AMUL – A case study on IT in SCM

AMUL A illustration try on IT in SCM A a blend(p) case of Use of IT Amul is a leading food brand in India. It offers a roomy fly the coop of products wish draw, take out powder, butter, ghee, cheese, chocolates, Shrikhand, ice cream and many another(prenominal) more. The brand name AMUL is derived from the Sanskrit word Amoolya, meaning priceless. The archetypal products with the Amul brand name were launched in 1955. Since whence, they ache been in use in trillions of homes in all part of India, and beyond.Today Amul is a symbol of many things Of high gauge products sold at reasonable prices, of availability, of service. Amul has been accredited with ISO 9001 and HACCP parcel documentation by QAS, Australia-the first food bon ton in Asia to receive the HACCP Certification Amul is a well-acknowledged and live eccentric of making a strong use of IT form in the year 1946, Amul initiated the dairy co-operative movement in India and formed an apex co-operative geolog ical formation called the Gujarat Cooperative milk Marketing Federation (GCMMF).Today, this movement is being replicated in 70,000 villages in over 200 districts in India, transforming the plain landscape. This co-operative revolution has made India the largest producer of milk in the populace today. Amul is overly atomic number 53 of the largest and most observe food brands in India. GCMMF markets its products through 50 gross sales offices throughout India and dispersal is done through a network of 4,000 stockists who, in turn, furnish 500,000 retail outlets.The interlacingity of logistics buttocks be visualized in term of millions of litres of milk to be attracted from millions of village fractions. Interestingly, milk is a putrescible commodity hence a strong coordination function is required in storing, treat and distributing the milk in required time. The case of Amuls release stove is noteworthy simply because the movement has not only lead to efficient ar my of milk but, more importantly, has utilize IT to create higher meshing for milk producers. Role of reading Technology IT has play a critical role in the learning of the Amul brand.The logistics behind the coordination of approximately six million liters of milk per day from numerous village co-operative societies throughout Gujarat, and storing, treat and producing of milk products at various district dairy societies, is carried out with clock-precision. In these, IT plays a critical role. The inductive reasoning of over 3,000 Automatic Milk Collection form Units (AMCUS) at village societies to capture member information, milk fat content volume collected, and amount due to all(prenominal) member, has proved invaluable in ensuring equity and f anoint throughout the entire organization.GCMMF is an apex co-operative organization that comprises affiliated member dairies/district milk unions, each having its own manufacturing unit. These member dairies in turn collect milk from members who cut milk twice a day to the respective village co-operative societies. To meet the quarrel of growing business, IT was decided as the thrust eye socket that would streamline the production and collection make for and the treat of milk products. This is where the installation of AMCUS made the entire function look simple.As milk is a highly perishable commodity in the supply fibril, the AMCUS initiative is live for the operations. More importantly, this initiative has increased the trust and transpargonncy for IT in rural areas. On an average, around molar concentration husbandmans come to sell milk at their topical anesthetic accommodating milk collection center. Each farmer is given a plastic card for credit, at the milk collection counter, the farmer drops the card into a box and the identification number is transmitted to a personal computer attached to the machine.The milk is indeed weighed and the fat content of the milk measured by an electron ic fat testing machine. Both these expound are recorded in the PC. The computer therefore calculates the amount 1 AMUL A case study on IT in SCM due to the farmer on the basis of the fat content. The value of the milk is then printed out on a slip and give over to the farmer, who collects the compensation at the adjacent window. With the apply of IT the farmers receive their payments within a matter of minutes.Each member preserves the milk in the cold storage, touch on it and producing several products, sold under the Amul brand name. As all products have a limited shelf life, the organizations ability to conduct its operations in a smooth way is much more praiseworthy-especially when one considers the scale of the operations. Amul makes about 10 million payment transactions day by day. On the logistics side, more than 5,000 trucks move the milk from the villages to 200 dairy processing plants twice a day, according to a carefully planned schedule.Amul took a strategic de cision to redesign and re-organize the existing parcel applications in 1994 to meet the challenges of growing business. Accordingly, Amul assigned the ERP software development project named as Enterprise wide integrated application system (EIAS) which covers a embarrassment of operations like market planning, advertising and promotion, dispersal network planning, stock control, sales and accounting, budgetary control, spirit control management and co-operative service management.Each of Amuls offices is connected by e-mail and all of them send a daily report on sales and inventory to the principal(prenominal) system at Anand. Also, sales offices, C&F points and wholesale distributors of GCMMF have been connected through the earnings for timely exchange of information. Amul is also in the process of Web-enabling the entire supply chain so that it can capture key information at the bloodline and use the same for decision-making. This would include the likes of transporters, mem ber manufacturing units, oil packing stations, suppliers, stores and the ntire field force. A web point (http//www. amul. com) has been constructed featuring sports information, recipes and quizzes (to stimulate buyer interest and to establish topic brand recognition) and business-to- consumer order turn outment. Amul has a customer feedback bloodline which uses e-mail addresses like emailprotected com for cheese products and emailprotected com for butter products. E-competency has been formal at the supply and dispersal ends of AMULs business.At the supply end, a computerized database has been accomplished of all suppliers and their cattle. Computerized equipment measures and records qualities and quantities collected. Computers have been set up at member unions and village cooperatives. At the distribution end, stockists have been provided with basic training and computers. AMUL experts assist stockists and retailers to pull in promotional web pages. AMUL cyber stores ha ve been set up at various locations in India, the USA, Singapore and Dubai.Each go steady to the Indian cyber store sites results in considerable purchases. A strong e-mail database of more than 10,000 customers has also been developed. In addition to the EIAS, Amul has also been using geographic Information Systems (GIS) to plot zone/depot boundary as well as a pointer for zone, depot and distributor locations, which are superimposed by product-wise sales data. Going forward, there are plans to introduce features like Internet banking services and ATMs which will enable milk societies to credit payments directly to the sellers bank account.In line with this plenty, officials at Amul are looking at upgrading the plastic cards, which are being currently used only for identification purposes, to smart cards which can be used to withdraw cash from ATMs. Amul has radically altered the complexion of the supply chain-by eliminating the middleman and bringing the producer side by side( predicate) to the consumer-resulting in benefits for both. Amul has also linked distributors to the network and also incorporated Web pages of top retailers in their web site (www. amul. com) as part of B2B initiatives.Distributors can place their orders on the website, amulb2b. com, especially meant for accepting orders from stockists and promoting Amuls products via 2 AMUL A case study on IT in SCM E-commerce. A big achievement of IT in Amul has been the automation of the complex supply and delivery chain. The machine-controlled supply chain seamlessly integrates the manufacturing dairy units for production, planning and raw material procurement. It handles distribution of milk from surplus unions to deficit unions.It is a live example of practicing Just in time supply chain management with six sigma accuracy Amuls victor in leveraging IT to its advantage lies in the simple fact that the organization has a clear IT vision and has made full use of the potential of IT for managing its supply chain. In 2003, GCMMF won the reputable international CIO coke present from IDGs CIO Magazine, USA. The 2003 CIO 100 award recognizes organizations around the world that excel in positive business public presentation through resourceful IT management and best practices.GCMMF, whose IT initiatives have been driven by the philosophy of being an IT company in food business, has inspired all its employees to sustain the challenges as a change agent by excelling their IT skills in order to transform the people around them towards IT integration on both the ends of supply chain (village dairy farmer to end-consumer), GCMMF has also won the prestigious Ramkrishna Bajaj National Quality Award for the year 2003.GCMMF has bagged this award for adopting noteworthy quality management practices for logistics and procurement. Over the years, it has established an efficient supply chain that penetrates even the remotest corners of the country. In summary, Amul has developed world-c lass expertise in the physiologic distribution of short-life produce. Already advanced in physiological logistics, Amul has innovatively explored ways to use IT to enhance its supply chain. (Source amul. com, ExpressComputers(16 kinsfolk 2002 article by Srikanth R P), and other sources)GCMMF An Overview Members nary(prenominal) of Producer Members No. of Village Societies Milk collection (Total 2002-03) Milk collection (Daily Average 2002-03) Milk Drying might Sales Turnover (2002-2003) 12 district cooperative milk producers Union. 2. 28 million. 11,132. 1. 86 billion litres. 5. 08 million litres. 510 metric Tons per day. Rs 27457 Million. IT Enablers used by Amul Uses automated milk collection system units for collection of milk. employ a customized ERP system which is used in company with GIS. Uses data compend software for forecasting milk production and increasing productivity. Has connected all zonal, regional and member dairies through VSAT. One of the first atom ic number 23 Indian organizations to have a Web presence. Geographic information system for sales and distribution planning. data Information System Kiosk for data analysis and decision support to help in meliorate milk collection. Web enabled customer feedback channels. Strong initiatives in e-commerce. 3