Maruti dominated the Indian passenger car industry from the very first year and still does so. The company has never seen a 2nd spot in its entire age even after the industry was flooded by Japanese, US and German automobile giants. The company understood the uncertainties and environmental forces surrounding the business operations and acted proactively to keep itself stable.
MSIL huge amount of part localization1 and has been the de facto for its success in this competition intense ...view middle of the document...
In this uncertain environment, Maruti has adopted different strategies in line with resource dependence Theory2.
In the following few paragraphs we will discuss some Inter-organizational strategies used by MSIL for managing resource dependencies (Figure 1.1). These strategies are formal as well as informal.
Figure 1.1 Explains strategies of resource dependence theory and their sub strategies.
Resource Dependence Strategies :-
Maruti, s esteemed reputation has always helped it to be in the good books of its vendors, suppliers and customers. Maruti has done this by timely payment of bills, equitable profit sharing, sustainable growth and high quality service. This informal method had helped and will help MSIL to retain its Number 1 Spot.
Maruti in the recent years have been conducting various dealer and vendor conferences in different part of worlds, where they share success stories and appraise the best performers. This strategy build an emotional connect between organizations and leverage out profits in terms of less uncertainty in resource supply.
1# Instead of importing part you develop them in domestic market
2# The goal of an organisation is to minimise its dependence on other organisation for the supply of scarce resources.