Sensex Devta

The case examines the reasons behind automobile major Mahindra & Mahindra's decision to implement a Business Process Reengineering (BPR) program.

The case explores in detail the implementation procedure at the company and the benefits that accrued from the BPR program. In addition, the case discusses the concept of BPR, its benefits, and the steps that need to be taken to ensure the success of such initiatives

In the mid-1990s, India's 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 sub-optimal 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.

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 UK-based 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&M's 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...