TWA Parts

BSC: What you measure is what you get

Group - 8.
Bhavani Shankar
Mrinal Gautam
Nishant Kumar
TWA Parts : Company Profile
Customer Geographic
Business Product Lines
Divisions Markets
• Tier 1
manufacturer 1.Electronics 1.Luxary 1.North
of Original 2.Economy America
and after 2.Europe
2.Interiors 3.Mid Priced
market parts
4.Truck 3.Asia
for
Automobile
producers
SWOT Analysis for TWA Parts
Luxury and Economy
segments are showing Mid priced and truck division
profits. making losses.

STRENGTHS
S W WEAKNESSES

OPPORTUNITIES THREATS
O T
International Emerging Ongoing downturn in the Auto
Markets such as China Industry due to global recession
Financials FYE 2018 (Customer Division
Wise in Mn $)
Product Economy Luxary Mid Priced Truck Total
category

Revenue 2255 2939 745 742 6681

COGS 2100 2560 899 801 6360

SGA 135 171 244 128 678

Operating 20 208 (398) (187) (357)

Income
TWA’s Strategy drift(Dec–2008 meeting)
Segment Performance Existing Strategy New Strategy
Adopted
Mid Priced Division Loss making -- Exit Strategy

Truck Division Loss Making -- Exit Strategy

Luxury segment Potential for profit Differentiation (Diluted) Differentiation –(pull

creation)
(Innovative Quality Parts ,
Technologically superior)
Economic Segment Potential for profit Cost leadership Focused Differentiation
(High Quality with lowest
lifetime cost) .Durability and
low maintenance cost.
TAP is now focused on the Asia market especially for the economy division and in the European market for the
luxury division as an out come of strategy restructuring and redefinition meeting.
Customer Value proposition
Segment Current Value proposition Intended Value proposition

LUXURY Innovation Most Innovative

Performance High Quality
High Quality

New Product Innovation Technologically Superior

Product Design
Technical Expertise
ECONOMY Low Cost Durable
Fuel Economy Low maintenance cost
Quality

Price High Quality

Product Quality Lowest lifetime cost
JIT/Lean
 BALANCED SCORECARD
with compliance (Luxury Segment)

75% 34%
FINANCIAL PERSPECTIVE CUSTOMER PERSPECTIVE

1.Increased ROCE 1.Improve Customer Satisfaction

2.Increase Cashflow 2.Manage Innovation
3.Increase Revenue 3.Initiate Customer R & D partnerships
4.Increase gross margin.

1.Reduce Raw material Cost 1.Increase Employee Engagement

2.Maintain Quality Leadership.

INTERNAL PROCESS
LEARNING/GROWTH
PERSPECTIVE
PERSPECTIVE
50% 0%
2/15/2020 50% 7
 BALANCED SCORECARD
with compliance (Economy Segment)
FINANCIAL PERSPECTIVE
1.Increased ROCE
2.Increase Cashflow
3.Increase Revenue
4.Increase gross margin.
5.Increase asset utilization
1Improve Durability of parts produced
2.Better Forecast OEM Demand
3.Increase Useful life of Subassemblies
4.Develop closer customer relationships
5.Eliminate Defects
6.Improve supplier base and performance
INTERNAL PROCESS
PERSPECTIVE
2/15/2020
CUSTOMER PERSPECTIVE
1.Grow market share in economy
0% 50% segment
2.Be the low-maintenance cost supplier
in the economy segment
3.Gain reputation for standing behind
quality
4.Be the high quality provider of auto
parts in the economy segment
1.Enhance workforce capability in TQM
2.Transform workforce in JIT/lean experts
3.Make JIT/lean priority for all workers
4.Allign IT to support TQM and JIT
5.Enhance electronic interchanges with
customers and suppliers
6.Train Buyers on high quality procurement
LEARNING/GROWTH
100% 100% PERSPECTIVE
67% 8
CONCLUSION
Luxury Division Economy Division Remarks
Achieved Financial Failed to achieve Financial 6 months is a short time to judge performance
Objectives Objectives based on Financial results. Its a Backward
Indicator and doesn’t indicate about Long term
insights.
Failed to achieve most of Achieved almost all the These objectives give long term insight for the
the objectives related to objectives related to Internal company , If these strategies are linked correctly
Internal process, Learning process, Learning and Growth then financial objectives will definitely get
and Growth and Customer. and Customer. achieved in long term.

• It is too early to comment that which division is doing better.

• Both the divisions has done well in one or other parameters.
• TWA Parts must revisit its strategy map and BSC that they are well linked specially from cause
and effect perspective.
THANK YOU