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Case Code: OPER139
Case Length: 14 Pages 
Period: 2015-2016      
Pub Date: 2019
Teaching Note: Available
Price:Rs.400
Organization : Max India Group
Industry :Healthcare and Services
Countries : India
Themes: Competitive Strategy/Business Models/Strategy Formulation/Strategy Implementation
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Business Excellence Framework as a Competitive Advantage: The Case of Max Group

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EXCERPTS

CUSTOMER CENTRICITY AT THE CORE

 
The Max Group’s Vision was to be “one of India’s most admired corporates for service excellence” (see Exhibit 3) and the values were Sevabhav, Excellence, and Credibility (see Exhibit 4). The two major arms i.e., Max India Limited and Max Financial Services (MFS), shared the same Vision. For example, Max India’s Vision was to be the most admired company for the health and life care needs of its customers, patients, and their families and MFS’s vision was to be the most admired company for protecting and enhancing the financial future of its customers. MFS was listed on the Bombay Stock Exchange as well as the National Stock Exchange. The company’s investor base included marquee global financial institutions such as KKR, Baron, Vanguard, Aberdeen, Jupiter, Wasatch, Norges, and Alliance Bernstein....
 
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MAX PERFORMANCE EXCELLENCE FRAMEWORK (MPEF)

The Max Performance Excellence Framework (MPEF) was an amalgamation of five global quality models, predominantly the US Baldrige model, with certain aspects chosen from Japan's Deming Prize, European Foundation for Quality Management, Singapore Quality Award, and the Australian quality model. The framework was based on the six ‘processes’ and one ‘result’ criteria and was modified every two years on the basis of what successful organizations did ...
 

MAX QUALITY SYSTEM – WHY AND HOW?

Hoskote recalled that the initial directive from the Chairman was to evaluate excellence models (Baldrige, EFQM, Japanese approaches), and deploy one of these as quickly as possible to bring to all the Group businesses a standard language of quality and a mindset of continuous improvement. However, he was aware that an excellence model only represented a structural framework that would highlight operational gaps..
 

IMPLEMENTATION OF THE MAX PERFORMANCE EXCELLENCE FRAMEWORK

At the Max Group, implementation of the MPEF was carried out in a phased manner. During the first phase (2011), a decision was taken to introduce the MPEF overarching Group Quality approach which involved the training of assessors, undertaking the assessment of the individual business units, submission of the feedback report, and development of the action plan (based on the feedback report).The second phase (2012) was to establish an overall Quality System, now called the Max Quality System (MQS), to elevate the subject into being called ‘organizational excellence’, to be driven using a three-year plan..
 

POTENTIAL BENEFITS OF MPEF

The MPEF was expected to provide both structure and discipline to the business excellence agenda. The reporting framework provided the necessary discipline and supported the overall governance structure. It helped the business units sharpen their key processes throughout the value chain and to align the organization, engage the workforce, delight the customers, and increase the bottom line...
 

THE BUSINESS EXCELLENCE FRAMEWORK AS A COMPETITIVE ADVANTAGE

Since its inception, the Max Group had ventured into different industries and sectors. In none of the sectors had it had any prior experience. In fact, most of the times, it was not the first to enter the market. It had to compete with competitors who had more resources and were much bigger in terms of the balance sheet than itself. In the company’s journey that started about three decades ago, business excellence had been the fulcrum for the success of Max Group as a whole. Its first venture was into drugs manufacturing during the early 1980s. In India, the first three Food & Drug Administration (FDA) approved plants were set up by the Max Group. At that time, the company was very small in size and was competing with very large pharmaceutical giants. The way it decided to compete was to go the FDA route. In 1985, the import duty was as high as 300 percent. This had come down to 30 percent by 1991...
 

THE CURRENT SITUATION – CHALLENGES & OPPORTUNITIES

The challenge was straightforward: stable, attractive returns would come only to those who fundamentally rethought the industry’s value proposition and shifted the focus on to serving the protection needs of a broader share of the population by building capabilities to effectively manage liability risk and a more efficient and effective distribution model...
 

DECISION

Hoskote looked at the clock and realized it was time to go for the meeting. On his way to the meeting room, the questions that kept him occupied were – How should the Max Group go about developing its execution strategies for expansion in the wake of rising competition and stringent regulations and how would service excellence as a value proposition be sustainable for a rapidly growing conglomerate like the Max Group? Hoskote had a lot of critical decisions to make and a lot of work to do...
 

EXHIBITS

Exhibit 1: Max Group Holding Structure
Exhibit 2: Max Group Shareholding Pattern as on 31st Dec 2015
Exhibit 3: Max India Vision & Mission
Exhibit 4: Max India Values
Exhibit 5: Performance Excellence Framework: A Systems Perspective
Exhibit 6: Criteria for Performance Excellence Framework – Items & Point Values
Exhibit 7: Max Quality System Scorecard
Exhibit 8: Max Quality System (MQS)
Exhibit 9: Tangible & Intangible Benefits (MQS)