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Amul India : A Social

Development Enterprise

 Have adapted new technologies over its journey and have diversified into new markets replicating its model across India.  Jointly owned by 3 million milk producers in Gujarat collecting approximately 6million kg of milk daily.Introduction  Amul India commenced with 2 villages in Gujarat. .  Began as a movement to overcome exploitation of rural farmers.  Spurred White revolution making India World’s largest producer of milk and milk products.

to augment rural income while developing local industry.Ideological Leadership  Sardar Vallabhai Patel recommended cooperative against the exploitative Polson.  Tribhuvandas appointed as Chairman. must be rooted in its social integrity rather than Industrialization.  Metric for progress.  A model to integrate economic prosperity with the imminent political freedom.  Believed that for India to thrive.“Are the Farmers happy?” .

 Verghese Kurien .  Joined as General Manager in 1950. an aspirant for a career in engineering –came to Gujarat for a Govt. Scholarship he had received to study abroad.  Was offered to be a part of cooperative for his professional expertise.  His independent spirit & creativity clashed with submissive nature of Govt.  Was determined to find productive pursuits.Ideological Leadership contd.. . officials.

 Brand became a synonym to butter.paying less for milk.  Used unscientific methods to find fat content and supply of milk.  Obtained an exclusive order to monopolistic practices to ensure consistent supply.set purchase price and selling price.  Suppliers of coffee.Polson  Diary products brand (1915).  Tribhuvandas led 15-day boycott.  Diverted to supply pasteurized milk to Bombay through Bombay Milk Scheme (BMS). .Dairy King of Kaira. butter and cheese to British army.BMS withdrew the order.

1946.‘quality takes precedence’.  Primary Objective – Economic liberation from the exploitation of money lenders and intermediaries.  Owned and operated a milk-processing fight abusive practices of Polson.  Nominal membership of Rs.  Common Need .  Began its operation in Oct 7.  Quality control had final decision. processing and selling dairy products to Mumbai.  Reinforced transparency at all levels.  Functions.Amul-Serving Farmers  ‘Amulya’-Priceless.10 .

• Payment basis. whole society suffered the loss of payment. • If contaminated or spoilt in plant.fat content.a disincentive to adulterate.The Anand pattern. .

Diversification Ansoff Matrix Products present present new Markets  new .

.Strategic vs Defensive  High Risk: Business has no experience in the new market and does not know if the product is going to be successful. new techniques and new resources. intended to get more economic value.  Requires a company to acquire new skills.  Types: Concentric vs Horizontal diversification  Amul: Which type?  Amul diversification: not defensive strategy.

to cancel the license of market leader Glaxo. by . was not in good terms with the cooperative. in exchange of distributing Rs/ 12lakh of free milk to undernourished children. 8lakh to Bombay govt.Path to Diversification  1953: UNICEF proposed to donate Rs.  Kurien’s Statement after successful production of milk powder out of Buffalo milk: “Experts advice can be biased towards economic interest of advanced nations & not for needs of developing economies”  Successfully entered into niche segment of baby products influencing Govt.  He questioned the feasibility of milk powder from Buffalo milk. Khurody.  The Milk Commissioner of Bombay.

Staged Progression .

Gujarat Cooperative Milk Marketing Federation  Over the course of operation flood. sale of dairy products  All dairies had to employ a common distributor & a common brand name. marketing. formulated production priorities. developed new markets & determined higher value products. standardized systems. Kurien was its first chairman & MD  GCMMF brought economic & political benefits to its cooperative members  Federation ensured full utilization of capacity. district unions multiplied. ensured greater consumer acceptance  In 2005 GCMMF was India’s largest food products marketing organization with annual turnover of Rs 30 billion  Federation focused on marketing & sales activities. integrated all the forces & helped saving on advertising & brand building  This led to the formation of Gujarat Cooperative Milk Marketing Federation in 1973. This eliminated competition. each district union was responsible for its production. .

He promoted the cooperative structure & challenged the Polson’s dominance. the general manager of Amul. thoughtful & serious observer. he mobilized the rural milk producers and convinced them about the power of cooperatives  Kurien – extrovert. sincere. Strategized the battle against Polson butter. He had strong links with farmers. innovated on dairy production techniques & methods to meet the need of the Kaira cooperative . he championed the producers’ cooperative against threat from urban bureaucracies & politics  HM Dalaya – Dairy technologist. benign.Team Work  Tribhuvandas Patel – unselfish. innovated the manufacturing of milk powder & condensed milk.

Developing People  Primary philosophy – connect producers directly with the consumers  Setup of cooperatives in various villages – ensured that largest share of customers rupee is transferred to the producer  Traders also supported for seeds & fertilizers  Banks loaned money for buying cows & buffalos  Women also made lot of efforts  Brought prosperity in the villages  Schools were established  Better homes were constructed  Electricity was brought .

Looking Ahead  During these years Amul empowered the village people  Amul built trust among the consumers and build an image of high quality  Brought vertical integration of the value chain  Moved from procurement & processing to branding & marketing  Envisions opening retail outlets across major cities .

Persistent Challenges  Conflict between farmer members & professional managers  Lack of leadership burnt bridges  Government bureaucracy and constant interference  Internal Crisis in Amul – Critics & Media voicing apprehensions over Kuriens Plans  Sustenance of Cooperative objectives after shift in leadership .

Thank You .