Background

The Anand Milk Union Limited (AMUL) was born in 1956, before the promulgation of the Gujarat State Cooperative Act, 1961. The first cooperative dairy in the state of Gujarat was established in Anand district and the offices of the National Dairy Development Board are also located here. The Anand District Milk Cooperative Society (DMCS) has a staff strength of 1,200 and collects 700,000 - 800,000 litres of milk every day from 1,003 milk societies (with more than 578,000 members, of whom 405,000 belong to the poor category) in Anand and Kheda districts. The Anand District Milk Cooperative Society produces milk, flavoured milk, cheese, chocolates, butter, ghee, etc. It provides backup integration to these societies through selling 600 tonnes/day cattle feed and has one breeding centre, 36 veterinary centres (with 76 qualified doctors) and four chilling plants. The old system of milk collection at the primary societies; with manual testing, manual account keeping on paper and manual receipt of the payments from the district dairy, resulted in a five to10 days’ delay in payment to the milk collectors. An Automatic Milk Collection System (AMCS) was introduced in 1996. At the time of the study, 691 primary milk collection societies used AMCS.

Objectives and Goals

AMCS has the following objectives:

• To automate milk collection procedures at the collection centres to reduce the time required in collecting milk from members.
• To use electronic technology to weigh the milk and to measure fat content in the milk.
• To automatically calculate the amount payable to each and every milk collector.
• To maintain regular records at the Dairy Cooperative Societies (DCS).
• To integrate data at each primary milk society with the District Milk Cooperative through the use of ICT.

Planning

Each AMCS consists of a computer for billing, a milk-testing machine and an automatic milk tester. There are seven to eight manufacturing companies (such as Akashganga, Surabhi, RAL, Kaamdhenu, Prompt, etc), which manufacture these instruments. Each AMCS costs Rs 70,000 to 90,000. At the time of the study, 691 out of 1,003 primary milk societies used AMCS, while the remaining societies used automatic weighing machines. The e-Governance Centre of the Indian Institute of Management (IIM) has worked to extend the benefits of this application by developing the Dairy Information System Kiosk (DISK) software, which will replace the existing application at the milk collection centres. It has two major components - an application with enhanced database and reporting running at the society level and connectivity to a dairy portal serving transactional and information needs of all members and staff at various levels in the district cooperative structure. The DISK database includes a complete history of all milch  cattle owned by the farmers. The basic details of breed and a history of diseases, inoculations, artificial insemination and pregnancy are maintained in the system. Longitudinal data on milk production by individual farmers is also available in the collection, which can provide feedback to the farmers.

Services Provided

AMCS provides automatic weighing of procured milk, measurement of fat content of the milk and automatically calculates the amount to be paid. It maintains a database on the computer for member details like membership number, date and time of the milk collection, weight of the milk, fat content of the milk and amount payable. The payment is made to the member on the spot at the rate of Rs 190 per kilo fat. Each primary milk collection society provides cattle feed at no profit-no loss basis, veterinary services of Rs 35 per visit and artificial insemination at nominal charges.

Target Group and Intended Beneficiaries

The target population is 578,000 members of 1,003 primary milk collection societies and 400,000 poorer members every day.

Institutional Arrangements

The DMCS has 13 elected members. There is a Managing Director, along with two General Managers (plant technology and dairy development), two Assistant General Managers (cattle feed and other products), 10 Managers (milk procurement, cooperative development, finance, accounts, production, engineering, chocolate complex, cattle feed, cheese centre and animal husbandry). There is a fully equipped research facility as well. Each 1,003 primary milk cooperative society has 11 elected members, out of which there is one chairman. Each primary society has a secretary, a milk collector, a cashier, a tester, an artificial insemination worker, a cattle-feed salesman and a clerk. At the primary milk cooperative society, AMCS is either manned by a milk collector or by a tester.

Technologies

A basic milk collection transaction done by Akashganga comprises:

• Measuring weight of milk with electronic weighing scale.
• Fat testing using ‘milk-o-tester’.
• Capture of unique member ID by the PC software.
• Printing of pay slip, with all this data and the amount to be paid.

The MS DOS based system offers scalability for an information-kiosk like service. Thus, DISK has been added as an enhancement, which offers a multitude of animal husbandry related services, besides maintaining databases and offering Internet connectivity at the Dairy Cooperative Society.

Primary Access Points

The Milk Collection Centres of the primary DCS  are the primary access points. The number of farmers selling to their local cooperative milk collection centre varies from 100 to 1,000 and the daily milk collection varies from 1,000 to 10,000 litres.

Capacity Building

AMUL uses the facilities of the Institute of Rural Management at Anand (IRMA) for the purpose of capacity building. At least two members from each DCS have been given three-day training on the use of AMCS and computers. All the secretaries of DCSs have been given one-day training in AMCS. Managerial training courses like Member Business Development Programme, Society Staff Orientation Programme, etc, also include an orientation towards the use of AMCS.

Constraints and Implementation Challenges

The major barrier is the attitude of the people. It seems like a surmountable challenge but building the initial momentum takes time due to this attitude. Although AMCS is priced competitively, the cost is a major impediment for the DCS, for whom every rupee has to be accounted for. They are answerable to every member of the society. In addition, villages in India are dusty and have poor infrastructure. For ICT based systems to operate, the machines have to be rugged and able to withstand all the climatic conditions. The power situation in the villages is poor. When the milk collection is going on and the power goes down, all activities come to a halt. At times, the manual entry mode has to be used, leading to a major disruption of normal routines.

Project Outcomes

AMUL has been one of India’s great success stories. It has been instrumental in bringing the “White Revolution” into India. The use of AMCS in the DCSs has brought about phenomenal results. AMCS has brought down the waiting time for the members of the Milk Collection Centres from 20 minutes to 50 seconds. AMCS has a comprehensive database of 290,000 members in Anand-Kheda districts in 691 DCSs. Also, it has reduced payment delays from 13-14 days to sameday payments. AMCS has served tens of thousands of members in Anand-Kheda districts and in other districts of Gujarat.

Key Lessons Learnt

A large part of the success of this venture can be attributed to the use of appropriate technology. The adapted milk-testing machine costs Rs 22, 500 (US$ 500) as compared to Rs 180,000 (US$ 4,000) for one from the original manufacturer. It works better in the heat and dust. It needs manpower to operate the machine, but this is not a disadvantage in rural India. Simple and rugged plastic cards with holes are used as personal identifiers, rather than smart cards. The idea was to keep the cost to affordable levels, without sacrificing any essential requirements. Building useful content in local languages is absolutely necessary. In the dairy sector, the district unions are willing to spend because they stand to gain as the system increases the efficiency and effectiveness of the services delivered by them to rural farmers. For rural kiosks to become a reality, it is necessary to build partnerships among development organizations, telecom companies, small IT service companies, and government agencies. The role of the committed volunteer who acts as the intermediary between the computer screen and the rural farmer is also extremely important.

Sustainability

The AMCS is sustainable. The cost of the whole system is Rs.70, 000 - 90,000 (around $2,000). The time reduction in catering to customers, providing an instant milk quality measurement facility and the automatic generation of database recovers the cost within a period of two years. In most DCSs, one or two staff have been removed after the introduction of AMCS, further reducing the operational costs. The District Milk Union has entered into an annual maintenance contract for the hardware. The operation of AMCS is so simple that in less than one day anyone can master its operation. The widespread replication of AMCS in numerous DCSs in various Indian states has been primarily due to its sustainable business model.

Replication and Scaling Up

Of 10,000 DCSs in Gujarat around 4,000 are in the AMCS network. The concept of AMCS required considerable effort from the manufacturing companies. Their aggressive marketing and rural coverage assisted them in winning the confidence of the DCSs. The replication of the use of AMCS has spread beyond the state of Gujarat. Of 96,000 DCSs all over India, around 6,500 are already using AMCS. The replication has been fastest in Gujarat and Maharashtra. But other states like Andhra Pradesh, Punjab and Karnataka are also quick in adapting AMCS at Milk Collection Centres of DCSs. The biggest stumbling block in fast replication is the poor financial position of most of DCSs in India.

Recommendations

It is recommended that the pilot DISK should be replicated in all the DCSs where AMCS are being used. There is a felt need for a database of milch cattle (consisting of past history of diseases, inoculations, artificial inseminations, etc), decision support systems (like milk collection forecasts), information on veterinary related issues and innovations. DISK would eventually fill the gap for the benefit of poorer members. There is a need to scale up the pilot of connecting five AMCS in DCSs through a network. All 50,000 AMUL product distributors are already connected to 50 marketing offices of AMUL across the country through dial-up connectivity. Since 1997, 50 marketing offices are linked to the Gujarat State Cooperative Milk Marketing Federation through dial-up connectivity and,in turn, this is connected through VSAT with 12 District Milk Unions in the state of Gujarat. The organizational structure is already in place; the networking of DCSs with the DMU should follow. In most DCSs which are using AMCS, other databases of members are kept manually. The PC attached with the AMCS is only used for four hours in a day. It will be useful for the DCSs if all their remaining work is computerized too. The cost of AMCS is still out of reach of small DCSs. If it could be reduced by 20-30 percent,  it would become affordable to even small DCSs.

Human Interest Stories

The Dairy Cooperative Society of the New Age

DCS at Utarsanda in Anand district provides quality services to 2300 pourer members. The population of Utarsands village is 15000 and has 4500 milch cattle. The DCS has a staff of 10 members and is looked after by the secretary, Deepakbhai Patel. AMCS was introduced in the Milk Collection Centre in 1997. Everyone in the DCS knows operation of AMCS. Every morning and evening they generate data of milk collection and post in front of the office notice board. The centre opens between 6 AM to 8.30 AM in the morning and between 5.30 PM to 8.00 PM at night. Earlier there used to be long queue of around 700 pourer members everyday and the centre used to close one hour later in the morning and evening as well. The centre has a telephone and a television for the use of pourer members. The AMCS are always functional because of the UPS and generator backup. 465 milk buyers have also joined a special Deposit scheme in which on a deposit of Rs.500 or Rs.1000 they receive milk and amount is debited from their accounts. The services available at DCS are very popular with the villagers. In 2002-2003, the DCS has made a net profit of Rs 2 million! And in 2001 it received the ISO-9002 certification.

Empowerment of  a Woman Member

Forty-year-old Santokhben is a migrant from drought-prone Saurashtra region. She has been looking after her five sons and one daughter since the death of her husband. She has no agriculture land and milch cattle are her sole source of income. She owns 25 cows and the income thus earned is their livelihood.  Her sons take the cattle for grazing and she takes the milk to the DCS in Bhumel, which is 1.5 km away from her house. She deposits 20-30 litres of milk every day at the Milk Collection Centre. She is very satisfied with the AMCS as now her work gets done in less than 60 seconds, while earlier it used to take up 20-30 minutes. She is fully satisfied with the fat content measurement of her milk now. Before the AMCS was introduced in October 1998, she used to argue with the milk collector/tester or the secretary every day over the quality of her milk. She is now happy as she gets her payment on the spot. She plans to change over from local breed cows (Gir) to newer breeds.

Website

http://www.amul.com