Business Environment At Mahindra And Mahindra Commerce Essay

The company was established in 1945 with the assembly line of Willy s jeep in India and now it is a 7.1 billion Indian and multinational company all across the globe. The main motive of the company is to become the global leader in the field they enter. They have more than 100000 employers employed in their company all across the globe and enjoy leadership in the utility vehicles, tractors and in the Information technology sector and also now they have entered the 2 wheeler segment in India they trying to become the global leaders in that also as the existing big 2 wheeler market players. It also has its presence in financial sector, tourism sectors, infrastructure sector, logistic and trade sector.

Mahindra is the only Indian company with full range f tractors all across the globe and market leader in its CV’s, MUV’s, SUV’s and SEDAN. Mahindra company recently took a major stake of the REVA the electric car to enter the electric car market segment is now known as Mahindra Reva in the segment and all over.

Mahindra also entered the information and technology segment by taking a hostile takeover of SATYAM TECH CO LTD. In India to get a global market leadership in the information technology sector and show some skills in the sector.

Also it took over the KINETIC INDIA PRIVATE LTD. Company the one of the best in the 2 wheeler segments as to enter the 2 wheeler markets and now the company is known as Mahindra 2 wheelers so as to become the global leader in the country and all across.

The company is one amongst the A+ rated companies in the GRI list of rating companies in 2008-09.

(http://www.mahindra.com/OurGroup/Overview.html)

COOPERATE GOVERNANCE:-

àThe cooperate governance code means to achieve best out of everything and to give best of the benefit to the stake holders and to the context to achieve the best performance environment in the market and in the cooperate world.

According to Mahindra and Mahindra governance is not just system, metrics, processes .according to the company it is inheriting itself with beliefs, its culture, values, and motives and its ethics leading to transparency and accountability which is good governance according to the company.

When there was hit of recession in the country there was a flood of legal notifications firing of people and a new set of rules and regulations were made but there was no change in the Mahindra and Mahindra company because they follow a good cooperate governance and also a good set of legislation reforms which make the company different from the other companies. The company follows a code of conduct which are made by director of the company and by the senior management and employees and those are:-

1. Director shall not take for themselves personally any business opportunities that belong to the Company or are discovered through the use of corporate property, information or position.

2. Director shall not corporate property, information or position for personal gain.

3. Director shall represent the interests of the shareholders of the Company

4. Director shall exhibit high standards of integrity, commitment and independence of thought and judgement

5. Director shall dedicate adequate time, energy and attention to ensure the diligent performance of his/her duties including making all reasonable efforts to attend Board or Committee Meeting

6. Director shall comply with every provision of this Code.

(http://www.mahindra.com/OurGroup/CODEOFCONDUCTFORDIRECTORS.pdf)

Cooperate governance code for management and employees:-

Management will ensure that the company is running under sound economic environment principles and is working properly with a balanced allocation of resources to support the companies’ responsibilities to each stake holder of the company.

System and policies should be transparent and should be known to everyone and shall be known to everyone.

The management would take out only those business processes or approve only those business processes that are strong and robust so as they are judicious and worthful.

The management committee is committed to seeking long term profits with no compromises.

The decision towards employees should be transparent and should not be done due to its caste, creed, gender, religion or handicap of the employee.

Every employee would be given the task which is best suited to it and is favoured to it and is capable of doing it.

The employees can give new ideas and they are welcome and rewarded for their new ideas in the company.

Employees will be provided safe and healthy environment and with full time devotion towards them.

(http://www.mahindra.com/OurGroup/CODEFORSENIORMGMTCL49.pdf)

Long term Sustainability of Mahindra and Mahindra:-

à Environmental changes and societal changes in the economy and in the market Mahindra and Mahindra Company have eagerly entered into new risk markets like the information sector and in the 2 wheeler market for more avenues and revenues from the market and benefiting the company.

The Mahindra and Mahindra Company’s sustainability is strategically is integrating in the business ventures and making intrinsic decision making processes.

In the last three years the sustainability of the company has traversed from intentions to commitments and from commitments to road ramps that is fulfilment of commitments and then presenting in front of the consumers to fulfil their expectations.

The company after integrating and controlling the environmental factors and social factors of business and management is able to establish a connection between financial and strategic and sustainability directions of the business.

(http://www.mahindra.com/sustainability/Mahindra%20CSR%202009-10/sustainabilityHYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/sustainabilitycontext.asp”&HYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/sustainabilitycontext.asp”us/sustainabilitycontext.asp)

The sustainability structure is divided into 3 tier system:-

One tier:-

àIt comprises of senior members of committee that is the senior board of directors which handle the management of the company and also take care of the stake holders report and the company stake. It is also called as cooperate sustainability council .

Middle tier :-

àIt is the back bone of the company as it handles all the sustainability initiatives like:-

1. To ensure the approved strategies are in action

2. To purpose strategies, action plans, scoping of the report to the sustainability council.

3. To develop plans to all the sector of the groups.

4. Ensuring share of knowledge and capacity team building among each sectors and monitoring and collecting data from each sector.

Also known as the ‘cooperate sustainability cell’

3. Third tier:-

àThe sector consists of a team of 8 to 10 members which collect all the data and analyze the data and monitoring the data.

They are responsible for:-

1. Coordination between the sustainability council

2. Differntiating the information with respect to the data collection of the core team collection.

3. Ensuring all the complied data with respect to the sustainability initiatives including the G.R.I UNIT.

This tier is also known as ‘sustainability champions’

(http://www.mahindra.com/sustainability/Mahindra%20CSR%202009-10/sustainabilityHYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/sustainabilitystructure.asp”&HYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/sustainabilitystructure.asp”us/sustainabilitystructure.asp)

There are certain factors which are affecting the company and its business in the market. Those factors are:-

Political factors

àThe political factors which are affecting the company is that participation of the employees of the company in political parties that is the company does not allow itself in the involvement of any political party but it allows its employees to participate which is a wrong process it affects the image of the company as the employer is representing the company when he or she is participating in the political violence or non violence activities this would affect the company s reputation and also the affairs in the market. Few factors related to the industry are:-

100%fdi policy

Change in taxation policy

Subsidy from loans of government.

Regaining dynamism a key goal of eleventh five year plan.

(http://www.slideshare.net/sitansusekharsahu/strategic-analysis-of-mahindra)

2.Economical factors:- àEconomic factors means utilisation of the resources in the fullest so as there is no wastage of resources while producing the product but there were various causes affecting the economical conditions of the company ,increasing cost of raw material is the biggest threat for the company and also the regulatory norms imposed to safe guard the environment ,fuel efficiency less use of more smoking vehicles ,volatility in financial market, escalation of raw material market, effect of the supply chain in the market are few causes affecting the economic stability of the company.

Social factors:-

àSocially the company works for different group to promote its brand and to create a good image in the market so as people see the company in good reason; the company goes hand in hand to fulfil its social responsibility for the economy and also the everyday business responsibility

The company gives 1% of the after tax profit to the CSR (cooperate social responsibility) group which is the group created by the Mahindra and Mahindra company to help the people around them and to boost up the economy and give other people a new chance.

The initiative of the group created is to help the disadvantaged section of the society and the company, like people who are uneducated help them to educate and people who are good in something improve their skills and help them to boost up in the world they are in and gain confidence in themselves.

They created another group called ECOPS that is a group of employers social responsibility group in which the employee is benefitted in it that is the employer kids and family are made to get educated and given work to do and their children are send to schools where they study and are made to things they like to do .The CSR group also helps the people to give them financial support and also give the shelter who don’t have shelter and also the group keeps in touch with the nongovernmental organisation to help people, they come up organisations to save girl child and mid day meals in school and to their employees to keep them happy ,helping flooded areas in India and also helping the crippled people and cochlear people so to promote the brand of the company and help the country socially and economically .

(http://www.mahindra.com/sustainability/Mahindra%20CSR%202009-10/sustainabilityHYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/socialresponsibility.asp”&HYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/socialresponsibility.asp”us/socialresponsibility.asp)

4. Technological factor:-

àNew technology can create new products and new innovations in the market and also it helps in reducing the cost of the product and also it helps in getting a new product launched in the market to become the leader in the market, Sometimes the new technologies in the industry leads to reduce in the life cycle of the product . The factors affecting the production due to new technology are:-

new innovation in the technology or continuous innovation n the technology

renewable energy development

(http://www.slideshare.net/sitansusekharsahu/strategic-analysis-of-mahindra)

5. Environmental factors:-

àThe environmental factors of the company matter the company a lot as the company depends on the environment of the company and also the environment outside the company as the company uses the go green policy that is less use of carbon producing products so as it does not disturb the social and economic environment of the country and the place they are working in .the products produced in the company are made n such a way that the environment is also safe and less of carbon monoxide is produced from the commodities they are producing for the consumer and the product does not harm the consumer .the company s initiative is on green building and alternative fuel front. They are focussing on green building and fuel efficient products for the consumers and energy efficient products.

(http://www.mahindra.com/sustainability/Mahindra%20CSR%202009-10/sustainabilityHYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/environmentresp.asp”&HYPERLINK “http://www.mahindra.com/sustainability/Mahindra CSR 2009-10/sustainability&us/environmentresp.asp”us/environmentresp.asp)

6. Legal factors:-

àAs the company is globally situated and work in different countries so legal changes happening in the world or in the other parts and also in the country can affect the company a lot. There are certain legal changes which have happened in recent years in the economy globally and have affected various firms globally. the legal systems can affect the cost of the product and also the production of the product produced by the company .the legal system can also affect the demand of the product produced by the company. To avoid various problems the company has accepted various factors to go through legal systems like:-

collaboration with government in various shapes of policy

agricultural policy

bank system policy

(http://www.slideshare.net/sitansusekharsahu/strategic-analysis-of-mahindra)