STRATEGIC MANAGEMENT WORKBOOK

1st MBA B, Team - B11

Submitted By:

P S Aruna Kumar NJK22MB088

Prajwal D Poojari NJK22MB092

Pritesh Walston Fernandes NJK22MB100

Nikita Shetty NJK22MB084

Prateeksha NJK22MB096

Submitted To:

Prof. Sudhir M

Professor, JKSHIM, Nitte

 STRATEGIC MANAGEMENT WORKBOOK

FORMAT: 1
Chosen Industry: Automotive Industry
Chosen Enterprise: Hero
Chosen Company: Hero Moto Corp Ltd

FORMAT: 2 Three levels of strategy

Type of decision The chosen company is Hero Competitor
MotoCorp Limited
Corporate On 16 December 2010 Hero Honda dissolved its partnership
Group (an Indian company) with the Hero group on 16-12-
and Honda Motor Company 2010. Nowadays Honda is a
(Japan company) decided to major competitor for the
dissolve the partnership, its HMCL.
make end of the joint venture • Competition
between them. • Interest
• To Expand their business
into the global market.
• To reach the company goal.
• The problem in the export
decision in Joint venture.
• Different interests and
competition between them.
Business HMCL wants the number 1 Ather decides to produce EVs,
company in the 2-wheeler which is the main impact on the
sector, so in 2023, they 2-wheeler sector. In the future
observed the 2-wheeler sector EVs, and vehicles have more
 electric vehicle coming, so they demand.
decided to expand their
segment to EV.
Functional • Title sponsor for CPL. • Honda has used Alia Bhat
• Brand ambassador Ram in their advertisement in
Charan (RRR movie). Brahmastra Movie Time.
• IPL time Virat and
Anushka were involved in
Xpulse200T.
• Sponsor to LSG for
promoting EV Vida.
(Source Bloomberg and Annual report.)

FORMAT: 3
Characteristics of Strategic Management Decisions Take one of the decisions by the company that
you identify by the research above and complete the following: The chosen decision by the
company? Dissolve the Partnership, End the Joint venture between Hero and Honda.

Characteristics of Strategic Management Explain why the chosen decision by the

Decisions?
1 Expansion to the Global market.
2 To reach Organization goal
3 To the expansion of Growth
company fits the characteristic listed?
1. Don’t force fit. Only explain if you are
convinced?
Earlier Hero and Honda were working
together, but Hero has to work only inside
India. (Local market).
Hero is the largest manufacturer of 2-wheelers
in the whole world. The company has a main
goal is to become number 1 in 2- wheeled
vehicles.
Earlier Hero Company did not have the rights
 to export to other countries, so growth was also
restricted only to its own country, after the end
of the partnership they have to get export rights
and growth expansion also.
4 Decision making Earlier Hero has dependent on the Honda
company, because of the end of the joint
venture, there is freedom level is high and
independently hero can take the decisions.

FORMAT: 4

Name of the Competitor? ATHER

The chosen decision by company? Ather Company has decided to produce an Electric 2-
wheeler vehicle. Source:

Characteristics of Strategic Management Explain why the chosen decision by the

Decisions? competitor company fits the characteristic
listed in Col: 1 ?

1 Market share As it is electric vehicle is the new product line in

the automotive sector, they come to market as
possible as earliest for acquiring the market
share in 2-wheeler EV.

2 Environment friendly As traditional vehicles are harmful to the

environment, so comparing to traditional
vehicles Electric vehicles are less harmful to the
environment.

3 Less Maintenance Cost Compared to normal 2-wheelers EV 2-wheelers

are less maintenance cost.

4 Features They have features that do not exist in normal

scooters, like regenerative breaking. Customer-
friendly features. Swapping batteries.
FORMAT: 5 What are the explicitly stated Mission/ vision/ goals/ objectives etc. etc. of the
enterprise? State how the enterprise articulates its philosophy (whether as mission/ vision/ goals/
objectives etc.)?

Vision:
“BE THE FUTURE OF MOBILITY”

Mission:
Create:
• Re-define mobility through the creation of a mobility roadmap.
• Set best practice and benchmarks for the industry.
Collaborate:
• Leverage partnerships and exhibit Teamwork.
• Co-create solutions that benefit the community, while caring for both the internal and external
environmental ecosystems and support sustainability.
Inspire:
• Move forward with purpose.
• Inspire our colleagues, customers, and communities.
• Thrive on the local and global stage.

Values:
PASSION
We have the ‘JOSH’– we are driven to deliver our best every day; loving what we do, be bold,
and have fun.

INTEGRITY
Our behavior is ethical and do the right thing when no one is watching.

RESPECT
 We show regard and appreciation for everyone; celebrate diversity, act with confidence yet
humility.

COURAGE
We are Risk-takers, pioneers, and unafraid to question the status quo.\

RESPONSIBLE
We are Accountable for our actions and performance; delivering outcomes as a team, caring for
each other and the environment.

Objectives:
HMC group of Companies aspires to deliver the best and the most cost-effective products &
solutions empowered by superior technologies. The Group is committed to ensuring value for
money by developing high-quality, environment-friendly, and efficient solutions that fulfill the
diverse needs of customers.

(Source: https://www.heromotocorp.com/en-in/investors/annual-reports.html)

FORMAT: 6 What are the implicitly stated Mission/ vision/ goals/ objectives? How do you come
to your conclusions and justify your statements?

Mission:

To create value for their customers, shareholders, employees, and society at large by providing the
best products and services in the two-wheeler industry.

Vision:

To be a global leader in the two-wheeler industry by continuously innovating and delivering superior
quality products and services that exceed customer expectations.

Goals:

To maintain market leadership in the domestic two-wheeler market by launching new products and
expanding their distribution network.

To increase their global market share by entering new markets and expanding their product portfolio.
 To enhance their manufacturing capabilities and efficiency to reduce costs and improve profitability.

Objectives:

To achieve a double-digit growth rate in sales volume and revenue year-on-year.

To maintain high customer satisfaction by providing quality products and services.

To improve operational efficiency and reduce costs to improve profitability.

To promote sustainable development by implementing environmentally friendly manufacturing

practices and reducing carbon emissions.

These are some of the implicitly stated mission, vision, goals, and objectives of Hero MotoCorp.
However, it's worth noting that these may not be explicitly stated by the company, but rather inferred
from their business practices and initiatives.
(Source: https://www.heromotocorp.com/en-in/investors/annual-reports.html )

FORMAT: 7 Connect the explicitly and implicitly derived philosophy of the company and
critique it?

Hero MotoCorp is centered around the idea of creating world-class products and services with
the highest level of customer satisfaction. This reflects a customer-centric approach, with a focus
on quality and innovation. Implicitly is reflected in its commitment to sustainability, social
responsibility, and collaboration with partners and teams. Hero MotoCorp aims to redefine
mobility and create a mobility roadmap that sets and benchmarks for the industry. They also aim
to inspire stakeholders. There are some potential criticisms to consider. One criticism is that the
company's focus on innovation and sustainability may be more about marketing and public
relations than genuine concern for the environment. Some critics may argue that Hero
MotoCorp's efforts in this area are not substantial enough to make a real difference and that the
company could be doing more to address environmental issues.
 FORMAT: 8 what are the businesses within the enterprise?

Hero FinCorp Hero Future Energies

Hero Electric Hero Realty

Hero Steels Hero enterprise

Hero enterprise Hero Corporate Service Ltd

FORMAT: 9 Discuss connected/ relatedness/ unconnected Ness among the businesses. Draw a
connectedness diagram. Identity of the business unit chosen within of the company?

Hero Group
Brijmohan Munjal

Sunil Kant Pawan Kant Suman Kant

Raman Kant Hero Chairman& MD Executive
1991expired Enterprise HMCL Chairman
Hero steels HFCL Rockman industries

Abhimanyu Ujjwal Munjal

Munjal Shefali Munjal Executive Director-
Joint MD ED- HCSL Rockman Industries
&CEO HFCL Founder Director
Hero electronics P

Rahul Munjal
MD- Hero Akshay Munjal
future President BML
energies ltd University
FORMAT:
 10 What is the product market space for the business? Compare with competitors. Consider
concepts like strategic groups, and niche markets. Identify the reasonable basis for forming
strategic groups. It may be useful to start with mapping product market space for the whole
industry?

High
Ducati
Triumph
Kawasaki BMW,
KTM,
RE
HMCL,
Bajaj, TVS,
Honda
Price

Low Product Range High

FORMAT: 11 What are the SBUs implicitly stated Mission/ vision/ goals/ objectives? How do
you come to your conclusions and justify your statements?

The objective of HMCL is to be the leader in the 2-wheeler industry and they are providing fuel-
efficient vehicles ahead of competitors. HMCL aims to understand the needs of the customer and
their preference in order to provide them with an exceptional ownership experience. HMCL
producing high-quality vehicles at affordable prices makes them as achieving their goal.

FORMAT: 12 Connect product market positioning with the mission/ vision of the enterprise. Is
there a proper fit?
Hero MotoCorp group focuses on manufacturing fuel efficient vehicles along with better
technology. Hero MotoCorp mark positioning is focused on manufacturing reliable and fuel
efficiency vehicles since they have to meet large customer needs. Hero MotoCorp’s mission
 statement mainly focuses on technology, this will help to differentiate its products in the market.
It also stresses on providing the good quality products, their products go through several tests
before it is being introduced to the market by this Hero MotoCorp is aiming to gain trust and
loyalty by their customers. They also give importance for sustainability, where they have started
to manufacture electric vehicles. Overall, there is a match between the mission and vision
statement and product positioning. The company is striving to improve Technology, design,
quality in order to meet the customer requirements. By aligning their mission and vision
statement Hero MotoCorp is the largest manufacturers of two wheelers in automotive industry

FORMAT: 13 Nearest Competitor: Bajaj Auto Limited

What are the explicitly stated Mission/ vision/ goals/ objectives etc. etc. of the nearest
competitor? State how it designates its philosophy (whether as mission/ vision/ goals/
objectives etc.
Vision:
“The future is promising and we look forward to an exciting period that would possibly
establish a pronounced and decisive road map for us on the Indian Industrial firmament”

Mission:
“To build businesses that support the growth of the country by creating entrepreneurial
excellence within the group. To create value by enabling innovation, creativity, integrity, and
service to the community in everything we do “.

Objective:
“Bajaj strives to produce automobiles for the people of India at an affordable price by
using advance technology and following business ethics to cater to the market of two and three-
wheeler transport it requires continuous improvements in existing products based on
customer feedback”.

Goal:
To catapult Bajaj Auto Limited as the country’s largest automobile company.

Source: https://investors.bajajauto.com/
FORMAT: 14
What is its implicitly stated Mission/ vision/ goals/ objectives? How do you come to your
conclusions and justify your statements?

Bajaj Auto Limited's implicit vision is to become a global leader in the automobile industry,
technological advancements, and driving innovation. And their implicit mission is to provide high-
quality vehicles and services as per the customer expectations while increasing sustainable
mobility. The company's objective and goals are to achieve market leadership, product excellence,
and manufacturing efficiency. They are more focused on customer satisfaction and employee
development. Through this Bajaj Auto aim to deliver an exceptional product, a global market, and
contribute to a greener and more efficient transportation ecosystem.

FORMAT: 15 Connect the explicitly and implicitly derived philosophy of the nearest competitor
and critique it
Implicitly Derived Philosophy of Bajaj Auto Limited
Bajaj Auto Limited has positioned itself as a provider of affordable two-wheelers and three-
wheelers. The company has focused on manufacturing products that are widely available and
are low cost. Bajaj Auto Limited is known for introducing new technology, advanced features
and designs in its vehicles. The company focuses on maintaining trust of the customers through
delivering quality vehicles, customer service, and after-sales support.
Critique of Implicit Philosophy:
As a big company in the automotive industry, hero should on the development and promotion
of eco-friendly vehicles, such as electric vehicles through the growing concerns of climate
change and air pollution. The company could invest further in CSR activities

FORMAT: 16 Undertake a PESTLE Analysis of your business – consider both domestic and
international factors if applicable?

Current situation Likely changes in the future

Political Government supports the In the future Electric vehicle

development of Electric demand will increase and EV
vehicles. manufacturing companies will
 increase.

Economic Auto buyers feel inflation Future petrol vehicle costs

pinch (6.4%) will increase, and EV costs

Union Budget 2023 to remove will decrease.

customs duty on goods that
are required to produce
lithium batteries.

Social The recent trend to move Hero will come up with more
towards eco-friendly and EV, Hero wants to lead the 2-
sustainable modes of wheeler sector so they are
transportation more focus on the EV.

Technological Growth in electric vehicles. Petrol vehicle demand will

E-commerce sales are the decrease; demand for electric

Trend. vehicles will increase. (People
are shifting from petrol
vehicles to electric vehicles).

People find it convenient to

buy online.

Legal Vehicle scrappage policy. Demand for new vehicles will

BS6 norms. increase.

HMCL should shift from BS4

to BS6 so engines will be
more tuned.

Ecological Electric Vehicle & save the An environment-friendly

scared resource is the current electric vehicle has more
trend. demand and manufacturing of
 Recent findings of 5.9 tons of EVs is high.
lithium are in J & K. HMCL could collaborate with
local government and reduce
the cost of EV.

(Source: Bloomberg)

FORMAT: 17 Apply Porter’s 5-force analysis to the INDUSTRY you have chosen and assess the
strength of the various forces the industry faces?

Power of Suppliers: LOW

In the Automobile industry, many suppliers exist, Rockman Industries, Samvardhana Motherson
International Ltd, Bharat Forge Ltd, and Tata steel ltd, are the main suppliers for the 2-wheeler
industry. There is 1000+ suppliers are existed, So many options exist for the automobile
industry, so the suppliers are less-powerful.

Power of Buyers: LOW

In automobile industry have forward integration, which contributes a major part of the cost of
goods sales, also this industry has direct buyers, and their power is low.

Power of substitutes: HIGH

Substitute for 2-wheelers is high, public transport, metro, bus, cab, trains, and cars is a major
substitute. Majorly 2 wheelers are used for private, nowadays somewhere it’s used for public
also.

Overall, for the automobile industry, the substitutes are high.

Power of new entrants: LOW

1st mainly new entrants need huge budgets(capital) for entry into the 2-wheeler automotive
industry, also in this industry well establish companies already existed like HMCL, Bajaj Ltd,
HMSI, and all others. So new entrant’s power will be Low.

Competitive Rivalry: HIGH

In the matter of competitive rivalry, quality, fuel efficiency, and price are a major factor, and in
2022 there is high competition between Hero and Honda 2-wheelers.
 Company Market Share 2021 Market Share 2022

Hero MotoCorp 32.00% 34.75%

Honda M&S India 27.10% 25.13%

TVS Motor Co 15.65% 14.82%

Baja] Auto 11.34% 12.78%

Royal Enfield 4.42% 3.54%

Suzuki Motorcycles India 4.39% 4.32%

India Yamaha Motor 3.63% 30.47%

Okinawa Autotech 0.67% 0.58%

Ather Energy 0.43% 0.15%

Piaggio Vehicles 0.28% 0.38%

India Kawasaki Motors 0.02% 0.03%

Triumph Motorcycles India 0.01% 0.01%

Chetak Technology. 0.00% 0.00%

Mahindra Two-Wheelers 0.00% 0.00%

Total 100.00% 100.00%

FORMAT: 18 Applying Porter’s 5-force model, analyze the competitive position of the
BUSINESS you have chosen and find what factors are “threatening” to your firm. Are there ways
to neutralize the impact of the firm’s competitive disadvantage vis-à-vis the five forces? Do these
forces differently impact your firm vis-à-vis its nearest competitor? Explain?

Porter’s 5-force model analysis to HMCL.

Power of Suppliers: MODERATE

HMCL has 72 suppliers, Rockman Industries Ltd (7.55%cogs), Mitsuba Corp (3.32% cogs), and
Samvardhana Motherson international ltd (3.54%cogs) (automotive) they are the main suppliers
for HMCL suppliers taking revenue (85%,73%, 45%,33%) from HMCL. So, there are both
sides’ powers.
 Power of Buyers: LOW

HMCL has 5 customers. Nitol Niloy Group 2.54% (revenue), HMCL has direct customers from
the dealers so, they are less powerful.

Power of substitutes: MODERATE

Currently substitute for HMCL is low, HMCL produces fuel efficient vehicles and also, entered
into EV. The substitutes are public transport, cabs, autorickshaw, and bus.

Power of new entrants: MODERATE

New entrants, Ola and Ather in EV 2- wheeler sector have made HMCL come into the EV
sector. Electric 2W sales go up 132% in 2021& in 2022 6x growth. In 2021 2-wheeler sector
EV’s sales growth is 132%.

(https://timesofindia.indiatimes.com/auto and Business Today)

Competitive Rivalry: HIGH

For HMCL, Honda and Bajaj are high competitors. According to 2020 data 52.7% of HMCL,
HMSI

14.9%, Bajaj auto 18.5%, 2021-2022 data HMCL 39.2%, Bajaj auto 14.3%, HMSI 20.5% So,
there is high competition to HMCL. {Source: https://auto.economictimes.indiatimes.com/ }

FORMAT: 19
What are the resources of the business?

• Brand Reputation
• Research and development
• Manufacturing facility
FORMAT: 20

Subject the above to VRIN (Valuable, Rare, Inimitable, Non-substitutable) analysis

Resource of the firm: Comments

Brand Reputation
Valuable (Yes) Hero Moto Corp has the positive brand reputation and it has built trust
among its customers, their existing customers are becoming loyal and
repeated buyers contributing to companies’ revenue and market share.
Hero MotoCorp has come up with Instant Redressal Feedback to improve
customer feedback.
Rare (YES) Hero MotoCorp is offering a wide range of 2-wheeled vehicles which
have fuel efficiency and most of them are value for money vehicles. It has
its own wide spread over the distribution channel. In this category hero
splendor has a separate brand image when it comes to mileage.
Inimitable (No) Hero is the leader in the 2-wheeler segment, so competitors would need
to invest resources and time to challenge hero Moto Corps market
position and reputation. But in case of implementing of technology Bajaj
has a better advantage.
Non-substitutable No Non-substitutable for HMCL

FORMAT: 21
Resource of the firm:
Research and development
Valuable (Yes)
Comments
Hero MotoCorp research and development hold significant value
for the company. The resources involved the development of new
segmented bikes. For example, previously they were only into
manufacturing of petrol vehicles and slowly they are entering into
EV segment.
 Rare (Yes) Hero MotoCorp has introduced Vida V1 Electric scooter in India,
which has swappable batteries in it. Hero was the first one to
introduce the concept of removable batteries.
Inimitable (Yes) Hero MotoCorp has a total of 702 patents globally in which 237
have been already granted. Out of these 91% patents are active.
Hero MotoCorp has filed the maximum number of patents in India
(593).
Non-substitutable (Yes) Research and Development main part for the success or failure of
a company. Hero spends over 1035.86 crores for research and
development activities.

FORMAT: 22
Resource of the Comments
firm:
Manufacturing
facility
Valuable (Yes) Hero MotoCorp is the biggest 2-wheeler company in the world, so
they have 5 manufacturing plants which are located in Dharuhera and
Gurugram in Haryana, Haridwar in Uttarakhand, Neemrana in
Rajasthan, Halol in Gujarat.

Rare (No) They are having 8 global facilities and 5 manufacturing plants in
India.

Inimitable (No) Hero MotoCorp has a production capacity of 9500 vehicles per day.
No other automobile company has the capacity to produce this
number in a single day.

Non-substitutable (Yes) Skilled employees and technology are two important factors which
cannot be duplicated. Employees with good technical skills and ideas
 can also help in improving technology and in Automobile sector
designs cannot be copied from one company unless there is a
collaboration.

FORMAT: 23
What are the resources of the nearest competitor? (Bajaj Auto)

Brand image
Customer loyalty and network
Strong Distribution

FORMAT: 24
Subject the above to VRIN analysis
Resources: 1 of the nearest
competitors Comments

Valuable The Bajaj brand is known as ‘The World ‘s Favorite Indian’. It

was the Indian No.1 motorcycle exporter and the world’s largest
manufacturing company of two-wheelers. More than 18 million
motorcycles were sold in 70 different countries.
Rare Bajaj Auto was the first two-wheeler company in the world cross
market capitalization of rupees one lakh crore

Inimitable Digital Twin Spark Ignition Technology which was patented by

Bajaj some years ago. Which enhance fuel efficiency. Bajaj use
it on Pulsar, Avenger and Discover.

Non - substitutable Vision and Corporate Leadership of Bajaj. The Corporate

leadership provides direction and motivates employees to
 achieve the vision which is ‘To create value by enabling
innovation, creation, integrity and service to community in
everything we do’.

Source: https://investors.bajajauto.com/
FORMAT: 25
Do the resources of the company form capabilities?
Manufacturing facilities
Hero MotoCorp uses cutting-edge machinery, production lines, and trained labor to create
motorcycles. Assembly, welding, painting, testing, and quality control are just a few of the
procedures that Hero MotoCorp is capable of making

FORMAT: 26
Do the resources of the competitor form capabilities?
Customer loyalty and network
Customer loyalty:
Customer loyalty may also be impacted by competitors' resources. Competitors can increase
customer loyalty by investing in marketing, product quality, and customer service.
Network:
Hero MotoCorp must strategically manage its network to remain competitive and deliver a
positive ownership experience. A well-established network can offer a competitive edge.

FORMAT: 27 What rivalries can you anticipate between your company and the competitors to
preserve their respective resources?
HMCL is known for its Brand Equity and they are one of the largest players in the two-wheeler
segment. And it also has strong brand image, being a companyfor many years it creates a distinct
brand image of reliability and affordability in the customer mind. But Bajaj as a brand image
has made a huge impact in people’s mind, hence HMCL should also strive to build their brand
image like Bajaj. And Bajaj has produced bikes that created a wider impact and revenue as
compared to HMCL, hence HMCL should work on their R & D to come with more products to
create an impact.
FORMAT: 28 Do SWOT Analysis for the business?

Strength

Cost efficiency: HMCL production is more focused on the cost efficiency of vehicles. They
produce large, economies of scale.

Diverse product basket (product portfolio): HMCL offers a big range of vehicles, to different
customer segments and preferences. They produce vehicles for off-road, sports, and transport
purposes. They have diversification in cost also, for the premium customers Xpulse400, for the
medium customers Xtreme 160R, for average cost customers Hero splendor Xtec. Also, they
are more focused on product innovation.

High brand image: HMCL has a strong brand image, in 2wheeler sector HMCL’s market share
is higher than other competitors. HMCL is known for fuel-efficiency vehicles. So, brand image
is one of the strengths.

Good Distribution Network: HMCL is reached widely in India and also, they have reached
almost 40 countries with their good distribution network.

Strong customer service: Hero MotoCorp provides excellent customer service, which helps in
building customer loyalty and trust.

Weakness
Dependence on the Indian market: Hero MotoCorp is heavily dependent on the Indian
market, which makes it vulnerable to economic and market fluctuations in the region.
Limited international presence: The company has limited international presence and exports,
which limits its potential for growth and diversification.
Lack of premium products: Hero MotoCorp's product portfolio is mainly focused on the mass
market segment, and it lacks premium products in its lineup, which limits its potential to tap
into higher-end segments.
Competition: Hero MotoCorp faces intense competition from both domestic and international
players, which puts pressure on pricing, quality, and innovation.

Limited R&D investments: The company's investments in R&D are limited compared to its
competitors, which may limit its ability to develop innovative products and maintain its
competitiveness in the market
Opportunity
Growing Indian market: The Indian two-wheeler market is growing, and Hero MotoCorp has
the opportunity to increase its market share by expanding its product portfolio and customer
base.
Expansion into international markets: The company has the opportunity to expand into
international markets and diversify its revenue sources.
Growing demand for premium products: There is growing demand for premium products in
the Indian market, and Hero MotoCorp has the opportunity to tap into this segment by
introducing premium products to its lineup.
Electric vehicles market: The electric vehicles market is growing, and Hero MotoCorp has the
opportunity to enter this market and capture a share of the growing demand for electric two-
wheelers.
Increasing focus on sustainability: With an increasing focus on sustainability and
environmental responsibility, Hero MotoCorp has the opportunity to develop eco-friendly
products and position itself as a responsible corporate citizen.

Digitalization: The trend towards digitalization presents opportunities for Hero MotoCorp to
improve its customer experience and service offerings through digital channels

Treats:
Intense Competition: The two-wheeler market is highly competitive with several established
players vying for market share.
Government Regulations: The company operates in a highly regulated industry with frequent
changes in regulations and policies, which could impact its business operations
Economic Slowdown: Slowdowns in the economy can impact consumer spending and reduce
demand for two-wheelers.
Raw Material Costs: Fluctuations in the prices of raw materials can increase the cost of
production and affect the company's profitability.
Technological Advancements: Rapid advancements in technology could render the company's
products obsolete, affecting its market position.

Changing Customer Preferences: Changing customer preferences and shifting trends in the
market could impact the company's sales.
 FORMAT: 29 Develop two or three scenarios that may happen in the next 5-7 years. Describe
the scenarios?

Scenario 1: Rise of Electric Vehicle (EV revolution)

• Currently around the world government has supported Electric Vehicles by giving subsidies and
incentives to promote EVs. (Eg: Tax deduction, Purchasing subsidies.)

• Manufacturers are majorly focused on the development of battery efficiency and range. So,
manufacturers are more invested in the R&D department.

• Currently, people are shifting to EVs in 2-wheeler is high

(Source: EV reporter, IBEF (India Brand Equity Foundation)

 Scenario 2: Sharing, connecting, and rentals
will increase.

• Currently, 2-wheeler vehicle prices going

up, so in the future sharing vehicle purchase,
connecting vehicle services, and rental services
will increase. Individual’s 2-wheeler purchases
may decrease (except for bike lovers).

Scenario 3: Introduce Autonomous Riding Vehicles

• Tesla has already planned to introduce Autonomous vehicles. So, in the future, there is a
chance to introduce Autonomous 2-wheeled vehicles.

• AI and sensor technology developing and growing in the world, so there is a high chance to
introduce Autonomous riding vehicles with safety technology.

FORMAT: 30
What are according to you is the Generic Strategy adopted by the firm?

1. Cost Leadership:
The HMCL targeting the middle-class people to expand its market share. Middle class
consumer mainly focusses on price and leadership. Cost leadership is the best strategy to
hold the need of consumer segment. They are more focus on easy accessibility and
affordability of its produce across the globe. That leads to high brand awareness and high
sales growth. It provides strong competitive advantage.

2. Differentiation:
Differentiation strategy allow HMCL to expand the customer base by take care over the
unique product feature. HMCL expand its product line after studding the customer
changing interest. It also differentiation from competitors and expand the scope of
 opportunity within the industry. That make them position its product offering in a way to
stand out and also different from alternatives.

3. Focus Strategy
HMCL adopt the focus strategy in both ways. That is low cost and offering best value.
Low-cost focus strategy is adopted to serve the need of niche market segment at the
possible lower price. And best value focus strategy is adopted by look over the size, taste
and design of the product that could match the customer needs and requirement.

FORMAT: 31
Map the business on the Strategy Clock?

Low Price: Hero MotoCorp's motorcycles are known for their affordability pricing. The company
aims to offer reasonably priced motorcycles.
Focused Differentiation: Hero MotoCorp adopted focused differentiation strategy by targeting
specific market segments or niches with motorcycles that were specifically build for off-road
purpose. Ex. Hero XPulse
FORMAT: 32

What are the issues that the company is facing that needs to be attended to?
What are the issues that the company is facing that needs to be attended to?
The major issue in hero MotoCorp is they have not yet started manufacturing bikes that have
higher engine capacity while comparing to its competitor Bajaj. As our rival are targeting the
younger generation since the trend is slowly changing previously customers were demanding
fuel efficient bikes and the current trend is they are willing to spend more money and get a bike
which has higher CC and they are ready to sacrifice the mileage. So, this is the main issue that
the company needs to address. In the higher segment the company has not made any attempts to
launch 250cc vehicles. Hero MotoCorp is not in a position to compete in the premium category
with its competitors like Bajaj, KTM and Royal Enfield.

FORMAT: 33

What is the Generic Strategy/ strategy clock position the business should strive to achieve in the
future?

Hero MotoCorp primarily focuses on entry-level motorcycle segments, and it may face
challenges in penetrating the premium segment dominated by brands like Royal Enfield,
Yamaha, and KTM. Hero can use Differentiation Strategy by creating unique and differentiated
position in the premium segment by offering motorcycles with new features, designs, and
performance capabilities. Hero can also use cost leadership strategy.

Hero MotoCorp may face challenges in term of electric vehicles as they are gaining more market
share. Hero needs to develop new advanced technology and cost-efficient electric vehicles and
also developing big charging infrastructure. By differentiating themselves in the EV segment,
they can target a niche market and establish a competitive advantage. So, Hero can use Focused
Differentiation Strategy.
FORMAT: 34 What functional strategies should the firm adopt to match the generic strategy
proposed?
Hero can use Differentiation Strategy by creating unique and differentiated position in the
premium segment by offering motorcycles with new features, designs, and performance
capabilities.
Hero needs to develop new advanced technology and cost-efficient electric vehicles and also
developing big charging infrastructure, they can target a niche market and establish a
competitive advantage. So, Hero can use Focused Differentiation Strategy.

FORMAT: 35 Do Portfolio Analysis in the following space (use BCG Matrix) (Make sure there
are no strong dependencies between the businesses)

Source:https://de41hj8xu1b85.cloudfront.net/media/tiny_mce/1633005681-image1.png

STAR: Hero Xpulse has been able to attract large number of customers. Since it is the most
affordable bike under the adventure segment. Even pleasure in the scooter segment has gained
better response.
QUESTION MARK: Hero Xtreme and hunk was considered as risky decision of the company to
invest in this product. Neither the product had sold massively nor it had attracted the customers.
CASH COW: hero splendor is the highest selling 2wheeler of hero motocorp which indicates a
large sales volume. Even till date Hero Splendor is still the highest selling bike of hero motocorp.
DOG: Karizma ZMR has low potential growth and it has lower demand among the consumers.
Hero had relaunched this motorcycle with better look and design but the result was the same.
FORMAT: 36 Map M&As/ joint ventures/ collaborative/ partnerships/ outsourcing that the firm
has undertaken to strengthen its competitive position in the past

Hero MotoCorp was a joint venture between Hero Cycles of India and Honda Motor Company
of Japan. The collaboration ended in 2010, resulting in Hero MotoCorp becoming an
independent company.

Hero MotoCorp acquired a 49.2% stake in EBR, a renowned American motorcycle

manufacturer. This improved Hero's research and development and to expand globally.

Hero MotoCorp partnered with AVL, an Austrian powertrain engineering company, to develop
next-generation engine technology and improve the fuel efficiency and performance of its
motorcycles.

Hero MotoCorp has established manufacturing plants and assembly units in several countries to
strengthen its global presence. Ex. Colombia, Bangladesh, and Nigeria.

Hero MotoCorp has collaborated with Bosch, a leading technology and service provider, for the
supply of various components such as fuel injection systems, engine units, and sensors.

FORMAT: 37
Suggest what to do using Ansoff’s Matrix for future direction
Market Penetration: In order to increase the market share of the existing market they have to
enhance their marketing and promotional activities. They should strengthen their distribution
network and also enhance the customer service. They should make sure their customer is very
loyal to them by making repeated purchase of product by giving them incentives.
Product development: They should invest in research and development so that they can come
up with more innovative products and gain the loyalty of the customers. As there is more demand
for electric vehicles, they should come up with more electric vehicles options.
Market Development: They need to focus on different geographical areas which they didn’t try
to reach yet and try to understand the needs and preferences in the international markets. As
their main focus is Indian market.
Diversification: They should diversify their market in electric Motorcycles, electric scooters.
 So that they can grab different opportunities for then to diversify their business in the market.
They can also merge or acquire to enter into new segment or industries. in order to gain more
customers and improved technology benefit.

FORMAT: 38 What M&As, collaborative tie-ups do you propose for the future to consolidate the
generic strategy/ new position on the strategy clock you are proposing

As there is high demand for EV vehicles and high support from Government. This is the right
time for Hero MotoCorp to merge with Hero Electric, as Hero Electrics is already established in
the EV sector it will be very helpful for HMCL.

FORMAT: 39

Undertake a force field analysis for the option you are proposing

Vis-à-vis the first change you propose suggests

Forces for change Forces against change

EVs in the future: Competition:
Rapid advancements in EV technology, such Hero MotoCorp faces intense competition
as improved battery technology and from other major EV players like Ather and
connectivity features give opportunities for Ola. Competitors are investing in electric
Hero MotoCorp to enhance its EV vehicles vehicles and are having more advanced
and offer innovative features to consumers. technology than Hero, making it crucial for
Hero MotoCorp to keep up with or to surpass
their advancements.
 FORMAT: 40

How can forces against the business be reduced/ neutralized?

1. Hero MotoCorp promotes social and environmental responsibility through CSR activities and
reputation.

2. Improve Customer Satisfaction by concentrating on offering premium vehicles, outstanding

customer care, and post-sale help. Customer loyalty will increase as a result, and negative
opinions will decrease.

3. Analyze Hero MotoCorp's competitive pricing to overcome opposition and ensure value for
money.

4. Stakeholder relationships can be improved by means of asking for input, fixing problems, and
developing trust.

5. Invest in marketing and branding to establish Hero MotoCorp's reputation

6. If HMCL merges with Hero Electrics that reduces the competition.

FORMAT: 41 Do a “Suitability, Acceptability, Feasibility” analysis for the option you have
chosen

Suitability: Yes, it’s suitable. Nowadays people are switching towards EV Vehicles. Due to
environmental concerns, improved battery capacity, reduce consumption, and cost savings.
That's why HMCL is more concentrated on the EV sector. There is a high demand for EV
Vehicles in the future.

Acceptability: Yes, its acceptable. HMCL main target customers are middle-class people. If the
company provides the best product with more benefits, people automatically shift for such
products. In EV Vehicles if the company use advanced technology to innovate more product
that will attract people to buy more.

Feasibility: yes, it’s feasible. HMCL already gets into the EV sector. So, it is not much difficult
to company come up with advanced technology. They aim to develop a new range of EVs in the
next 13-15 months to expand their portfolio.