EXECUTIVE SUMMARY

AMUL is a co-operative sector company. It is the institution of farmers, for the farmers and from
the farmers. The Amul gives pleasure to the farmer to change the own price, which was not
possible in earlier years. This union was born on 14th December 1946. The union provides
facilities to its members like more return, satisfactory price, insemination, first aid, group
insurance, cattle food at confessional price etc.

I have projected and studied organizational structure of AMUL and from that I have to know
how organization operates and how the functions have been carried in the organization. From
this case I have come to know how a wide organization like AMUL manages its Organization
resource.

AMUL dairy has five main departments like finance, personnel, commercial, milk procurement
and production.
CHAPTER ONE
INTRODUCTION
ABOUT THE COMPANY
The seeds of this unusual saga were sown more than 65 years back in Anand, a small town in the
state of Gujarat in western India. The exploitative trade practices followed by the local trade
cartel triggered off the cooperative movement. Angered by unfair and manipulative practices
followed by the trade, the farmers of the district approached the great Indian patriot Sardar
Vallabhbhai Patel for a solution. He advised them to get rid of middlemen and form their own
co-operative, which would have procurement, processing and marketing under their control.

In 1946, the farmers of this area went on a milk strike refusing to be cowed down by the cartel.
Under the inspiration of Sardar Patel, and the guidance of leaders like Morarji Desai and
Tribhuvandas Patel, they formed their own cooperative in 1946.

This co-operative, the Kaira District Co-operative Milk Producers Union Ltd. began with just
two village dairy co-operative societies and 247 litres of milk and is today better known as Amul
Dairy. Amul grew from strength to strength thanks to the inspired leadership of Tribhuvandas
Patel, the founder Chairman and the committed professionalism of Dr Verghese Kurien,who was
entrusted the task of running the dairy from 1950.

The then Prime Minister of India, Lal Bahadur Shastri decided that the same approach should
become the basis of a National Dairy Development policy. He understood that the success of
Amul could be attributed to four important factors. The farmers owned the dairy, their elected
representatives managed the village societies and the district union, they employed professionals
to operate the dairy and manage its business. Most importantly, the co-operatives were sensitive
to the needs of farmers and responsive to their demands.

At his instance in 1965 the National Dairy Development Board was set up with the basic
objective of replicating the Amul model. Dr. Kurien was chosen to head the institution as its
Chairman and asked to replicate this model throughout the country.
HISTORY OF AMUL FROM BIRTH

Over seven decades ago the life of a farmer in Kaira was very much like that of farmers
anywhere else in India. His income was derived almost entirely from seasonal crops. Many poor
farmers faced starvation during off-seasons. Their income from milch buffaloes was
undependable. The milk marketing system was controlled by contractors and middlemen. As
milk is perishable, farmers were compelled to sell their milk for whatever they were offered.
Often they had to sell cream and ghee at a throwaway price.
They were in general illiterate. But they could see that the system under which contractors could
buy their produce at a low price and arrange to sell it at huge profits was just not fair. This
became more noticeable when the Government of Bombay started the Bombay Milk Scheme in
1945. Milk had to be transported 427 kilometers, from Anand to Bombay. This could be done
only if milk was pasteurized in Anand.

After preliminary trials, the Government of Bombay entered into an agreement with Polsons
Limited to supply milk from Anand to Bombay on a regular basis. The arrangement was highly
satisfactory to all concerned – except the farmers. The Government found it profitable; Polsons
kept a good margin. Milk contractors took the biggest cut. No one had taken the trouble to fix the
price of milk to be paid to the producers. Thus under the Bombay Milk Scheme the farmers of
Kaira District were no better off ever before. They were still at the mercy of milk contractors.
They had to sell their milk at a price the contractors fixed. The discontent of the farmers grew.
They went in deputation to Sardar Patel, who had advocated farmers’ co-operatives as early as
1942

Sardar Patel reiterated his advice that they should market their milk through a co-operative
society of their own. This co-operative should have its own pasteurization plant. His advice was
that the farmers should demand permission to set up such a co-operative. If their demand was
rejected, they should refuse to sell their milk to middlemen

Sardar Patel pointed out that in undertaking such a strike there should be some losses to the
farmers as they would not be able to sell their milk for some time. If they were prepared to put
up with the loss, he was prepared to lead them. The farmers’ deputation readily accepted his
proposal

Sardar then sent his trusted deputy, Mr. Morarjibhai Desai, to Kaira District to organize milk co-
operative – and a milk strike if necessary. Mr. Desai held a meeting in Samarkha village on
January 4, 1946. It was resolved that milk producers’ co-operative societies should be organized
in each village of Kaira District to collect milk from their member-farmers. All the milk societies
would federate into a Union which would own milk processing facilities. The Government
should undertake to buy milk from the Union. If this wasn’t done, the farmers would refuse to
sell milk to any milk contractor in Kaira District

The Government turned down the demand. The farmers called a ‘milk strike’. It lasted 15 days.
Not a drop of milk was sold to the milk merchants. No milk reached Bombay from Anand, and
the Bombay Milk Scheme almost collapsed. After 15 days the milk commissioner of Bombay, an
Englishman, and his deputy visited Anand, assessed the situation and accepted the farmers’
demand.

This marked the beginning of the Kaira District Co-operative Milk Producers’ Union Limited,
Anand. It was formally registered on December 14, 1946. Its objective was to provide proper
marketing facilities for the milk producers of the district. The Union began pasteurizing milk in
June 1948, for the Bombay Milk Scheme – just a handful of farmers in two village co-operative
societies producing about 250 liters a day

An assured market proved a great incentive to the milk producers in the district. By the end of
1948, 432 farmers had joined village societies, and the quantity of milk handled by the Union
had increased to 5000 liters a day. In the early stages, rapid growth brought in its wake serious
problems. Their solution provided the stimulus for further growth. For example, as the co-
operative movement spread in the district, it was found that the Bombay Milk Scheme could not
absorb the extra milk collected by the Union in winter, when buffaloes yielded an average of 2.5
times their summer yield. Thus by 1953, the farmer-members had no regular market for the extra
milk produced in winter. They were again forced to sell a large surplus at low rate to middlemen.

The only remedy was to set up a plant to process the extra milk into products like butter and milk
powder. The logic of this step was readily accepted by the Government of Bombay and the
Government of India, except for a few doubting Thomases. The government of India helped the
Union to get financial help from UNICEF and assistance from the Government of New Zealand
under the Colombo Plan. Technical aid was provided by F.A.O. A Rs.50 – lakh factory to
process milk powder and butter was blueprinted. Its foundation stone was laid by the then
President of India the late Dr. Rajendra Prasad on November 15, 1954. The project was
completed by October 31, 1955, on which day the late Pandit Jawaharlal Nehru, the then Prime
Minister of India, declared it open. The new dairy provided a further fillip to the co-operative
movement among milk producers. The union was thus enabled to organize more village co-
operative societies and to handle more and more milk each year. This event also brought a
breakthrough in dairy technology as the products were made processing buffalo milk for the first
time in the world. Kaira Union introduced the brand “Amul” for marketing its product range.
The word “Amul” is derived from Sanskrit word ‘Amulya’ which means ‘priceless’ or precious’.
In the subsequent years Amul made cheese and baby food on a large commercial scale again
processing buffalo milk creating a history in the world.

1964 was the turning point in the history of dairy development programme in India. Late Shri
Lal Bahadur Shastri, the then Prime Minister of India who visited Anand on 31s October for
inauguration of Amul’s Cattle Feed Plant, having spent a night with farmers of Kaira and
experiencing the success wished and expressed to Mr Kurien, then the General Manager of Amul
that replicating Amul model through out our country will bring a great change in the socio-
economic conditions of the people. In order to bring this dream into reality, 1965 The National
Dairy Development Board (NDDB) was established at Anand and by 1969-70 NDDB came out
with the dairy development programme for India popularly known as “Operation Flood” or
“White Revolution”. The Operation Flood programme, even today, stands to be the largest dairy
development programme ever drawn in the world. This saw Amul as model and this model is
often referred in the history of White Revolution as “Anand Pattern”. Replication of “Anand
Pattern” has helped India to emerge as the largest milk producing nation in the world.

SIGNIFICANCE OF THE STUDY

In the present research paper a relationship between the designs of an organization with its
operational efficiency indicators has been examined. It was found that these indicators play a very
important role in the success of the organization. The factors were studied in the context to a co-
operative form of organization and while comparing it with the corporate form, it was found that
the design of the Amul structure is somewhat different as it believes in the federal form of structure
each unit is independent of each other

OBJECTIVE OF THE STUDY

To make study more scientific and systematic the researcher frame following objectives
1) To study the significance of Amul co-operative in India.

2) To identify the relationship between organizational design and operational efficiency of Amul
co-operative in india
 CHAPTER TWO

RESEARCH METHODOLOGY
DATA SOURCES

 The data is purely secondary in nature and the knowledge has been obtained
only through various articles available on various websites.
 There is no scope to collect primary data in any form as the topic is
theoretical in nature and does not include any kind of questionnaire to be
filled.

RESEARCH OBJECTIVES

The objective of this dissertation is

 To study the efforts of Indian companies in this field and their impacts on the company

 To find out how Organisational structure is serving as a determinant of

corporate success.

RESEARCH METHODOLOGY

The research commences by searching for the articles related to the topic .Then
having a detailed knowledge of the same.

Then, studying the steps taken and efforts made in this field by various Indian
companies for organization structure. Taking examples of Indian company AMUL

Then explaining by examples of various study that how it has lead to increase in
profits and is one the reason of corporate success. Also there is special emphasis on
an Indian company which can explain the topic better and help to achieve the
objectives.
 CHAPTER THREE

AMUL ORGANIZATION STRUCTURE

COMPANY PROFILE

Amul (Anand Milk Union)

Formed in 1946, is a dairy cooperative movement in India. It is a brand name managed by an apex
cooperative organization, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which
today is jointly owned by some 2.6 million milk producers in Gujarat, India. It is based in Anand town of Gujarat
and has been a sterling example of a co-operative organization's success in the long term.

The Amul Pattern

It has established itself as a uniquely appropriate model for rural development. Amul has spurred the White
Revolution 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.

GCMMF
Gujarat Cooperative Milk Marketing Federation (GCMMF) is India's largest food products
marketing organization. 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.

Amul's product range includes milk powders, milk, butter, ghee, cheese, curd, chocolate, ice cream, cream,
shrikhand, paneer, gulabjamuns, basundi, nutramul brand and others.

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 marketing 1994 had not succeeded, but now it has fresh plans of flooding the Japanese markets. Other
potential markets being considered include Sri Lanka.
OVERVIEW

NUMBER OF PRODUCER MEMBERS 6,94,271

NO.OF VILLAGE DAIRYCOOPERATIVE 1713

SOCIETIES
TOTAL MILK HANDLING CAPACITY 5 MILLION LTR PER DAY

MILK COLLECTION DAILY AVERAGE 2.5 MILLION LITERS

MILK DRYING CAPACITY 150 MTS PER DAY

WHEY DRYING CAPACITY 60 MTS PER DAY

CATTLE FEED MANUFACTURING CAPACITY 2500 MTS PER DAY

Vision

GCMMF will be an outstanding marketing organization, with specialization in marketing of food

and dairy products both fresh and long life with customer focus and IT integrated. The network
would consist of over 100 offices, 7500 stockiest covering at least every Taluka. Head quarter
servicing nearly 10 lakhs outlets with a turnover of Rs.10, 000 Cr and serving several co-
operatives. GCMMF shall also create markets for its products in neighboring countries.

Mission

We at GCMMF endeavor to satisfy the taste and nutritional requirements of the customer of the
world through excellence in the marketing by our committed team. Through co-operative
networking, we are committed to offering quality product that provides best value for money.

SALES TURNOVER FROM 2004-05

Chart Title
60000

50000
rupees{million}

40000

30000

20000

10000

sales turnover
ORGANISATIONAL STRUCTURE

EXTERNAL ORGANISATIONAL STRUCTURE

 INTERNAL ORGANISATIONAL STRUCTURE

EXTERNAL ORGANISATIONAL STRUCTURE:

State Level Marketing Federation

District Milk Product Union Ltd.

Village Milk Product Union Ltd

Villagers

EXTERNAL ORGANISATION STRUCTURE:

• It is organization structure that effects organization from outside

• GCMMF is unit of Gujarat Milk Marketing Federation, which is a
Co-operative organization.The villagers of more than 10,000 villages
of Gujarat are the bases of this structure.
• Its also provide better communication between two stages.
The structure is Line relationship, which provides easy way to operation

INTERNAL ORGANISATIONAL STRUCTURE

• A systematic & well-defined organizational structure plays a vital role & provides accurate
information to the Top-Level Management.
• An organization structure defines a clear cut line of authorites& responsibilities among the
employees of GCMMF.
• The organization structure of AMUL is in well-arranged structure.

Chairman

Managing Director

General Manager

Asst. General Manager

BOARD OF DIRECTORS FROM FY 2017
PRODUCTION & OPERATIONAL MANGEMENT

“Production management is refers to the process of correction of past mistakes catching up with
the new techniques, taking up steps with developing techniques and taking measures for the
production of goods at competitive cost.”

The basic philosophy of production management is to launch a frontal attack on direct costs and
effective use the availability manpower weaving new techniques in to the whole to keep
theproduction unit efficient and developing production management is the process of planning,
organizing, directing and controlling.
The Amul is started with only 250 liters of milk per day. But now Amul collect average 9
lakhs of liters milk per day. At the initialstage, Amul has not any problem regarding milk, but in
the winter season there was excess supply of milk. So, Amul has to sell out that excess milk at the
low price or Amul hastofaceloss. To removingthese problems Amul take decision to set up
a plant to process the surplus milk butter and milk powder.

The Amul has three plants Known as Amul 1, 2 & 3 all three plant work 24hours a day
continuously. The all manufacturingprocessis done automatically. The production is done in the
special machines. These machines and the technology are import-id from the TRFTA PEAK
Company. There is also facility of chilling of milk, so that the milk remains usable.

Three plant of AMUL perform different functions:

 AMUL–1 Presently it is use as a go down for storing raw materials.
 AMUL–2 In this unit, the production processof Ghee and packing's are running.
 AMUL–3 This unit is producing AMUL butter, spray power, and flavored milk.

Milk Collection Cycle:

The success of each and every dairy industry is the getting the milk from the farmers andmaking
that milk in use as soon as possiblebefore that milk get spoiled because the milk isthe perishable
product. For the smooth runningthe business of dairy industry the industrymust concentrate on the
milk collection cycle.
Amul dairy is very conscious about the milkcollection cycle because the base of thesuccess of the
Amul is milk collection cycle.

Production capacity of Amul:

 Butter 50 to 60 Tones.
 Powder plant 70 tones.
 Powder plant 60 tones.
 Flavour milk 40000 bottles.

Amul – 2 Raw Reception Dock:

Reception dock is the very first department of any dairy where milk is unloaded andsimultaneously
tested. Amul-2 has a welldesigned RMRD, situated in the west wingof dairy. Raw milk at Amul-
2 is received mainly through cans. There are 2 receptionlines for unloading milk cans in Amul –
2.
About 60 % of reception is of buffalo milkand remaining 40% is cow milk.

Butter section:
The utterly Butterly Delicious butter of the Amul is one of the most popular product of Amul dairy
along with the famous butter girl. The butter section is located in Amul-3which manufactures
Table Butter, white butter and renducedsalt butter. The section is completely computer controlled
and is equipped with most modern imported equipments.Butter section very important as it handles
fat, which is the costliest constituent. The cream obtained from process
section is fully utilized for butter making. Amul white and table Butter is exported to USA and
various Middle Eastern countries.

OPERATION:
The cream for manufacturing Butter is receiving from Amul-3 process section while
standardization of milk. In Amul -3 the milk fat will be separated at above 60
Celsius, the centrifugal separators in line with Milk pasteurizer separate this as cream. The cream
thus separated is pasteurized and then pumped to the cream buffer tanks and to cream silo. After
ageing at 8 Celsius for 24 hrs, cream is pumped to cream chilling unit in the butter section. There
the temperature of cream is adjusted to the required churning temperature of continuous Butter
Making Machine.

Packing materials used:

Delocalize market Double laminated is used for export.Tin – used for 400g Army pack
Card board box- used for tertiary packing 3ply for 9.1 g weight package 5ply for normal & export.

Powder plant:
F-35 plant is situated in Amul -2 near to the railway siding. The plant is a single stage drying plant
having a capacity of 35 TDP. The plant is not in regular use and mainly used for the manufacturing
of cheese wheypowder .

F-35 CONDENSING PLANT DETAILS:

 Make : SSP ,Faridabad.
 Type : Falling film vertical tube type.
 No of Pre heater : 5.
 No of calendria : 7.
 No of vapor separators : 5.

OPERATION DETAIL:
 MILK:One of the most versatile food consumed by us. All children start with mother’s
milk and continue to use it in one other throughout their life. It isthe secretion from the
mammary glands of a lactatingmammal. The white fluid, know as milk, is made up of milk
fat and other milk solids.

MANUFACTURING PROCESS FOR MILK :

 MILK PROCUREMENT:Total milk procurement by our Member Unions duringthe year
2006-07 averaged 67.25lakh kilograms(6.7million kg) per day, representing a growth of
4.5per cent over64.38lakh kilograms (6.4 million kg) per day achieved during 2005-06.
The highestprocurement as usual was recorded duringJanuary 2007 at 84.09 lakh
kilograms(8.4million kg) per day. This increase inmilk procurement is very
impressive,keeping in mind the massive loss sufferedby our farmers due to floods during
themonsoon season, specially in Surat district
MILK PROCESSING:

 Homogenization: Milk must then behomogenized.Without homogenization, the

milk fat would separate from the milk and rise to the top. Milk fat is what gives
milk its rich and creamy taste. In this process Milk is transferred to a piece
ofequipment called a homogenizer. In this machine the milk fat is forced, under
high pressure through tiny holes.

 Pasteurization: Pasteurization is the process that purifies milk and helps is stay
fresher, longer. Milk is pasteurized by heating it to 72°C for 16 seconds then
quickly cooling it to 4°C. Pasteurization is named after Louis Pasteur, the famous
Scientists.

 Adding Vitamins: Before homogenization, vitamin D is added to all milk.

VitaminD combined with the calcium that naturally exists in milk help gives us
strong bones and teeth. Dairies also add Vitamin A to skim, 1% and 2% milk.
Vitamin A is good for our eyesight.

 Packaging Milk: Milk is now ready to be packaged. Milk is pumped through

automatic filling machines direct into bags, cartons and jugs. The machines are
carefully sanitized and packages are filled and sealed without human hands. During
the entire time that milk is at the dairy, it is kept at 1° - 2°C. This prevents the
development of extra bacteria keeps the milk fresh.

 Storing: Milk is delivered to grocery stores, convenience stores and restaurants

inrefrigerated trucks that keep milk cooled to 1° - 4°C. The stores take their milk
and immediately place it in their refrigerated storage area. Because fresh milk is so
important to our diets, dairies, and our health.
QUALITY MOVEMENT
 Quality Policy: The motivated and devoted work-force of AMUL- are committed to
produce wholesome and safe foods of excellent quality to remain market leader through
deployment ofQuality management systems, state-of-art-technology, innovation and eco-
friendly operations to achieve delightmentof customers and betterment of milk producers.

 Quality of Life: Assured market for their milk and dailyincome round the year from milk
hasimproved the quality of life of farmers.The role village dairy co-operative societies in
the overall development of the villages have brought better socialinfrastructures in the
villages such asroads, communication system, schools,health centers, water facilities,
banksetc.
MARKETING
 Concept:The marketing concept holds the key to achieving its organizational goals
consists of the company being moreeffective than competitors in creating, delivering and
Communicating customer value to its chosen target markets. Marketing starts with the
Determination of consumer wants and ends with the satisfaction of those wants. The
conceptsays that any business should be organization around the marketing function,
anticipating and stimulating and meeting customers need.

The marketing concept rests on four pillars and they are:

1. Target market.
2. Customer needs.
3. Integrated marketing.
4. Profitability.

 AMUL has also its own marketing concept. AMUL targets all type of Customers like
babies,children,young customers and old agecustomers etc. Amul try bestfor satisfying
needs by providing good quality products.

STRUCTURE OF MARKETING DEPARTMENT

FINANCIAL DEPARTMENT

INTRODUCTION:

AMUL is Asia’s no. 1 and world’s second number co-operative dairy. It has large market and dairy
network in every state of India and across the India, like central Asian countries, Bangladesh,
Thailand, Indonesia, Malaysia, Singapore, etc. It was started with 250 liters of milk and 2 societies
and now, it produces 10 lakhs litters milk per day and has 1113 societies and more than 6 lakes
farmer members. It produces milk and milk products. The main motto of AMUL is to help farmers.
Farmers were the foundation stone of AMUL. The system works only for farmers and for
consumers, not for profit. The main aim of AMUL is to provide quality products to the consumers
at minimum cost. The goal of AMUL is to provide maximum profit in terms of money to the
farmers. Vision of AMUL is to provide and vanish the problems of farmers (milk producers). The
AMUL apparition was to run the organization with the co-operation of four main parties, the
farmers, the representatives, the marketers, and the consumers.

OBJECTIVES

The management of finance of business / organization is to achieve financial objective they are
like :-
 To ensure that the financial discipline is maintained in the divisions.

 To ensure that all expenditure is incurred with due regard to principles of financial
property.

 To generate cash

 To know the market position

 To provide a return on investment keeping

Finance department is concerned with procurement and use of funds. It main aim is to use business
funds in such a way that the earning are maximized.
FUCTIONS OF FINANCE MANAGEMENT
To give financial concurrence as per delegation of power for each proposal involving :-
 Capital & Revenue expenditure
 Purchase of material/ stores/ tools and other services.
 Manpower requirement
 Project report
 Finance planning
 Decision making in finance

ROLES AND RESPONSIBILITIES OF A FINANCE MANAGER IN A

COMPANY

Senior leader of an organization are responsible for all aspects of its financial health. Managers
are charged with understanding the unit’s financial situation and not allowing unintended deficits
to occur.
Finance managers remain accountable for the resources entrusted them, including funding,
facilities and staffing, even if they have delegated budget and accounting responsibilities to their
staff.
His roles and responsibility include making decisions related to :-
1. Working capital and cash management decision.

2. Investment decision

3. Portfolio management

4. Risk management

5. Budgeting
6. Inventory management

7. Decision making

A finance manager also acts as a mediator, well-wisher, leader etc. finance manager also control
the cost of funds has to achieve the organizational goals. These are the certain rules and
responsibility of a good finance manager.

STRUCTURE OF FINANCE DEPARTMENT:-

FINANCE
MANAGER

CAPITAL ACCOUNT
TREASURER EXPENDITURE MANAGER

MATERIAL COST
ACCOUNT ACCOUNT

HUMAN RESOURCE MANAGEMENT

 Introduction: According to SCOOT CLOTHIER AND SPRIGGEL Human resource
management as the branch of management which is responsible on a staff basis for
concentrating on those aspects of relationship of management to employees and employees
to employees and with the development of the individual and the group. The objective is
to attain maximum individual between employer and employees and effective moulding of
human resources as contrasted with physical resources.

 Personal (Human resource) management plays a very important role for any organization.
The firm having all types of resources like machines, materials, money, information etc.
will not beSuccess in business without effectivemanpower. Human capital is the greatest
assetsof business enterprise and manpower management is the most important and crucial
job because the managing group is the heart of the company.

 Human resource department plays most important role in establishing good relation and
harmony among all.

 MAJOR FUNCTION OF HUMAN RESOURCE

DEPATMENT:
1. RECRUITMENT AND SELECTION.
2. TRAINING AND DEVLOPMEN.
3. PERFORMANCE APPRAISAL.
4. SALARY AND WAGE ADMINISTION.
5. EMPLOYEE TURNOVER.
6. COMPENSATION.
7. INDUSTRIAL RELATION.
8. FACTORE ACT.
9. INDUSTRIAL DISPUTE ACT.
10. HUMAN RESOURCE INFORMATION SYSTEM.
TOTAL QUALITY MANAGEMENT

 In 1994 AMUL had embarked on the Total Quality Management and in 1999 received the
Rajiv Gandhi National Quality Award for the year 1999, India’s premier recognition for
quality. Continuing to learn their employees have consistently striven to maintain
improved product and service quality at each stage of the value chain.
 More than 25000 Kaizens small improvements in work areas-were made by employees in
different areas like cost cutting, time saving and process improvement. To ensure minimum
wastage and maximum productivity and quality, house keeping initiatives have been
zealously pursued at the Federation offices, Warehouses and Distributor points.
 Learning from employing Total Quality Management principleshave been cascaded to both
the member dairies as well asdistribution channel members. Workshops on Statistical
QualityControl have been conducted across the member dairies to achieve total quality in
the production process.
 On of AMUL’s most remarkable achievements has been creation of more than 225Quality
Circles across the length andbreadth of the country. The federation’s wholesale dealers
meetevery month in these quality circles and discuss and resolve
distribution problems and improve their distribution process.
 Amul continues its commitment on improving the competencyof its professional managers
through its Competency BasedTraining Programs which builds both generic and functional
skills through in-house, customized trainingprograms.
AMUL THREE TIER MODEL

The Anand Pattern co-operative structure comprises village level co-operative societies (DCSs),
which promote district level union, which in turn promote state level marketing federation. Anand
pattern envisaged: Decentralized milk production by small producers

, Milk procurement by primary co-operatives of milk producers,

 Centralized Milk Processing by union of dairy co-operatives and

 Marketing of milk and milk products done by federations of unions

The primary milk producers democratically govern this entire federal co-operative structure to
ensure that the higher tier organizations are geared to serve the purpose of the lower levels and the
gains at all levels flow ultimately back to the milk producers in a significant measure

. The core feature of Anand model is the farmer control on all the three stages that is procurement,
processing and marketing of milk and milk products. The value addition at procurement and
processing stages can be realized by the cooperatives only through control over marketing thus
making control over marketing essential and critical features for success. In contrast, many dairy
co-operatives worldwide end up as suppliers of raw materials to private companies as the private
companies own the brands and marketing. (AMUL, 2010)

Village Dairy Co-operative Society

The milk producers of a village, having surplus of milk after own consumption, come together
and form a village dairy co-operative society which is the primary society under the three tier
structure. It has membership of milk producers of the village and is governed by elected
management committee consists of 9 to 12 elected members, based on principle of one member,
one vote. The village society appoints a paid secretary and a few staff for the management of the
day to day functions. The major functions of the village diary co-operative society are mainly the
following the collection of surplus milk from the milk producers of the village, payment

 based on quality and quantity (price bases on FAT& SNF) of milk supplied 48 providing support
services to the members like veterinary first Aid, Artificial insemination services, cattle-feed sales,
mineral mixture sales, fodder and fodder seed sales, conducting training on Animal Husbandry
and dairying selling liquid milk for local consumers of the village supplying milk to the district
milk union

 The village milk co-operative is an independent entity managed locally by the milk producers
and assisted by the district milk union.

District Co-operative Milk Producers Union (Milk Union)

The village dairy societies of a district having surplus milk after local sales come together and
form a milk union. The milk union is the second tier under the three –tier structure. It has got
membership of village dairy societies of the district and governed by the board of directors elected
from affiliated village dairy co-operatives. The milk union is managed by the appointed
professional management team consisting of a Managing Director and competent staff. The main
functions of milk union are as follows Procurement of milk from village dairy societies coming
under its preview

 Arranging transportation of raw milk from village societies to the union

 Providing input services to the producers like veterinary care, artificial insemination services,
cattle-feed sales, etc. Conducting training on co-operative development, Animal Husbandry &
dairying for milk producers and conducting specialized skill development and leadership
development training for village dairy society members and staff 49 Providing management
support to the village dairy co-operative society along with regular supervision of its activities
Establishing chilling centers and dairy plants for processing the milk

 Selling liquid milk and milk products within its operational area Processing milk into various
milk and milk products as per the requirements of state marketing federation Deciding the prices
of milk to be paid to milk producers as well on the prices of support services provided to members.

State Co-operative Milk Federation (Federation)

The milk unions of the state are federated into a state co-operative milk federation. The federation
is the apex tier under the three tier structure. It has membership of all the co-operative milk unions
of the state and is governed by board of directors consisting of elected representative of each milk
union. The state federation appoints a managing director and competent staff for the professional
management of the federation. The main factions of the federation are as follows Marketing of
milk and milk products processed/manufactured by milk union

 Establishing distribution network for marketing of milk and milk products

 Arranging transportation of milk and milk products from the milk union to the market Creating
and maintaining a brand for marketing of milk and milk products Providing support services to
the milk unions and members like technical inputs, management and advisory services 50 Pooling
surplus milk from the milk unions and supplying it the deficit unions

 Establish feed balancing dairy plants for processing the surplus milk of the unions Arranging
for common purchase of row material used in manufacture/packing of milk products Deciding the
prices of milk and milk products to be paid to milk unions Deciding on the products to be
manufactured at various milk unions andcapacity required for the seam Planning long-term milk
production and procurement & processing as well as marketing. Arranging finance for the milk
unions and providing them technical knowhow

 Designing and providing training on co-operative development, technical& marketing functions.

COMPARISON OF AMUL MODEL WITH OTHER CO-OPERATIVES

In this study a comparison has also been done on the working of other states co-operatives with
that of the AMUL Model. It was found that the basic Anand Pattern is the same everywhere, but
the professional management is different from the AMUL model. In the case with other dairy
cooperatives the managing Director of the federation which is apex body is an IAS on deputation.
As he is not in one federation permanently that does not give him the feeling of ownership which
is very essential for a co-operative to be successful. Since in most of the co-operatives the
government still has share, so various representatives are there in the board of directors and they
become the decision making authorities. The elections of the village society, union andfederation
are not politicized at GCMMF, whereas in other states these are influenced by the political parties
at the state. At AMUL the employees are hired by their own recruitment pattern by the Human
Resource Section whereas st other milk co-operatives there has not been any recruitment since last
many years. The recruitment system is dependent on state government. Cooperatives works for the
same purpose i.e. maximising return for milk producers by adding value in different ways in the
whole value chain. The organistion design is done taking into consideration the mission of the
organization. That is why the design is done in such a way so that there is maximum participation
of its members and the benefits can reach the members in a proper way. Even at the profit-sharing
level, the distribution is made in proportion to the volume of business contributed by each member;
therefore, bonuses etc. are determined from the value of the commodity supplied by the members.
This in turn ensures that while the co-operative does business, it also makes its members quality
conscious. In Anand Pattern Co-operatives, while the producers themselves determine the policies,
the opportunity is provided to the professionals to implement the policies as well as to manage the
operations

E-REVOLUTION
AMUL is the first company in the co-operative form to adopt the e-revolution. In this
informationcommunication-Entertainment age, the barriers between the business organization and
consumers, between manufacturers and end-users are all breaking down. This is what was started
fifty years back by AMUL by eliminating the ‘middlemen’ and bringing the ‘producers’ closer to
the ‘consumers’. The organization believes in innovations in product as well as process. For rapid
communication access to Veterinary Health Assistance they have introduced the GIS facility. The
adoption of the electronic milk testers to ensure efficient testing and measurement of milk
constituents is a step in this direction. This is first organization to have its own website –
www.amul.com They have nationwide cyberstores, functioning in some 120 cities, and an AMUL
cyber stores gifting service capable of serving consumers in more than 220 cities, on special
occasions. This has been possible by creating an IT network, which links the production, centres
with sales offices and dealers by VSAT and e-mail connectivity.
 FINDINGS
AND
CONCLUSIONS

Like any other organization Amul too has its own strength and some grey areas. The strength of
Amul lies in the dedication of its producer members, the technology, the supply chain
management, the values, the HR initiatives taken by the organization, their visionary leadership.
And the grey areas include certain structural as well as operational bottlenecks which need to be
tackled by Amul for smooth & steady operations and for taking the organization to new heights.
On the basis of in-depth analysis of operations and based on the feedback collected from the
farmers, vendors, employees and officers at Amul. The following actions were suggested for
improving the efficiency.

Participative Management
Although the structure of GCMMF demands participative management and it has been, of course
trying to implement it. On the one hand, participative management involve much time impost yet
there they need a clearly defined the areas where participation management can be implemented.
On all critical areas affecting participative decision making whereas routine decisions can be taken
by the managers in the spot.

Changes in Cooperative Law

The cooperative act had been framed some eighty years back by the colonial government. It was
under the pressure of these farmers the English government had to form a cooperative. The
Englishman did not have faith in the Indians, so they included in the cooperative act that the
registrar of the cooperatives would be a member of the board. In independent India, we must
understand the role of cooperatives in rural development. The real development can take place
when we depoliticize the cooperative act.

Avoiding Delay in Decision Making

Decision making plays a very important role in the growth of the organization. Right decision at
right time is very important. Generally delayed decisions spoil the urgency and significance of the
methods in question. GCMMF is advised to spot the decisions where from decision making is
much warranted. Only with firm International Journal of Scientific & Engineering Research
Volume 4, decision making Amul can stay much ahead of its competitors.

Availability of the Products

Amul has been trying to make the products available to its customers easily. In this context they
have opened Amul Parlours so that its products are available to its customers under one roof. From
the survey it has been deducted that although Amul is doing all such efforts but still the availability
has increased in western parts of India and in Metros but still rest of India these parlours have a
problem of Non-availability due to which they are not able to meet the consumers demand. Amul
must increase its milk production base and processing capacity so that they are able to meet the
growing needs.

Awareness in Unexplored Areas

Although Amul has been doing lot of projects for the awareness of the people in regards to cattle
care and better breeding facilities. But unfortunately these programs have been concentrated in
those areas which have higher literacy rate. The remote areas which are the potential zone for milk
production must be taken up by Amul. Extensive programs should be done to attract the farmers
to become members of the society. Some demonstrations or some experience of the producers like
them should be taken there to share their experience. This way they can be convinced easily

Coping with the Competition

The largest share of Amul’s turnover comes from Fresh Milk and then from butter, one of the
earliest product. If Amul has to increase its turnover, it has to concentrate on increasing its fresh
milk sale which will be done only if the procurement of the milk increases.

Product Development
Although Amul believes in innovation, but still in many segments requires upgradation in some
of the aspects. Amul chocolates and Nutramul hardly has 10% market share which is far behind
their competitors. Moreover this 10% market share of Nutramul comes from the army supply. The
malted drink is mainly dominated by Bournvita. Most of the people they are not aware of their
Nutramul brand. They should have advertisement campaign in this segment first to make the
consumers aware of the product. They can also have a feedback from the consumers what they
want from the product. In this way they can capture the market and will be able to compete with
the other companies.
Availability of Power
Although Amul has developed itself a lot in the field of Information Technology, still it has been
realized that the acceptance of the technology is difficult in the villages which are slightly
backward. There are problems of electricity also. For this they can have proper power backups and
they can even use generators. They can also request the electricity department for the supply of
electricity for running the BMC unit and the chilling plants during the peak times of collection.

Attrition Rate
Manpower is the force of the organization. In case of Amul producer members are the most
important factor. The organization works upon the principle of giving maximum benefits to its
members, but professionals play an equally important role in the success of the organization. They
also have to be satisfied in order to realize the dreams of the producer members. The rate of attrition
at Amul is high. The salary and perks are not at par with that of the multinationals. Amul has
started with taking a bond for three years with the employees who are inducted. The promotions
must be on the appraisal basis and with every promotion; the increment amount should be good
enough to retain back the employees.
 INTERPRETATION

AND

RECOMMENDATIONS

INTERPRETATION

 After the completion of PROJECT named ‘Organizational structure of AMUL’ would like
 to conclude that in today’s competitive era Proper organization structure has an important
role to play.
 Organization structure initiatives practiced by the companies contribute to the profit and
success of the company. As an example in the success of Amul dairy organizational
structure initiative has an important role to play as it is one of the success factors of
business. This has been showed with the help of graphs that depict the company’s
performance has been initiated. With time many other companies have started taking
interest in this profit cause.

RECOMMEDATIONS

 The companies practicing and following customized organizational structure should

provide information about the after effects of their initiative. This would help the
stakeholders to understand the initiative better.
 Companies should focus more on maintaining organizational initiatives as it leads to the
growing profits for the company.

LIMITATIONS
 General management initiatives practiced by companies were easily available but the
results of these initiatives are hard to find out.
 It was difficult to find out the contribution of the practices to the profit of the company
after they were initiated

REFERENCE