Tata Motors is transforming its commercial vehicle after-sales service operations to ensure vehicle owners come back to its authorised service outlets or maintenance, which gives it a key edge.
A big challenge in the commercial vehicle business is that majority of the trucks sold in the country do not come to authorised dealers’ workshops for any repair and maintenance due to delay in service and non-availability of spare parts.
But, CV spares environment has always been a very challenging given that there is a large variety of parts and the customers need service in very short lead times.
“A robust after-sales services with excellent availability of genuine parts is a must for vehicle sales and retain edge. We have a service network every 30 km across the country,” said Sanjeev Garg, Global Head – Customer Care, Tata Motors.
Two years back it engaged Vector Consulting Group, which has helped several top companies in the country in building supply chain capabilities, when it decided to transform its mammoth after-sales network for commercial vehicles comprising 1,000 suppliers, 100 distributors, 2000 workshops, 400 container workshops and 35,000 retailers.
It needed to reduce the high inventory and long lead times the company was battling with as also to improve sales by offering enhanced service levels for customers at dealer and distributor channels. The scope of the Vector project involved a total transformation of its supply chain of vendors, dealers, distributors, retailers and Tata authorised service centres.
According to Garg, the engagement has paid dividends for Tata as more than half of Tata’s CV network reporting transformation in its operations. Vector’s principles under ‘Theory of Constraints’ (TOC) platform has helped improve availability of parts, while reducing the overall inventory levels significantly.
Kiran Kothekar, Founding Director, Vector Consulting Group, said the other improvements it achieved include doubling of sales by service outlets and distributors and 95 per cent availability of parts at Central warehouse (as against 65 per cent earlier). Also, Tata Motors has been able to save close to Rs. 20 crore on freight costs so far with the transformation exercise.
“There is also growth in sales through higher reach in the market and enhanced range in a time period of one year since TOC implementation,” said Kothekar.