Management Information System

ASSIGNMENT - 1
Operating Models

Group No. - 02
Chanakya Kamminana – 21PGP060
Dyuti Bhattacharyya – 21PGP066
Arti Rastogi – 21PGP044
Ashuthosh Ravi- 21PGP047
B Karthik Dharan- 21PGP055
Ankita Prasad – 21PGP036

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Question 1: Provide the Indian Corporates/business firm examples for
each of the following:

a) Four types of operating models,

1. Coordination
2. Unification
3. Diversification
4. Replication

COORDINATION: MARUTI SUZUKI

Coordination requires a high degree of integration but requires little process

standardization.
The company Maruti Suzuki follows the Coordination operating model.
Various departments need to share information across each other in order to
manage vehicle sales and production. The showrooms, manufacturing plant
and service centers need to coordinate with each other to provide sales and
after sales service. The company’s business units share one or more elements
of customers, products, suppliers, and partners. Benefits of the integration
include integrated customer service, cross-selling, and transparency across all
supply chain processes. However, while important business processes are
integrated, business units have their own operations and often require their own
skills.

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UNIFICATION: RELIANCE INDUSTRIES

Reliance Industries follows Diversification operating model with presence in

different domains. Diversification is effectively ‘independence with shared
services.” It requires low standardization and low integration.
It has business units with different customers and expertise. The organization
has low standardization and low integration. The company has few common
customers, suppliers, or business methods in their business unit. The business
units offer different products and services to different customers, giving the
central management limited control over these business units.

DIVERSIFICATION: AIR INDIA

Indigo airlines has Unification operating model with high integration and high
standardization. The business operates with global standards and global data
access. Its operations are efficient and support end-to-end visibility of business
processes. The organization has high standardization and high integration.
Enterprises benefit from an integration model when organizational units are
tightly integrated around a standardized set of processes. Companies using this
model benefit little from the autonomy of their business units. Maximize

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efficiency and customer service by presenting integrated data and reducing
business process volatility.

REPLICATION: ITC HOTELS

ITC hotels follow Replication operating model. It has independent but similar
business units. The organization has high standardization and low integration.
The replication model gives the business unit autonomy but operates in a highly
standardized way. In the replication model, business success depends on
efficient and repeatable business processes rather than mutual customer
relationships. The departments are independent of each other's transactions or
data. The success of the entire company depends on global innovation and the
efficiency of all business units that implement standardized business processes.
Therefore, business unit managers have limited discretion in designing business
processes, even when acting independently of other business units.

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b) Multiple operating models at different hierarchy of Corporate (with
necessary explanations)

Tata Group is an Indian multinational conglomerate manufacturer of airplanes,

vehicles and other products.
Tata Group has affiliates in many sectors. These include:
• Chemicals
• FMCG
• Retail and E-commerce
• Energy
• Engineering
• Information systems and communications
• Iron and steel
• Aerospace & Defence
Tata Group follows diversification operating model with presence in different
domains.

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Its business unit has few common customers, suppliers, or ways of doing
business. Business units in Tata group offer different products and services to
different customers, so central management exercises limited control over
those business units. For instance, Tata Vistara airlines has a unification
operating model, Tata consumer products/ tata motors has a coordination
operating model. These units embarked on a strategy for increased
coordination and integration between group companies.

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c) Transformation of operating models (with necessary explanations)

Paytm started in 2010 with an investment of 13 lakhs by Vijay Shekar Sharma

in Noida, A region adjacent to New Delhi. It started its business with a prepaid
mobile phone and DTH recharge platform. Eventually it diversified into banking
services, marketplace, mobile payments, bill payments, and recharge.
Initially, it followed the unification model, but later adopted the diversification
and coordination model.

Unification Diversification Coordination

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The growth timeline of Paytm explains how Paytm transformed from unification
model (prepaid mobile and dth recharge program) to coordination and

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diversification model, diversifying into making it an app used for bill payments,
making bookings, making it a wallet, banking and financial purposes, and
shopping place for its diverse set of customers.

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