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Abstract:
Masuki (name disguised) was established as a joint venture company with Kisuzu (name disguised) Motor Company of Japan and the Government of Indian Company in February 1981 with the objectives of modernising the Indian automobile industry, producing fuel efficient vehicles to conserve scarce resources and producing indigenous utility cars for the growing needs of the Indian population. Masuki today is a Rs 74 billion ($1.5 billion) company producing over 3,700,000 vehicles per year out of a total of 1.2 million cars produced in India. Masuki (subsidiary of Kisuzu), has made profits every year since inception except 2000-2001. In 2001-2002, it made a profit (before tax) of Rs 1.2 billion. In 2002-2003, the profit (before tax) rose to Rs 2.8 billion, recording a growth of 138.4% over the previous year. The case discusses the liberalisation of the Indian economy and the deregulation of the automobile industry. It discusses how the Indian automobile industry went through a transformation process of having three automobile companies and a handful of car models, to that of all the major car manufacturers of the world setting up shop in India. The case discusses how to save itself from the onslaught of hyper- competition from both new domestic and foreign players Masuki had to undertake an organisational redesign process. The case traces the history of Masuki, its redesign programme, the effects of the redesign on the company's strategy, its shared vision and values, changes in the organisational structure and the role of strategic human resource management in the redesign process. The case focuses on five key issues: (1) liberalisation and privatisation in an emerging country context and the deregulation of the automobile industry in India (environment); (2) the redesign process (structure and process); (3) cross-cultural integration of Indian and Japanese management practices; (4) the role of strategic human resources management during the redesign process (people); and (5) difficulties faced in the implementation of the change process (performance). A technical note, 'Technical Note on Japanese Management Practices' (404-007-6) is available to accompany this case and is supplied free of charge when the case is purchased.
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