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Issue of December 2004 

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Sumul Dairy

The right technology for the masses

India's progress as a country is highly dependent on the growth of its rural areas. This is where technology can help to a great extent by providing right solutions to empower the rural economy. Sumul Dairy's OICS to automate its processes is one such success story of innovation. by Anil Patrick R

The intelligent edge

Project: Sumul Dairy's Online Integrated Computerized Systems (OICS).
Date Started: January 1999
Date Completed: June 2002
Project Cost: Rs 230 lakh
Project Objective: To provide access to requisite information at the nearest point of work area to all associated with Sumul Dairy through the integrated network.
Benefits Obtained: Better capability to incorporate customer feedback, right weighing, differentiation of cow and buffalo milk, and reduction in sourage of milk.
Innovation: Providing the most appropriate and emerging cutting-edge technology to rural areas to utilize information for socio-economic development, growth and better quality of life.

Implementing and managing a supply chain management solution consisting of 1004 suppliers spread over 7,657 square kilometers is not an easy task, when one considers rural India. Add to this the use of a Geographical Information System (GIS) to manage resources, logistics, and procurement, makes it a bigger challenge.

Wireless laptop connectivity, biometrics, VOIP, VPNs, financial accounting, and IP cameras are de facto in the enterprise being talked about. And, the surprising part is that we are talking about a cooperative milk marketing organization called Sumul Dairy (The Surat District cooperative Milk Producer's Union Limited), and not a manufacturing major.

Read on for more information about how a cooperative society dared to dream, and made it come true. About how emerging technology has helped our country's rural citizen achieve the just rewards for his/her hard work. It will also give us an overview of OICS's innovations that helped Sumul Dairy become the Computer Associates Intelligent Enterprise Awards 2004 winner in the 'Others' category.

A right to be informed

One of the biggest problems the Indian dairy market faced earlier was its unorganized nature. The absence of infrastructure gave rise to middlemen who exploited the milk producers by keeping procurement prices low and cheating them of revenues.

This is where organizations like Sumul Dairy come in. Sumul Dairy is one of the 12 district unions that act as manufacturing units of dairy products for the Gujarat Cooperative Milk Marketing Federation Limited, marketers of Amul and Dhara brand of products.

While the issue of lack of organization has been rectified to a great extent due to cooperative initiatives like Sumul Dairy's, and the globally acclaimed Operation Flood initiative, information exchange between the cooperative society and its members still needs to be more efficient.

Improved processes and thereby higher productivity and efficiency are but natural offshoots if this effective information exchange occurs.

"Our IT vision is to provide access to requisite information at the work area to all associated with the company through an integrated network. We will especially work to provide the facility to rural areas so that they are not deprived of latest art of IT and help them use this information for their socio-economic development, growth and better quality of life," said Satyen Naik, Assistant Manager (IS), Sumul Dairy.

Superior workflow

To achieve this, the company felt a need to evolve superior workflow using computerized processes. Also at the heart of this was the recognition—that it was a growing business with operation complexity and pressures to achieve higher productivity and efficiency. In fact, the increasingly competitive and liberalized environment demanded technology evolution and innovation.

Sumul Dairy also realized that computerization would provide a good opportunity to redesign many of its existing processes that were predominantly based on obsolete organizational methods.

"Our company's larger goal was to create a positive 'computer culture' within the organization that could compliment its quality drive and establish sound forward and backward linkages with the aid of information and communication technologies," said Satyen Naik.


Fortis Healthcare's Hospital Information System developed an in-house application system. It automates billing/work flows, provides MIS, manages inventory, performs digital imaging/online reporting, and monitors patient satisfaction.

Kuoni Travels was the next nominee for its Fundamental Reservations, Administrations and Management Environment (FRAME) initiative. The project is a customized ERP to automate the company's key processes, manage the distribution/supply chains, and improve efficiency in a more productive manner.

Appropriate integration

OICS covers processes like milk procurement, marketing, cattle feed management, materials management, human resource, and financial accounting. The system also uses an integrated GIS to keep track of animal population, animal diseases, milk route transport management, milk procurement cattle feed utilization, and other veterinary services.

The main components of OICS are the following:

  • Milk procurement system (MPS)
  • Marketing Sales Accounting System (SAS)
  • Cattle feed and Finished Product Management (CFM)
  • Materials Management (MM)
  • Human Resource (HR)
  • Financial Accounting System (FAS)
  • Document Management System (DMS)
  • Financial accounting package for village societies

Data and modules

Sumul Dairy's OICS processes data generated at 1004 village level dairy cooperatives collecting milk from 2,14,415 members, spread over 7,657 Sq. Km area for various analytical purposes. Internet and e-mail facilities are also available at each village cooperative society.

"The system is pivoted around six major modules comprising approximately 500 data entry forms, 40 query forms, and 800 reports. It is estimated that more than four lakh records are created each day in the computerized systems at different places," said Satyen Naik.

Victory Talk
"By selecting Sumul Dairy for the Intelligent Enterprise Award 2004, the Indian Express Group has acknowledged that besides corporate houses, there is a scope for Information Technology in rural development."

Business challenge

Minimizing milk sourage is one of the challenges of the dairy industry. This is achieved by minimizing transport delays. Swipe cards and biometric technology are used at Sumul Dairy for time-capturing of truck drivers and staff to help timely delivery of milk consignments.

Ready online access is also available to all crucial processes. Weigh bridge data and all production/stock data are captured at source from the Cattle Feed Plant, Chalthan (25 kms away from Surat) and is available online. Cash collection centers located at five strategic locations in Surat city are also online and integrated using a VPN. The OICS also has an Automatic Milk Collection System (AMCS) and Bulk Chilling Unit (BCU) modules at village cooperative societies.

Connectivity links the business

Wireless connectivity links (802.11b, 11 Mbps) are used to connect Sumul's head office, chilling centers (a distance of up to 55 Kms) and its cattle feed factory (25 Kms away). This innovative use of Wi-Fi comes at a low cost compared to the more expensive optical fiber alternative.

The campus also has 12 wireless access points. IP cameras are used at remote locations and in the dairy premise for surveillance.

VoIP technology is used for communication over wireless connectivity links between the head office and remote locations, like the chilling centers.

"Leased lines are not reliable at remote locations, and our telephone bills were high. The voice over WLAN solution is very cost-effective and reliable, according to Naik.

Gains all the way

The biggest achievement of OICS has been rural upliftment. "Due to transparency in the system, the management is in a position to take decisions, which are advantageous to the farmers," said Satyen Naik.

OICS also had a positive impact on quality and productivity. The ready availability of MIS data reduces expenditure, helps plan for higher productivity, and optimally utilize resources. Higher customer satisfaction levels are made possible by timely resolution of customer complaints.

According to Naik, zone-wise population analysis and timely dispatches in OICS have also helped increase market share. On the packing side, OICS maintains the data from milk Form Fill and Seal (FFS) pouch-filling machines to ensure packing of the right quantity.

The future roadmap

Future plans for OICS include bringing every animal and milk producer under recording and monitoring. Disease-free zones and healthcare prevention for milch animals are also on the cards.

OICS will be extended to have access to all customers/producers and other dairy co-operative milk producers' unions. Planned customer care initiatives over OICS include customer service and grievance control through online customer education.

Sumul Dairy wants every village society in Surat District be connected to the Sumul HO by 2007-08.

Anil Patrick R can be reached at:

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