The SPARTANS: The SPARTANS MEMBERS: SANGEETHA LISA SHEPHERD SWAROOP SATHISH Slide 3: Type-public company Industry-automobile Founded -1984 in Gurgaon ,Haryana Head quarters-New Delhi Products-scooters, motorcycles Revenue-USD 2.8 Billion Slide 4: Hero Honda Motors Ltd ; based in Delhi, India is a joint venture between Hero Group of India & Honda of Japan. It is been referred as world’s biggest manufacturer of 2 wheeler motorized vehicles since 2001, when it produced 1.3 million motorbikes in a single year. During Fiscal year 2008-09, the company had sold 3.28 million bikes and the net-profit stood up at `1281.7 crore . Company Profile: Company Profile “Hero” is the brand name used by the Munjal brothers for their flagship company Hero Cycles Ltd. A joint venture between the Hero Group and Honda Motor Company was established in 1984 as the Hero Honda company, India In the Hero Honda JV, currently Hero Group owns 26 % of the shares and Honda owns 26 %, the rest 48% is owned by the general public. So according to current status quo both Hero and Honda are equal owners of the Hero Honda JV Mission: Mission Hero Honda’s mission is to strive for synergy between technology, systems and human resources, to produce products and services that meet the quality, performance and price aspirations of its customers. At the same time maintain the highest standards of ethics and social responsibilities. How the Hero Honda JV has worked out so far? : How the Hero Honda JV has worked out so far? Honda has provided the technology for the products; Hero Honda has manufactured and sold the products through it dealership networks. Hero also pays royalty to Honda for every product that it sells. The technological prowess of Honda along with Hero’s extensive dealer network has made the JV one of the most successful in the history of bikes. Reasons for split: Reasons for split 2015-Bharat norm IV would have to be implemented Euro V norms in Europe –western regions So greater investment in technology Weaker brand leading to financial loss Slide 9: Hero was always dependent on Honda for technology; in return Honda was earning huge amounts in the form of royalty. Even though Hero Honda bikes were selling in millions in India, the export market wasn’t totally opened for Hero Honda products. At the same time Honda started it HMSI ( Honda Motorcycles and Scooters India ) and started selling scooters and motorcycles independently. Current State: Current State Split took place in December 2010 According to news Hero group has bought 26% from Honda and thus retain a total of 52% (majority) stake. For that Hero had to spend 3840 crores . Steps taken by Hero: Steps taken by Hero Hero Group taking the Rebranding path to get a new brand identity Hero MotoCorp Hero Honda Motors Ltd : soon to be renamed Hero MotoCorp Ltd), Slide 12: Why rebranding? The Hero Group is planning to expand its operations in the export markets such as Africa, Latin America and Southeast Asia. However, the technology agreement signed by Hero and Honda bar the former from using the Honda name in case they make changes to its current products. Hence, Hero has decided to rebrand its bikes and sell them in the export markets. Besides, the company wants to stand on its own in the highly competitive Indian two-wheeler segment and rebranding will ensure this. India’s largest two-wheeler maker by sales, is preparing to introduce at least three new models before the end of the year, with the first of these being a dirt bike that it will launch under its new name . New R&D Moves: New R&D Moves Its reportedly looking to expand its R&D potential for retaining its number one position in the market. The Hero Group reportedly hired engineers from its competitors like Bajaj Auto, Yamaha, and Mahindra two wheelers. It was recently reported that the company plans on deploying their R&D executives under many divisions like engine, technology, design and regulations for bringing greater focus to their growing pool of talent. SUGGESTED BPR STEPS: SUGGESTED BPR STEPS Develop Strategic Vision: ( Vendor Management theory) Identify and Select Business Process Reengineering Opportunities : Benefits for Hero and Honda Hero could save upto Rs. 5,500 crores on royalty for the financial year 2011. Hero would also be free to explore new export markets. Honda could utilize the money from selling its stake in further strengthening its dealer network Challenges for Hero and Honda Without Honda’s technical assistance, Hero will have to build an R&D and fast. Honda will also have to build its product line up fast to match up to Hero Honda 100 cc Superstars, the Splendor and the Passion. Slide 15: In any case, Hero can’t rely forever on Honda for technology. Like Bajaj and TVS, Hero has to build its own R&D. But that could take some time. Analyze and Document Current Process( es ) To strengthen their network in rural areas, the company started sales, servicing and spare part outlets in small towns and villages across India. Therefore Hero has a competitive advantage over others. As they have the villagers loyalty (and they are known for their brand loyalty), it will be difficult for competitors to take away the customers. Slide 16: Benchmarking Since they have hired people for R&D department its easy for them to benchmark.