GSMC 2014

Global Summit on
Management Cases

STRATEGIC LEADERSHIP: THE STORY OF MARUTI UDYOG LTD.

AND R.C.BHARGAVA*
ABSTRACT
This case studys objective is to establish that organizational success brought about by strategic leaders is the result of a
studied fit between four fundamental functions that they internalize and apply them in the organizations environment.
Presented through the dynamic achievements of R.C.Bhargava (Bhargava), Chairman, Maruti Udyog this case seeks to
establish the role of a strategic leader in creating, questioning and transforming a company from a mere Public Sector
Undertaking to Indias most successful automobile manufacturer with successful employees participation in management
that lead to the success of Way of Life. Bhargava with his decision to diverge from regular PSU practices by infusing
Japanese management and labor practices lead to higher turnovers with Marutis market share rising from 38 % to 44 %
in the last four years. These values internalized and demonstrated by these leaders and Bhargava are:

Internalizing the organizations vision, mission and core values

Working towards the formulation of strategies, policies and structure that translate the vision, mission and core
values into business possibilities

Create an environment for organizational growth and learning

Serve as role models within the organization and lead form the front

Bhargava lead from the front: whether at a labor standoff in 2011-12, which resulted in violence, a general manager dead,
100 managers hospitalized with 147 workers arrested and a plant lockout, he demonstrated an uncanny ability to turn crisis
into cosmos. He was elevated to its chairmanship in 2007 by his repeated demonstration of his ability to anticipate,
envision, and think strategically making stakeholders to realize that sustained profits is a necessary condition for any company
to survive for long. He was an innovator: whether it involved building sales and after sales network, promoting road safety,
running of driver training schools or maintaining roundabouts and parks, Bhargava implemented these initiatives under his
leadership to demonstrate their importance for long term business sustainability. Bhargava has been planning out the success
for Marutis next plant at Becharaji, Gujarat where it would be sub-contracting part of its manufacturing to Suzuki which
would in turn sell those cars to Maruti.

Pedagogical Objectives

To identify and relate strategic leadership as being a key factor in the long term sustainability and success of an
organization

To understand how innovation, inclusion and adaptation lead to profit maximization

To internalize the values and apply the roles of leadership that fits itself into the environment of the organization to
make it a successful venture

Case Positioning and Setting

This case study can be used for MBA or Executive MBA for the following course:

Strategic Leadership Course The role of individual decision making and ownership- How inclusion of people,
innovative policies and techniques and measured implementation of management methodologies to keep the
stakeholders contended at all levels contribute to sustained growth of an organization

* GSMC 2014, IIM Raipur

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