Department of Mechanical Engineering

CASE STUDY ON IMPLEMENTATION OF TQM IN

BAJAJ AUTO LTD

Submitted by: Submitted to:

Muhammad Bilal (200554) Mam Hira Asif

Hamza Iftikhar (200556)

Ali Hassan (200558)

ABSTRACT
This case study examines the application of Total Quality Management (TQM) in an automotive
company. The BAJAJ automobile company manufactures auto parts and components for major
automakers who build a range of automobiles. Three companies consider Bajaj Auto Company to
be their top supplier; their branches are spread out across several locations. Currently holding an
ISO 9000 certification, Bajaj Auto plans to use the TQM philosophy and best practices for TQM
tools and processes inside the organization. A quality team, known as the TQM implementation
team, was already designated by the senior management. It is made up of eminent personnel from
several departments, including design, marketing, HR, production, purchase, suppliers, industrial
engineering, and quality, among others.
Higher employee and customer happiness, higher process and supply quality, and better employee
satisfaction are all anticipated outcomes of TQM deployment. According to the findings of this
case study, TQM training is crucial for firm employees to participate in the TQM implementation
process.
ABOUT BAJAJ
The Bajaj Group is amongst the top 10 business houses in India. Its footprint stretches over a wide
range of industries, spanning automobiles (two wheelers manufacturer and three wheelers
manufacturer), home appliances, lighting, iron and steel, insurance, travel, and finance. The
group's flagship company, Bajaj Auto, is ranked as the world's fourth largest three and two-wheeler
manufacturer and the Bajaj brand is well-known across several countries in Latin America, Africa,
Middle East, South and Southeast Asia. Founded in 1926, at the height of India's movement for
independence from the British, the group has an illustrious history. The integrity, dedication,
resourcefulness, and determination to succeed which are characteristic of the group today, are often
traced back to its birth during those days of relentless devotion to a common cause. Jamnalal Bajaj,
founder of the group, was a close confidant and disciple of Mahatma Gandhi. In fact, Gandhiji had
adopted him as his son.

Bajaj Auto Limited is a global two-wheeler and three-wheeler manufacturing company based in
India. It manufactures motorcycles, scooters, and auto rickshaws. Bajaj Auto is a part of the Bajaj
Group. It was founded by Jamnalal Bajaj in Rajasthan in the 1940s. It is based in Pune
Maharashtra, with plants in Chakan (Pune), Waluj (near Aurangabad) and Pantnagar in
Uttarakhand.

Bajaj Auto is the world's third-largest manufacturer of motorcycles and the second largest in India.
It is the world's largest three-wheeler manufacturer.

In May 2015, its market capitalisation was 640 billion, making it India's 23rd largest publicly
traded company by market value. The Forbes Global 2000 list for the year 2012 ranked Bajaj Auto
at 1,416.

The present Chairman of the group, Rahul Bajaj, took charge of the business in 1965. Under his
leadership, the turnover of the Bajaj Auto the flagship company has gone up from INR.72 million
to INR. 120 billion, its product portfolio has expanded, and the brand has found a global market.
He is one of India’s most distinguished business leaders, bike manufacturer India and
internationally respected for his business acumen and entrepreneurial spirit.
History
Bajaj Auto came into existence on 29 November 1944 as M/s Bachraj Trading Corporation Private
Limited. It started off by selling imported two- and three-wheelers in India. In 1959, it obtained a
license from the Government of India to manufacture two-wheelers and three-wheelers and
obtained Licence from Piaggio to manufacture Vespa Brand Scooters in India and started making
Vespa 150 scooters. It became a public limited company in 1960. In 1970, it rolled out its
100,000th vehicle. In 1977, it sold 100,000 vehicles in a financial year.

In 1985, it started producing at Waluj near Aurangabad. In 1986, it sold 500,000 vehicles in a
financial year. In 1995, it rolled out its ten millionth vehicle and produced and sold one million
vehicles in a year.

In 2017 it was announced that Bajaj Auto and Triumph Motorcycles Ltd would form an alliance
to build mid-capacity motorcycles.

Bajaj is the first Indian two-wheeler manufacturer to deliver 4-stroke commuter motorcycles with
sporty performance for the Indian market, which was otherwise dominated mostly by mileage-
based products from Hero Honda and TVS Motors. Bajaj achieved this with the 150cc and 180cc
Pulsar, giving Indians the first taste of performance biking. This was also accompanied by
innovative marketing techniques - by featuring its flagship product Pulsar 220 DTS-i in Pulsar
MTV Stuntmania, India's first stunt biking reality show.

Motorcycles in production include the Platina Discover, Pulsar, Avenger , Dominar and CT 100.
In FY 2012-13, it sold approximately 3.76 million motorcycles which accounted for 31% of the
market share in India. Of these, approximately 2.46 million motorcycles (66%) were sold in India
and remaining 34% were exported.
Auto rickshaw (three-wheeler) Bajaj is the world's largest manufacturer of auto rickshaws and
accounts for almost 84% of India's three-wheeler exports. During the FY 2012-13, it sold approx.
480,000 three-wheelers which was 57% of the total market share in India. Out of these 480,000
three-wheelers, 53% were exported and remaining 47% were sold in India. In Indonesia, Bajaj
three-wheelers are "iconic" and "ubiquitous" to the point that the word bajaj (pronounced bajay )
is used to refer to auto rickshaws of any kind .

Bajaj and Kawasaki have ended their 33-year alliance in India following deepening of ties between
the former and its Austrian partner KTM. Bajaj Auto had an alliance with Kawasaki's Motorcycle
division for the sale and after sales service of Kawasaki motorcycles through its Probiking, a
premium bike dealership network, since 2009. These Probiking dealerships were later converted
to KTM dealerships.

Bajaj Auto Ltd. made a technical assistance agreement with Kawasaki Japan in 1984, and since
then it had cooperated to expand production and sales of motorcycles in India.

INUSTRIES SALE OF TWO WEEHLERS

TQM Framework and Implementation Plan
One of the outcomes of the brainstorming session was TQM implementation in the company. The
specific field or critical areas of TQM have been identified in the brainstorming sessions. The
identified areas are also known as critical success factors (CSF’s) of TQM. These factors are also
again classified as “Soft elements of TQM” and “Hard elements of TQM”. The soft elements are
human and cultural development activities for understanding about the TQM and tries to support
the TQM implementation process. The hard elements are to be best practiced and performed during
the TQM implementation process. With this understanding about TQM elements, designed a TQM
framework for this case company according to the company requirements and policy. The
framework comprises of various factors having great value according to literature studies. In most
of the literature and in the company brainstorming session identified factors of TQM are to be
implemented and best practiced for gaining manufacturing excellence, improving the quality and
productivity.

The TQM framework CSFs are as follows:

• Top management support.
• Supplier quality improvement (input materials quality)
• Leadership development
• Manufacturing process management (products quality)
• Training and involvement of employees
• TQM tools and techniques
• Customer satisfaction (Output products quality)
These CSF’s have been further divided into soft and hard TQM elements for the ease of
understanding and implementation purpose.

Soft TQM Elements Hard TQM Elements

• Top management support • Supplier quality improvement
• Leadership development • Manufacturing process management
• Training and involvement of employees • TQM tools and techniques
• Customer satisfaction
Training and Involvement of Employees in TQM Implementation Process
The training was given to all the employees on TQM procedures, tools, techniques, quality
monitoring systems and explained the advantages of TQM implementation processes. Training
also emphasized the satisfaction of internal and external customers. In the training process specific
training has been given to the employees to actively participate in problem solving skills and
continuous quality improvement processes. Some of the employees, who are working in the quality
dept., were given specialized training in data collection, data analysis and carrying out statistical
process control techniques. In the TQM implementation training employees have been motivated
to learn cooperative working, take individual responsibilities, and learn safety habits and changed
working habits. The TQM implementation process motivated the employees to participate in
suggestion schemes through filled in format. The recognized employees have been given training
in conducting DOE and SPC techniques to improve the standards of product specifications.
Best Practices of TQM Tools and Techniques to Improve the Quality of
Processes and Products Continuously
During the management development and employee training program all the managers and
employees have been given training on the TQM tools and techniques. Now these tools and
techniques must be practiced in the manufacturing quality improvement process. Most of the TQM
tools and techniques observed in the literature are as follows:
• Statistical quality control
• Statistical process control
• Control charts
• Data collection and analysis
• Histogram
• Pareto charts
• Stratification diagram
• Scatter plots
• Cause and effect diagram
• FMEA
• Benchmarking
These tools and techniques are utilized to control the process quality, product quality, quality of
cutting tools, raw materials quality and to achieve the benchmark standards etc.; These tools and
techniques are utilized to control the process quality, product quality, quality of cutting tools, raw
materials quality and to achieve the benchmark standards etc.; By best practicing these tools and
techniques systematically the products produced met the customer requirements and satisfied the
customers. The benchmarking process is also one of the TQM techniques to improve the quality
and improve the production targets. In the auto company benchmarking practices are properly
implemented to enhance the technology up gradation, increase production capabilities, to improve
quality standards and to satisfy the end customers with innovative products.
Results after TQM Implementation
In the TQM implementation case study, we have utilized seven quality tools and techniques
extensively to improve the quality performance of the company. After TQM implementation and
best practicing of the soft and hard TQM elements the following results have been achieved.
• Improved leadership skills
• Improved supplier quality (reduced raw materials rejection to 4% to 1.5%)
• Frequent delivery of supplies (every alternate day)
• Reduced inventory (5 days to 2 days)
• Improved manufacturing processes (5% efficiency)
• Improved customer satisfaction
• Improved employee satisfaction
• Reduced defect rate (from 6.34% to 1.4%)
• Reduced variations in the processes (2%)
• Reduced quality costs (from 3% to 1%)
• Reduced machine breakdown time (from 24 hrs to 8 hrs)
• Improved productivity and performance (30%)
• Increased sales (16%)
• Improved cultural habits and cooperative working etc.
Awards and recognitions won by Bajaj

Bajaj Pulsar 135 LS received Bike of the Year 2010 award from BBC - TopGear and Bike India.

Pulsar 220 DTS-Fi received the Bike of the Year 2008 award by all major Indian automobile
magazines like Overdrive, AutoCar, Business Standard Motoring and Bike Top Gear.

In 2006, Bajaj Auto won the Frost & Sullivan Super Platinum Award for manufacturing excellence
in its Chakan Plant.

It received award for The Most Customer Responsive Company in Automobiles category in a
survey conducted by Economic Times for the years 2004, 2006 and 2008.

Bajaj Auto received the Bike Maker of the Year award in ICICI Bank Overdrive Awards 2004.
Bajaj Pulsar 180 DTS-i won the BBC World Wheels Viewer’s Choice Two-Wheeler of the Year
2003 award.
CONCLUSION
During the case study research process identified critical success factors of TQM through extensive
literature study conducted and through brainstorming sessions in the company. Now the case study
is being conducted at Bajaj auto company to know the effects of implementing critical success
factors of TQM and best practicing the TQM tools and techniques. It was observed that the soft
elements of TQM practices improve the strength for implementing hard elements of TQM. The
hard elements of TQM practices improve the quality and overall performance of the company. All
the critical success factors of TQM are to be best practiced, gaining the manufacturing excellence
and quality improvement awards. It was proved in this case study. TQM implementation and best
practices of TQM tools and techniques gained various advantages like reduced quality costs and
improved customer satisfaction.
The improved leadership skills of managers and supervisors played different roles in motivating
the employees to participate in decision making processes and daily problem-solving activities.
Maintaining best relationship with suppliers, quality of supply services has been improved, quality
of raw materials has been received in time, reduced quality problems from suppliers, quality
management systems have been implemented in the suppliers’ companies, so that the overall
supply performance index is improved steeply. The TQM implementation has impacted positively
in the manufacturing quality improvement. Employees are encouraged to participate in a
suggestion scheme and awarded for their best suggestions. Employees are trained in new
technology, new quality tools to improve their quality performance. In the beginning of training
process employees were scared about new
tools and technology, but later they understood the concept very well and now employing these
tools and technology well in working. Improved morale boosts the employee participation level.
Employee satisfaction increased many folds through TQM training process. Product rejection,
rework and scraping were reduced drastically by best practicing the TQM tools and techniques by
the shop floor employees. The TQM implementation process provides in-depth knowledge to all
the stakeholders of the company about the benefits they are going to get in future. TQM
implementation has gained a competitive edge and customer satisfaction. Tangible and intangible
benefits also gained by company after TQM implementation. Committed leadership of top
management, supportive leadership of middle management and total involvement of employees
have made TQM a successful endeavor in the company. There were so many benefits by
implementing TQM philosophy in auto companies in India. Still there is a gap in understanding
the TQM philosophy and its implementation procedure. There is an essential thing we identified
is that some certificate should be issued for TQM implementation so that the industries should get
the interest in implanting TQM philosophy.