Enterprise-wide Digitization

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Enterprise-wide Digitization

India
Organization type: 
nonprofit/ngo/citizen sector
Budget: 
< $1,000
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

By implementation of right IT solutions, Surat District Co-operative Milk Producers’ Union Ltd. (SUMUL) is trying to achieve in the context of business, be it entering a new and profitable market, gaining a lasting competitive advantage, creating new products to attract new customers or make existing ones more profitable, increasing the enterprise’s market share, or other big wins.

About You
Organization:
Surat District Cooperative Milk Producers’ Union Limited
Visit website
Section 1: About You
First Name

Satyen

Last Name

Naik

Country

, GJ

Section 2: About Your Organization
Is your initiative connected to an established organization?

Yes

Organization Name

Surat District Cooperative Milk Producers’ Union Limited

Organization Phone

+91 261 2537693

Organization Address

Post Box 501, Sumul Dairy, Surat - 395 008

Organization Country

, GJ

How long has this organization been operating?

More than 5 years

Your idea
Country your work focuses on

, GJ

Innovation
What makes your innovation unique?

Currently, 650 AMCS are running successfully in the villages of Surat District. 4 Chilling Centres are fully automated and computerized. At head office, Sumul Dairy is using Enterprise-wide Digitization, which takes care of data generated at 1004 village level dairy co-operatives collecting milk from 2,54,415 members (farmers) spread over 7,745 Sq. Km area for various analytical purposes.
• Personnel (approximately) have benefited:
Employees : 1050
Customers : 40 Lakhs (70% Market Share of Surat City)
Other members in the Value / Supply chain : 2,18,975 Farmers
Milk Retailers (In Surat City) : 2306
1. Implementation of Information Technology at Village level:Since the education level at villages is quit low and advantages of computerization is not known to them, it’s little difficult to convince the milk co-operative producer (farmer) that by use our software for his business, it would be easy for him to do his daily business transactions and he can increase the profitability of the business.
2. Transparency of Business at Village Co-Operative Society:The farmer is given a slip of every transaction (morning and evening), he does with the milk co-operative society. Before the implementation of our project, he was not aware / given of any document from which he can calculate the amount of money. Now, since with slips with him, he is in a position to calculate his amount.
3. Resistance to Change:SUMUL developed an Enterprise-wide Digitization – A very well intergrated package using ORACLE database. During these times, few emp. from each dept., who had shown interest in IT systems, were picked up and they were trained to use the IT systems. In turn they help others in getting acquainted with the systems. Now, the users have confidence in the IT and their expectations from IT dept. are rising.
4. Economic Pressure:The Co-operative Diary is the non-profit, service oriented organization. Hence, the investment on IT compared to other industry is less.

Do you have a patent for this idea?

Impact
Tell us about the social impact of your innovation. Please include both numbers and stories as evidence of this impact

Key business and/or social benefits that this project has delivered.

Rural upliftment: Due to transparency in the system, the management is in a position to take decisions advantageous to the farmers. Sumul Dairy is paying higher rate in India to milk producer boosting rural economy and minimizing rural unemployment by proving gainful dairy farming enterprise. (Source: National Dairy Development Board, Anand).
Increase in profitability: Because of MIS, management is in a position to reduce the expenditure and plan for higher productivity and optimum resource utilization e.g. reduction in milk sourage, higher milk and cattle feed sales.
Higher market share: Higher market share is achieved through Customer Care database by timely resolving the customer complaints. Zone wise population analysis and timely dispatches also helped to increase the market share.
Right quantity: The system is maintaining the data of milk FFS (Form Fill and Seal) pouch filling machine due to which right quantity is being packed. Due to this variation in packing has been eliminated.

Automatic Milk Collection System (AMCS) Includes:

• Computer and printer
• Weigh scale
• Milko tester
• Online UPS
• Accounting software

The growth of AMCS (Automatic Milk Collection System)
Year wise Growth
1998-99 : 22
1999-00 : 37
2000-01 : 23
2001-02 : 25
2002-03 : 27
2003-04 : 104
2004-05 : 82
2005-06 : 57
2006-07 : 11
2007-08 : 40
2008-09 : 102
2009-10 : 120

VILLAGE CONNECTIVITY

• Internet facility
• E-mail facility
• Exchange of information through Wi-Fi Connectivity
• Voice over IP (VOIP) setup

In 2007-2008 the turnover was Rs.700 crores compared to Rs.521 crores in the year 2005-2006. 35% of this increase is achieved due to the implementation & improvement in all business processes and innovative IT deployment. Sumul is not profit motive organization hence the benefits are passed on to farmers through milk pervasive rate hike. In the year 2005-2006 the amount paid to the farmers was Rs. 4,41,62,92,274 against Rs. 6,02,88,02,530 paid in 2007-2008 i.e. 36.50% increase.

In 2005-2006, Sumul Dairy paid Rs.233 per KG Fat of milk to the farmer and in the year 2007-2008 Sumul paid Rs.295 per KG Fat, an increase of 26.60%.

Problem: Describe the primary problem(s) that your innovation is addressing

Resistance to Change

When Sumul initiated computerization, the employees were not familiar with computer operations. The employees were of very normal skilled and not much of a higher qualification. They were hesitate/scarred to use computers. There was no computer availability at their workplace.

Hence, management decided to give computer training from the reputed training institute. During the training people were educated for the advantages of computer and its usage. Then, in 1995 LAN was developed so that computers were kept at their desk. During 1995 – 1998 business applications were developed using Foxpro/Clipper. Limitations of the above systems were not capable of handling large amount of data, applications were not integrated. So, SUMUL developed an Enterprise-wide Digitization – A very well integrated package using ORACLE database. During these times, few employees from each department, who had shown interest in IT systems, were picked up and they were trained to use the IT systems. In turn they help their colleagues in getting acquainted with the systems. Now, the users have confidence in the IT and their expectations from IT department are rising day by day which is very encouraging.

Currently, we have almost every table has a Desktop pc and Sumul is running the entire business (Rs. 900 Crore) with the help of Information Technology.

Key technical challenges that were faced while implementing this project.

• Poor power condition at village level
• Lack of Technical man power at Dairy & Village level
• Network Problem (Last Mile)

Actions: Describe the steps that you are taking to make your innovation a success. Include a description of the business model. What might prevent that success?

1.Supporting all the process systems
1.The entire business transactions are largely dependent on Information Systems.
2. Milk cycle starting from milk procurement to distribution of processed milk / milk products is supported by the software.

2. Data capturing at village level
1. Village level dairy Co-operative Milk societies are using the computers for weighing and Fat / SNF milk testing.
2. By pouring the milk in a vessel and by using milko tester machine immediately the system generates the amount payable to the farmer and the data component is being used for further analysis.

3. Reduction of milk sourage
1. Milk being highly perishable commodity in nature requires to be processed in time.
2. Time recording of truck arrivals keeps control on delay that helps in minimizing milk sourage

4. Timely dispatch and cash collections
1. The liquid milk sale is about 5 lakh liters per day distributed through more than 1,700 retailing agents.
2. Sumul is required to collect the money on day-to-day basis from these retailers.
3. The process of receiving orders, dispatch and cash collection is carried out using Marketing module.
4. If milk is not distributed in time, the sales will be reduced.

5. Timely payment to farmers
1. Since the data is available online the payments to village societies is made possible in time which in turn helps the societies to make timely payment to farmers.
4th of every month money transfer in the Surat District cooperative bank account of 1036 village societies.

6. Timely payment to Vendors On-line payment gateway system, through which we can track the entire payment cycle (Bill receipt to out-going Cheque) and reduce any delay. Within 15 days, Sumul Dairy clears any outstanding of vendors. 5th of every month trade discount is paid to 1832 sales agents.

7. Timely payment of employees 6th of every month salary transfers in the ICICI bank account of 882 employees.
(We have external linkage with PF and LIC offices, where we provide the data in the format required by them, and they simply upload the our data). We are talking to Income Tax dept for similar set up.
It is mandatory for sumul dairy to make the payment on above dates. Failure of maintaining any above dates will affect farmers, employees and sales agents.

Project Review from time to time:
The project progress was reviewed at periodic meetings attended by members of the coordination committee and concerned users. These review meetings were chaired by the MD, Sumul. Detailed discussions would be held with the concerned users on all issues relating to the design, development and implementation of software relating to the modules of their respective departments.

Results: Describe the expected results of these actions over the next three years. Please address each year separately, if possible

Details of business advantages accruing from the IT application
Rural upliftment: Due to transparency in the system, the management is in a position to take decisions advantageous to the farmers. Sumul Dairy is paying higher rate in India to milk producer boosting rural economy and minimizing rural unemployment by proving gainful dairy farming enterprise.
Year wise Profit Details :

Financial Year Profit Amt (INR) Profit Amt in USD Additional Profit Shared Amount Milk Producers (Farmer) (INR) Additional Profit Shared Amount Milk Producers (Farmer) (USD)
2003-2004 3,760,930.00 94,023.25 95,801,302.87 2,395,032.57
2004-2005 6,988,826.00 174,720.65 104,532,353.13 2,613,308.83
2005-2006 11,400,566.00 285,014.15 132,082,009.11 3,302,050.23
2006-2007 16,331,368.00 408,284.20 178,954,944.63 4,473,873.62
2007-2008 20,761,681.00 519,042.03 302,841,565.43 7,571,039.14

Quantifiable / Non-quantifiable benefits
- Customer satisfaction
- Transparency in the business from village level to the customer level
- Quality improvement
- Less Manpower
- Saving in Transportation
- Reduction in inventory cost
- Action initiation from employees
Direct / In-direct cost savings
- Less Manpower
- Less sourage of milk
- Less paper work
- Reduction in inventory cost
- No duplication of data
- Weighing loss decreased
Improvement in customer service
- Immediate resolvement of customer complaints
- Customer survey reports are used for improvement of quality and service
- Cash deposit by retailers at nearest cash collection centre
- Village level complaints / issues resolved through call management system
- Order acceptance over telephone
- Timely dispatches
- Introduction of B2B portal and online shop
- Internal call management for handling internal customers

Impact on quality and productivity
- Quality of product is improved with the help of Customer Feedback System
- Differentiation of cow and buffalo milk is made possible
- Reduction in sourage of milk
- Right weighing
- ISO 9K2K / ISO14000

Impact on society
- Rural economical and social upliftment
- Financial freedom to rural women
- Village social development

The Village Society accounting package is very easy to operate even by high school drop out. A banished dependence on professional accountant mean net saving on book keeping and accountancy expenses
- Introduction of Internet at village level
- More realization of milk to the society member (farmer)
- Use of latest technology at village

How many people will your project serve annually?

More than 10,000

What is the average monthly household income in your target community, in US Dollars?

Less than $50

Does your innovation seek to have an impact on public policy?

No

If your innovation seeks to impact public policy, how?

Approximately 150 words left (1200 characters).

Sustainability
What stage is your Social Enterprise in?

Operating for more than 5 years

Does your organization have a board of directors or an advisory board?

Yes

Does your organization have a non monetary partnerships with NGOs?

No

Does your organization have a non monetary partnerships with businesses?

No

Does your organization have a non monetary partnerships with government?

No

Please tell us more about how partnerships could be critical to the success of your Social Enterprise

We do not have any partnerships with any other organization or government.

We would like to learn more about how your initiative is financially supported. Please explain your business plan/revenue model

Approximately 250 words left (2000 characters).

The Story
What was the defining moment that led you to this innovation?

Recognising the growing complexity of its business operations and the mounting pressures to achieve higher productivity and efficiency – on account of an increasingly competitive and liberalised environment – Sumul felt a need to evolve superior workflows using computerised processes. Sumul also felt that computerisation would provide a good opportunity to redesign many of its existing processes that were predominantly based on organisational methods more suited to the environment of the past. Sumul’s larger goal of embarking upon the computerisation programme was to create a positive ‘computer culture’ within the organisation that could compliment its quality drive and establish sound forward and backward linkages with the aid of information and communication technologies .

Tell us about the person—the social innovator—behind this idea.

Mr. Manubhai Patel
Chairman
SUMUL DAIRY SURAT.

He established milk societies, education services, social activities and many other development schemes for all the people of villages. By the use of latest technology for milk collection and chilling centre, Animal food distribution service provides speedy and satisfactory service to society members. It is worth saying that manubhai is the “Modern Gandhi” of Surat, because of his simplicity, co-operative nature, politeness. His long-sighted vision changes the life style of board members, staff members, village milk producers & customers and binds them under co-operative chain do the white revolution and through that do social revolution, green revolution, educational revolution and economical revolution.

For Sumul Dairy’s Contribution in rural development activity FICCI awarded “GRAM VIKAS AWARD” at the hand of Prime minister Dr. Manmohan Singh to Chairman Manubhai Patel.

Federation of Gujarat Industries, Vadodara has complacently noted the additional role played in the filed of Environment Preservation and Pollution Control over and above routine activities; so awarded Award for Excellence – 2007 at the hands of Rev. Dr. A.P.J. Kalam former President of India and with that in appreciation of the achievements in Energy Conservation in the Dairy Sector for the Year 2007 at the hands of Smt. Pratibhaben Patil, Hon ‘able President of India

For the Social Activities by Sumul Dairy institute of directors awarded “GOLDEN PEACOCK AWARD” at the hand of BABA RAMDEV to Chairman Manubhai.

Manubhai have been honored with Gold Medal and “Rashtriya Udhyog Samman Puraskar” by Indian Society for Intellectual Development, New Delhi for developing milk co-operative activities in the Surat District which truly nurture the concept of Mahatma Gandhi's dream-village to live with poise through self employment; at the hands of Hon'ble Subodhkant Sahay, Minister of Food Processing.

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