Corporate Social Responsibility, The Amul Way

Page 1 of 4

This is Google's cache of http://www.financialexpress.com/news/corporate-social-responsibility-the-amul-way/112172/0. It is a snapshot of the page as it appeared on 20 Dec 2011 18:44:34 GMT. The current page could have changed in the meantime. Learn more These search terms are highlighted: gcmmf social responsibility Text-only version

Home

Print

Stocks

epaper

Archives

Company Info

Edits & Columns

Feedback | RSS | Subscribe

Thu, 29 Dec 2011 Financial Express

Latest News
Industry Sectors JobsCommoditiesAutomobilesInsuranceReal EstateTravel & TourismHealth & PharmaLifestyleMediaPowerTelecomInfotechRetailInfrastructureEditor's Picks Sensex/Nifty Research Stocks Most Read Articles

Print Edition
Sections Corporates & Markets Supplement(s) International Reports SME World (Aug-Oct 2011) Microfinance Magazines FE Centres FE Columnists Cartoon Gallery

Events
FE Events Services Channels Astrology Shopping Tenders Express Classifieds Express Money

Group Websites Expressindia Indian Express Screen City Newslines Express Cricket Loksatta Jansatta Express Computer Exims Express Towers

FE Home- India Inc - Story

INDIA INC COLUMN

Corporate Social Responsibility, The Amul Way

Posted: Saturday, Aug 07, 2004 at 0000 hrs IST Tags: : Corporate social responsibility (CSR) has been defined as the commitment of business to contribute to sustainable economic development working with employees, their families, the local community, and society at large to improve their quality of life, in ways that are both good for business and good for development. To meet with the CSR it is expected that a business in its entire procurement-production-processing-marketing chain should focus on human development involving the producer, the worker, the supplier, the consumer, the civil society, and the environment. Indeed, a very tough task. Most businesses would certainly flounder in not being able to achieve at least one or many of those expectations. But AMUL has shown the way. CSR-sensitive Organisational Structure AMUL is a three tier co-operative organisation. The first tier is the co-operative society at the village,of which; milk producers are voluntary members, managing the cooperative through a democratically elected 9-member managing committee, and doing business by purchasing milk from members and selling it to the district level cooperative. There are more than 11,000 co-operatives in villages of Gujarat. The second tier is the district co-operative that processes milk into milk products, markets locally and sells surplus to the state co-operative for national and international marketing. There are 12 district co-operatives each being managed by a 15-member board elected by the college comprising the nominated representatives or chairmen of the village co-operatives. Third tier is the state level co-operative - the Gujarat Co-operative Milk Marketing Federation (GCMMF) responsible for national and international marketing of milk and milk products produced and sold to it. The GCMMF is managed by the board democratically elected by and from amongst the chairmen of the district co-operatives.

http://webcache.googleusercontent.com/search?q=cache:7SgDrVeqlz4J:www.financi...

29-12-2011

Corporate Social Responsibility, The Amul Way

Page 2 of 4

The entire three-tier structure with the GCMMF at its apex, is a unique institution because it encompasses the entire chain from production of raw material to reaching the consumer with the end product. Every function involves human intervention: 23.60 lakh primary milk producers; 35,000 rural workmen in more than 11,400 village societies; 12,000 workers in 15 dairy pla-nts; 750 marketing professionals; 10,500 salesmen in distribution network and 600,000 sal-esmen in retail network. Accu-mulation of human capital is sine qua non for the development and growth of any enterprise or economy. The GCMMF is sensitive towards CSR. It believes that technology and capital are replicable inputs but not the human capital. Since men are the basis for achieving the CSR, the GCMMF lays emp-hasis on their development into competent, courteous, credible, reliable, responsive communicators and performers. CSR-sensitive Business Philosophy The first step towards discharging the CSR is the business philosophy of the GCMMF. It is two-fold: one, to serve the interests of milk producers and second, to provide quality products to consumers as value for money. Evolution of an organisational system has ensured that the corporate social responsibility towards the primary milk producers, village and the ecological balance is fulfilled. The milk producers are paid for their milk in accordance with market forces and realisation of value for their produce. Invariably the price paid to the member-producers in Gujarat is higher by 15 per cent than the national average. CSR-orientation To Distributors & Retailers The GCMMF has identified the distributors and retailers are its important link in its vendor supply chain. Through surveys the GCMMF found that 90% of the distributors do not get any opportunity of exposure to latest management practices. The GCMMF realised that it was a corporate social responsibility to strengthen the core business processes of its distributors so as to keep them in mainstream business and compete with those with formal training in management. The GCMMF has developed and trained all its distributors through Value-Mission-Strategy Workshops, competence building, Amul Yatra, Amul Quality Circle meetings, computerisation, and electronic commerce activities. Competency Building Module of the GCMMF is meant to infuse professional selling skills by making the distributors and their salesmen aware of latest sales management tools and techniques; enhance their knowledge of products; positioning and segmentation strategies for various products. Under Amul Yatra the distributors and their salesmen are taken on a visit to Anand. During this visit they are shown dairy plants, their upkeep, international standards of hygiene and quality; the practices adopted for clean milk production, and above all the cooperative philosophy. Through one to one talk with the farmers, the distributors and salesmen realise AMUL is a large business of small farmers. The visit leaves an everlasting impression on their minds that by selling AMUL products, they are discharging a social responsibility towards a large number of poor farmers whose livelihood depends upon their skill and integrity. They feel proud that they are participants in development of rural society and thus in nation building. Earnings Of GCMMF Nurturing its primary members - the milk producers - is the first mission of the GCMMF. Discharge of this responsibility is reflected in the manner in which the GCMMF conducts its business and shares its earnings. The milk from the village co-operatives is purchased at an interim price. So as to maximise the earnings of the milk producers the GCMMF changes the product profile during the fiscal and directs its sales and marketing activities towards those products that would bring in maximum returns. True! Every business organisation follows the same principle. But the GCMMF follows it with the central interest of the producers. During the fiscal, as the GCMMF finds that from its earnings it is possible to pay more to the producers for milk, the final price is declared higher than the interim price being paid. Before the GCMMF closes its financial accounts the co-operatives are paid price difference, the amount between the interim price and the final price. Thus profit of the GCMMF is very low. The net profit (PADT) of the GCMMF during 2003-04 was Rs 7.31 crore against a turnover of Rs 2,947 crore, a meagre 0.25%. Further out of the net profit of Rs 7.31 crore, Rs 4 crore was given as share dividend to the co-operatives. To fulfill its corporate social responsibility towards its milk producers and co-operatives the GCMMF works on razor thin profits and retention of funds. CSR-oriented To Staff The GCMMF hires and trains people to take advantage over its competitors. It has developed in-house modules for training and competence buil-ding to improve and up grade of their knowledge; communication skills to understand the customer, be responsive to customer requirements, and communicate clearly for trouble shooting of problems. They are expected to be courteous, frie-ndly, respectful, and considerate to the customer. To improve the credibility and trustworthiness of the managers it is important they perform consistently and accurately every time and at all times. The structure of salary and perquisites is altogether different. The first and foremost the staff must get satisfaction from the job they. They are recognised for their contribution (Climate Survey) CSR-AMUL WAY The writer is an officer on special duty, Gujarat Co-operative Milk Marketing Federation, New Delhi) Multi Page Format More from India Inc Happily ever afterStart early, land safe, the key M&A mantraBajaj banking on financePreparing for the worstIts a long summer aheadFree ride over for job seekersGetting the accent just rightIndian tourism on a high
Top Headline Most Read Most Emailed

Sensex falls 0.5% on gloomy growth Rupee falls to Rs 53.04 vs dollar Few cheers for hospitality in 2011 US stocks drop; Big banks fall hard UK Stocks : FTSE down 0.4 percent Indian market retains trillion-dollar tag RCom, Bharti face fine for violating 'norms' Kingfisher to join 'oneworld' airlines' alliance

The URL you requested has been blocked

The page you have requested has been blocked, because the URL is banned.

http://webcache.googleusercontent.com/search?q=cache:7SgDrVeqlz4J:www.financi...

29-12-2011

Corporate Social Responsibility, The Amul Way

Page 3 of 4

Cities in India
Technologies that make cities more eco-friendly & cut costs - Siemens!
siemens.com/india/city-solutions

Production Manager Jobs

APICS Certified in Production & Inventory Management Program
www.apics.org/cpim

CSR Company International

Leading global CSR Consultancy ISO 26000-CSR Strategy-Measurement
www.csr-company.com

Discuss this story on expressindia forums

Post Comments 3000

Name Subject

characters left
Email ID

Message

TERMS OF USE: The views, opinions and comments posted are your, and are not endorsed by this website. You shall be solely responsible for the comment posted here. The website reserves the right to delete, reject, or otherwise remove any views, opinions and comments posted or part thereof. You shall ensure that the comment is not inflammatory, abusive, derogatory, defamatory &/or obscene, or contain pornographic matter and/or does not constitute hate mail, or violate privacy of any person (s) or breach confidentiality or otherwise is illegal, immoral or contrary to public policy. Nor should it contain anything infringing copyright &/or intellectual property rights of any person(s). I agree to the terms of use.

Comments
Be the first to comment.

Home

Print Edition

Latest News

Stocks

epapers

Archives

Subscribe

Company Info
FinancialExpress web

About Us | Contact Us | Advertisers | Site Map | Make us your homepage | Work for Us | Express Group | RSS | Subscribe | Electronic Edition | Privacy Policy 2011: The Indian Express Limited. All rights reserved throughout the world

http://webcache.googleusercontent.com/search?q=cache:7SgDrVeqlz4J:www.financi...

29-12-2011

Corporate Social Responsibility, The Amul Way

Page 4 of 4

http://webcache.googleusercontent.com/search?q=cache:7SgDrVeqlz4J:www.financi...

29-12-2011