overcome the
challenges of relying on disparate sources of information, as well as having
inconsistent business processes. Today, our employees and dealers are much
more responsive and can serve customers more efficiently and effectively—
drawing upon real-time, centralized customer and vehicle data. “One of our first
dealers to install Siebel Automotive said that his sales volume doubled in three
months without the need for additional manpower,” he continues. “Another
dealer said that for the first time he was able to view his entire stock of vehicles
and how his inventory was aging, improving his control.” Siebel Automotive has
also helped dealers respond to customer queries regarding vehicles that aren’t
in a dealer’s stock, but which can be ordered directly from Tata Motors. “Within
the first year of implementing the solution, we are targeting improvements of 5
to 10% in customer satisfaction, revenue growth, operating cost reduction, and
productivity gains,” says Sreenivasan. “These numbers should increase
considerably over time.” He concludes, “Siebel has been very committed to
helping us in all aspects of the project. Combining Siebel Automotive with our
dealer management system is unique, so we have needed quality support.
Siebel has played a major role in getting us to where we are today.

Recommendations
Many organizations operating in automobile market still do not differentiate their
CRM activities at the segment level. They contact each prospect with the same
Frequency instead of applying a level of effort consistent with the cost of
acquisition and profit potential. Their unrefined use of resources not only leads
to wasted investment but can cause annoyance among customers who are
either being oversupplied or undersupplied with attention.

• Companies keep the name of financing company as the owner of the

vehicle and in many cases does not have the record of effective owner of
vehicle who was responsible for the purchase decision.
• In CRM Indian Automobile industry has to learn much from other service
industries such as airline industry. Each time a customer approaches a
service agent, his entire history was flashed on screen.
• Customer knowledge can be used to give customer specific offer on
purchase of second vehicle in family.
• Services such as pick and drop, on-road service, should be provided at
TATA service station, which are common in other companies.

CONCLUSION

Tata Motors has proven excellence over the years through its technologically
advanced products, market expansion, customer satisfaction and increasing
sales. Tata Motors consistently strives to increase shareholder value, build
stronger customer relations and work with its business partners to provide the
best value for money. The company is also involved in accelerating the country’s
economic growth and protecting the environment. With the initial financial
backing of the giant parent company, Tata Group, the division has built a strong
business over the past 60 years and continues to show strong financial results.
The continual improvement and introduction of new products in the market have
allowed it to successfully enter as well as dominate the automobile industry in
India. With increasing sales, employees, product offerings, manufacturing
facilities and distribution centers along with expansion outside India, the
company seems to have a promising future.