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Group C02- Market Leader in VUCA World

1. Has the value creation stage of Maruti Suzuki has changed during 2011-21 period? Explain
Maruti focused on maximizing their creation of value through changing their approach in multiple value
creation stages at the same point of time. During the 2011-13 period, identifying the need for Maruti to
focus more towards diesel engine vehicles, they not only augmented their diesel engine production
capacity from 2.4 lakh units to 3 lakhs, which indicates input stage value creation, but also pushed Suzuki
for development of a new smaller diesel engine which points towards their focus on conversion stage.
During this period, they decided to increase capacity at their Manesar plant to compensate for the planned
reduction in capacity at Gurgaon plant due to congestion reasons along with a third plant planned in
August 2013, while also investing in Gujarat for enhancing future capacity capabilities, which indicates a
high input conversion stage orientation. They were developing diesel engines for two of their biggest selling
petrol engine cars (Alto and Wagon R) as part of their conversion value creation stage strategy.

In 2014, they tried to transition Maruti towards the output stage of value creation through the
announcement of creating a new entity that would mainly be responsible for the manufacturing while MSIL
would be taking care of the marketing and dealer network expansion and essentially outsourcing their
manufacturing activities.

In the year 2015, in order to give Maruti an image makeover of sorts, they launched their premium
segment products under the aegis of Nexa retail channel to attract a new genre of carbuyers. For non-nexa
models, they opened Arena outlets that provided a modernized and digitised buying experience to the
customers that is indicative of a Output stage of value creation.

Maruti outperformed industry growth for 6 consecutive years in financial year 2018 and seeing an
upwards trend in the vehicles sales over the years planned towards expanding their assembly lines at the
Gujarat facility by adding two more lines to the existing one over the course of 2 years by 2020 which
indicates towards a conversion value creation stage in the company.

Post 2020, they even planned on setting up a new plant in South India, in line with their next stage of
expansion phase which again shows their emphasis on input value creation stage.

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