Mahindra First Choice Services
Mahindra First Choice Services (MFCS) is the largest multi-brand car service company in the country. MFCS kicked off the TOC implementation with Vector, in the Chennai cluster by putting in processes of TOC replenishment for spare parts while creating a hub and spoke model of inventory locations. Within a year of TOC implementation, the following results were realized:
We are able to guarantee completion of running repair jobs in four hours from the time a car enters the service centre. Ultimately we want to be known as the dominos of car servicing market.
We are a multi-brand car service company. We are sandwiched between brand companies offering high quality service at high prices and unorganized local garages offering ‘not-so-great’ quality at dirt-cheap prices. Our offer of high quality at reasonable prices is attractive to people looking to move away from unorganized garages. The challenge is beating single-brand service centers in service delivery. Parts management gets in the way – the number of components that a brand service center has to hold is much lower than what we (a multi-brand service company) have to stock. Expanding rapidly without solving the inventory conundrum can spell doom for a multi-brand service company.
Vector Consulting Group, our partner on this transformational journey, showed us the merits of exploiting sales opportunities using existing infrastructure. Vector educated us on the benefits of improving ROI before we push for accelerated growth. Guided by the TOC approach, we are focused on improving services and inventory management, cluster by cluster.
TOC implementation requires hub and spoke model. Therefore, as a first step, we grouped the company-owned workshops across India into clusters. Kicking off the implementation along with Vector Consulting Group in the Chennai cluster, we adopted processes of TOC replenishment for auto components while we created a hub and spoke model of inventory locations. This allowed for maximum aggregation benefits at the hub. We implemented TOC operations processes to cut down service lead-times. Our turn-around-times have dropped by more than 50 percent, our on-time performance has entered the 90s. We now guarantee that running repair jobs will be completed in four hours, we offer to pay a penalty if we fail to do so.
Component availability is in the high 90s. All in all, we have made the working environment stress-free for our operations team.
Sales (of restricted models) has gone up by more than 20 percent by value in the Chennai cluster where we are doing the first phase of implementation. Ticket size has gone up, thanks to the decoupling of inspection and actual repair work.
We will roll this out in all clusters and then expand through franchisees whom we are promising an ROI of minimum 30 percent.
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