29 November 2004
Chennai: Perhaps Venu Srinivasan is the only corporate chief in the world to sport three prestigious quality medals awarded by the Union of Japanese Scientists and Engineers (JUSE) on his lapel.
In 1998, Sundaram Clayton Limited, of which he is the MD, won the Deming medal. Four years later, he received another on behalf of the Rs2,856-crore TVS Motor Company Limited as the chairman and managing director, followed by Sundaram Clayton winning the Japan Quality Medal - regarded as being a notch above the Deming - in 2002.
Srinivasan, who bridles at the sight of even a scrap of dirt on his factory floor, believes in the all-encompassing scope of quality consciousness. After all, he is the driving force behind his companies' quest for achieving total quality.
In 2001, when TVS Motor Company Limited (then TVS Suzuki Limited) parted ways with the Japanese automobile major, Suzuki Motor Corporation, few could resist writing off the company. Analysts felt the company would lag behind its rivals for want of technology, citing the failure of its bulky four-stroke scooter, Spectra.
Srinivasan remained unperturbed. He was sure that he had a winner in his research lab. His faith didn't fail as TVS Victor, which was still in an embryonic stage in 2000 prior to parting company with TVS Suzuki, turned around the fortunes of the company in the marketplace.
What is not well-known is the contribution of the total quality management (TQM) processes that had been put into practice in the early '90s that culminated in the company receiving the Deming medal.
One of the key demands for the award of the Deming is the launch of new products and product innovations.
Innovation was nothing new for Srinivasan who was behind the launch the country's first two- seater 50cc-moped in 1980, the TVS 50. In 1994, TVS Motor launched India's first scooterette, the TVS Scooty, which went on to become a major success.
Apart from the launch of the economy and power models of the Victor, the company introduced the Centra with a VT-i engine that does not burn petrol while the vehicle is stationary, resulting in fuel economy.
In addition, the company will also launch a hybrid three-wheeler with a 175cc-engine engine that can run on battery power as well as petrol and, with slight modifications, use liquefied petroleum gas (LPG) or compressed natural gas (CNG). This would avoid the need for separate LPG / CNG kits.
The company's facility for designing and developing new products employs over 400 engineers and is easily on par with international standards. It continuously undertakes innovations to develop and upgrade technologies that reduce emissions, improve fuel efficiency and enhance customer value in terms of comfort and safety.
In the last three years, the company's engineers have presented 18 technical papers at international conferences on engine and vehicular technologies, and the company currently has 44 patents under application.
TVS Motor expects to sell 13.10 lakh vehicles, projecting revenues of Rs3,200 crore for the current fiscal. Srinivasan elaborates on TVS Motor's research efforts and its post-Deming journey. Excerpts:
After presenting the award, what improvements did JUSE suggest?
JUSE commended us as a learning organisation that aims at high quality manufacturing by faithfully practising the fundamentals of TQM. While complimenting our leadership structure and the steps taken for developing new organisational competence, JUSE also pointed out the need for an integrated strategy for strengthening our brand recognition and recall.
In order to support new product development, it is necessary to prioritise, strategically and systematically, the issues related to medium and long-term technological development. JUSE also pointed out that the company needed to pick up new tools in order to enhance technological capability.
How far have they been implemented?
We strengthened the brand image and visibility by using Sachin Tendulkar for the TVS Victor and actress Priety Zinta for the Scooty Pep as our brand ambassadors. In addition, the corporate "TVS" brand is being repositioned. The company constantly brings out aggressive advertising campaigns to promote all brands. We have drawn up advance technology development plans in line with the long term strategic planning. One such technology development was the VT-i technology for superior mileage, now used in the Centra and Victor GLX 125.
Many of these are not one-time efforts and are being pursued continuously. We have a long-range strategic planning process. Based on that, our annual policy deployment is aligned to the entire organisation towards the 'breakthrough objectives' for the company. The policy guidelines for each year include action plans based on the feedback from the Deming examiners.
How did the company score on new product development, innovation, creating value for customers etc, that JUSE demands?
We have developed and launched various motorcycles based on the needs of Indian customer such as fuel efficiency, ride-comfort and handling. These benefits are offered to its customers through innovations such as power economy mode, synchronised suspension and VT-i engine technology based on lean burn and friction reduction, offering the 'best in class' mileage for its products.
Scooty Pep is another example of its understanding of a new segment, the youth, through style and performance geared for them. Successful new product launches in the last three years have been the Victor GL, Scooty Pep, Fiero F2 and FX, Centra, Victor GLX 125, Victor GX and TVS Star.
How does TVS Motor create value for its customers and measure satisfaction levels?
In addition to continuous innovation to improve the performance, features and durability of our two-wheelers, we also benchmark the sales of the products and service processes to offer better value to the customer. Customer service is provided through a large network of fully equipped dealers, authorised and certified service points. The service network is equipped with state of the art workshops, hydraulic and pneumatic equipment, carbon emission devices, etc. A network of authorised spare parts stockists has also been set-up to ensure timely supplies.
We commission customer satisfaction surveys through specialist agencies on a continuous basis to monitor the feedback, which is benchmarked to improve product performance and satisfaction. The company was ranked second in overall customer satisfaction and TVS Centra emerged as the top choice in the executive segment.
Since dealers are the first customers, a comprehensive dealer management system (DMS) is being introduced to improve dealership sales and services processes. Regular meetings of select groups of dealers, designated as 'presidents club' and 'antenna club', are conducted to obtain feedback on customer's expectations and solve customer problems.
Can you quantify the benefits of TQM and the Deming in terms of domestic and exports?
By applying the principles TQM, the company has developed and launched several new products resulting in higher sales volume, turnover and profit. Sales turnover increased from around Rs1,940 crore in FY 2002, to Rs2,700 crore in FY 2003 and to Rs2,856 last fiscal. Our projection for the current fiscal is Rs3,200 crore.
While new product development has been accelerated, the lead-time for product launches have been brought down significantly. Understanding the international markets and customers better has enabled TVS Motor to achieve high export growth.
Export performance - sales volume
Employee Morale -Average no. of suggestions implemented per Employee per Year
Employee Morale - No. of Improvement Projects implemented by QC Circles
Safety Improvement -Effects
Just in Time - Improvement projects
also see : Excelling
through technological leadership
When do you plan to challenge the Japan Quality Medal?
TVS Motor is already working on the business challenges with an eye on the Japan Quality Medal and will challenge it once it is prepared thoroughly.
What are TVS Motor's future plans?
We have planned a capex of Rs2,500 crore towards capacity expansion, launch of new products, improving research and development, setting up overseas production facility and also for rolling out three-wheelers.
We will build the TVS brand within and outside India, especially in Asia. We will improve our channel management and trigger growth through retail finance. While improving the supplier and dealer capabilities, we will leverage customer relationship management through IT. On the human resources side we will train leaders in key positions to support further business growth.
We plan to develop advanced technology and multi-project management capabilities to introduce new products for the domestic and international markets. In international business, we will increase distribution in Asian, African and Latin American countries, intensify our marketing efforts in Sri Lanka and Bangladesh and enter the South East Asian market.
MILESTONES of product launches …. always First
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Launched TVS 50, India's first 2-seater, 50cc Moped
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First Indian Company to introduce 100cc Indo-Japanese motorcycle
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Launched TVS Scooty - India's first indigenous Scooterette,
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Introduced Shogun - India's first catalytic converter enabled motorcycle
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Launched Shaolin - India's first 5-speed motorcycle
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Launched XL Super - India's first high performance moped
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Launched Victor - a world-class 4-stroke 110 cc motorcycle.
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Launched Centra - a world-class 4-stroke 100 cc motorcycle with VT-i Engines for best-in-class mileage.
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Launched Victor GLX, first 125 cc motorcycle with VT-i
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Launched TVS Star, 4 stroke economy bike
group: smitten by Deming
to chug fast on rail track