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 extended paidwarranty program markete
d under the brand, “Forever Yours” for the third and fourth year after purchase. The extend
ed warranty program helps in strengthening contact with the customer and also increase th
e revenue generated from sale of spares, accessories and automobilerelated services. 

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.