STRATEGY

PROJECT
A case study on Mahindra RISE

Impact of Level of Consistency

among Company’s business and
Corporate Strategy

By Group 3
Harsh Agarwal - PGP/21/21
Vishakha Jagtap - PGP/21/22
Jayendu Bhaskar - PGP/21/23
Kaustav Nayak - PGP/21/24

Sanjay Ramesh - PGP/21/44

Shubhathra - PGP/21/48
TABLE OF CONTENTS

1. ACKNOWLEDGEMENT 3
2. EXECUTIVE SUMMARY 4
3. INTRODUCTION
5
4. STATEMENT OF PROBLEM
6
5. METHODOLOGY AND SOURCE OF DATA
8
6. SCENARIO PLANNING
7. ANALYSIS AND INTERPRETATION 10
8. CORPORATE AND BUSINESS STRATEGY 13
9. CONCLUSION 14
10. REFERENCE
15

1
Acknowledgement
The detailed study of “Impact of level of consistency among company’s business and
corporate strategy”, a case of Mahindra RISE has helped us to gain deep insights about the
company’s corporate as well as business strategy.
We would like to thank Prof. P. Rameshan, Professor in the area of Strategy, IIM Kozhikode
for providing us this opportunity to apply the classroom concepts in this project, in order to
gain a deeper insight into this subject. His continuous guidance and support helped us
throughout the study.
Without his guidance, the successful completion of project would not have been possible.

2
Executive Summary

Mahindra & Mahindra is one of the top Indian conglomerates along with the Tata Group and
Aditya Birla group. It revolutionised the Indian automobile sector with its compact vehicle
segment and changed the scenario of the Indian farming segment with new agri-machineries.
The vision of Anand Mahindra, chairman of the Mahindra and Mahindra group with the
implementation of Mahindra “Rise” as a corporate strategy has taken the group to new
heights. Mahindra Rise is a concept where Mahindra focus on enhancement and rise of all of
its sectors in tandem with the stakeholders associated with it. We chose Mahindra & Mahindra
group as the conglomerate to highlight the impact of consistency of corporate strategy due to
this specific strategy of “Rise” which has transcended into all of its sectors and increased the
overall profitability of the group. It has also created a new perception in the minds of the
customers and has also uplifted the social communities associated with the group. It has
stayed true to its vision of inclusion of all during its journey and has led to the creation of core
competency and competitive advantage. Its repositioning, as well as diversification have
followed the footsteps of this strategy and have given them the required framework to
prosper further.

We have done analysis of Mahindra Rise and done a study of how the strategy of corporate
& business was in synergy & the impact it had in the minds of the public. The sales figure
supported the data as Mahindra saw a gradual rise in the sales. The public image & perception
of Mahindra in the eyes of public started to improve. Mahindra also did image makeover from
a robust old fashioned company to a new tech savvy company-that was also put into place
with Mahindra Club and the acquisition of Satyam in the form of Tech Mahindra

3
Introduction to the Study
This study is about creating corporate advantage in multi business companies to achieve
competitive advantage at the level of individual businesses. In case of Mahindra Group, the
individual business units were not adding to the sum of the total value of the company. The
reason for this is that they had different strategies and brand image which did add value with
lack of defined corporate strategy. This is a detailed study of how ‘Mahindra Rise’ led to
unification of all business level strategies and creating competitive advantage for Mahindra
Group.
Why do this study?
In big group companies with multiple businesses, especially like Mahindra Group, the
individual business units don’t destroy value but at the same time, they don’t add value at the
corporate level. This leads to top management struggling to create effective corporate
strategies which lead to attain core competency and achieve competitive advantage. This
study will show how Mahindra created a corporate level strategy-‘Mahindra Rise’ helped
Mahindra to create effective corporate strategy which lead to creation of core competency and
achieve competitive advantage.
Why Mahindra?
Mahindra Group is an Indian Multinational Giant that is valued at US $16.7 billion was going
thorough one of the most important phases in its growth. It is headquartered at Mumbai with
presence over 100 countries and employees more than 180,000 employees globally. Mahindra
is trying to reposition itself as a brand to create a connection among different brands under it.
When considering Club Mahindra and Mahindra Farm Equipment, they never really created a
sense of connection in customers mind.
BUSINESS NATURE OF BUSNIESS
Automotive B2C, B2B
Farm Equipment B2C
Auto Components B2B
Financial Services B2C
Information Technology B2B
Infrastructure B2C,B2B
Two Wheelers B2C
Defence Government
Retail B2C
Logistics B2B
Steel B2B
Boats B2C

The Mahindra Group is a federated Group of companies that has grown rapidly into a global
leader by being one of the 20 largest companies in India in 2009. Mahindra Group wanted to
be a global leader by entering into new businesses, joint venture and acquisitions. Initially
Mahindra was perceived to be a ‘Jeep and Tractor company’ which was rugged and tough.
Over the years it has grown into a business with 18 Businesses and 120 Subsidiaries. What
strategy should it employ to make all its strategic business units be in line with its corporate
strategy?
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Strategic Problem:
With the ambition of global penetration, the global presence of Mahindra was sufficient
enough in the global arena to develop a competitive advantage over global competitors.
Comparatively Indian markets were also becoming increasingly competitive. The main
strategic problem with Mahindra Group was that the mission of individual Strategic Business
Units (SBUs) autonomous and it was not in line with the overall group level corporate vision.
This lead to a lack of congruence, coordination and control among SBUs.
Proposed Solution:
A group level corporate strategy like ‘Mahindra Rise’ will address the lack of congruence of
individual business levels among various SBUs. This will help Mahindra in effective control of
its resources and businesses to attain competitive advantage relevant to its mission to be a
global leader.

The Triangle of Corporate Strategy:

The triangle of corporate strategy shows how an effective corporate like ‘Mahindra Rise’
could help achieve coordination, control and competitive advantage over resources,
businesses and the entire organization.
History:
The Mahindra Group has a rich history of more than seventy years. Established in 1945 as a
steel trading company, the Mahindra brand has been synonymous with strength, reliability,
passion and quality in the Indian automotive industry as well as a consumer mind map. The
story of Mahindra began in 1945 with two men performing tasks. When JC and KC Mahindra
encountered bumpy "General Motors" inventor Baniros and had an inspiration: "This iconic
vehicle will not be invincible and invincible in World War II, is the Indian terrain is the ideal
choice for rural roads?" The answer is the Willys Jeep, the first commercial vehicle to obtain a
license in India.. In 2011, Mahindra launched an ambitious Mahindra Rise in-order to diversify
the segment & make a new brand image & perception.

5
Analysis of External Environment- Mahindra Rise

A PESTEL analysis of Mahindra Group is performed below:

Political – A strong government at the centre is expected to boast the sales of Mahindra Group
as a whole. The political situation in the country as well as in the world is in a pretty stable
place. As far as impact of this political stability is to be considered, stable political environment
will help Club Mahindra & Mahindra Holidays & Resort. International scenario wise, the
protectionist nature that has started to emerge will pose a strong channel to the Mahindra
group as a whole. Government has started to give concessions in terms of electric cars
manufacturing which will give Mahindra a good boast.
Economic – The economic scenario of India as well as world is pretty stable. Inflation is in
control,& GDP growth is always The make in India initiative has provided a major boast to the
company as a whole. The GST move in a way will be bringing the prices down.
Social – The disposable income of middle class has increased, thus they will have a better
purchasing power, which in a way will lead to greater sales. Mahindra Rise has struck at a
great time, the millennial are coming in a better position to buy things. The purchasing power
of tier II & tier III cities have increased. The financing of cars, real estate & heavy machinery
has increased, thus making
Technological - Technology factors will have a great impact, the impact of technology can be
very well seen in the automotive sector for the least, as there has been a gradual shift to
electric cars. Technology wise Tech Mahindra is going to have a drastic change, seeing the
recent trend of IT industry. The rural sector is also witnessing a drastic change in terms of
technology shift.

Environmental – A global push towards sustainability and risks arising due to climate risk
will have an impact on the Mahindra & Mahindra as a whole .Most of the products of Mahindra
has a direct impact on the environment. The rural sector which comprises of major chunk of
Mahindra’s main market has a direct interaction with the environment, for eg- if there’s less
monsoon then the rural demand will be less for tractors which will adversely effect the
company.

6
 PORTER FIVE FORCES MODEL:

Buyer Bargaining Power-

 Buyers have less leverage individually as there’s large number of buyers present.
 Customers have got a dearth of choices individually, and hence they are willing to pay more
for some particular commodities
 Buyers require special type of customisation for their comfort. Mahindra at times is able to
provide it & hence the bargaining power of customers is relatively less.
Supplier Bargaining Power –
 The inputs have less impact on costs & hence the suppliers have got a relatively moderate
supplier power.
 The bargaining power of buyers have a comparatively lower impact on the Mahindra &
Mahindra group
 Critical productions units are comparatively of the same integrity, hence can be easily
replaced, thus, less buyer bargaining power.
 Mahindra works on volume of scale & hence suppliers generally come back to it because of
huge demand
Intensity of Existing Rivalry –
 The industry size is pretty high & hence the despite the rivalry all the competitors easily
flourish
 The market as a whole is growing, so the competitors are not focussing on a rivalry rather
than entering new segments
 The barriers for exit is low & hence the rivals can easily enter & exit the firm.
 The number of conglomerates in India are few & limited.
Threat of Substitutes –
 The substitutes present for Mahindra are few in the niche sectors and if they are they provide
limited quality.
 There can be a technological shift which can have a significant impact on the positioning of
Mahindra
Threat of New Competitors-
 The entry power is pretty high for the new entrant for they will require huge investments in
term of machineries
 The distribution network required is very exhaustive and hence that will be a deterrence for
the entry of the new entrants
 Customers do have a loyalty towards an existing brands
 The brand name is important in the market which won’t be gained overnight.

7
Mahindra & Mahindra Porter’s Generic Strategy

Mahindra’s competitive advantage lies in the fact that it caters to all the segments based on
its different segments.
It caters to cost leadership & differentiation when it comes to automotive industry. The
tractors in the rural sector goes on to add differentiation focus. The Tech Mahindra post the
Satyam Acquisition focuses mainly on cost leadership.

8
Scenario Planning

Step 1:

Identification of key focal issue The Key Focal point that we wanted to address: How
consistent has Mahindra & Mahindra been in its corporate strategy of Mahindra “Rise” across
all its diversified sectors.

Step 2:

List of 5S framework details Mahindra Rise adopts to bring its innovation philosophy to life:

1. Space
Mahindra believes in giving mental and physical space to critically analyse problems and
so that we can adopt a non-linear approach to concentrate on the problem alone while
disconnecting ourselves from the world.
2. Self -indulgent Creativity
Mahindra allows one to work on projects one is passionate about, which may not be a part
of his/her day to day work.

3. Simplicity
Mahindra encourages its employees to find simple solutions to complex problems which
can be replicated in every other sector.

4. Sans
Employees at Mahindra are motivated in overcoming challenges without enough capital,
technology or skilled labour but with the minimum amount of fundamental resources at
their disposal.

5. Sustained Experimenting
Mahindra encourages creativity and allows the employees to experiment with ideas and
allows people to fail and learn from their mistakes which will make them go through a
constant learning curve.

Step 3:

Integration and interplay of six types of capital employed by Mahindra & Mahindra

1. Natural Capital
Mahindra and Mahindra approaches a “give more than we take” policy in which it gives
back to the nature by nurturing it and slowing down the reduction of natural resources.
2. Social Capital
It hires the talent from communities who have allowed them to operate by giving them
social licence and therefore Mahindra and Mahindra tries to uplift such communities
3. Human Capital
Mahindra believes that people are the biggest assets to an organisation therefore they are
given regular increments, incentives and empowering them by other means.
4. Intellectual Capital

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 Knowledge and creativity are highly valued in any organisation and hence Mahindra
invests heavily in R&D and there has been an increase in the number of patients applied
5. Financial Capital
Mahindra and Mahindra invests heavily in fixed assets and has to maintain a healthy
working capital for operational activities.
6. Manufactured Capital
Mahindra has invested in heavy plant and machineries all over the worlds and other such
fixed assets. E.g. auto manufacturing plant.

10
Analysis of Mahindra Rise
External Factor Evaluation Matrix:
EFE matrix is used here to analyse the external environment of Mahindra where we have
identified the key external opportunities and threats that might affect or are affecting a
company. These factors have been obtained by analysing the external environment using tools
like PESTEL analysis, Porter’s Five Forces, etc.
Sr. No. Factors Weight Rating Score
OPPORTUNITIES
1 Upstream/ Downstream integration 0.05 2 0.1
2 Mergers and Acquisitions 0.02 4 0.08
3 Growth in foreign markets 0.02 3 0.06
4 Synergies in SBUs 0.10 4 0.4
5 Leveraging local resources 0.10 2 0.2
6 Diversified export portfolio 0.10 3 0.3
7 Sourcing hub for foreign markets 0.10 3 0.3
8 0.02 2 0.04
0
9 THREATS 0
10 M&M mainly dependent on Rural sector 0.10 3 0.3
11 Fluctuating fuel prices 0.05 3 0.15
12 Strong competition 0.02 1 0.02
13 Government Policies 0.10 2 0.2
14 Taxation laws 0.02 2 0.04
15 Legal Compliance issues due to involvement of multiple
0.10 3 0.3
countries
2.49

The general rule in this matrix is to identify around 10-20 key external factors and
additional 10-20 key internal parameters.
Each key factor has been assigned certain weight ranging from 0.0 (low importance) to 1.0
(high importance). The weight indicates how significant the factor is for a company to succeed
in an industry. If there were no weights assigned, all the factors would be equally important
for company, which is not a correct scenario in reality. The sum of all the weights (Strengths
and weaknesses) must equal 1.0.
The ratings assigned in external matrix refer to how effective is the company’s current
strategy while responding to the opportunities and threats. The ratings are ranging from 4 to
1, where 4 means a great response, 3 means above average response, 2 being average
response and 1 being poor response. Ratings, as well as weights, have been subjectively
assigned to each of these factors. In case of Mahindra, we see that the company’s response to
the opportunities is good, because many opportunities have received a rating of 3 or 4, while
the rest have received a lower rating. The company’s preparation is average in terms of
meeting the threats.

11
Internal Factor Evaluation Matrix:
IFE matrix is used here to analyse the internal environment using its strengths and
weaknesses Strengths and weaknesses of Mahindra are used as the key internal factors for
evaluation. In case of the strengths, we ask what does the company do better or does it have
something more valuable than its competitors? When looking for weaknesses, ask which areas
of Mahindra could be improved and at least can be at par with its competitors?
Sr. No. Factors Weight Rating Score
STRENGTHS
1 Globally known brand 0.10 2 0.2
2 Diversified into various sectors 0.10 4 0.40
3 Large employee base 0.02 3 0.06
4 Policy support by government 0.02 3 0.06
5 Distribution network 0.10 4 0.4
6 Corporate vision 0.10 4 0.4
7 Strong vision and mission 0.02 4 0.08
8 Market leader in few sectors 0.02 2 0.04
9 Strong R&D and innovation 0.10 3 0.3
10 Strong CSR values 0.05 3 0.15
11 Strategic M&A 0.10 4 0.4

WEAKNESS
12 Over-dependence on few sectors only 0.10 4 0.4
13 Weak brand recall in non-automotive SBUs 0.05 3 0.15
14 Poor synergy between SBUs 0.10 4 0.4
15 Less diversified export portfolio 0.02 1 0.02
3.26

The ratings in internal matrix means how strong or weak that factor is. The ratings range
from 4 to 1, where 4 means major strength, 3 means minor strength, 2 being minor weakness
and 1 being major weakness. Strengths can only be given ratings like 3 & 4 while weaknesses
can only be rated 2 & 1. The score means weight multiplied by rating. Each key factor gets a
score. Total weighted score is the sum of all individual weighted scores given to all the factors.
In external evaluation, a low total weighted score indicates that company’s strategies aren’t
well designed to meet the opportunities and defend against threats. In internal evaluation, a
high score indicates company has a strong strategy otherwise it is weak against its
competitors.
Here, the EFE score is 2.49 which means Mahindra’s overall strategy is not good enough to
meet its opportunities or fight against the threats. While it’s IFE score of 3.26 indicates that it
has a fairly strong strategy and has a scope of improvement in few areas.
Based on the IFE and EFE score, we understand that Mahindra needs to grow and build in
a few areas which can be seen from the IE matrix of Strategic decision given below. The BCG
matrix helps to consider business growth opportunities of 6 SBUs of Mahindra and whether
they should invest, develop or discontinue the business.

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IE Matrix of Strategic Decision

IFE matrix Total Weighted Scores

Mahindra Group High Medium Low
3.0 - 4.0 2.0 - 2.99 1.0 - 1.99
4.0 3.0 2.0 1.0
EFE matrix Total Weighted Scores

High I II III
3.0 - 4.0 Grow and Build Grow and Build Hold and Maintain

3.0

Medium IV V VI
2.0 - 2.99 Grow and Build Hold and Maintain Harvest and Divest

2.0

Low VII VII IX

1.0 - 1.99 Hold and Maintain Harvest and Divest Harvest and Divest

1.0

BCG matrix

High Low

STAR QUESTION MARK

?
Relative Market Growth Rate

High

Mahindra World
Mahindra Tractor City

Tech Mahindra

Mahindra
Low

Automotive Mahindra and

components Mahindra
Mahindra
Holidays and
Resorts
COWS DOGS

Relative Market
Share

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Mahindra’s corporate strategy

Mahindra’s global corporate strategy was revamped and thus the idea of Rise came into
existence. The idea of Rise was articulated as “Mahindra, the brand that empowers customers
and stakeholders to succeed, grow and rise”.

The Rise proposition was based on 3 pillars:

 Accepting no limits
 Alternative thinking
 Driving positive change

The corporate strategy of Mahindra is all pervasive. The Strategic Business Units (SBUs) have
aligned their strategies so as to align them with corporate strategy.

Let us now explore how SBUs have aligned their strategy:

Tech Mahindra

Tech Mahindra is one of the earliest global Information Technology Service Providers to focus
on the needs of the “Connected World” with “Connected Solutions”. Tech Mahindra foresees a
new demand for connected experiences playing across all industries it services. The Company
has embraced the philosophy of the hyper-connected world and appreciates that the new
revolution is going to be powered by an intelligent symphony of solutions and designing
“experiences”.

Mahindra Racing

Mahindra’s presence in electric motorsport clearly conveys its stand on sustainable mobility.
Through sustainable practices in in Formula E Mahindra is driving positive change

Mahindra World City

A PPP between the Mahindra Group and Rajasthan State Industrial Development and Investment
Corporation (RIICO), Mahindra World City is a global benchmark in sustainable development and
has a Multi-Product Economic Zone (SEZ) spread across 1500 acres. It is the first and world’s
largest project to receive C40 Climate Positive Development Stage 2 Certification.

14
Mahindra & Mahindra Financial Services Limited

MMFSL is one of India's driving Rural NBFC headquartered in Mumbai, India. It is among the best
tractor financer in India and offers an extensive variety of money related items to address
fluctuated client prerequisites. The NBFC has 1000+ workplaces spread crosswise over 1 in each
3 towns crosswise over India with an aggregate of in excess of 4.7 Million clients till date.

Its mission is to transform rural lives and transform rural lives and drive positive change in the
communities.

Various SBU financial performance post incorporation of Rise strategy

M &M : Pr ofit M ar gin

12.00%

10.00%

8.00%

6.00%

4.00%

2.00%

0.00%
Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14

Profit Margin

Mahindra Holidays & Resort: Profit margin

25.00%

20.00%

15.00%

10.00%

5.00%

0.00%
Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14

Profit margin

15
Conclusion
Mahindra despite its diverse range of business has managed to coalesce its SBUs by its
corporate strategy. The concept of Rise has deeply percolated into business strategy and
defines and guides everyday functioning of SBUs.
Through this study we explored how corporate strategy of conglomerate guides the
business strategies of the business comprising of a conglomerate. Before rise, the brand
recall of Mahindra was mainly concentrated towards its automobile businesses. Moreover,
the SBUs didn’t share any common objective and mission per se.
Post implementation of Rise, the SBUs shared a common mission vision, thus the level of
consistency between the SBUs and Corporate strategy increased. On the financial front, for
various SBUs there was a significant positive change encountered post Rise. Thus, the major
takeaway from this project is that synergy between Business strategy and corporate strategy
is the way to go ahead for a conglomerate.

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References
http://www.mahindra.com/about-us/history
https://www.strategicmanagementinsight.com/tools/ife-efe-matrix.html
http://www.sparktherise.com/home/
https://hbr.org/product/mahindra-rise-a-brand-architecture-decision/W14691-PDF-ENG
https://www.ibef.org/
http://marketline.com/

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