A Project Report on AMUL

Submitted By BHUSHAN N. HULKE

T.Y.B.M.S Semester VI 2012-13

Submitted To University of Mumbai

Under the guidance of Prof Abhijit Rane

Vidyalankar School of Information Technology (Affiliated to University of Mumbai) Vidyalankar Marg, Wadala (E), Mumbai 400 037
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VIDYALANKAR SCHOOL OF INFORMATION TECHNOLOGY

(Affiliated to Mumbai University)

Certificate
This is to certify that Mr./Ms. _________________________________ of B.M.S Semester _____ has undertaken & completed the project work titled ______________________________ during the academic year __________ under the guidance of Mr./Ms. _______________ submitted on _________ to this college in fulfillment of the curriculum of Bachelor of Management Studies, University of Mumbai. This is a bonafide project work & the information presented is True & original to the best of our knowledge and belief.

PROJECT GUIDE

COURSE CO-ORDINATOR

EXTERNAL EXAMINER

PRINCIPAL

ACKNOWLEDGMENT

I hereby acknowledge all those who directly or indirectly helped me to draft the project report. It would not have been possible for me to complete the task without their help and guidance

First of all I would like to thank the principal Dr.Rohini Kelkar and the coordinator Prof. Vijay Gawde who gave me the opportunity to do this project work. They also conveyed the important instructions from the university from time to time. Secondly, I am very much obliged of Prof. for giving guidance for completing the project

I am thankful to all those persons who co-operated with me. They not only rendered time out of their busy scheduled but also answered my queries without hesitation.

Last but not the least; I am thankful to the University of Mumbai for offering the project in the syllabus. I must mention my hearty gratitude towards my family, other faculties and friends who supported me to go ahead with the project.

DECLARATION

Vidyalankar School of Information Technology (Affiliated to University of Mumbai) Vidyalankar Marg, Wadala (E), Mumbai 400 037

I BHUSHAN N. HULKE of Vidyalankar School of Information Technology, T.Y.B.M.S Semester V hereby declare that I have completed the project on Promotion of College Events in academic year 2012-13 The information submitted is true and original to the best of my knowledge

[Signature of the Student]

BHUSHAN N. HULKE

Research Methodology Statement of the Project The project has been titled analytical study of functioning of amul as the aim of the project is to study the functiong of Gujrat co-operative milk manufacturer fedaration , the evolution of amul brand and the effects of white revloution Formulating the Research Problem: Unit of Analysis amul Characteristic of Interest functiong and implentation of business model Objective of the Study: To study the functioning of GCMMF To study the evolution of amul brand To study analyticaly the bussiness and development model of amul To study the scope for implementation of the model Research Design: Every project requires an action plan and method for conducting a study. This project is more prone to descriptive research as all the findings are based on both primary data through interaction as well as secondary data (internet, books, etc.)

Sources of Data: After listing down the methods of study and the activities to be done to complete this project, the next step was implementation of the activities. This project is based on primary as well as secondary data. Following sources were used to obtain data and information: Primary source Interaction with the dealers of amul in the city 6

Internet : It is secondary source of data. Majority of the data is collected through the Internet. It was a tedious job to find relevant data, which was useful for the study. It requires lot of scanning of lots of PDF and various other documents published.

Limitations of study Due to geographical restrictions it was not possible to interact with the milk manufacturers of gujrat who are affected by the grwoth of GCMMF Could not practically visit the production plant of amul and interact with the officials of GCMMF

EXECUTIVE SUMMARY Amul ("priceless" in Sanskrit. The brand name "Amul," from the Sanskrit "Amoolya," (meaning Precious) was suggested by a quality control expert in Anand.), formed in 1946, is a dairycooperative in India. It is a brand name managed by an apex cooperative organisation, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly owned by some 2.8 million milk producers in Gujarat, India. AMUL is based in Anand, Gujarat and has been an example of a co-operative organization's success in the long term. It is one of the best examples of co-operative achievement in the developing economy. "Anyone who has seen the dairy cooperatives in the state of Gujarat, especially the highly successful one known as AMUL, will naturally wonder what combination of influences and incentives is needed to multiply such a model a thousand times over in developing regions everywhere."The Amul Pattern has established itself as a uniquely appropriate model for rural development. Amul has spurred the WhiteRevolution of India, which has made India the largest producer of milk and milk products in the world. It is also the world's biggest vegetarian cheese brand. Amul is the largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US$1050 million (200607). Currently Unions making up GCMMF have 2.8 million producer members with milk collection average of 10.16 million litres per day. Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a few South African countries. Its bid to enter Japanese market in 1994 did not succeed, but now it has fresh plans entering the Japanese markets. Other potential markets being considered include Sri Lanka. Dr VergheseKurien, former chairman of the GCMMF, is recognised as a key person behind the success of Amul. On 10 Aug 2006 ParthiBhatol, chairman of the Banaskantha Union, was elected chairman of GCMMF.Amul products have been in use in millions of homes since1946. Amul Butter, Amul Milk Powder, Amul Ghee,Amulspray, Amul Cheese, Amul Chocolates, AmulShrikhand, AmulIce cream, Nutramul, Amul Milk and Amulya have made Amul a leading food brand in India. (Turnover: Rs. 52.55 billion in 2007-08). Today Amul is a symbol of many things. Of high-quality products sold at reasonable prices. Of the genesis of a vast cooperative network.Of the triumph of indigenous technology.Of the marketing savvy of a farmers' organisation. And of a proven model for dairy development.

INDEX Sr. no.

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Topic
AMUL Introduction 1.1 Amul the origin 1.2 Start of the revolution 1.3 Obstacles : springboards for success 1.4 Milk by products : an excuse to expand 1.5 Cattle : from stumbling blocks to building blocks The kaira experiment GCMMF 3.1 GCMMF : an overview 3.2 GCMMF today About the company 4.1 Organization structure 4.2 Company information 4.3 Developing demand 4.4 The distribution network 4.5 Umbrella brand 4.6 Managing the supply chain 4.7 Coordination 4.8 Managing third party service providers 4.9 Establishing the best practices 4.10 Technology and e-initiatives The birth of Amul and development of Indias dairy co operatives Corporate social responsibility 6.1 CSR-sensitive organizational structure The three-tier AMUL MODEL 7.1 Village dairy cooperative society (VDCS) 7.2 District cooperative milk producers union 7.3 State cooperative milk federation 7.4 Impact of Amul model Assessment report of the world bank Achievements of Amul movement Achievements of GCMMF Amul brand building 11.1 Products 11.2 List of products 11.3 Mascot 11.4 Advertising Recent advertisements from 2000-2010

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11 11 12 12 13 13 14 15 15 16 16 16 17 18 18 19 19 19 20 20 21 24 23 23 24 25 25 26 27 28 29 30 30 31 31 33 35 39
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2 3 4

5 6 7

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16 17 18 19

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12.1 2010-2011 12.2 2009-2010 Rivals In popular culture VergheseKurien 15.1 Education 15.2 Career 15.3 Personal life The white revolution Awards Operation flood 18.1Introduction 18.2 Objectives Programme implementation 19.1 Phase 1 19.2 Phase 2 19.3 Phase 3 SWOT ANALYISI SUMMARY AMUL RELIEF TRUSt VARIOUS ARTICLES FROM NEWSPAPER CONCLUSION BIBLIOGRAPHY

39 39 37 37 38 39 39 39 40 41 42 42 42 43 43 44 44 45 47 47 50 52 53

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1 .AMUL- INTRODUCTION

AMUL PLANT AT ANAND

1.1 Amul: The origin The mighty Ganges at it's origin is but a tiny stream in the Gangotri ranges of the Himalayas. Similar is the story of Amul which inspired 'Operation Flood' and heralded the 'White Revolution' in India. It began with two village cooperatives and 250 liters of milk per day, nothing but a trickle compared to the flood it has become today. TodayAmul collects, processes and distributes over a million liters of milk and milk products per day, during the peak, on behalf of more than a thousand village cooperatives owned by half a million farmer members. Further, as Ganga-ma carries the aspirations of generations for moksha, Amul too has become a symbol of the aspirations of millions of farmers.Creating a pattern of liberation and self-reliance for every farmer to follow.

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1.2 The start of a revolution The revolution started as an awareness among the farmers that grew and matured into a protest movement and the determination to liberate themselves. Over four decades ago, the life of a farmer in Kaira District was very much like that of his counterpart anywhere else in India. His income was derived almost entirely from seasonal crops. The income from milch buffaloes was undependable. The marketing and distribution system for the milk was controlled by private traders and middlemen. As milk is perishable, farmerswere compelled to sell it for whatever they were offered. Often, they had to sell cream and ghee at throwaway prices. In this situation, the one who gained was the private trader. Gradually, the realization dawned on the farmers that the exploitation by the trader could be checked only if marketed their milk themselves. In order to do that they needed to form some sort of an organization. This realization is what led to the establishment of the Kaira District Cooperative Milk Producers' Union Limited (popularly known as Amul) which was formally registered on December 14, 1946.The Kaira Union began pasteurizing milk for the Bombay Milk Scheme in June 1948. An assured market proved a great incentive to the milk producers of the district. By the end of 1948, more than 400 farmers joined in more village societies, and the quantity of milk handled by one Union increased from 250 to 5,000 liters a day.

1.3 Obstacles: Springboards for success. Each failure, each obstacle, each stumbling block can be turned into a success story. In the early years, Amul had to face a number of problems. With every problem came opportunity. A chance to turn a negative into a positive. Milk by products and supplementary yield which suffered from the same lack of marketing and distribution facilities became encumbrances. Instead of being bogged down by their fate they were used as stepping stones for expansion. Backward integration of the process led the cooperatives to advances in animal husbandry and veterinary practice. 12

1.4 Milk by products: An excuse to expand. The response to these provided stimulus for further growth. For example, as the movement spread in the district, it was found that the Bombay Milk Scheme could not absorb the extra milk collected by the Kaira Union in winter, when the production on an average was 2.5 times more than in summer. Thus, even by 1953, the farmer- members had no assured market for the extra milk produced in winter. They were again forced to sell a large surplus at low rates to the middlemen. The remedy was to set up a plant to process milk into products like butter and milk powder. ARs 5 million plant to manufacture milk powder and butter was completed in 1955. In 1958, the factory was expanded to manufacture sweetened condensed milk. Two years later, a new wing was added for the manufacture of 2500 tons of roller-dried baby food and 600 tons of cheese per year, the former based on a formula developed with the assistance of Central Food Technological Research Institute (CFTRI), Mysore. It was the first time anywhere in the world that cheese or baby food was made from buffalo milk on a large, commercial scale. Another milestone was the completion of a project to manufacture balanced cattle feed. The plant was donated by OXFAM under the Freedom From Hunger Campaign of the FAO. To meet the requirement of milk powder for the Defense, the Kaira Union was asked by the Government of India in 1963 to setup additional milk drying capacity. A new dairy capable of producing 40 tons of milk powder and 20 tons of butter a day was speedily completed. It was declared open in 1965. The Mogar Complex where high protein weaning food, chocolate and malted food are being made was another initiative by Amul to ensure that while it fulfilled the social responsibility to meet the demand for liquid milk, its members were not deprived of the benefits to be had from the sale of high valueadded products. 1.5 Cattle: From stumbling blocks to building blocks. Traditionally dairying was a subsidairy occupation of the farmersof Kaira. However, the contribution to the farmer's income was not as prominent as his attachment to dairying as a tradition handed down from one generation to the next. The milk yield from animals, which were maintained mainly on the by products of the farm, was decidedly low. That together with the lack of facilities to market even the little produced rendered the scientific practice of animal husbandry irrational as well as unaffordable. The return on the investment as well as the prospects of being able to market the product looked very bleak. It was a vicious cycle reinforced by generations of beliefs. The Kaira Union broke the cycle by not only taking upon themselves the responsibility of collecting the marketable surplus of milk but also provided the members with every provision needed to enhance production. Thus the Kaira Union has full-fledged machinery geared to provide animal health care and breeding facilities. 13

As early as late fifties, the Union started making high quality buffalo semen. Through village society workers artificial insemination service was made available to the rural animal population. The Union started its mobile veterinary services to render animal health care at the farmers' doorstep. Probably for the first time in the country, veterinary first aid services, by trained personnel, were made available in the villages.The Union's 16 mobile veterinary dispensaries are manned by fully qualified staff. All the villages are visited bimonthly, on a predetermined day, to provide animal health care. A 24-hour Emergency Service is also available at a fee (Rs. 35 for members and Rs. 100 for non-members). All the mobile veterinary vans are equipped with Radio Telephones. The Union runs a semen production center where it maintains high pedigreed Surtibuffalo bulls, Holstein Friesian bulls, Jersey bulls and 50 per cent crossbred bulls. The semen obtained from these bulls is used for artificial breeding of buffaloes and cows belonging to the farmer members of the district. The artificial insemination service has become very popular because it regulates the frequency of calving in cowsand buffaloes thus reducing their dry period. Not only that, a balanced feed concentrate is manufactured in the Union's Cattle Feed Plant and sold to the members through the societies at cost price.Impressive though its growth, the unique feature of the Amul sagas did not lie in the extensive use of modern technology, nor the range of its products, not even the rapid inroads it made into the market for dairy products. The essence of the Amul story lies in the breakthrough it achieved in modernizing the subsistence economy of a sector by organizing the rural producers in the areas. 2. The Kaira experiment: A new beginning in more ways than one. A system which involves participation of people on such a large magnitude does not confine itself to an isolated sector. The ripples of its turbulence affect other areas of the society as well. The cooperatives in the villages of Kaira are contributing to various desirable social changes such as: The yearly elections of the management committee and its chairman, by the members, are making the participants aware of their rights and educating them about the democratic process. Perpetuating the voluntary mix of the various ethnic and social groups twice-a-day for common causes and mutual betterment has resulted in eroding many socialinequilibria. The rich and the poor, the elite and the ordinary come together to cooperate for a common cause. Live exposure to various modern technologies and their application in day-to-day life has not only made them aware of these developments but also made it easier for them to adopt these very processes for their own betterment. One might wonder whether the farmer who knows almosteverything about impregnating a cow or buffalo, is also equally aware of the process in the humans and works towards planning it. More than 14

900 village cooperatives have created jobs for nearly 5000 people in their own villages without disturbing the socio-agro- system and thereby the exodus from the rural areas has been arrested to a great extent.The income from milk has contributed to their household economy. Besides, women, who are the major participants, now have a say in the home economy. Independent studies by various individuals and institutions have shown that as high as 48 per cent of the income of the rural household in Kaira District is being derived from dairying. Since dairying is a subsidairy occupation for the majority of the rural population, this income is helping these people not only to liberate themselves from the stronghold of poverty but also to elevate their social status.

3. GCMMF LTD Gujarat Cooperative Milk Marketing Federation 3.1 GCMMF: An Overview Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food products marketing organisation. It is a state level apex body of milk cooperatives in Gujarat which aims to provide remunerative returns to the farmers and also serve the interest of consumers by providing quality products which are good value for money Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF) is the largestOrganisation in FMCG industry engaged in marketing of milk & milk products under the brand names of AMUL and SAGAR with an annual turnover exceeding Rs 5000 crores. GCMMF is a unique organisation. It's a body created by Farmers, managed by competent professionals serving a very competitive and challenging consumer market. It is a true testimony of synergistic national development through the practice of modern management methods. We in GCMMF stand for integrity, excellence and quality through innovation. Our roots are embedded in the phrase " Work is worship ". Those who share these values will find themselves at home with us. At GCMMF Ltd, while in pursuit of excellence, we offer a unique career opportunity to unlock your own potential. If you are looking for a challenging opportunity, you can explore your options with us. We firmly believe that you will never look back in your career again

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3.2 GCMMF Today GCMMF is India's largest food products marketing organisation. It is a state level apex body of milk cooperatives in Gujarat, which aims to provide remunerative returns to the farmers and also serve the interest of consumers by providing affordable quality products. GCMMF markets and manages the Amul brand. From mid-1990s Amul has entered areas not related directly to its core business. Its entry into ice cream was regarded as successful due to the large market share it was able to capture within a short period of time primarily due to the price differential and the brand name. It also entered the pizza business, where the base and the recipes were made available to restaurant owners who could price it as low as 30 rupees per pizza when the other players were charging upwards of 100 rupees.

4. About the Company 4.1 Organisation structure It all started in December 1946 with a group of farmers keen to free themselves from intermediaries, gain access to markets and thereby ensure maximum returns for their efforts. Based in the village of Anand, the Kaira District Milk Cooperative Union (better known as Amul) expanded exponentially. It joined hands with other milk cooperatives, and the Gujarat network now covers 2.12 million farmers, 10,411 village level milk collection centers and fourteen district level plants (unions) under the overall supervision of GCMMF. There are similar federations in other states. Right from the beginning, there was recognition that this initiative would directly benefit and transform small farmers and contribute to the development of society. Markets, then and even today, are primitive and poor in infrastructure. Amul and GCMMF acknowledged that development and growth could not be left to market forces and that proactive intervention was required. Two key requirements were identified. The first, that sustained growth for the long term would depend on matching supply and demand. It would need heavy investment in the simultaneous development of suppliers and consumers. Second, that effective management of the network and commercial viability would require professional managers and technocrats. To implement their vision while retaining their focus on farmers, a hierarchical network of cooperatives was developed, which today forms the robust supply chain behind GCMMF's endeavors. The vast and complex supply chain stretches from small suppliers to large fragmented markets. Management of this network is made more complex by the fact that GCMMF is directly responsible only for a small part of the chain, 16

with a number of third party players (distributors, retailers and logistics support providers) playing large roles.Managing this supply chain efficiently is critical as GCMMF's competitive position is driven by low consumer prices supported by a low cost system.

4.2 Company info The Gujarat Cooperative Milk Marketing Federation Ltd, Anand (GCMMF) is the largest food products marketing organisation of India. It is the apex organization of the Dairy Cooperatives of Gujarat. This State has been a pioneer in organizing dairy cooperatives and our success has not only been emulated in India but serves as a model for rest of the World. Over the last five and a half decades, Dairy Cooperatives in Gujarat have created an economic network that links more than 2.8 million village milk producers with millions of consumers in India and abroad through a cooperative system that includes 13,141 Village Dairy Cooperative Societies (VDCS) at the village level, affiliated to 13 District Cooperative Milk Producers Unions at the District level and GCMMF at the State level. These cooperatives collect on an average 7.5 million litres of milk per day from their producer members, more than 70% of whom are small, marginal farmers and landless labourers and include a sizeable population of tribal folk and people belonging to the scheduled castes. The turnover of GCMMF (AMUL) during 2008-09 was Rs. 67.11 billion. It markets the products, produced by the district milk unions in 30 dairy plants, under the renowned AMUL brand name. The combined processing capacity of these plants is 11.6 million litres per day, with four dairy plants having processing capacity in excess of 1 million Litres per day. The farmers of Gujarat own the largest state of the art dairy plant in Asia Mother Dairy, Gandhinagar, Gujarat which can handle 2.5 million litres of milk per day and process 100 MTs of milk powder daily. During the last year, 3.1 billion litres of milk was collected by Member Unions of GCMMF. Huge capacities for milk drying, product manufacture and cattle feed manufacture have been installed. All its products are manufactured under the most hygienic conditions. All dairy plants of the unions are ISO 9001-2000, ISO 22000 and HACCP certified. GCMMF (AMUL)s Total Quality Management ensures the quality of products right from the starting point (milk producer) through the value chain until it reaches the consumer. Ever since the movement was launched fifty-five years ago, Gujarats Dairy Cooperatives have brought about a significant social and economic change to our rural people. The Dairy Cooperatives have helped in ending the exploitation of farmers and demonstrated that when our rural producers benefit, the community and nation benefits as well. The Gujarat Cooperative Milk Marketing Federation Ltd. cannot be viewed simply as a business 17

enterprise. It is an institution created by the milk producers themselves to primarily safeguard their interest economically, socially as well as democratically. Business houses create profit in order to distribute it to the shareholders. In the case of GCMMF the surplus is ploughed back to farmers through the District Unions as well as the village societies. This circulation of capital with value addition within the structure not only benefits the final beneficiary the farmer but eventually contributes to the development of the village community. This is the most significant contribution the Amul Model cooperatives has made in building the Nation.

4.3 Developing demand At the time Amul was formed, consumers had limited purchasing power, and modest consumption levels of milk and other dairy products. Thus Amul adopted a low-cost price strategy to make its products affordable and attractive to consumers by guaranteeing them value for money. Introducing higher value products Beginning with liquid milk, GCMMF enhanced the product mix through the progressive addition of higher value products while maintaining the desired growth in existing products. Despite competition in the high value dairy product segments from firms such as Hindustan Lever [Get Quote], Nestle [Get Quote] and Britannia [Get Quote], GCMMF ensures that the product mix and the sequence in which Amul introduces its products is consistent with the core philosophy of providing milk at a basic, affordable price.

4.4 The distribution network Amul products are available in over 500,000 retail outlets across India through its network of over 3,500 distributors. There are 47 depots with dry and cold warehouses to buffer inventory of the entire range of products. GCMMF transacts on an advance demand draft basis from its wholesale dealers instead of the cheque system adopted by other major FMCG companies. This practice is consistent with GCMMF's philosophy of maintaining cash transactions throughout the supply chain and it also minimizes dumping. Wholesale dealers carry inventory that is just adequate to take care of the transit time from the branch warehouse to their premises. This just-in-time inventory strategy improves dealers' return on investment (ROI). All GCMMF branches engage in route scheduling and have dedicated vehicle operations.

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4.5 Umbrella brand The network follows an umbrella branding strategy. Amul is the common brand for most product categories produced by various unions: liquid milk, milk powders, butter, ghee, cheese, cocoa products, sweets, ice-cream and condensed milk.Amul's sub-brands include variants such as Amulspray, Amulspree, Amulya and Nutramul. The edible oil products are grouped around Dharaand Lokdhara, mineral water is sold under the JalDhara brand while fruit drinks bear the Safalname. By insisting on an umbrella brand, GCMMF not only skillfully avoided inter-union conflicts but also created an opportunity for the union members to cooperate in developing products.

4.6 Managing the supply chain Even though the cooperative was formed to bring together farmers, it wasrecognised that professional managers and technocratswould be required to manage the network effectively and make it commercially viable.

4.7 Coordination Given the large number of organisations and entities in the supply chain and decentralised responsibility for various activities, effective coordination is critical for efficiency and cost control. GCMMF and the unions play a major role in this process and jointly achieve the desired degree of control. Buy-in from the unions is assured as the plans are approved by GCMMF's board. The board is drawn from the heads of all the unions, and the boards of the unions comprise of farmers elected through village societies, thereby creating a situation of interlocking control. The federation handles the distribution of end products and coordination with retailers and the dealers. The unions coordinate the supply side activities. These include monitoring milk collection contractors, the supply of animal feed and other supplies, provision of veterinary services, and educational activities. 19

4.8 Managing third party service providers From the beginning, it was recognised that the unions' core activity lay in milk processing and the production of dairy products. Accordingly, marketing efforts (including brand development) were assumed by GCMMF. All other activities were entrusted to third parties. These include logistics of milk collection, distribution of dairy products, sale of products through dealers and retail stores, provision of animal feed, and veterinary services. It is worth noting that a number of these third parties are not in the organized sector, and many are not professionally managed with little regard for quality and service. This is a particularly critical issue in the logistics and transport of a perishable commodity where there are already weaknesses in the basic Infrastructure.

4.9 Establishing best practices A key source of competitive advantage has been the enterprise's ability to continuously implement best practices across all elements of the network: the federation, the unions, the village societies and the distribution channel. In developing these practices, the federation and the unionshave adapted successful models from around the world. It could be the implementation of small group activities or quality circles at the federation. Or a TQM program at the unions. Or housekeeping and good accounting practices at the village society level. More important, the network has been able to regularly roll out improvement programs across to a large number of members and the implementation rate is consistently high. For example, every Friday, without fail, between 10.00 a.m. and 11.00 a.m., all employees of GCMMF meet at the closest office, be it a department or a branch or a depot to discuss their variousquality concerns. Each meeting has its pre-set format in terms of Purpose, Agenda and Limit (PAL) with a process check at the end to record how the meeting was conducted. Similar processes are in place at the village societies, the unions and even at the wholesaler and C&F agent levels as well. Examples of benefits from recent initiatives include reduction in transportation time from the depots to the wholesale dealers, improvement in ROI of wholesale dealers, implementation of Zero Stock Out through improved availability of products at depots and also the implementation of Just-in-Time in finance to reduce the float. Kaizens at the unions have helped improve the quality of milk in terms of acidity and sour milk. (Undertaken by multi-disciplined teams, Kaizens are highly focussed projects, reliant on a structured approach based on data gathering and analysis.) For example, Sabar Union's records show a reduction from 2.0% to 0.5% in the amount of sour milk/curd received a

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tunion. The most impressive aspect of this large-scale roll out is that improvement processes are turning the village societies into individual improvement centers.

4.10 Technology and e-initiatives GCMMF's technology strategy is characterized by four distinct components: new products, process technology, and complementary assets to enhance milk production and ecommerce. Few dairies of the world have the wide variety of products produced by the GCMMF network. Village societies are encouraged through subsidies to install chilling units. Automation in processing and packaging areas is common, as is HACCP certification. Amulactively pursues developments in embryo transfer and cattle breeding in order to improve cattle quality and increases in milk yields. GCMMF was one of the first FMCG (fastmoving consumer goods) firms in India to employ Internet technologies to implement B2C commerce. Today customers can order a variety of products through the Internet and be assured of timely delivery with cash payment upon receipt. Another e-initiative underway is to provide farmers access to information relating to markets, technology and best practices in the dairy industry through net enabled kiosks in the villages. GCMMF has also implemented a Geographical Information System (GIS) at both ends of the supply chain, i.e. milk collection as well as the marketing process. Farmers now have better access to information on the output as well as support services while providing a better planning tool to the company 5. The Birth of Amul and development of Indias Dairy Cooperative Movement The birth of Amul at Anand provided the impetus to the cooperative dairy movement in the country. The Kaira District Cooperative Milk Producers Union Limited was registered on December 14, 1946 as a response to exploitation of marginal milk producers by traders or agents of existing dairies in the small town named Anand (inKaira District of Gujarat). Milk Producers had to travel long distances to deliver milk to the only dairy, the Polson Dairy in Anand. Often milk went sour as producers had to physically carry the milk in individual containers, especially in the summer season. These agents arbitrarily decided the prices depending on the production and the season. Milk is a commodity that has to be collected twice a day from each cow/buffalo. In winter, the producer was either left with surplus / unsold milk or had to sell it at very low prices. Moreover, the government at that time had given monopoly rights to Polson Dairy (around that time Polson was the most well known butter brand in the country) to collect milk from Anand and supply it to Bombay city in turn. India ranked nowhere amongst milk producing countries in the world in 1946. 21

Angered by the unfair and manipulative trade practices, the farmers of Kaira District approached SardarVallabhbhai Patel (who later became the first Deputy Prime Minister and Home Minister of free India) under the leadership of the local farmer leader Tribhuvandas Patel. Sardar Patel advised the farmers to form a Cooperative and supply milk directly to the Bombay Milk Scheme instead of selling it to Polson (who did the same but gave low prices to the producers). He sent Morarji Desai (who later became Prime Minister of India) to organize the farmers. In 1946, the farmers of the area went on a milk strike refusing to be further oppressed. Thus the Kaira District Cooperative was established to collect and process milk in the District of Kaira in 1946. Milk collection was also decentralized, as most producers were marginal farmers who were in a position to deliver 1-2 litres of milk per day. Village level cooperatives were established to organize the marginal milk producers in each of these villages. The Cooperative was further developed & managed by Dr. V Kurien along with Shri H M Dalaya. The first modern dairy of the Kaira Union was established at Anand (which popularly came to be known as AMUL dairy after its brand name). Indigenous R&D and technology development at the Cooperative had led to the successful production of skimmed milk powder from buffalo milk the first time on a commercial scale anywhere in the world. The foundations of a modern dairy industry in India were thus laid since India had one of the largest buffalo populations in the world. The success of the dairy co-operative movement spread rapidly in Gujarat. Within a short span five other district unions Mehsana, Banaskantha, Baroda, Sabarkantha and Surat were organized. In order to combine forces and expand the market while saving on advertising and avoid a situation where milk cooperatives would compete against each other it was decided to set up an apex marketing body of dairy cooperative unions in Gujarat. Thus, in 1973, the Gujarat Co-operative Milk Marketing Federation was established. The Kaira District Cooperative Milk Producers Union Ltd. which had established the brand name AMUL in 1955 decided to hand over the brand name to GCMMF (AMUL). With the creation of GCMMF (AMUL), wemanaged to eliminate competition between Gujarats cooperatives while competing with the private sector as a combined stronger force. GCMMF (AMUL) has ensured remunerative returns to the farmers while providing consumers with products under the brand name AMUL. This was possible due to the leadership of the founder Chairman of AMUL, Tribhuvandas Patel and the vision of the father of the White Revolution, Dr. VergheseKurien who worked as a professional manager at AMUL. Numerous people contributed to this movement which would otherwise not have been possible. Dr. VergheseKurien, the World Food Prize and the Magsaysay Award winner, is the architect 22

of Indias White Revolution, which helped India emerge as the largest milk producer in the world.

Impressed with the development of dairy cooperatives in Kaira District & its success, ShriLalBahadurShastri, the then Prime Minister of India during his visit to Anand in 1964, asked Dr. V Kurien to replicate the Anand type dairy cooperatives all over India. Thus, the National Dairy Developed Board was formed and Operation FloodProgramme was launched for replication of the Amul Model all over India. Operation Flood, the worlds largest dairy development programme, is based o n the experience gained from the Amul Model dairy cooperatives. The facilities at all levels are entirely farmer owned. The cooperatives are able to build markets, supply inputs and create value-added processing. Thus, Amul Model cooperatives seem to be the most appropriate organizational force for promoting agricultural development using modern technologies and professional management and thereby generating employment for the rural masses and eradicating poverty in these undeveloped areas. India has already demonstrated the superiority of this approach

6. Corporate Social Responsibility, The Amul Way

Corporate social responsibility (CSR) has been defined as the commitment of business to contribute to sustainable economic development working with employees, their families, the local community, and society at large to improve their quality of life, in ways that are both good for business and good for development. To meet with the CSR it is expected that a business in its entire procurement-production-processing-marketing chain should focus on human development involving the producer, the worker, the supplier, the consumer, the civil society, and the environment. Indeed, a very tough task. Most businesses would certainly flounder in not being able to achieve at least one or many of those expectations. But AMUL has shown the way.

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6.1 CSR-sensitive Organizational Structure AMUL is a three tier co-operative organization. The first tier is the co- operative society at the village, of which; milk producers are voluntary members, managing the co-operative through a democratically elected 9-member managing committee, and doing business by purchasing milk from members and selling it to the district level co- operative. There are more than 11,000 co-operatives in villages of Gujarat. The second tier is the district co-operative that processes milk into milk products, markets locally and sells surplus to the state co- operative for national and international marketing. There are 12 district co-operatives each being managed by a 15member board elected by the college comprising the nominated representatives or chairmen of the village co-operatives. Third tier is the state level co-operative - the Gujarat Cooperative Milk Marketing Federation (GCMMF) responsible for national and international marketing of milk and milk products produced and sold to it. The GCMMF is managed by the board democratically elected by and from amongst the chairmen of the district cooperatives. The entire three-tier structure with the GCMMF at its apex, is a unique institution because it encompasses the entire chain from production of raw material to reaching the consumer with the end product. Every function involves human intervention: 23.60 lakh primary milk producers; 35,000 rural workmen in more than 11,400 village societies; 12,000 workers in 15 dairy plants; 750 marketing professionals; 10,500 salesmen in distribution network and 600,000 salesmen in retail network. Accumulation of human capital is sine qua non for the development and growth of any enterprise or economy. 7. The Three-tier "Amul Model" The Amul Model is a three-tier cooperative structure. This structure consists of a Dairy Cooperative Society at the village level affiliated to a Milk Union at the District level which in turn is further federated into a Milk Federation at the State level. The above three-tier structure was set-up in order to delegate the various functions, milk collection is done at the Village Dairy Society, Milk Procurement & Processing at the District Milk Union and Milk & Milk Products Marketing at the State Milk Federation. This helps in eliminating not only internal competition but also ensuring that economies of scale is achieved. As the above structure was first evolved at Amul in Gujarat and thereafter replicated all over the country under the Operation Flood Programme, it is known as the Amul Model or Anand Pattern of Dairy Cooperatives.Responsible for Marketing of Milk & Milk Products Responsible for Procurement & Processing of Milk Responsible for Collection of Milk Responsible for Milk Production.

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7.1 Village Dairy Cooperative Society (VDCS) The milk producers of a village, having surplus milk after own consumption, come together and form a Village Dairy Cooperative Society (VDCS). The Village Dairy Cooperative is the primary society under the three-tier structure. It has membership of milk producers of the village and is governed by an elected Management Committee consisting of 9 to 12 elected representatives of the milk producers based on the principle of one member, one vote. The village society further appoints a Secretary (a paid employee and member secretary of the Management Committee) for management of the day-to-day functions. It also employs various people for assisting the Secretary in accomplishing his / her daily duties.

The main functions of the VDCS are as follows: Collection of surplus milk from the milk producers of the village & payment based on quality & quantity Providing support services to the members like Veterinary First Aid, Artificial Insemination services, cattle-feed sales, mineral mixture sales, fodder & fodder seed sales, conducting training on Animal Husbandry & Dairying, etc.

Selling liquid milk for local consumers of the village

Supplying milk to the District Milk Union Thus, the VDCS in an independent entity managed locally by the milk producers and assisted by the District Milk Union.

7.2 District Cooperative Milk Producers Union (Milk Union) The Village Societies of a District (ranging from 75 to 1653 per Milk Union in Gujarat) having surplus milk after local sales come together and form a District Milk Union. The Milk Union is the second tier under the three-tier structure. It has membership of Village Dairy Societies of the District and is governed by a Board of Directors consisting of 9 to 18 elected representatives of the Village Societies. The Milk Union further appoints a professional Managing Director (paid employee and member secretary of the Board) for management of the day-to-day functions. It also employs various people for assisting the Managing Director in accomplishing his / her daily duties. The main functions of the Milk Union are as follows: Procurement of milk from the Village Dairy Societies of the District Arranging transportation of raw milk from the VDCS to the Milk Union. 25

Providing input services to the producers like Veterinary Care, Artificial Insemination services, cattle-feed sales, mineral mixture sales, fodder & fodder seed sales, etc. Conducting training on Cooperative Development, Animal Husbandry & Dairying for milk producers and conducting specialised skill development & Leadership Development training for VDCS staff & Management Committee members.

Providing management support to the VDCS along with regular supervision of its activities. Establish Chilling Centres& Dairy Plants for processing the milk received from the villages. Selling liquid milk & milk products within the District Process milk into various milk & milk products as per the requirement of State Marketing Federation. Decide on the prices of milk to be paid to milk producers as well on the prices of support services provided to members.

7.3 State Cooperative Milk Federation (Federation) The Milk Unions of a State are federated into a State Cooperative Milk Federation. The Federation is the apex tier under the three-tier structure. It has membership of all the cooperative Milk Unions of the State and is governed by a Board of Directors consisting of one elected representative of each Milk Union. The State Federation further appoints a Managing Director (paid employee and member secretary of the Board) for management of the day-to-day functions. It also employs various people for assisting the Managing Director in accomplishing his daily duties. The main functions of the Federation are as follows: Marketing of milk & milk products processed / manufactured by Milk Unions. Establish distribution network for marketing of milk & milk products. Arranging transportation of milk & milk products from the Milk Unions to the market. 26

Creating & maintaining a brand for marketing of milk & milk products (brand building). Providing support services to the Milk Unions & members like Technical Inputs, management support & advisory services. Pooling surplus milk from the Milk Unions and supplying it to deficit Milk Unions. Establish feeder-balancing Dairy Plants for processing the surplus milk of the Milk Unions. Arranging for common purchase of raw materials used in manufacture / packaging of milk products. Decide on the prices of milk & milk products to be paid to Milk Unions. Decide on the products to be manufactured at various Milk Unions (product-mix) and capacity required for the same. Conduct long-term Milk Production, Procurement & Processing as well as Marketing Planning.

Arranging Finance for the Milk Unions and providing them technical know-how.
Designing &Providing training on Cooperative Development, Technical & Marketing functions. Conflict Resolution & keeping the entire structure intact.

7.4 Impact of the "Amul Model" The effects of Operation Flood Programme are more appraised by the World Bank in its recent evaluation report. It has been proved that an investment of Rs. 20 billion over 20 years under Operation Flood Programme in 70s & 80s has contributed in increase of Indias milk production by 40 Million Metric Tonne (MMT) i.e. from about 20 MMT in pre- Operation Flood period to more than 60 MMT at the end of Operation flood Programme. Thus, an incremental return of Rs. 400 billion annually have been generated by an investment of Rs. 20 billion over a period of 20 years. This has been the most beneficial project funded by the World Bank anywhere in the World. One can continue to see the effect of these efforts as Indias milk production continues to increase and now stands at 90 MMT. Despite this fourfold increase in milk production, there has not been drop in the prices of milk during the period and has continued to grow. Due to this movement, the countrys milk production tripled between the years 1971 to 1996. Similarly, the per capita milk consumption doubled from 111 gms per day in 1973 to 222 gms 27

per day in 2000. Thus, these cooperatives have not just been instrumental in economic development of the rural society of India but it also has provided vital ingredient for improving health & nutritional requirement of the Indian society. Very few industries of India have such parallels of development encompassing such a large population. These dairy cooperatives have been responsible in uplifting the social & economic status of the women folk in particular as women are basically involved in dairying while the men are busy with their agriculture. This has also provided a definite source of income to the women leading to their economic emancipation. The three-tier Amul Model has been instrumental in bringing about the White Revolution in the country.

8. As per the assessment report of the World Bank on the Impact of Dairy Development in India, the Anand Pattern has demonstrated the following benefits: The role of dairying in poverty reduction The fact that rural development involves more than agricultural production The value of national ownership in development The beneficial effects of higher incomes in relieving the worst aspects of poverty The capacity of dairying to create jobs The capacity of dairying to benefit the poor at low cost The importance of commercial approach to development The capacity of single-commodity projects to have multi-dimensional impacts The importance of getting government out of commercial enterprises The importance of market failure in agriculture The power & problems of participatory organisations 28

The importance of policy

9. Achievements of the "Amul Movement" The phenomenal growth of milk production in India from 20 million MT to 100 million MT in a span of just 40 years has been made possible only because of the dairy cooperative movement. This has propelled India to emerge as the largest milk producing country in the World today. The dairy cooperative movement has also encouraged Indian dairy farmers to keep more animals, which has resulted in the 500 million cattle & buffalo population in the country the largest in the World. The dairy cooperative movement has garnered a large base of milk producers, with their membership today boasting of more than 13 million member families. The dairy cooperative movement has spread across the length and breadth of the country, covering more than 125,000 villages of 180 Districts in 22 States. The dairy cooperatives have been able to maintain democratic structure at least at the grass-root level with the management committee of the village level unit elected from among the members in majority of the villages. The dairy cooperatives have also been instrumental in bridging the social divide of caste, creed, race, religion & language at the villages, by offering open and voluntary membership. The dairy cooperatives have been successfully propagating the concepts of scientific animal husbandry & efficiency of operations, which has resulted in low cost of production & processing of milk. The movement has been successful because of a well-developed procurement system & supportive federal structures at District & State levels. Dairy Cooperatives have always been proactive in building large processing capacities, which has further propelled growth of milk production. The dairy cooperatives are among those few institutions in India, which still cherish a strong Cooperative identity, values and purpose. They still boast of idealism & good will of members and employees. The dairy cooperatives have removed the poor farmers of India from the shackles of agents & middlemen and provided an assured market for their produce. As these are the institutions run by farmers themselves, it has also resulted in fair returns to the 29

members for their produce Dairy cooperatives have been able to create a market perception of honesty & transparency with their clean management.

10. Achievements of GCMMF 2.8 million milk producer member families 13,759 village societies 13 District Unions 8.5 million liters of milk procured per day Rs. 150 million disbursed in cash daily GCMMF is the largest cooperative business of small producers with an annual turnover of Rs. 53 billion The Govt. of India has honouredAmul with the Best of all categories Rajiv Gandhi National Quality Award. Largest milk handling capacity in Asia Largest Cold Chain Network 48 Sales offices, 3000 Wholesale Distributors, 5lakh retail outlets Export to 37 countries worth Rs. 150 crores Winner of APEDA award for nine consecutive years

11. Amul Brand Building GCMMF (AMUL) has the largest distribution network for any FMCG company. It has nearly 50 sales offices spread all over the country, more than 3,000 wholesale dealers and more than 5,00,000 retailers. AMUL is also the largest exporter of dairy products in the country. AMUL is available today in over 40 countries of the world. AMUL is exporting a wide variety of products which include Whole and Skimmed Milk Powder, Cottage Cheese (Paneer), UHT Milk, Clarified Butter (Ghee) and Indigenous Sweets. The major markets are USA, West Indies, and countries in Africa, the Gulf Region, and [SAARC] SAARCneighbours, Singapore, The Philippines, Thailand, Japan and China. 30

In September 2007, Amul emerged as the leading Indian brand according to a survey by Synovate to find out Asia's top 1000 Brands.

11.1 Products Amul's product range includes milk powders, milk, butter, ghee, cheese, MastiDahi, Yoghurt, Buttermilkchocolate, ice cream, cream, shrikhand, paneer, gulabjamuns, flavoured milk, basundi, Nutramul brand and others. In January 2006, Amul plans to launch India's first sports drinkStamina, which will be competing with Coca Cola's Powerade and PepsiCo's Gatorade. In August 2007, Amul introduced Kool Koko, a chocolate milk brand extending its product offering in the milk products segment. Other Amul brands are AmulKool, a low calorie thirst quenching drink; Masti Butter Milk; Kool Cafe, ready to drink coffee and India's first sports drink Stamina. Amul's sugar-free Pro-Biotic Ice-cream won The International Dairy Federation Marketing Award for 2007.

11.2 List of Products Marketed:

Breadspreads: Amul Butter AmulLite Low Fat Breadspread Amul Cooking Butter

Cheese Range: Amul Pasteurized Processed Cheddar Cheese Amul Processed Cheese Spread 31

Amul Pizza (Mozarella) Cheese Amul Shredded Pizza Cheese AmulEmmental Cheese Amul Gouda Cheese AmulMalaiPaneer (cottage cheese) Utterly Delicious Pizza

Mithaee Range (Ethnic sweets): AmulShrikhand (Mango, Saffron, Almond Pistachio,Cardamom) AmulAmrakhand AmulMithaeeGulabjamuns AmulMithaeeGulabjamun Mix AmulMithaeeKulfi Mix AvsarLadoos

UHT Milk Range: AmulShakti 3% fat Milk AmulTaaza 1.5% fat Milk Amul Gold 4.5% fat Milk AmulLite Slim-n-Trim Milk 0% fat milk AmulShakti Toned Milk Amul Fresh Cream Amul Snowcap Softy Mix

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Pure Ghee: Amul Pure Ghee Sagar Pure Ghee Amul Cow Ghee

Infant Milk Range: Amul Infant Milk Formula 1 (0-6 months) Amul Infant Milk Formula 2 ( 6 months above) Amulspray Infant Milk Food

Milk Powders: Amul Full Cream Milk Powder Amulya Dairy Whitener Sagar Skimmed Milk Powder Sagar Tea and Coffee Whitener

Sweetened Condensed Milk: AmulMithaimate Sweetened Condensed Milk

Fresh Milk: AmulTaaza Toned Milk 3% fat Amul Gold Full Cream Milk 6% fat AmulShaktiStandardised Milk 4.5% fat Amul Slim & Trim Double Toned Milk 1.5% fat

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AmulSaathi Skimmed Milk 0% fat Amul Cow Milk

Curd Products: Yogi Sweetened FlavouredDahi (Dessert) AmulMastiDahi (fresh curd) AmulMasti Spiced Butter Milk AmulLassee

AmulIcecreams: Royal Treat Range (Butterscotch, Rajbhog, MalaiKulfi) Nut-o-Mania Range (KajuDraksh,KesarPista, Fruit Bonanza, RoastedAlmond) Nature's Treat (Alphanso Mango, Fresh Litchi, ShahiAnjir, Fresh Strawberry, Black Currant, Santra Mantra, Fresh Pineapple) Sundae Range (Mango, Black Currant, Sundae Magic, Double Sundae) Assorted Treat (Chocobar, Dollies, Frostik, Ice Candies, Tricone, Chococrunch, Megabite, Cassatta) Utterly Delicious (Vanila, Strawberry, Chocolate, Chocochips, Cake Magic)

Chocolate & Confectionery: Amul Milk Chocolate Amul Fruit & Nut Chocolate

Brown Beverage: 34

Nutramul Malted Milk Food

Milk Drink: AmulKoolFlavoured Milk (Mango, Strawberry, Saffron, Cardamom, Rose, Chocolate) 11.3 Mascot Since 1967 Amul products' mascot has been the very recognisable"Amul baby" (a chubby butter girl usually dressed in polka dotted dress) showing up on hoardings and product wrappers with the equally recognisable tagline Utterly Butterly Delicious Amul.The mascot was first used for Amul butter. But in recent years in a second wave of ad campaign for Amul products, she has also been used for other product like ghee and milk.

11.4 Advertising Amul outdoor advertising uses billboards, with a humorous take on current events and is updated frequently. The Amul ads are one of the longest running ads based on a theme, now vying for the Guinness records for being the longest running ad campaign ever with Smokey Bear. Sylvester da Cunha was the Managing Director of the advertising agency, ASP, that created the campaign in 1967.

12. RECENT ADVERTISEMENTS FROM AMUL

12.1 Ads2010-2011

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13. Rivals The success of Amul resulted in similar organizations being setup by state governments throughout India, most of which had reasonable success. Examples are Milma in Kerala, Vijaya in Andhra Pradesh, Aavin in Tamil Nadu, K.M.F (Nandini) in Karnataka, Sudha in Bihar, Omfed in Orissa, saras in Rajasthan, Parag in Uttar Pradesh, Verka in Punjab, Aanchal in uttaranchal, Vita in Haryana and others. Other co-operative rivals of Amul include National Dairy Development Board (NDDB) (with its Mother Dairy and Sugam brands). With Amul entering the sports drink market, its rivals now include Coca Cola and PepsiCo.

14. In popular culture The establishment of Amul is also known as White Revolution. The White Revolution of India inspired the notable Indian film-makerShyamBenegal to base his film Manthan(1976) on it. The film starred SmitaPatil, GirishKarnad, Naseeruddin Shah and AmrishPuri. The film itself was financed by over five lakh rural farmers in Gujarat who contributed Rs 2 each to the films budget. Upon its release, these same farmers went in truckloads to watch 'their' film, making it a commercial success. the film was chosen for the 1977 National Film Award for Best Feature Film in Hindi. The Amul success story is taken up as a case study in marketing in many premier management institutes across the world.

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The White Revolution ushered an era of plenty from a measly amount of milk production and distribution. Aside from the great measurable success that this project was, it also demonstrated the power of "collective might". A small set of poor farmers of Kheda district in Gujarat had the vision and foresight to act in a way that was good for the society and not for the self alone.

15. VergheseKurien

VergheseKurien (born November 26, 1921 at Kozhikode, Kerala) is called the father of the White Revolution in India. He is also known as the Milkman of India. He was the chairman of the Gujarat Co-operative Milk Marketing Federation Ltd.(GCMMF). GCMMF is an apex cooperative organization that manages the Amul food brand. He is recognised as the man behind the success of the Amul brand. Amul had a revenue of $1b USD in 2006-07. 38

He is credited with being the architect of Operation Flood -- the largest dairy development program in the world. Kurien helped moderniseAnand model of cooperative dairy development and thus engineered the White Revolution in India, and made India the largest milk producer in the world. His uncle, John Mathai, was an economist who served as India's first Railway Minister and subsequently as India's Finance Minister.

15.1 Education Kurien graduated in Physics from Loyola College, Madras in 1940 and then did B.E. (Mech) from the University of Madras. After completing his degree, he joined the Tata Steel Technical Institute, Jamshedpur from where he graduated in 1946. He then went to USA on a government scholarship to earn his Master of Science in Mechanical Engineering (with distinction) from Michigan State University.

15.2 Career When he came back to India, he was posted as a dairy engineer at the government creamery, Anand, in May 1949. Around the same time, the infant cooperative dairy, Kaira District Cooperative Milk Producers' Union (KDCMPUL), now famous as Amul -- was fighting a battle with the Polson Dairy, which was privately owned. Young Kurien, fed up with being at the government creamery, which held no challenge, volunteered to help ShriTribhuvandas Patel, the Chairman of KDCMPUL, to set up a processing plant. This marked the birth of AMUL.

15.3 Personal life Dr. Kurien belonged to Syrian Christian community of India. He married his neighbor's daughter Molly. Molly was a gracious host and Dr Kurien's house used to serve as a guest house in Anand for the visiting dignitaries.He has one daughter NirmalaKurien and a grandson, Siddharth. 39

16. The White Revolution Kurien has since then built this organization into one of the largest and most successful institutions in India. The Amul pattern of cooperatives had been so successful, in 1965, then Prime Minister of India, ShriLalBahadurShastri, created the National Dairy Development Board (NDDB) (NDDB) to replicate the program on a nationwide basis citing Kurien's "extraordinary and dynamic leadership" upon naming him chairman. Kurien also set up GCMMF (Gujarat Cooperative Milk Marketing Federation) in 1973 to sell the products produced by the dairies. Today GCMMF sells AMUL brand products not only in India but also overseas. He quit the post of GCMMF Chairman in 2006 following disagreements with GCMMF management. Kurien, plays a key role in many other organizations, ranging from chairing the Viksit Bharat Foundation, a body set up by the President of India to chairman of the Institute of Rural Management, Anand's Board of Governors in India. Dr. Kurien was mentioned by the Ashoka foundation as one of the eminent present Day Social Entrepreneurs. Kurien's life story is chronicled in his memoirs 'I too had a dream'. Dr. Kurien and his team were pioneers in inventing the process of making milk powder and condensed milk from buffalo's milk instead of cow's milk. This was the reason Amul became so successful and competed well against Nestle who only used cow milk to make powder and condensed milk. In India buffalo milk was the main raw material unlike Europe where cow milk is abundant. 40

India's first Prime Minister JawaharLal Nehru visited Anand to inaugrate AMUL "factory" and he embraced Dr. Kurien for his groundbreaking work.

17. Awards

For his contribution to the dairy industry, Kurien has received top awards not only in India but also overseas.

1963 Ramon Magsaysay Award for Community Leadership 1965 PadmaShri

1966 PadmaBhushan (from president SarvepalliRadhakrishnan)

1986 KrishiRatna Award (by the President of India)

1986 Wateler Peace Prize Award (of Carnegie Foundation )

1989 World Food Prize Laureate

1993 International Person of the Year (by the World Dairy Expo, Madison, Wisconsin, USA)

1999 PadmaVibhushan

2007KarmaveerPuraskaar Noble Laureates by iCONGO- Confederation of NGOs.

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18. Operation Flood Operation Flood was a rural development programme started by India's National Dairy Development Board (NDDB) in 1970. One of the largest of its kind, the programme objective was to create a nationwide milk grid. It resulted in making India the largest producer of milk and milk products, and hence is also called the White Revolution of India. It also helped reduce malpractices by milk traders and merchants. This revolution followed the Indian green revolution and helped in alleviating poverty and famine levels from their dangerous proportions in India during the era.

18.1 Introduction Operation Flood has helped dairy farmers, direct their own development, placing control of the resources they create in their own hands. A 'National Milk Grid', links milk producers throughout India with consumers in over 700 towns and cities, reducing seasonal and regional price variations while ensuring that the producer gets a major share of the price consumers pay. The bedrock of Operation Flood has been village milk producers' cooperatives, which procure milk and provide inputs and services, making modern management and technology available to members.

18.2 Operation Flood's objectives included :

Increase milk production ("a flood of milk") 42

Augment rural incomes

Fair prices for consumers

19. Programme implementation Gujarat-based co-operation "Anand Milk Union Limited", often called Amul, was the engine behind the success of the programme, and in turn became a mega company based on the cooperative approach. Tribhuvandas Patel was the founder Chairman of Amul, while VergheseKurien was the chairman of NDDB at the time when the programme was implemented. VergheseKurien, who was then 33, gave the professional management skills and necessary thrust to the cooperative, and is considered the architect of India's 'White Revolution' (Operation Flood). His work has been recognised by the award of a PadmaBhushan, the Ramon Magsaysay Award for Community Leadership, the Carnegie-Wateler World Peace Prize, and the World Food Prize. Operation Flood was implemented in three phases.

19.1 Phase I Phase I (19701980) was financed by the sale of skimmed milk powder and butter oil donated by the European Union (then the European Economic Community) through the World Food Programme. NDDB planned the programme and negotiated the details of EEC assistance. During its first phase, Operation Flood linked 18 of India's premier milksheds with consumers in India's major metropolitan cities: Delhi, Mumbai, Kolkata and Chennai. Thus establishing mother dairies in four metros. Operation flood, also referred to as White Revolution is a gigantic project propounded by Government of India for developing dairy industry in the country. The Operation Flood 1 originally meant to be completed in 1975, actually the period of about nine years from 1970 79, 43

at a total cost of Rs.116 crores. As start of operation Flood-1 in 1970 certain set of aims were kept in view for the implementation of the programmers. Improvement by milk marketing the organized dairy sector in the metropolitan cities Bombay, Calcutta, Madras, Delhi. The objectives of commanding share of milk market and speed up development of dairy animals respectively hinter lands of rural areas with a view to increase both production and procurement.

19.2 Phase II Operation Flood Phase II (19811985) increased the milksheds from 18 to 136; 290 urban markets expanded the outlets for milk. By the end of 1985, a self-sustaining system of 43,000 village cooperatives with 4,250,000 milk producers were covered. Domestic milk powder production increased from 22,000 tons in the pre-project year to 140,000 tons by 1989, all of the increase coming from dairies set up under Operation Flood. In this way EEC gifts and World Bank loan helped promote self-reliance. Direct marketing of milk by producers' cooperatives increased by several million litres a day.

19.3 Phase III Phase III (19851996) enabled dairy cooperatives to expand and strengthen the infrastructure required to procure and market increasing volumes of milk. Veterinary first-aid health care services, feed and artificial insemination services for cooperative members were extended, along with intensified member education. Operation Flood's Phase III consolidated India's dairy cooperative movement, adding 30,000 new dairy cooperatives to the 42,000 existing societies organized during Phase II. Milksheds peaked to 173 in 1988-89 with the numbers of women members and Women's Dairy Cooperative Societies increasing significantly. Phase III gave increased emphasis to research and development in animal health and animal nutrition. Innovations like vaccine for Theileriosis, bypassing protein feed and urea-molasses 44

mineral blocks, all contributed to the enhanced productivity of milk animals.

S.W.O.T. Analysis of AMUL Strengths :

1. The company is having Indian origin thus creating feeling of oneness in the mind of the customers. 2. It manufactures only milk and milk products, which is purely vegetarian thus providing quality confidence in the minds of the customers. 3. It is aiming at rural segment, which covers a large area of loyal customers, which other companies had failed to do. 4. People are quite confident for the quality products provided by Amul. 5. Amul has its base in India with its butter and so can easily promote chocolates without fearing of loses. 6. The prices of chocolates of Nestles are comparatively cheap as compared to other companies.

Weaknesses :

1. There are various big players in the chocolate market, which acts as major competitors restricting their growth. 2. Lack of capital invested as compared to other companies. 45

3. Improper distribution channel in India.

Opportunities :

1. There is a lot of potential for growth and development as huge population stay in rural market where other companies are not targeting. 2. The chocolate market is at growth stage with very less competition so by introducing new brand and intensive advertising there can be a very good scope in future.

Threats :

1. The major threat is from other companies who hold the majority share of consumers in Indian market i.e. Cadburys and Nestle. 2. There exists no brand loyalty in the chocolate market and consumers frequently shift their brands. 3. New companies entering in Indian market like Fantasie fine poses lot problems for Amul.

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20. Summary From the outset, Operation Flood was conceived and implemented as much more than a dairy programme. Rather, dairying was seen as an instrument of development, generating employment and regular incomes for millions of rural people.

A World Bank Report 1997 says: Operation Flood can be viewed as a twenty year experiment confirming the Rural Development Vision

21. AMUL RELIEF TRUST A devastating earthquake (Richter scale 7.9) hit Gujarat on 26th January 2001. The epicenter of the quake was located in Kutch district. It caused death of thousands of people, tens of thousands were injured, hundreds of thousands were rendered homeless and damage of billions of Rupees was done. GCMMF formed a specific organization named Amul Relief Trust (ART) under the Chairmanship of Dr. V. Kurien in 2001 with a donation of Rs. 50 Millions for reconstruction of the school buildings damaged in the 2001 earthquake in the Kutch area. The Trust reconstructed 6 schools damaged by the above earthquake at a cost of Rs. 41.1 millions in Kutch area. Four of these schools started re-functioning from the last two academic sessions and the other two schools from the current session.

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22. Various Articles taken from various newspapers Amul hopes to flow into Japanese market Sindhu Bhattacharya Friday, December 30, 2005 NEW DELHI: Amul is going places. Literally. After having established its presence in China, Mauritius and Hong Kong, Gujarat Cooperative Milk Marketing Federation (GCMMF), Indias largest milk cooperative, is waiting to flood the Japanese market.The milk cooperative, which marketsAmul brand of products, is hopeful of bagging a major export order from Japan. In keeping with the popularity of the brand abroad, GCMMF has revised its export target for this fiscal by Rs 50 crore to Rs 200 crore. Says GCMMF managing director B M Vyas, W e have had a distributor in Japan since 1994 but no major presence in that country. But a few days ago a delegation from Japan, under the aegis of Agriculture and Livestock Industry Corp (ALIC), visited our facilities at Anand (Gujarat) and were pleasantly surprised with the sheer scale of our dairy operations. I am hopeful that some of our products, such as milk powder and cheese, could be exported to Japan soon. Then, GCMMF is also looking at Sri Lanka as one of its next export destinations. Amul products are already available on shelves across several countries, including the US, China, Australia, West Asian countries and Africa. While Vyas declined to reveal other overseas markets that the federation is targeting now, he said that demand for dairy products from India is expected to grow in many overseas markets. Claiming that buoyant exports help the company maintain prices in the domestic market, Vyas said that in times of milk surplus, having ready export markets allow the federation to save itself from making any distress sales. GCMMF recorded a turnover of Rs 2,922 crore last fiscal. Its products include pouch milk, ultra heat treated (UHT) milk, icecream, butter, cheese and buttermilk.

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Taken From The Financial Express Amul ready to take on Pepsi, Coke in sports drink segment LALITHA SRINIVASAN Posted online: Wednesday, January 11, 2006 at MUMBAI, JAN 10: Swadeshi FMCG major Gujarat Co-operative Milk Marketing Federation Ltd (GCMMF) is getting ready to launch India's first sports drink 'Stamina' in two weeks.On the other hand, videshi major Coca-Cola India is planning to introduce its global sports brand 'Powerade' in India and PepsiCo India is preparing for a national roll- out of 'Gatorade', which is available only in select metros now. According to industry analysts, this nascent segment will witness a lot of action in 2006--with the entry of new players. "Most companies now want to cash in on the growing consumerism in India. As lifestyles change, consumers opt for energy and sports drinks to stay fit. At present, Red Bull which is priced at Rs 75 is the only major player in this segment," said analysts. On Amul's foray into the sports drinks sector, RS Sodhi, general manager, GCMMF informed the company plans to launch 'Stamina' in select metros, which include Mumbai, Chennai, Delhi and Ahmedabad - to start with." Stamina will the first sports drink from India. With lemon flavour, it will be available in Tetra Paks and is priced at Rs 12(for 200 ml). Two years ago, we enteredflavoured milk segment,"saidMrSodhi. According to analysts, with competitive pricing strategy, Amulwill score over other sports drinks in India, which are priced above Rs 75. As for Coca-Cola's strategy for 'Powerade' in India, the company spokesperson was reluctant to divulge details on coke's new initiatives. "We are exploring opportunities to bring in new beverages targeted at different segments in the new year," he said. The vital question is -Will a swadeshi brand like Amul take on global brands in the sports drinks sector in India?

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News Articles: Amul, now a billion dollar Co-Operative enterprise The Economic Times : June 23, 2008 Gujarat: Gujarat Co-operative Milk Marketing Federation (GCMMF) popularly known for its products brand name Amul has become India's first billion dollar co-operative unit after touching the record annual turnover of Rs. 5,255.41 crores (52.554 bn rupees). It has registered quantum growth of 22.9 pc with an increase of nearly Rs.1,000 crores (10 bn rupees) in absolute terms over the previous fiscal year. Besides, the GCMMF, the apex marketing body of 13 district milk unions of Gujarat having a membership of at least 27 lakh (2.7 mn) milk producers has reached another milestone by processing almost onecrorelitres of milk in a single day. This success was announced on the 34th annual General Body meeting by GCMMF held at Anand recently while reviewing the annualperformance. "Last fiscal (2006-07) our milk procurement represented a growth of average 13 to 14 pc with average milk collection of 7.5 mnlitres per day. During peak procurement period, we have successfully demonstrated to process almost 10 mnlitres of milk per day. With this, our sales turnover has gone up by 15 to 20 percent and we have crossed a sales turnover by almost rupees 52.55 bn. This shows an increase of rupees 1,000 crores (10 bn rupees). We are constantly doing equally well and hope to post similar growth in the upcoming years," said B.M. Vyas, Managing Director of Gujarat Co-operative Milk Marketing Federation (GCMMF). During the fiscal year, Gujarat Co-operative Milk Marketing Federation has done remarkably well in most value added consumer products in which Amul milk pouches have been considered the largest contributor to the turnover with sales up by 48 per cent in value terms. Ultra Heat Treated (UHT) milk has also shown an impressive growth of 60 pc. Sales in the flavoured milk segment rose by 39 pc while the processedAmul cheese and Amul cheese spread recorded a growth of 27 pc and 39 pc respectively. The dairy whitener Amulya also recorded a growth of 20 pc and the infant milk powder named Amulspray recorded higher sales of 19 pc. Despite a stiff competition from multi national companies (MNCs) in butter category, Amul managed to register double-digit growth in value. In tune with the lifestyle 50

trends, GCMMF has focussed on healthier life products. Amulcalci plus and Amul shake are new innovative UHT milk category which will hit the market soon. "Level playing is that our farmers should be protected from subsidies export which may take place from developed world into India. If the duties are lowered, a lot of export subsidies exist in agriculture and when you allow such commodities to come into India with duty free it damages Indian agriculture where our production falls down. And we need the shelter to import and maintain supply," said Vyas. "So we need to correct things if the exporting country subsidizing their agriculture corresponding import duty should be there so that Indian farmers have level playing field," he added. Today, being the largest milk-producing nation in the world, India is also self-reliant in terms of milk products. However, we do not have buffer stock mechanism for dairy commodities in India. Vyas suggested if the country can maintain and consolidate this achievement, the policy makers must put in place an effective buffer stock mechanism for dairy commodities alongside proper management of demand and supply equation from milk products. Another secret of GCMMF's success could be attributed to its policy of supporting farmer owned organisations and giving them all their dues. Recently World Bank has initiated to replicate Amul's model in African countries for their co-operative dairy development, which has shown a remarkable growth.The GCMMF is sensitive towards CSR. It believes that technology and capital are replicable inputs but not the human capital. Amul (Gujarat Cooperative Milk Marketing Federation), India is the largest food production organisation in India and have contributed their growth and success to their co-operative culture, co-operative networking, market acumen, respect for both producer and the consumer and their contribution to social integration among members of different backgrounds. They aim to provide remunerative returns to farmers and members. When the 2001 Gujarat earthquake struck, the Amul Relief Fund donated 50 million Indian rupees to reconstructing schools.

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23. Conclusion

India , which was once a milk deficient country,is today the worldslargest milk producer, primarily owing to the White Revolution . Every state has a milk federation . Some 170 milk unions operating in 285 districts covering 96000 village level societies feed these federations .Over 10 million farmers across the country are members of these cooperatives and have benefited hugely from the production of milk.

The GCMMF is a rs 3600 crorefederation .Amul itself is one of the Indias strongest brand names this is not just in dairy industry , but also as a brand. None of this can be forgotten easily. At this point of time india is in a state where special attention should be given to the agricutural sector and efforts should be taken to increase its sustainability . the same amul model can be implemneted in the agricultural sector where a co-operative society of the farmers buys their products process it and sell it in the market on their own eleminatin the whole chain of middleman who eat up the large chunk of profit of the producers This entire model if applied in the agricultural sector can provide higher rates for the produce of the farmers and thereby also help in controlling inflation

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BIBLOGRAPHY

Books of references

The Amul India story Ruth Heredia I too had a dream biography of Dr vargheese kurin

Reference sites www.indiadairy.com www.timesofindia.com www.businessweek.com www.scribid.com www.slideshare.com www.amul.com 53