Ashok Leyland is huge by any measure. And it’s really rather simple to prove how. With a revenue Rs 29,055 crores, the company is the dominant player in the commercial vehicle segment. It is the world’s largest supplier of defense logistics vehicles. It is the fourth largest manufacturer of buses and the tenth largest manufacturer of trucks globally.The commercial vehicle major is penetrating global frontiers with seven manufacturing plants and a wide network of sales and services outlets across the globe.
Supporting such a blistering pace of growth is never easy, but especially so when the contours of your industry are being stretched by definitive digital trends.
But Venkatesh Natarajan , SVP-IT, Ashok Leyland isn’t fretting. His approach: focusing on enhancing the value of the company for consumers using IT. Natarajan is not the technologist who gets visibly enthused about a neat application of technology. For him, it’s all about looking beyond the technology razzle-dazzle to focus on the business gold.
Changing the business model
Natarajan believes that technology is redefining competitive rules in the automotive industry.
Traditionally, auto manufacturing companies made revenues from the sale of a product, spare parts, services. A very small fraction of their revenues came from solutions. “We see this changing completely in the next 5-10 years where there will be more revenue coming for solutions rather than product and services,” he affirms.
The two most important sources of business value: data and platforms are now even more so. That’s because data and digital technologies will be the driving force behind the creation of digital solutions.
“The predominant reason behind this fundamental shift is the changing customer demands and expectations. For instance, five years ago we only manufactured and supplied chassis for the commercial vehicles. Then the customers started asking us if we can build bodies on top of it. Over the last 3 years, customers have been asking us to provide solutions and platforms for tracking driver behavior, bringing down the cost of ownership, optimizing the fleet efficiencies and so on,” he explains.
The other trend, Natarajan points out, is that the automotive industry which has predominantly been a B2B industry is now piggybacking on digital technologies to slowly transform itself into the B2C industry.
Meeting customer expectations
Ashok Leyland began its digital transformation journey seven years ago. Over the years it has leveraged digital for cost optimization, business optimization, building new business models and revenue streams.
These objectives have seeped into the business so deeply that they find their implementation across the value chain.
Three years ago Natarajan relooked at his technology strategy and resolved to deliver on each of these objectives with a well thought out digital solution.
That’s when Ashok Leyland launched its digital marketplace two years ago.
The digital marketplace has the combined force of four digital solutions aimed at delivering increased value to the customers and helping the organization to generate additional revenue by monetizing all these platforms.
The applications called iAlert, e-Diagnostics, Leykart, and Service Mandi are all born out of customer needs of cater to diagnostics, service, fleet management, and spare parts of customers. iAlert enables real-time fleet monitoring across various vehicle parameters. “It brings together advanced Track and Trace (TnT), Vehicle Health Monitoring Diagnostics) and Reports & Analytics capabilities to provide valuable data on your vehicle’s performance, predict service requirements, help you plan maintenance schedules and help your vehicle stay on road longer,” he shares.
“While most new telematics solutions are accessible only to a small percentage of vehicles with electronic engine platforms, iAlert is an industry first telematics solution available across engine platforms, mechanical and electronic alike. The home-grown system can monitor up to 42 parameters on advanced vehicles to generate the most comprehensive, real-time data on your vehicle’s health and whereabouts,” he claims.
E-diagnostics app is aimed at problem identification and offers step by step troubleshooting with the help of videos. It then helps customers connect with the nearest local and rated mechanic for repair jobs at standardized prices.
“The Leykart app is a round the clock repository of genuine spare parts. Users can search for any specific spare using their vehicle registration or selecting it from a list. Parts can be ordered directly with digital payments and will be sent to them with doorstep delivery,” he shares.
There are about one lakh garages in India. But it is a very unorganized sector. The ServiceMandi platform connects customers with Ashok Leyland mechanics irrespective of the vehicle’s location. It also provides live status updates of the vehicle repair directly on the mobile. Once completed it also enables digital payment for the service on a pre-agreed rate.
Each of these platforms is driven by customer needs and expectations.
New Frontiers
From a business perspective, the automotive industry is transforming from ‘ownership’ to ‘usership’ model. Listening to the customer is as important as listening to the product. Data from IoT sensors and product insights will drive customer insights.
Data has remained in the barracks for too long. Now is the time for it to be lined in the frontier positions. In keeping with this view, Ashok Leyland has equipped about 1,50,000 vehicles with IoT sensors. Over 7000 vehicles are being boarded on the IoT platform everyday. On an average, the company captures about 315 GB of data and processes one billion data packages on a daily basis. That amounts to capturing 40 million kilometers of vehicle tracking data daily which is equivalent to four roundtrips from the sun to the earth. That’s the volume of the tracking data which we capture.
All this humongous amount of data helps the company respond rapidly and intelligently to customer demands. “We use the data-driven insight for fuel management. Fuel pilferage is a big problem in India. So we use a lot of ML algorithms to get deep insights on how much fuel has the customer has lost. Let me give you an example to illustrate this. One of our customers had a fleet of 150 vehicles and in the month of March this year, he lost fuel worth Rs 25 lakh due to pilferage,” Natarajan states.
IT has supercharged the analytics engine of Ashok Leyland in a big way and this change in culture is propelling digital transformation of the company.