AN ORGNIZATIONAL STUDY KMF-GUMUL

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AN ORGNIZATIONAL STUDY KMF-GUMUL

INTRODUCTION OF KMF:

Karnataka milk federation [kmf] is a cooperative apex body in the state of Karnataka

representing dairy farmer’s organization and also implementing dairy development activities to

achieve the following objectives

Providing assured and remunerative market for the milk produced by the farmer

members.

Providing quality milk to urban consumers.

To build village level institutions in cooperative sector to manage the dairy activities.

To ensure provision of milk production inputs, processing facilities and dissemination of

know how.

To facilitate rural development by providing opportunities for self employment at village

level, preventing migration to urban areas, introducing cash economy and opportunity for

steady income.

The philosophy of dairy development is to eliminate middleman and organize institutions to be

owned and managed by the milk producers themselves, employing professionals. Chive

economics of scale to ensure maximum returns to the milk producers, at the same time providing

wholesome milk at reasonable price to urban consumers. Ultimately, the complex network of

cooperative organization should build a bridge between masses of rural producers and millions of

urban consumers and archive a socio- economic revolution in the hinterland of the state.

INDUSRTY PROFILE:

In the early days, milch animals were domesticated for the fulfillment of household needs and

purposes, but with the passage of time, growth of population and development of business and

commerce, people started using their animals as a source of their earnings. In the first instance,

the surplus milk was collected, stored and sold out in the open market with a limited number of

persons, but their activities gradually swelled and assumed a complete form of business. The

actual beginning of modern dairying has been in the middle of the nineteenth century. But,

significant changes in the structure of dairy have been marked during the past hundred years or

so. However, it was in the second quarter of the twentieth century that the creamery ice cream

factory, fluid milk bottling plant, condenser and dry milk plant were established and dairying was

run in modern ways and dairying assumed a form of full-fledged industry.

G.T INSTUTITE OF MANAGEMENT STUDIES AND RESEARCH

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On the path of revolution in the recent years, milk production evolved as the primary rather than

the secondary occupation of farmers. Moreover, the industry is employment oriented as it

provides employment to a large number of persons. A good number of people in Indian

population is engaged in the production, processing and marketing of dairy products and many

persons are needed to process, bottle and deliver fluid mills and other dairy products. Thus, it

helps in combating the unemployment conditions caused by seasonal industries and casual

opportunities of employment.

Farmers in many regions grow fodder in their land for the purpose of cattle raring and have made

dairying as their primary occupation. Milk and milk products are also very important from

nutritional point of view as they contain almost all the essential food constituents required in

human diet. Milk and milk products are very rich in protein, calcium, vitamins and milk sugar

and they provide the nutrients for people in proper proportions. Dairy Industry also fits in well in

diversifying farming programs and reducing the farmer’s link involved in agriculture. It provides

a regular and at least a subsistence income to the farmers.

Even the annuity over the world business argument having adverse effect on dairy industry has

not stopped the growth of milk producer’s societies and unions, which is seen to be increasing

day by day.

The establishment of Karnataka Milk Federation (KMF) in Bangalore, and milk producer’s

societies and unions in various districts (and their products under the corporate brand name)

Along the lines of Gujarat AMUL (Anand Milk Union Ltd) has changed the scenario of milk

production and totally revolutionized the dairy industry in Karnataka.

The confidence of continuous and permanent market for milk has encouraged large number of

people to take up cow and buffalo rearing. This scenario is restricted to northern, southern and

central districts of the state. The Hyderabad – Karnataka region says a different story. For

example, the growth of milk production in Gulbarga district (where the rivers Krishna, Bhima,

Amarja, Mullamari, Bennitore flow) is very meager.

Even in the face of such an adverse conditions the Gulbarga milk producer’s co-operative

societies union, that covers both Gulbarga and Bidar districts, has been continuously trying to


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restructure dairy industry in the region. They domesticate milk-yielding cattle but also collect

milk directly from the rural areas through their own refrigerated milk tankers. They generally

produce standardized type of milk products, such as milk pouches, Ghee, Cream etc., GUMUL in

this effort though having to face losses has never left doubt in its determination.


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DESIGN OF THE STUDY:

1.1 Objective of the Study:

To get an overall view and exposure to the functioning of organization, origin and growth

of the organization, objectives of the organization, organizational structure, product profile

and functional departments of the company.

To acquaint myself with the real practical situations.

To study several business goals, problems, facts, conditions, conflicts and personalities

obtained in organizational settings.

1.2 Scope of the Study:

The scope of the study is indeed vast to be started in brief; the study helps to analyze the

functioning of the organization with reference to various departments. This study would serve as

the basis for any future studies on departments and other functions.

1.3 Study Methodology:

The Research Methodology used for the collection of data needed mainly by the organization

induction manuals, conversation with the officials and the employees, observation and visiting all

the departments.

1.4 Limitations of the Study:

This study was limited to that particular organization.

This study was restricted with in the organization campus.

This study cannot be taken as representative of the other milk unions in the state.


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1.5 Mission, Corporate Objectives and Strategic Goals:

1.5.1 Mission:

Product excellence, hard work and continuous self improvement.

To encourage individual ability and build effective teams.

To contribute for the advancement and development of the nation and improve

human life.

Become market leader by continuously adding new capacities and incorporation

of technology to produce quality milk dairy products at least cost for the complete

satisfaction of customer and to enter into related fields and maintain core

competencies.

1.5.2 Corporate objectives:

To lower the cost of wastes and equipment maintenance.

To impart the knowledge and skills to the new entrants which they can use for an

intelligent performance of their tasks.

To lower turnover and absenteeism.

To assist employees to perform their tasks more efficiently.

1.5.3 Strategic goals:

To become best milk producer’s organization in the country.

To maintain quality of product.

To develop skill up gradation programs for employees.


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Company Profile and Product Profile

Company profile:

In June 3, 1974, an integrated project was launched in Karnataka to restructure and recognize the

dairy industry on the co – operative principle and to lay foundation for a new direction in dairy

development. Work on the first ever World Bank aided dairy development project was initiated

in 1975. Initially the project covered 8 southern districts of Karnataka, and Karnataka dairy

development was setup to implement the project. The multilevel, multiunit organization with

vertical integration of all dairy developmental activities was setup with dairy cooperative

societies at grass – root level. Milk unions at the middle level and Dairy development

cooperation at the state level as an apex body, vested with responsibilities of implementing Rs.51

Crore project. At the end of September 1984 the World Bank aided project ended and the dairy

development activities continued under operation Flood – II. The activities were extended to

cover the entire state except coastal Taluks of Uttar Karnataka District and in April 1984 KMF

came into existence.

2.2 Organization Status:

The union which started with 30 dairy cooperative societies (DCS) had an average collection of

5700 Liters / day. Till the year 2003 – 2004 it increased to 199 dairy cooperative societies (DCS)

with an average milk collection of 18,089 Liters / day.

In the year 2004 – 2005 having 203 dairy cooperative societies (DCS) with an average milk

collection of 21,334 Liters/day.

2.3 Operation status:

The economic position of the Gulbarga – Bidar cooperation milk producer’s society union

limited has improved in a great way since last 3 years. This organization has gained the profit of

49.75 lakhs in the year 2004 – 2005.


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2.4 Manpower Coverage:

The present level of activities encompasses about 15.22 lakhs of dairy farmers as primary

members. Of these, the schedule caste members are 1,49,525, scheduled tribes members are

86,911 and women members are 2,88,035 Nos. A total of about 5,500 numbers of employees are

working.

In various capacities, in all the units of KMF and affiliated milk unions with direct employment.

The indirect employment generated through various project activities of veterinary services, milk

transportation through trucks and tankers. Milk sales through agents, parlors, booths, etc is

around 37,000 which cover about 4,500 Nos. of milk by parlors / booths and about 700 people in

veterinary services. About 810 route contract vehicles directly employing 1800 people are

working in milk transportation. About 14,000 numbers of persons are employed as village level

functionaries in the dairy cooperative societies.

2.5 Dairy Cooperative Society Role:

Dairy cooperative is a basic organization unit functioning at the village level. Democracy is

practiced at the grass root level in these societies, which are organized on the cooperative

principles. By training local to organize and manage the activities, village level inspection

buildings and development of local leadership is promoted. All milk cattle owners are eligible to

become members of the dairy cooperative societies.

2.6 Dairy Corporation Societies Function:

The DCS function dairy and act as a marketing outlet for the milk produced in the village. Input

facilities are also canalized to the dairy farmers through these societies and include veterinary

first aid, sale of cattle feed, supply of fodder seeds, seedlings, provisions of mobile and

emergency veterinary health cover, dissemination of know – how, etc. Payment for the milk

purchased is also arranged through the society. A string of DCS is organized to form a milk

procurement route linked to chilling center or a dairy.


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2.7 GUMUL: Background and Profile:

Karnataka Milk Federation (KMF) is a cooperative apex body in the state of Karnataka

representing dairy farmer’s organization and also implementing dairy development activities to

achieve the following objectives.

Providing assured and remunerative market for the milk produced by the farmer

members.

Providing quality milk to urban consumer at reasonable bill.

To build village level institutions in cooperative sector to manage the dairy activities.

To ensure provision for milk production input facilities and dissemination of know how.

To facilitate rural development by providing opportunities for self – employment at

village level, preventing migration to urban areas, introducing cash economy and

opportunity for steady income.

The philosophy of dairy development is to eliminate middlemen and organize institutions to be

owned and managed by the milk producers themselves, employing professionals / achieve

economies of scales to ensure maximum returns to the milk producers, at the same time

providing wholesome milk at a reasonable price to urban consumers. Ultimately, the complex

network of cooperative organization should build a bridge between masses of rural producers and

millions of rural consumers and achieve a socio – economic revolution in the hinterland of the

state.

2.7.1 Establishment:

The Gulbarga milk producer’s societies union came into existence on 19 th August 1985, with an

initial capital of Rs. 39.34 lakhs where the producer.

Membership and Societies: As of latest, the number of societies of milk collection is 308, of

which only 203 are working successfully, the other being out of order due to milk shortage and

mismanagements. The total number of members registered is 47,645 out of which 16,005 are

small farmers, 10,352 are lower agriculturist, 12,262 are landless labors and others are 9026.


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2.7.2 Board of directors:

There are 12 board of directors out of which 5 are Government appointed, 5 are elected directors

and 2 government nominated directors.

2.7.3 Competitors:

Arokya Milk, Rajhamsa Milk, Sai Milk, Shivamrutha Milk, Dudh Pandhari.

2.7.4 Milk collection and Sales:

Average collection of milk per day is around 21,344 Kgs with an average collection of 105 Kgs

of milk per day per society. The average sale of milk per day is around 29,675 liters.

Dairy Expansion:

The capacity of the Gulbarga dairy has been increased from 30,000 liters to 60,000 liters. The

national dairy development board has implemented this as a part of its 3 rd plan. Chilling centers

of capacity 20,000 are started in Krishna Kada (Shapur C.C) and Gulbarga district on

03.10.1979. One chilling center of 10,000 capacities was started in Hudgi taluk of Bidar district.

A minimal dairy with a capacity of 30,000 liters was opened at Bidar City.


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2.7.5 Product Profile:

Sl. No. Name of the Product Packaging Design Quantity

I MILK

1. Toned Milk

(3% Fat, 8.5% SNF)

Sachets 500 ml,

1000 ml

2 Standardized Milk

(4.5% Fat, 8.5% SNF)

Sachets 500 ml

II GHEE Sachets 200 ml, 500ml

Sl. No. Name of the Product Packaging Design Quantity

III CURD Sachets 500 ml

IV PEDA Cartons 250 gm

V JAMOON MIX Sachets 100 gm

VI BADAM POWDER Sachets 100 gm

VII MILTON STERLISED MILK Bottles 200 ml

2.7.6 Performance Highlights

1. 13 out of 15 taluk that come under the scope of the union are engaged in milk collection

and the sales permitted to all the cites of the district.

2. Elected boards in position in the union and also all the cooperative societies coming under

the scope of the union.

3. The milk from chilling center from Hudgi district is procured by the GUMUL.

Pasteurized, made into packets and then sent to the market.

4. 164 DCS out of 180 working DCS are earning profits.

5. The union collects on an average (9,402 bags of milk/day and distributed Rs.1474 lakhs

to the milk producers per day).


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6. The union also seals on a monthly average of 48.25 MT of cattle fodder.

7. With the help from the state and central government, the providence of loan at a lower

interest from the state SC/St, backward and minorities Development Corporation has been

made possible.

8. By the union scheme of “Bharat Dharshan”, 30 progressive dairy farmer members were

sent on 10-day training tour.

2.7.7 The History of Gulbarga Milk Union is given here under:

24.1.1971 In Karnataka, Gulbarga Milk Union was established

01.06.84 Production and input unit commenced its milk procurement operation in

the village societies

26.10.84 The procurement milk route was started

31.10.84 The first village level society was registered

1984 Shahapur heifer project was started

19.08.85 Gulbarga Milk Union was registered

01.09.88 The training center was handed over to Gulbarga Milk Union

July 1990 The Gulbarga Milk Union recorded in procuring more than 50,000 kg of

milk from village level societies

1991 Bidar Mini Dairy construction work was inaugurated

01.08.91 The Gulbarga Dairy under the control of KMF handed over to Gulbarga

Milk Union

21.08.97 The Gulbarga Dairy plant capacity was increased to 60,000 LPD

03.10.97 The Gulbarga Milk Union new training center building was inaugurated

03.10.97 Shahapur Milk Chilling center was inaugurated

20.11.98 Gulbarga Milk Union started distributing liquid nitrogen

2000 The Bidar dairy started its operation under the control of Gulbarga Milk

Union

June 2002 MIS dept was introduced

2006 Sale of avg 43000 lpd of milk, highest in GUMUL history

In fact with the above year wise performance, the Gulbarga Milk Union is venturing into a new

era in achieving its tasks at the optimum level. Overall 19-20 other hands of milk are competing


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with Nandini Milk. In this circumstances also, Nandini Milk captured a giant share with around

24% of market share in Gulbarga and 54% of market share is captured by local milk vendors and

remaining 22% is by private vendors. The union is pioneer in satisfying the interest of the milk

producers, customers and the employees. Its basic structure is in there tier system, which is at

village level societies, districts with the representation of milk producer’s and controllability.

Table:

ACTIVITY PERFORMANCE

Milk procurement and transportation Dairy industry

Processing and manufacturing Procurement section

Marketing Sales division through parlors & agents

Technical input services Union training center

Training to farmers Veterinary section

Accounts section

Milk route division for procurement

2.7.8 Membership of Gulbarga Union:

Gulbarga co-operative milk union is run on co-operative principles. And it is a voluntary

association of member and is established on the “Anand Pattern”. The bye laws of Gulbarga Milk

Union govern its membership. It has provision for three types of members as shown below.

1. “A” class members: A class membership is open to registered milk producers co-

operative societies operating in the area.

2. “B” class members: B class membership is open only to state government.

3. Nominal Members: Nominal members are those having financial dealings with the union

as suppliers. Contractors selling agents, shall have to pay Rs.100 which is not refundable,

such members have no right to vote or to participate in the management meetings.


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2.7.9 Board of Directors:

Board of directors of union shall consists of 18 members of which 12 are elected presidents of

primary milk co operative societies (A class members) and the remaining 6 directors are

nominated as follows

1. One Director from Joint Register of co-op society.

2. One Director from National Dairy Development Board.

3. Two nominees from Karnataka Milk Federation.

4. One Director from Animal Husbandry.

5. One from Milk Diary and managing director as Director of milk union as

6. Special Ex-office Director

The director from “A” class members will be elected once in a three years. For discharging

various decisions making functions. The board of directors constitutes a number of subs –

committees involving officers of Gulbarga cooperative milk union.

2.7.10 Area of Operation of Gulbarga Cooperative Milk Union:

The Gulbarga Milk Union functions in the two districts, namely Gulbarga and Bidar as shown

below:

1. Gulbarga

2. Aland

3. Afzalpur

4. Chitapur

5. Chincholi

6. Jewargi

7. Sedam

8. Shahapur

9. Sholapur

10. Yadgir


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Bidar District covers 5 Talukas namely

1. Bidar

2. Bhalki

3. Basavakalyan

4. Aurad

5. Humnabad

Bidar district is a center of Milk procurement and Gulbarga district is a center for milk

marketing.

2.7.11 Objectives of Gulbarga Co-operative Milk Union:

As per the Bye laws of Gulbarga cooperative milk union the objectives of the union shall

beached out through activities conductive to the economic and socio economic development of

the milk producers by organizing effective production, processing and marketing of

commodities.

To attain the above objectives the union carries out.

1. Purchase, pool, process, manufacture, distribute and market commodities of the members

and others without effacing the increasing of the members.

2. Own or hold on lease of otherwise moveable or immovable properties and dispose of the

same.

3. Purchase or erect buildings, plant and machinery.

4. Organize new milk producers co-operative society and develop affiliated societies advice.

5. Organize, supervise affiliated societies and for this purpose fix and collect the supervision

charges with the permission of the register of cooperative society.

6. Undertake and exchange production of milk and growing fodder and agricultural

products.

7. Provide veterinary and artificial insemination services. And other technical inputs for

milk production, enhancement and other technical inputs for milk production,

enhancement and medicines for prophylactic and preventive purposes.

8. Own cattle for breeding programmes.


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9. Carry on Cooperative propaganda and impart among the members cooperative knowledge

and its application to business method.

10. Arrange for training to its employees and to its members.

11. Create Trusts and raise funds for the benefits of the employees of the

union, and its members.

12. Establish research and development association.

13. Organize and encourage savings scheme

14. Union shall take advice and guidance from Karnataka Milk Federation.

15. Undertake housing schemes to the diary employees.

2.7.12 Milk Collection of Union:

Gulbarga cooperative milk producers union is procuring milk from two sources.

1. From primary milk producers co-operative societies of the area.

2. From other unions (branch divisions) during slack seasons.

In the case of milk collection from area of operation, there have been 21 routes involving

252 societies at present. Milk routes are shown in the below mentioned table.

Sl. No. Year Routes Societies Involved

1 2003-2004 24 286

2 2004-2005 25 305

3 2005-2006 21 252

Source: Field Investigation

It is evident from the year 2005-2006 Gulbarga Dairy management have reduced milk routes

from 25 to 21 and number of societies are also reduced from 305 to 252.

It is a significant change that has been brought to reduce the loss of the union.

The Gulbarga Milk Union has made a decision to close off nonviable routes and discourage sick

societies, which do not function properly. This important decision is taken during 2005-2006.


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2.8 Marketing of Milk and Milk Products of Gulbarga Co-operative Milk

Producers Union, Gulbarga.

The dairy business in Gulbarga commenced from 1971 the Karnataka Government started dairy

business through its animal husbandry department sale was only limited to Gulbarga city. Diary

plant was inaugurated on 24.01.1971 the then plants capacity was 10,000 liters per day.

Subsequently, the importance of Diary has increased in the district in the meanwhile the

government. Handed over the district in the meanwhile the government. Handed over the dairy

business to the control of Karnataka milk federation.

The Karnataka milk federation in turn after managing the diary business from January 1985 to

01.08.1991 has handed over Gulbarga diary to Gulbarga Milk Union which was functioning

since 19th August, 1985. Since 1985 Gulbarga diary area was fixed in Gulbarga and Bidar district

Bidar district is a center for milk procurement and Gulbarga is a center for milk marketing.

Similarly Raichur is a procurement center and Bellary is a marketing center.

The total sale of milk and milk products of Gulbarga milk union is presented in table.

Sale of Milk by Gulbarga Co-operative Milk Producers Union Ltd, Gulbarga

Year Milk Sold (In Ltr) Amount Rs.

1 1,04,30,409 10,76,52,600

2 1,13,20,853 11,24,05,015

3 1,11,63,665 10,18,43,320

Source: Annual report of Gulbarga cooperative milk producer’s union ltd. Gulbarga.

Other products include 1) Sterilized milk 2) Butter Milk 3) Curds 4) Khava 5) Lassi and 6)

Srikand.

Ghee sale varied from Rs. 38.86 lakhs to 1,10-64 thousands average of Rs.73.46 thousands. Peda

sale varied from 168.77 to 550.15 averages of 312.24 thousands. Sales of skimmed milk powder

during 1995-96 was to the tune of Rs.326.50 thousands, sale of flavored milk was Rs.16.05 and

Butter sale was 3795.09 thousands and other products sale stood to 225.51 thousands.

It is concluded that, Gulbarga co-operative milk producers union ltd. Sold more milk products in

2005-06 i.e. Ghee, Skimmed Milk Powder, Butter and other products than 2004-05 and less milk

than in 2004-2005.


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2.8.1 Taluk Wise Co-operative Milk Societies:

Co-operative Milk Societies in Gulbarga and Bidar Districts

Gulbarga District:

Taluk Villages Villages having co-operative societies

Gulbarga 147 35

Aland 129 26

Chitapur 121 06

Yadgir 142 10

Sedam 111 --

Afzalpur 91 06

Chincholi 145 12

Shahapur 157 157 05

Shorapur 185 28

Jewargi 158 --

No. of Societies 128

Co-operative Milk Societies in Bidar District


Bidar 123 43

Bhalki 120 57


Basavakalyan 82 34

Aurad 149 66

Humnabad 113 58

Total societies 91 258

Source: Field Investigation

The present scene of Taluk wise milk cooperative societies reveal that most of the Talukas of

Bidar and except 2 Talukas of Gulbarga district have cooperative milk societies procuring the

milk. As per the record of Gulbarga cooperative milk producer’s union ltd, Gulbarga is having

128 societies, Bidar having 258 milk societies.


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The share of each taluk shows that Gulbarga taluk ranks at the top on Gulbarga district and

Humnabad ranks in cooperative societies in Bidar district.

In the year 2006 March average milk procured was 23306 KPD (Kgs per day) and average milk

sales during the year 2005-06 was 30767 liters per day.

Gulbarga – Cooperative Milk Producers Society’s Union Ltd, Gulbarga

The causes for the loss incurred by Gulbarga co-operative milk producer’s union ltd. Areas as

follows:

1. The increased rate of milk procurement

2. The increased rate fat content milk i.e., 4.5%

3. The excessive expenditure in the procurement trains potation of milk.

4. Lagging behind in the sale of milk or kid crease in the sale of milk.

5. Decreased allocation of Government grant.

6. Increasing administrative expenditure.

The union made a concerted effort in 2005-2006 and earned profit through the following steps.

1. Decreasing the milk rate during the harvest season by 0.50 paisa.

2. Decreasing the fact content from 4.5% to 3%

3. By reducing procurement transportation routes and minimized the expenses. In 2004-05

procurement transport expenditure was reduced by 16 lakhs.

4. By reducing veterinary expenditure

5. By reducing the administrative expenditure to the extent of Rs.4 lakhs.


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PRODUCT PROFILE:

1. TONED MILK: Karnataka’s most favorite

milk. Nandini toned milk. Pure milk containing

3.0% fat and 8.5% SNF. This is available in

500ml and 1ltr packs.

2. FULL CREAM MILK: Pure milk containing 6% fat

and 9% SNF. Rich, creamier and tastier milk. This is

available in 500ml and 1ltr packs.

3. HOMOGENISED MILK: Nandini

homogenized milk is pure milk which is

homogenized and pasteurized.

Consistent right through, it gives you

more cups of tea or coffee and is easily

digestible. This is available in 500ml packs.

4. CURDS: ‘Nandini’ curds are made out of pure

Milk. It is thick and delicious, giving all the

goodness of homemade curds. It is available in

200gms and 500gms packets.

5. GHEE: ‘Nandini’ ghee is made from pure butter. It is fresh and pure will a

delicious flavor. Hygienically manufactured and packed in a special pack to retain

the goodness of pure ghee. Shelf life of 6 months at

ambient temperature. This is available in 200ml,

500ml, 1-liter sachets, 5-liter tins and 15kg tins.

6. BUTTER: Rich smooth and delicious, ‘Nandini’ butter is made out of fresh

pasteurized Milk cream. Any preparations made from this will be a delicious treat.

It is available in 100gms (salted), 200gms and 500gms cartons both salted and

unsalted.


http://www.komul.coop/ourproducts.html






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7. PEDA: peda is sweetened heat desiccated product obtained from milk. It is rich in

Fat, proteins, lactose and minerals especially iron content. On an average 25kg peda

is produced and sold in units’ o 250gms box. Each box contains 10 pedas weighting

25gm each.

8. UHT MILK: It refers to ultra high temperature

heat-treated Milk. The concept of UHT milk is

absolute i.e. bacteria free besides retaining the

nutritional quality of milk. During the process,

milk is exposed to a temperature of 137ºc for 4

sec and immediately cooled a room

temperature packing it aseptically.

At present two types of UHT Milk are being produced one “Nandini Good Life”

with 3.6% fat and 8.5% SNF and another one is “Nandini Smart” with 1.5% fat and

9% SNF. Nandini Smart being low fat products

good for health conscious people. Both the milks can

be stored for at least 45 days at room temperature. It

needs no boiling before drinking on an average

25,000 of both the Milk is being sold per day.

9. MASALA BUTTERMILK: Masala buttermilk is

manufactured and sold in the summer season, especially

form month of March to July, the only period during which

it gets demand. On an overselling mounts to about

1000Ltrs. per day in 250ml sachets.



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Chapter-2

Organizational Structure:


Managing Director

Deputy Manager Dairy Manager Administration Staff

Assistant Manager

Veterinary Officer

Purchase Officers

Production& Quality Control

Officer

Technical Officers and Dairy Supervisor

Chairman

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1). Human resources department:

4.1 Human Resource Department Human resource is the most important part of any business

organization. The human resource can be defined as the total number of human employees

employed in any business organization. These days a lot of importance is being given to the

human resource of the business organizations. This is because the other resources like technology

and assets can be easily acquired by the competitors. But, the human resource cannot be acquired

that easily and can be used as a strategic advantage in the competition.

Uses of H. R. M:

Contribution to Team Performance

Works with others member in the team to accomplish departmental goals by way of:

Building Relationships.

Participating in Team efforts towards attainment of output providing inputs and sharing

ideas.

Appreciating / accepting the diversity of ideas.

Resolving conflicts.

Problem Solving Ability

Uses discipline process to define problems, identify root causes, and evaluate data,

reflected by numerical or financial information or through other variety of sources.

Generate alternative solutions and chooses the best solution.

Identify cause and effect relationship by considering the impact of decisions on other

areas.


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Contribution to Customer Satisfaction:

Providing prompt efficient and personalized service, serving clients with equal care and

attention, ensure that client needs are met or exceeded with each transaction.

Generating and evaluating customer options.

Detailing the customer plan.

Bringing the customer into the business.

People Orientation.

Valuing Diversity.

System Thinking.

Empowering Subordinates.

Team building Ability / Contribution to Team Performance.

Works effectively, with others, inside and outside the lines of formal authority to

accomplish organizational goals and to identify and resolve problems. Uses cross-

functional resources for optimal solutions and commitment.

Works well and co-operates with other to produce quality work, approaches issues and

problems through collaborative efforts, is openly involved and participates in the team

decisions.

Potential Identification:

For Potential Identification, the Assessor is required to rate the employee on various other

attributes, which will be relevant in identifying the potential for taking the higher responsibilities.


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The evaluation on these attributes will be in terms of Excellent, very Good, and Unsatisfactory

levels.

Integrity:

Fairness, equity, respect, dignity in treatment towards people.

Trust – worthiness.

Self – confidence.

Analytical Ability.

Cognitive Capacity (Ability to solve multi – faceted problems)

Anticipate potential roadblocks.

Creativity / Innovativeness.

Remains open – minded.

Recognizing the importance of continuous learning.

Communication Ability.

Use clear communication style to ensure messages are understood.

Effective use of communication for inters personal effectiveness.

Risk Behavior.

Confident in undertaking the challenging assignment.

Ability to visualize calculative risk in challenging assignment.

Confident in undertaking the challenging assignment.

Quality Consciousness.

Should be aware of all quality aspects.

Able to bench mark quality norms with high standards.

Adherence to the quality standards.


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4.1.1 Human Resource Management:

The total number of employees in the organization is 157 which include the following

Managing Director

Deputy Manger

Assistant Manager

Extension Officer

Accountants, superintendents

Technical Officers

Technicians

Accounting Assistants

Administration Assistants

Lab Assistants

Store Keepers

Purchasers

Helpers

Personal Management is concerned with the human resource of the enterprise. Before we define

personnel management. It is appropriate to understand the meaning of the term personnel. The

term is used in the broadest since as the human factor is the enterprise. It is not merely restricted

to the operative workers.

Personnel management may be defined as that area of management that deal with planning

organizing, directing and controlling the functions of procuring, developing and utilizing the

work force in the enterprise.

4.1.2 Human Resource Planning (Technical):

In accordance with the capacity of plant operation and production turnover, the required qualified

technical staff will be planned in executive level with the consent of the Register of Co-operative

societies, government of Karnataka. The necessity of the technical staff, their qualification,


47


experience etc will be fixed by the expert panel committee, after considering the technical

feasibility and changing circumstances etc. The expert panel committee comprises of union

president and representative from KMF central office, NDDB, animal husbandry department.

4.1.3 Recruitment / Selection / Induction Methods:

Recruitment will be done for the sanctioned post by Government of Karnataka through

publication in the leading news papers, by conducting competitive exams and selection through

interviews.

Recruitment within the department is subject to availability of post by giving opportunity to the

qualified experienced candidates within the department through competitive examination and

selection through interviews.

The expert panel committee comprising of Union President and representative of KMF central

office, NDDB, animal husbandry, department will conduct interview and after considering

eligibility criteria and fitness, suitable candidates will be inducted for employment as per service

rules of the organization.

4.1.4 Employee Interview – Types:

Expert panel committee comprising of union president and representatives of KMF central office,

NDDB, animal husbandry department will do the task of interview for open and inside

recruitment process. The same committee will review and timely recommend for the periodical

salary benefits, promotions, time bond advancement etc.

Type: This interview is of face to face.

Labor Turnover in Last 5 Years:

Apart from the recruited staff, due to necessity, the contract labors were also taken for the

production activities.

The staff turnover from 1993-2006 is around 24. The contract laborers are engaged for the

unskilled work.


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4.1.5 Welfare Provisions:

EPF:

Organization employees are covered under employees provident fund act.

EPF amount deducted from employee 12% and employer contribution 12% out of which 8.33%

goes to EPF pension fund and remaining 3.67% goes to employee account, EPF deposit is paying

8.5% interest on both contribution amount calculated at 9.5% interest. This is fixed on the basis

of inflation rates of the country. This account can be withdrawn by the member on retirement,

Marriage of daughter, son and in case of medical expenditure.

ESI:

Organization employees are covered under the employee state insurance act, whose salary is less

than Rs 10000/- per month, the contribution towards ESI from employee is 1.75% and employer

contribution is 4.75% . The employees covered under this act will get all the medical treatments

on accident and also regular treatment of his/her family members.

Bonus Act:

Employees are covered under the payment of bonus act, minimum bonus eligible members are

paid annually.

Gratuity:

Employees are covered under the payment of gratuity act, employees group linked insurance, and

employee’s death linked insurance.

Other Benefits:

Other benefits are provided by employer like, House and Building advance interest subsidiary,

Concessional rate from purchase of milk, and yearly half Kg ghee is given two times.


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4.1.9 Performance Appraisal Methods Followed:

The performance of the job entrusted in various sections is being reviewed once in 6 months

confidentially. The performance is appraised based on the judgment on the following issues.

Contribution rendered to organization

Taking qualitative making pertaining to general matters.

Working hard with devotion to the organization.

Concentration on the entrusted job and interest in rendering service to the organization.

Expatriation in terms of technical requirements with regard to organization.

Capacity in giving decision

Taking responsibilities, decision making

Speedy disposal of work entrusted

Honesty and sincerity to organization

Dependence

Conduct and character

Asked on the above information the performance on the job will be reviewed and by giving

general report as good or fair or average.

4.1.10 Retirement Benefits:

They are getting contributions from both employer and employees.

Pension benefits from PF authority

Gratuity benefits

Employee’s group insurance scheme contribution among along with interest.

4.1.11 Employee Record Keeping (Time Keeping):

Recording employees both in and out timings

180 minutes per month allowed as a grace time. If an employee comes more than 180

minutes late his salary will be deducted according to his late hours.

Electric punching machine is installed. It can be handled manually also.


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Punching cards is maintained, recording employees scroll number and displayed

accordingly.

4.1.12 Wage Structure + Incentive Schemes:

Pay scale is fixed in accordance with the rules of the government of Karnataka. Comprising of

Basic + DA and other incentives, such as:

Attendance hours will be given for employees who come regularly in a month without

any absence. Rs.30/- will be given as attendance hours.

If employee will work more than 8 hours. O.T. allowances (single wage) will be given to

the subordinate staff.

For technical officers if they come on second Saturday depending upon necessity they

will be given O.T. allowance (single wage).

If employees come on holidays and weekly holidays they will be given OT allowance

(single wage) for 8 hours.

Every year uniform will be given to the employees

4.1.13 Job Evaluation Methods:

Job chart will be given to the employees according to their eligibility and responsibility and is

fixed to accomplish the assigned work. Performance will be evaluated based on the job chart and

disciplinary action will be taken for any lapses.

For lower level employees (helpers – technical in plant) they will be assigned particular work on

routine day to day basis.

4.1.14 Employee Motivation:

With the provisions of following incentive

Attendance Bonus

Special Pay

The employees are motivated to discharge more work. Rewards are given to the outstanding

technical employees.


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4.2 Marketing Department:

4.2.1 Departmental Structure

The term marketing has been defined differently by different authors. However all the definition

may be classified in two types viz., product orientation came to be recognized because the

manufacturing concern keep in mind either by product of the consumer.

4.2.2 Product Lines:

1. There are two types of milk

Toned milk. It contains 3% Fat, 8.5% SNF (solid not fat) 65% half litre packets,

35% one liter packets.

Standardized Milk. It contains 4.5% fat, 8.5% SNF, and 100% 500 ml packets.

2. Ghee

200 ml and 500 ml packets

3. Curd


Marketing Department

Manager (Dairy)

Deputy Manager (Marketing)

Marketing Superintendent

Marketing Assistant Salesman Marketing Assistant

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100% 500ml packets

4. Pedal

250 Gm packet

5. Jamoon Mix

100 Gm packet

6. Badam Powder :

100 Gm packet

7. Miltone sterilized flavored milk bottles

4.2.3 Package Design:

Milk is being packed in sachets of different colors. Blue color is used for toned milk. They are

packing 65% half liter packets and 35% one liter packets.

Red color sachets are used for standardized milk. They are using 100% 500ml packets. Ghee is

being packed in sachets. The color of sachets is yellow. They are packing 200ml and 500ml

packets. 15 kg. Ting for bulk selling flavored milk is in 250ml and bottles.

Peda is being packed in 250 grams blue colored cartons.

Brand policy: Uniform brand policy all over Karnataka i.e. Nandini.

Distributors – Policy, terms/conditions:

They are not selling their milk and milk products through distributions. They are selling only

through agents.

4.2.4 Price Policy methods:

They are following cost of production method. According to raw material price, agent’s

commission, electricity bill, expenditure, variable and fixed overheads transportation, the price

will be fixed.

4.2.5 Pricing Strategy:

According to quality of the product and after considering all fixed and variable expenses, the

final price is arrived at.


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Details on Sales Promotion undertaken in last 3 years:

School children programmes.

Mahila Mandal programmes.

Qualification testing programmes.

Customer’s Dairy visit.

Telephone contacts with customers.

Door-to-Door consumer awareness programmes.

Hoarding, pole advertisements, wall paintings, supply of sign boards to agents, glow

signboard, flute boards and supplying of Nandini milk carry bags to agents.

4.2.6 New Product Development – Approach Procedure:

They are planning to install ice cream plant for the production of ice cream. Considering the

market survey, market situation, price availability of competitor’s milk availability and

considering the distribution strategy they are going to launch a new product. The introduction of

new product will be published in the newspapers, TVs, picture theaters to enlighten customers.

4.2.7 Sales Budget:

For 2005 – 2006 the expected budget is 10,00,000/- per annum towards sales promotion and

advertisement expenses such as hoarding, glow signboards, pamphlets flute boards, wall

paintings etc.

4.2.8 Training to Sales Staff:

For training purpose Field Staff National Dairy Development Board at Erode, Tamilnadu and

KMF a Central Office – Bangalore to impart necessary training to their sales staff.

4.2.9 Remuneration to Sales Staff

Against fixed salary as per Government rules the sales staff is working.

4.2.10 Invoice Procedure:

Main dairy sales (milk and milk products) are made on delivery channel, compiled to trip sheet.

The cash will be collected on basis of trip sheet. Scrap items are sold on invoice method on the

payment of cash on the spot.


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4.2.11 Billing:

Regarding milk sales the salesmen collect the amount from agents as per the trip sheet and same

is remitted to main Dairy cash reception. The trip sheet is prepared on the bases of Delivery

challan.

4.2.12 Milk procurement:

Against suppliers of milk from villagers based on the fat and SNF the rate per kg of milk will be

arrived at and detail billing will be done on this basis and sent to the villages along with the

payment.

4.2.13 Methods of selling:

Usually they are selling through agents. In some cases they are taking money in advanced and

giving door delivery.

4.3 Production department:

Managing Director


Quality control in chargePlant in charge Engineering in charge

Technical Officer Technical Lab Asst Dairy Supervisor

Shift Officer Second Division Asst Mechanical Asst

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4.3.1 Inventory / Replenishment Policies:

Inventory levels for the essential materials such as pouch film, plant cleaning chemicals,

mechanical spare and lab testing materials etc were maintained up to the point of reordering

level. Keeping the procurement and supplies of milk without any dissipation. If the inventory is

not maintained for such material and given up to danger level there will be every chance of

hampering the process of milk procurement and distribution.

Replenishment policies were adopted by following purchase procedures such as by making

enquires, calling quotations and giving order for purchases. In case of exigencies the required

material will be drawn by their nearest sister concern. Further in accordance with the purchase

orders of central purchase committee of KMF central office, the required material will be

purchased. Sometimes consolations will be made with the CPC (Central Process Committee) of

KMF office to procure required material.

4.3.2 Milk Processing Unit:


MILK TANKER

WEIGHING M/C

DUMP STORAGE

MILK CHILLER1

2 MILK CHILLER

S1 30000 LTRS

S2 35000 LTRS

STORAGE TANK

2

2

2HT/ST

1

STORAGE T1 5000 LTR

STORAGE T2 3000 LTR

LTR PACK

1 LTR PACK

Milk Pump 9hp

Non Return Valve

1

2

HT/ST Heat Exchanger Unit Capacity Pasteuriser 10klph

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TEMP 860c

COOLING TEMP 40C

4.3.3 Production Plant:

Milk production contain following units:

Milk Tankers:

The milk is collected from different societies and the respective chilling center the brought to

main plant for further processing of milk through the tankers as per the time allotted.

Weighing Machine:

The milk stored in the can of each 40 capacity is dumped to the weighing machine through

conveyor. At the same time sample of milk is taken from each can of different societies for

testing fat and SNF%. Then results are documented under total quantity of milk received. This

milk is called raw milk (unpasteurized).

Dump Storage:

Milk from the weighing machine is collected in the dump storage having a capacity of 1800 liters

for temporary storage. From this storage milk is pumped to a chilling unit for primary stage of

pasteurization.

Plate Heat Exchanger:

It is primary unit of chilling in which raw milk is chilled to a temperature of 2.50C without

heating.

4.3.4 HST2:

Raw milk from chiller is made to enter into HST2 for a temporary storage which is used for

compensating milk distribution inside the plant during milk processing. This storage tank has a

capacity of 15000 liters and it is well detected.

4.3.5 S1, S2, HST1:

These are the storage tanks having a main supply from the chiller having a storage capacity of

30000 each and 15000 its respectively the milk is transformed from chiller these units by


47


controlling the valves so that milk is distributed uniformly and to maintain uniform prod4uction

of milk and its products.

4.3.6 HT/ST Plant:

This is a core unit of milk process plant containing a consecutive heating and cooling and inlet

for raw milk. In this unit raw milk is converted into pasteurized milk.

When the raw milk enters into this chamber it is first heated to 760C so that all the inflectional

bacteria’s present in the milk is destroyed. Then another cycle, milk enters into a chilling

chamber in a same heat exchanger so that, milk is allowed to cool up to a temperature of 40C

such that there will not be any bacterial growth under this temperature. This milk is called

pasteurized milk`and free from all pathogenic infection. It can be preserved fro long time under

packing.

4.3.7 T1 & T2 Storage Units:

These are the storage for packing unit. The pasteurized milk from HTST plant is made to enter

into these storage units having capacity 5000 liters. Each these storages have proper control for

packing machines.

4.3.8 Packing Unit:

This unit includes a pouching machines and a storage chamber. The machines are designed in

such a way that there is an arrangement fro packing ½ liters and 1 liter, ¼ liters pouches for milk

and its products.

4.4 Milk Products:

They are preparing two types of milk.

1. Toned Milk: It contains 3.0% fat and 8.5% SNF. For this milk if the fat % is less than

3.0% they add powder to cream separate to reduce the fat %

2. Standardized Milk: It contains 4.5% fat and 8.5% SNF. For this also they are following

the same method which is following for toned milk. The excess cream will be sent to

ghee and Peda section.


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Then the processed milk will be sent to the package section. The milk will be packed in 500ml

and 1000ml sachets them it will sent to the cold storage. From that it will be sent to the different

marketing areas.

Ghee:

A taste of purity. Nandini Ghee made from pure butter. It is fresh and pure with a delicious

flavor. Hygienically manufactured and packed in a special pack to retain the goodness of pure

ghee.

This production plant is an integrated plant of the earlier one consists of following units. Cream

separator, pasteurized from HTST plant before going to storage T1 & T2 it is made to pass

through cream separator to remove excess fat contained. Then cream is separated from the milk it

is further converted into Ghee.

Ghee Boiler:

It is having capacity of converting butter 360 kg into Ghee at temperature 1200C. From Ghee

boiler Ghee is entered into clarifier for filtration and stored in 40 kgs, and also stored in settling

tank have 1300-1400 kgs capacity.

Packing Unit:

Ghee from storage tank is made to enter into pouching machine packet at a standard of ½ kg and

1 kg and it is preserved under cold temperature.

Toned Milk:

Karnataka’s most favorite milk Nandini Toned fresh and pure milk containing 3.0% fat and 8.5

% SNF. Available in 500 ml and 1 liters packs.

Butter Milk:

Nandini spiced butter milk is a refreshing health drink. It is made from quality curds and blended

with fresh green chilies, green coriander leaves, asafetida and fresh ginger, Nandini spiced butter

milk promotes health and easy digestion.


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QUALITY CONTROL DEPARTMENT:


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4.3 Quality Control department:

The Quality control Division at the Apex Federation aims at not only controlling the quality but

also development of Quality Standards from time to time for milk & milk Products manufactured

under the Brand Name “NANDINI” All these products pass through quality standards. The

standers are not only mandatory or statutory but also meet the latest Quality Parameters.

Consumer’s complaints also get investigated at the apex level quality Control Division. As a part

of on – the spot inspections of milk plants, the Central Quality Division has its own Quality

Assurance officers stationed at the Dairies of milk Unions to assess the quality of milk and milk

products manufactured. They too are responsible for inspecting the quality of raw – material

used, processing parameters followed. And quality of final products in their work place.

The department has a vital role in this organization. On the basis of quality of milk the rate is

fixed. The type of milk and its composition factors decides the quality of milk. The milk

composition includes fat and SNF percentage. The other factors like atmospheric condition and

the preservation period of milk influence the quality of milk and its product.

4.4.1 Inspection Procedure: For Raw Milk:

1. COB testing (clot on boiling):

Purpose: To test the acidity in the milk

Procedure: First they take 5ml milk in test tubes. Then they heat it on spirit lamp to find out the

acidity. The acidity will be measured through filtration test. It the acidity is more than 0.18 it will

clot during boiling.

Adulteration Test: For raw milk:

Purpose: To check the adulteration of milk


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Procedure: The good mild contains standard lactometer reading of more than 28.0 – 31.0 if the

lactometer reading show below 280 then it will be very clear that the milk is added is with water.

In order to increase the lactometer reading to more than 280 the milk is adulterated by adding

salt, sugar, caustic soda, and uria specific titrating testing will be done to identify such

adulterated milk in the laboratory.

4.4.2 Quality – Standard etc:

The quality of the incoming milk will be tested in sophisticated laboratories established at area

chilling centers and at main dairy. The substandard, milk will be rejected at the time of reception.

Milk supplies to the customers will be at standardized fat and SNF which are as follows.

For toned milk – 3% fat, 8.5% SNF

For standard milk – 4.5% fat, 8.5% SNF

One then the milk will be accepted for supply.

Standards:

ISI standards, Agmark standards and KMF standards for milk and milk products and packing

material.

Routing and Scheduling:

1. Raw milk from producers to area milk chilling centers.

2. From milk chilling centers to main dairy.

3. The milk will be stored in dump tank by maintaining temperature and quality.

4. According to requirement the milk will be sent from dump tank to processing unit.

5. From processing unit milk will go to packing section after pasteurization in accordance

with the standard fat and SNF.

6. The excess fat and SNF over the standers i.e. cream will sent to Ghee and Peda section.

7. The packed milk will be stored in cold storage rooms and finally milk and milk products

will be handed over to finished goods sections.

Various Techniques used:


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They are using techniques like milk chilling, standardization, pasteurization, cream separation,

homogenization, Ghee classification, CIP (Clean in plant entire processing unit).

Machinery equipment maintenance:

There are two types systems, in maintenance of machines and equipments.

Periodical Maintenance:

According to the working hours covered by the individual equipments as per the manufactures

recommendations replacement of filters, lubricants and cleaning will be undertaken, as per the

fixed schedule to monitor the smooth running of equipment.

Breakdown Maintenance:

Whenever the equipments performance is found to be inefficient due to the breakdown of any

parts of the equipment to make it good maintenance work will be taken up.

Note:

Some of the equipments are maintained by giving the AMC (Annual Maintenance Contact) to the

manufacturers, like power generating sets and weighing machine.

Safety Standards:

In the defreeze room siren has been fixed to call during closing of the store doors

unknowingly.

Necessary guards are fixed to the all the flywheels of the moving equipment.

In front of all the electric panel boards shock proof rubber matting are provided.

In H.T. substation and in the generator room, fire fighting equipment, electrical shock treatment,

manual chart and first aid box are provided as per the electrical standard of electrical inspectorate

of Gulbarga


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And the different tests to quality consciousness. The different tests are as follows.

1. Orgnolaptic test

2. Keeping quality test.

3. MBRT test

4. Acidity test.

5. Fat and snf percentage test.

ORGNOLAPTIC TEST:

This test is carried out for raw milk to study the bacterial infection on the milk in other words, it

is a visual observation test done by sensing the smell. Taste and foam present in the milk. If

above observation are not within the desired quality level the milk is rejected before subjecting to

further process.

As per study analysis raw milk should be chilled within six hours after milking Otherwise there is

chance of bacterial growth which increases acidity percentage in the milk this doesn’t favor the

further milk processing.

KEEPING QUALITY TEST:

This test is carried out for pasteurized milk. Here packed milk is kept under observation from

time to dispatch to time of customer reach. The milk is tested for temperature and acidity

percentage to their optimal limits. This test is carried out fore every hour to avoid customer

complaint as well as to take precaution for reservation of milk. During the course of processing.

The temperature and acidity data are systematically tabulated on record book different type’s

milk such as toned milk and standard milk.

MBRT TEST:

It is also called methyline blue reduction test. It is carried out for pasteurized milk for analysis of

bacterial of bacterial contamination present in the milk. In some times due to cross contamination

of machines and heat exchange there is chance of presence of bacteria in pasteurized milk. To

overcome from this hurdle MBRT test is carried out.

In this test quality of milk is judged on the basis of time span taken by indicator to change its

color from blue to calories when methylene (indicator) is added to the test quantity of milk.

Following are some observation done by this test on different type of milk.

G.T INSTUTITE OF MANAGEMENT STUDIES AND RESEARCH Type of Milk Color change Time taken

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CONCLUSION:

As from above observation time taken to change its color form blue to colorless is more in

pasteurized milk hence, the quality of pasteurized milk up to the standard level. On other hand it

indicates percentage of bacterial contamination is comparative less in pasteurized milk as

compared to other two types of milk.

ACIDITY MILK:

This is a chemical analysis test carried out on pasteurized and chilled milk using phenolphthalein

indicator, taking 10 ml test quantity of milk citrated against 0.1 normal NaOH sol. and

phenolphthalein indictor. Observation is made color of the indicator changes from colorless to

pink. This is a confirmation test for acidity in milk by using chemical formula acidity percentage

in milk is calculated. If acidity limits are within 0.1356 then 0.156 then it is good quality milk if

it exceeds limit the milk is termed as spoiled milk.

FAT AND SNF TEST:

This test is carried out for all type of milk i.e. raw milk. Chilled milk and pasteurized milk. The

percentage of fat is calculated by electronic testing machine and SNF percentage by lactometer in

quality labs. Following observation shows percentage of fat & SNF.

Milk Type Fat % SNF %

Cow milk 3 to 4.5 8.5

Buffalo milk 6 to 10 9

Standardized milk 4.5 8.5

Toned milk 3 8.5


Raw milk Blue to colorless 10 min

Chilled milk Blue to colorless 1 to 3 Hrs.

Pasteurized Blue to colorless 1 to 5 Hrs.

Milk

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4.5 Purchase department:

Stores Department:

It is located very near to plant section. The entire purchase and stores department is controlled

by purchase officer. All the materials comprising of its essentially is stored systematically. The

stock position of essential materials is updated every day and displayed on Notice Board for

ready reference. The materials are stored in a manner which can be identified very easily. The

materials are bifurcated according to the daily requirement, considering it’s essentially. There are

7 rooms where all the materials are stored separately.

4.5.1Nature of Purchase Policy:

They are purchasing major materials like ELPD film; nitric acid etc on credit basis and few

materials are on advance payment and lesser value items on cash basis depending upon the

circumstances.

4.5.2 Policy:

Central purchases committee in KMF central office will issue the orders to various portions on

behalf of their organization as regards to major materials such as ELDP film, caustic soda, liquid

detergent, nitric acid, veterinary drugs etc. The CPC orders stands for all the federation union of

Karnataka which is finalized on yearly rate contract. For consumable materials, mechanical

spare, stationers etc will be purchased directly by the district union by following purchase

formalities.

4.5.3 Credit System Followed:

The material payment on credit basis is normally released within a span of 20-30 days.

For few materials the payment will be released initially, 90% within 30 days and remaining 10%

after obtaining quality report.


47


4.5.4 Method of Purchasing:

1. For certain things key directly go to manufacturers.

2. For certain things they directly go for floating the enquiries for the concern suppliers.

3. In some cases they directly go for government agencies.

4.5.5 Purchase Procedure:

By making enquiries, obtaining quotations, by receiving quotations, by purchase committee after

giving due consideration about the rates quality, suitability of required material. Then issuing

purchase orders to the suitable party in accordance with the terms/conditions of the organization.

4.5.6 Issuing of Material – Procedure:

The materials are issued according to the requirement of various sections against the indent

authorized by the superior officers.

4.5.7 Procedure:

They receive the purchased materials from various suppliers or from government agencies or

from manufacturers and they count it and they enter it in purchase register. Then they enter in

stock register. They issue it to various sections where they are required. These issues will be

made on indent basis. In the indent the requirement of the materials section for which it is

required along with the signature of the indenter, authorization by superiors is essentially found.

Types of items purchased:

1. Packing materials like ELDP film, cartoons, the 15 kg Ghee tins.

2. Plan cleaning chemicals like caustic soda, liquid detergent nitric acid.

3. Equipment and spare purchases.

4. Daily consumable and stationary items.

5. Veterinary medicine.

6. Dairy cooperative societies milk testing equipments and chemicals and related books.


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4.6 Stores Department

4.6.1 Stores management:

PURPOSE OF STORES:

Stores play a vital role in the operations of a company. It is in direct touch with the user

department in its day – to – day activates. It is having functions of stores.

1. To receive raw materials. Components, tools, equipments.

2. To provide adequate and proper storage.

3. To meet the demands of the consuming departments.

4. To minimize obsolescence, surplus and scrap through proper codification preservation

and handling.

5. To highlight stock accumulation, discrepancies and abnormal consumption and – effect

control measures.

6. To ensure good housekeeping so that material handling, material preservation. Stocking,

receipt and issue can be done adequately.

7. To assist in verification and provide supporting information for effective purchase action

In India, owing to stiff supply positions. 4 to 6 months’ inventories are not uncommon and, in

fact for certain imported items. It could be as high as 24 month’s stock. In this context. Stored

management assumes greater importance.

4.6.2 PURCHASE SYSTEMS:

INTRODUCTION:

In organizations, depending on the size and nature of operation, the quantum of purchase varies

anywhere between thousands of rupees and hundreds of crores of rupees. We can classify the

system in the following manner.

1. Pre – purchase system.


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2. Ordering system.

3. Post – purchase system.

The salient features in features in each of the systems mentioned are as follows.

1. PRE – PURCHASE SYSTEM:

Initiating the purchase through requisitions, requirements programmers, selection of suppliers,

obtaining quotations and evaluating them, are broadly the pre – purchase activities.

(a) Requisitions. The department concerned, in need of a material, usually present a competed

requisition made by any one in the concerned department. However, it has to be countersigned by

a senior officer. In any organization only a limited number of officers are empowered to

countersign the requisitions as it amounts to authorization of the expenditure. Purchase

department must have the list of such officers so as to check the validity of the purchase

requisition normally; there is a delegation of authority in authorizing a requisition. This is

expressed in terms of the financial limits up to which an officer can authorize a requisition

This form contains:

a. Department requiring the material.

b. Requisition reference number.

(b) Traveling requisitions: This document is widely used for requisitioning items that are

required frequently in bulk quantities over a long period. During each stage a purchase order is

initiated. Factors such as specification and supplier details are write permanently and provisions

for entering date, quantity required names of requisitioned and authorizer are available. This

reduces paper work and eases the operation. Standardized clerical system can be devised and the

bulk of the work can thus be efficiently handled. For repeat ordering this is the ideal procedure.

This form consists of;

a. Material description

b. Part number

c. Annual usage.

d. Name of the supplier.


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(c) Enquiries. Many organizations often invite suppliers to quote rates for supply of materials.

For this purpose a standard format is used which is similar to a purchase order in an aspects

except that word such as “this is only a request for quotation” or “this is not a purchase order” are

printed so as to ensure that the supplier does not consist the request for quotation as a firm order.

2. ORDERING SYSTEM:

Having selected the supplier and the rates agreed, the buyer places the purchase order on the

supplier, expressing the term and conditions. The purchase order once accepted becomes a

binding contract. The details that are normally furnished in a purchase order are listed below.

a. Purchase order reference number (which will be quoted in all subsequent follow – up

measures pertaining to that order).

b. Description of the materials and detailed specification.

c. Quality required and delivery schedule.

d. Price and discounts.

e. Shipping instructions.

f. Location where the materials are to be shipped (usually the name and address if the

buyer).

g. Signature of the materials manager who can authorize the purchase order, and

h. Detailed terms and conditions (as a common practice these are printed at the back of the

purchase order).

2. Post – purchase System:

This includes follow – up procedures, receipt and checking invoices.

(a) Follow – up procedures: Follow – up implies commitment of time and money and

therefore it has to be selective. Certain priorities could be established for follow – up.

Only critical items require continuous follow – up. Depending upon the movement.

Items can be classified into fast moving and slow moving. For fast moving items,

follow – up can be initiated whenever the stock level depletes to one month’s

consumption For slow moving items also similar norms can be established A few

organization also have decentralized inspection facilities for on – the spot inspection

and acceptance. Purchase Order (P.O) status reports are generally prepared so that


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selective follow – up is ensured. The status report can be printed part number wise or

supplier wise for suitable follow – up.

(b) Receipt: A systematic record of the consignments received, carrier details and

descriptions are to be maintained in chronological sequence, to help in quick

identifications of materials so that inspection can be arranged prior to acceptance.

Many organizations have a separate central receiving section for this purpose. As

mentioned earlier. A copy of the purchase order is sent to the central receiving section

for reconciling purposes.

(c) Invoice Checking: The supplier normally sends the invoice for the materials supplied

for payment. It is essential that this invoice is matched against the receipt details,

quantity accepted and rejected so that payment’s can be made within the

Discount period or provisions be made which will keep in funds planning. Normally invoices are

sent to the buyer’s finance and materials management department is necessary.

4.7 Finance Department:

4.7.1 Departmental Structure:

Managing Director

Asst. Manager (Finance)

Superintendent A/C

Methods of Depreciation followed any change in method in the last 5year:

They are following straight-line method on Written. Down Value basis of depreciation. They are

charging different depreciation percentage for different assets according specify rules.


A/C Asst Grade 2 A/C Asst Grade 1

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No changes in the rates and methods for last 5years.

Source of Capital – structure:

Share capital raised from members of DCS (Dairy Co – operative Societies) i.e. Village Dairy Co

– operative society).

The organization is borrowing working capital for the operation of Dairy activities form KMF

Central Office and from Co – operative Banks i.e., DCC Bank Gulbarga and Bidar, Krishna

Grameena Bank, Gulbarga, refundable along with interest. The working capital is drawn mainly

for the payment towards cost of raw milk to village level DCS members.

4.7.2 Cash Management:

As organization business is daily consumable and essential products i.e., milk, etc., total turnover

is on cash basis and Daily dairy sales proceeds deposited to banks and making payment on

priority basis, by ascertaining priority payment such as payments to milk products, vehicle

contractors, power and electricity, ELDP film etc.

4.7.3 Credit Management:

Organization is selling its products on credit basis to the Government institutions like General

Hospital, air Force station Remand Home etc on monthly billing basis.

4.7.4 Risk Policy:

The organization is selling its milk products on cash basis, except Government Institutions, under

any circumstances credit facility will not be extended to any to any of the customers. Hence,

organization is operating its sales and other activities with no risk policy.


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4.8 Inventory Control and Management:

4.8.1Inventory:

In Gulbarga Dairy the inventory comprises of

a. Raw material (raw material)

b. Spare parts and components

c. Factory supplies (Liquid detergent, caustic soda, nitric acid etc)

d. Packing material (ELDPE film, corrugated boxes etc).

These items may be either direct or indirect materials and being biggest cost factor, afford a wide

scope for saving in costs.

4.8.2 Inventory Control:

It is a systematic control over purchasing, storing and consumption of materials so as to maintain

a regular and timely supply of materials at the same time avoiding over strucking. It is being

achieved in the dairy by systematically organizing the procedures and activities relating by

Purchasing

Properly storing

Issuing as per requirements

Keeping record on consumption of material

Systematic overall record keeping

4.8.3 Inventory Classification:

In Gulbarga Dairy, the inventories are classified according to its requirement based on its

essentiality to avoid dislocation of production process and over strutting of materials.

Category 1:


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Comprises of consumption materials which is needed for day to day requirements such as cattle

feed LDPE film, caustic, soda, nitric acid, lab testing chemicals fuel and lubricants to plant and

machinery, general stores, etc.

Category 2:

Comprises of mechanical spares, electrical stores, lab testing equipments, vehicles spare etc.

Category 3:

Comprises of stationeries, DCS materials such as aluminum cans, can lids, centrifuge machine

for milk testing etc.

The inventory classification is made according to its day-to-day consumption. Its essentiality,

value of the material, storage capacity etc is to ensure continuous production process as Dairy

comes under the purview of essential and commodities Act.

Inventory Management:

In the dairy, inventory is beginning managed systematically giving importance to the requirement

of materials to keep continuous production process to avoid over strucking of materials. These

inventories are stored in a systematical manner and maintained with regular and timely supply of

materials. The process of purchasing, reception and inspection of material storing and issuing and

consumption of materials, record keeping are systematically organized in the Dairy. All these

processes are prejudiced on routine basis by the representatives of chartered accountants and

monthly as well as yearly consumption of overall materials are being interpreted in the financial

statements which will be certified by the Government Co – operatives Auditors. The

responsibility of inventory management is being fixed by purchase Officer, purchase

4.8. Control: 4 Objective of Inventory:

Ensuring timely availability of right type of keep the continues production process.

Avoiding overstocking of materials to ensure minimum capital investment by removing

unnecessary blockage of funds.


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Economy in buying and controlling expenses by organizing ideal order quantity of each

item.

Prevention of leakage, deterioration of waste material by arranging systematic, suitable

storage facilities by fixing allowable waste percentage.

4.8.5 Material Requirements Planning:

According to requirement the material for ensuring continuous systematic, suitable storage

facilities by fixing allowable waste percentage.

Based on the requirement and nature of material

Value of the materials

Availability and sources of materials

Time taken for the materials reach to the dairy

Means of transportation and its cost

Storage capacity and facilities

4.9 Sales and Distribution Department:

4.9.1 Introduction:

The organization has covered market area comprising of totally 800000 of population covering

both Gulbarga and Bidar cities. It acquired a giant share in the field of marketing and built up its

Nandini brand name so widely. It is meeting the sales demand at present ranging from 29000 to

35000 LPD. There are totally 300 milk agents appointed under the channel of 6 milk distribution

routes in Gulbarga city and 5 milk distribution routes which covers outside Gulbarga i.e.

Shahpur, Bidar, etc. In order to deal with the marketing operations so effectively and efficiently

the organization has put more qualified, experienced, and market oriented sales staff. Presently

there are 22 sales staff engaged in dealing with the marketing operations. The Deputy manager,

marketing Superintendent, marketing Assistant and marketing Salesmen are working hard to

achieve the targeted goals and under the consultation advice and suggestions of managing

Director.

4.9.2 Sales Management:


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In time supply of milk

Available of milk to customers

Getting feed back of competitors

Motivating agents to sell more milk to providing the advertisement materials and

conducting agents and customers meetings

Customers attraction

Attending customers, complaints immediately

Their ultimate objective is to satisfy the customers by providing good quality of milk,

service and availability etc.

4.9.3 Function of Sales Department:

Dispatching of milk route vehicle in time

Collecting indent from agents and salesmen as per the intend milk supplies.

Attending replacement of milk and milk products

Attending agents and consumers complaints.

4.9.4 Duty of Sales Manager:

At the time of dispatch of milk a surprise checkup is conducted.

Attending the grievances of milk agents by route survey.

Giving concentration on sale of milk by competitors.

Replacement of milk and milk producers in case of any complaints.

Keeping the sale of milk and milk products at the optimum level.

Giving reasons to higher officers regarding reduction of milk and milk products sales.

Conducting sales promotion activities, consumer awareness programmes etc.

Reporting to higher officers any desecripenses noticed in the marketing of sale of milk

and products.

Conducting periodical Salesmen meetings in the presence of higher authorities.

Review of milk sales and forecasting future strategy to be adopted.

4.9.5 Duty of Salesmen:

Supply of milk to agents point in time as per their indent.

Collection milk and milk product indent from each and every agent, same to be intimated

to marketing section.


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Collection of milk and milk product sales amount from the agents, same will be remitted

in the main Dairy.

Achievement of monthly target.

4.9.6 The selling concept Vs Marketing Concept:

Selling Concept:

For special demand, supplying door to door to customers and agents

For marriage, supplying milk to marriage function hall

The ultimate objective of selling concept is creating availability of milk in the market

near to customer

Selling the product which the consumer would prefer.

Marketing Concept:

To be market leader

Supplying good quality products

As per the needs of consumers milk and milk products will be supplied

Considering the competitors weakness, these will be converted into their strength.

The ultimate objective of marketing concept is satisfying the customer and to be a market

leader.

Sales Forecasting:

They are doing forecasting through,

Forecasting of monsoon

By getting day – to – day market feed ack.

4.9.7 Marketing Mix:

Price:

On cost of production they are going to fix the price of milk and milk products.


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Place:

1. Based on customers they are appointing a sales agent point.

2. Through agents and subagents and hawkers delivery will be supplied.

3. Appointing refrigerator shops on a day counters to sell milk around the clock for creating

availability of milk in the market.

Product:

As per the specification of KMF central office product will be launched into the market and after

considering the competitors and the consumer point of view the product design will be made.

Promotion:

Conducting agent motivation programmes, consumer’s awareness programmes, quality

awareness, programmes, telephone and hoarding, role advertisements, glow sign boards etc.

4.9.8 Channel of Distribution:

Milk Dairy Agent Door Delivery Boy Customer

Or

Milk Dairy Agent Customer

Or

Milk Dairy Agent Subagent Customer

Or

Milk Dairy Day Counters/Refrigerators shop Customer

4.9.9 Advertising:

They are advertising about their milk and milk products through picture slidings, hoardings,

publishing in local newspaper, wall painting, flute board, glow sign boards, bus painting / boards

etc.

Year Wise Milk Procurement & Sales Avg. Per Day (In Kgs)

YEAR PROCUREMENT SALES

2000-01 18370 26882

2001-02 18857 25294


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2002-03 19083 25258

2003-04 18089 29383

2004-05 21344 29675

2005-06 23954 30842

Special Task

Problems:

The main problem which Nandini milk is facing relates to its variation in quality.

Most of the Agents & Consumers have complaint pertaining to Nandini’s quality.

They have complaint regarding variation in thickness and bad smell that arises on account of

mixing of milk powder whenever there is a shortage of milk this kind of dissatisfaction amongst

costumer may force them to switch over to other brand and permanently abandons the idea of

purchasing Nandini milk in future

Another serious change prevailed against Nandini brand is having bad smell which comes while

boiling the milk

Suggestions:

Nandini milk having bad smell, as feeded in the customer mind to fully reduce the smell,

and it should be as a good. Milk should be maintaining an equal level, don’t change day

by day.

Nandini milk can maintain proper quality, with a good thick quality; don’t fluctuate every

day.

Nandini can produce a new product for children, i.e. pure filtered cow milk.

Nandini can give special offers to their customer, like gifts, vouchers and etc so that

customer can divert to Nandini products.

Nandini should give effective advertisements and a good wall print

Credit is the backbone of the business; Nandini should give credit facilities to their

dealers.


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FRAME WORK:

The 7-s model is better then as McKenzie 7-s. this is because the person who develop this model, Tom Peters and Robert waterman, have been consultant at McKenzie. They published their article “structure is not organization” (1980) and in their books “the art of Japanese management” (1981) and “in search of excellence” (1982).The model starts on the premise that an organization is not a structure but consist of seven elements namely:

THE 7-Ss ARE: Structure

Shared values


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System

Style

Staff

Skills, and

Strategy

These seven elements are distinguished as, so called herds and soft’s. The elements are feasible and easy to understand and indentify. They can be found in strategy statements, corporation plans, organizational charts, and documentation.The four softs however, are hardly feasible. They are difficult to describe since capabilities, values, and element of corporate culture are continuously developing and changing. They are highly determined by the people at work in the organization. Therefore, it is much more difficult to plan or to influence the characteristics of the soft elements.

1. SKILL:

The term skill includes those characteristics which people use to describe a company, the

dominate skills or the distinctive competence of an organization are part of the organization

character.

Training in BRPL is aimed at the systematic development, skills, attitude, and team

work .Training and development of personal skills is considered a high priority area and it forms

an integral part BRPL people and its organization development. Suitable training is imparted to

enhance the multiple skills of the executives and to enrich the functional tasks.

Technical Skills

Human Skills

Conceptual Skills

CLASSIFICATION OF SKILL:

Executives

Non Executives

Technicians

Workmen

The qualification required for the staff in the Gomal are described according to the authority and

responsibility and nature of work carried.

1. EXECUTIVES:


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At the top level management the executives require more of conceptual skill, human skill and

low of technical skill. The qualification for the executive is described as under:

QUALIFICATION:

They must have Engineering, MBA, MSW, CA, ICWA and an experience of 5 to 8 years of

experience in the respective position.

SKILLS REQUIRED:

Forecasting, Policy framing, Establishing objectives, Formulating supporting plans.

2. NON EXECUTIVES:

At the middle level management the need for technical skill decreases human skill are still

essential and the conceptual skills gain importance.

QUALIFICATION:

They must have bachelor degree B.com, B.A; B.Sc requires relevant experience in the respective

positions.

SKILLS REQUIRED:

Clerical skill, accounting knowledge, finalization of accounts, statistical skill.

3. TECHNICIANS:

At the low level the need for technical skill increases, human skills are also helpful in the

frequent interaction with subordinates & conceptual skills are not critical for lower level.

QUALIFICATION:

Diploma in mechanical, electrical & electronics and ITI.

4. WORKMEN:

At the shop floor the need for technical skill, human skills requirement decrease.

QUALIFICATION:


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Basic education i.e. 7th, SSLC, PUC.

SKILLS REQUIRED:

Machines handling, work under the supervision of the technicians.

SYSTEM:

Systems are formal and informal procedures that govern everyday activity, covering everything

from management information systems, through to the point of contact with the customer.

Finance department is doing enough to properly plan and control the funds. There is regular

program verification.

INVENTORY CONTROL SYSTEM:

Raw materials will be held in the stores for maximum of 4 days only.

Finished goods will be held in the stores for maximum of 2 days.

MANAGEMENT INFORMATION SYSTEM:

In company the management information system is well developed. The MIS department

maintains the data of the company. They capture information from different areas of organization

through network spread around the company. This department gives the information for report to

the management. All the data will be stored in main server of MIS. The purpose of MIS is to give

the timeless information to the internal and external customer. It enables the management to take

quick decision and reduced much of paper work.

The internet and extranet is well connected to all the systems and provided good communication

tools. All the staff members are well aware with the systems. The integrated information system

is used to maintain time lines information for employees. At present

“Enterprise Resource Planning” is installed in the company to well aware of the day to day

activities.

FUNCTIONS OF MIS:


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Look after the development of new programming

Collect day to day information

Take requisition from each department and decides whether it can be designed or not

Take care of communication through e-mail

The department has an e-mail server connected to 5 users.

1. STYLE:

Style refers to the employees shared and common way of thinking and behaving - unwritten

norms of behavior and thought:

LEADERSHIP STYLE & ORGANIZATIONAL CULTURE:

Here style implies the leadership approach of top management and the company’s employee’s

way of thinking and behaving. The style is the tangible evidence of what management considers

important, the way it collectively spends time and attendance and uses symbolic behavior.

Participative style of leadership:

The company is following participative style workers in management (usually the management

will discuss with workers and enter into memorandum of settlement under sec 12(3) of industrial

dispute Act, which comprises terms and condition, labour compliments i.e. number of operation

required to work per day (standard strength) and work load category wise).

Centralized decision making:

The company is follow centralized decision making style only management people can

participate in the process of decision making.

2. STRATEGY:

Strategy refers to the systematic action and allocation of resources to achieve the companies aim.

The integrated vision and direction of the company as well as the manner, in which it drives,

articulate, communicates and implements that vision and direction. It can also be defined as the

choice of direction and action that the company adopts to achieve its objectives in a competitive

situation.


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3. SHARED VALUE:

It refers to the core or fundamental values that are widely shared in the organization and serve as

guiding principle that are important. These values have great meaning because they focus

attention and provide a broader sense of purpose.

Values are things that you would strive for even if they were demonstrably not profitable. Values

act as an organization’s conscience, providing guidance in time of crisis.

The values and beliefs of the company ultimately they guide employees towards valued behavior.

It refers to the simple goal statements in determining corporate destiny to fit the concept; most

people in an organization must share these values.

As per the value of the company “Quality and purity that’s unmatched” the company has

implemented many techniques to see that this values are implemented.

The company tries to satisfy every which is dependent directly or indirectly

The company tries to satisfy employees, shareholders, customers, government, families of

employee, community.

6. STURECHER:

Basis for specialization co-ordination influenced primarily by strategy and by organization size and diversity.

7. STAFF:

There is no proper HR department and recruitment is mainly employees reference or through promotion on its website. The assistant General Managers are the head their respective departments. Promotion or the promotion gradation of the employees is clearly based on Merit-cum-seniority basis.The company secretary takes up the member or secretarial work. He prepares the needed reports to be provided to the top management. The registration of the new clients is the responsibility of the senior executives. Inspection work is the duty of respective mangers of the department. The mangers take up administration. The depository help desk handles the queries regarding the depository services. Various desks are responsible for clearing the queries and communicating with the clients.


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5.1 Strengths:

1. It has wide distribution network.

2. Capable to quote competitive prices and reduces price.

3. The quality of milk is good

4. Consumers good will

5. Better financial strengths

6. Good brand name

7. Institutional support.

8. Economics of scale of production/operations, which leads reduce the cost of productive.

9. Geographical location in order to quick supply of milk in the market.

10. Good distribution and transportation system.

5.2 Weakness

Varying Quality:

The most significant and visible weakness of Nandini milk is its variations in quality this survey

upholds our above remarks. Most of the institutional buyers have complaint pertaining to

Nandini’s quality. They have complaint regarding variation in thickness and bad smell that arises

on account of mixing of milk powder whenever there is a shortage of milk.

This kind of dissatisfaction amongst customer may force them to switch over to other branch and

permanently abundance the idea of purchasing Nandini Milk in future. Another serous change

leveled against Nandini brand is bad smell which spreads while failing many customers revealed

that because of its bad smell, they have dropped the idea to purchase.

Discouraging Margin and Insensitive:

The driving force for any agent is commission i.e., how much they get from selling each packet.

We believe that commissions to the agents are crucial for success or failure of Nandini in future.


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Many dealers contended that the holding cost of Nandini milk is much higher than the

commission, which they derive from selling. Just because of some loyal customers they are

maintaining the stock of Nandini milk. There are some agents who are selling only Nandini milk

for the last 10 to 15 years and that there is no change in their financial portion.

WEAKNESS:

Freezing of marketable area.

Lack of flexibility in system.

Rivalry among sister unions.

Government influence.

Lack of personalize service to channel members.

High overheads.

Turns are not expected.

5.3 Opportunities:

1. Favorable government policy like incentives and grants and infrastructure facilities.

2. Institutional supports

3. Introduce new products

4. Tapping the un served market.

5. Servicing the below poverty or low income people with new schemes.

6. Evening time milk should be supplied

7. It has to focus on Kirana shops and General stores in slum areas under special schemes.

5.4 Threats:

1. Cut through competition from emerging competitions.

2. The bad smell of milk

3. Rapid growth in Technology

4. Research and Development facilities.

5. Threat forms agents and dealers to increase commission.

6. Lack of consumer awareness


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5.5 Recommendations:

1. The main problem which Nandini milk is facing relates to its quality. Many hotels used to

use Nandini before abandoning the idea completely due to its quality. The revealed that

there is no standard quality and the quality varies. They also have complaints regarding

thickness and bad smell. According to their opinion Nandini milk, some time is thicker

sometimes less. This kind of variation has forced them to switch to other brands. Many

complaints have been registered by hotels regarding bad smell, which comes while

boiling the milk. We believe that there are serious issues and should address immediately

without any delay if at all Nandini brand wants to survive in the market.

2. As we said earlier, there are only two impediments

a) Low thickness and b) Bad smells

Further we suggest you to stop the mixing of powder, in the event of insufficient

procurement, we believe in serving the market with quality product. We need not to

mix anything to meet the demand. Price was not an issue for them and this will not be

a barrier in future. They are least bothered about price in fact; they purchase milk at

15 to 16 hours from loose vendors. They seek thickness and ability to last far

maximum buyers. They do not have any complaints regarding packing, availability,

delivery system and behavior of agents.


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6.1 Findings:

The departmental functioning is on the lines of proper co-ordination and managerial

decision making.

Inter departmental communication is satisfactory but is not up to level of perfection.

The emphasis on some cheques and balances is not strong which would lead to more

problems at the level of marketing.

Procedures related to decision making is satisfactory but time consuming.

Although organization is good as for training and development is concern, it has to

improve much more in this direction.

Regarding the quality of Nandini milk and milk products it has been proved that the

quality is best.

It is observed that management unnecessarily spending huge amount on transportation for

the purpose of procuring less quantity of milk (less than 10 to 20 liters of milk).

It is also observed that GUMUL management is spending huge amount of money for

engaging indirect expenses.

GUMUL is spending huge amount on engaging private securities and contract laborers.


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6.2 Suggestions:

The company is having the capacity of producing 60,000 lpd. But presently, they are

utilizing only half of the capacity i.e., they are producing only 30,000 lpd. This can be set

right and can also be streamlined.

By utilizing remaining half of the capacity, the company can manufacture more milk with

the same amount of electricity which saves the electricity and would lead to the cost

reduction.

By reducing the production cost the company can reduce the price and increases its

market share.

The company can introduce money back scheme i.e., if any customer purchases 100 liters

per month they will be giving some money as incentives for purchase. The company can

increase their sales.

The company should conduct a competition analysis.

They should advertise more and TV and printing media

The company should improve the present tones of distribution.

GUMUL should ensure that quality of milk should be maintained at any cost as per the

norms of the TQM there is no compromise with quality. The best quality of milk at

reasonable price should be provided to the consumer.

GUMUL is a co-operative society AMUL pattern and as per the norms of the KMF and

NDDB (National Dairy Development Board) ANAND, GUJARATH.

GUMUL management should have annual action plan for procuring more and more milk

and also induction of high yield milching cows or buffaloes.

The GUMUL management should make provision for providing Jersey cross breed cows

to the farmers in GULBARGA and BIDAR districts, and AI (Artificial Insemination)

centers should be established within the GUMUL premises itself.

THE management should reduce overhead costs.

It is observed that maximum number of employees needs motivation, promotional aspects

and other service benefits in order to improve their efficiency and achieve organization

goals.

GUMUL should recruit highly qualified and suitable persons, right person at the right place.


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Conclusion:

Gulbarga Milk Dairy that is providing milk and milk products under the different kind of brand

names, have made a sufficient name and fame in the minds of people for its quality, availability

and relatively satisfying the needs of the ultimate consumer and it has made a sufficient mark an

established brand among the milk and milk products.

Initially when Gulbarga Milk Dairy was started, its capacity of production was less, as for now it

has uplifted itself for higher production capacity.

By large the study has revealed that the product mix of Gulbarga Milk Diary is excellent and the

pricing strategy is also excellent. By this I can conclude that Gulbarga Milk Diary has a very

good market share for its brand name and also it products.


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LEARNING EXPERIENCE:

Learning is synonymous to experience. This is because every human being learns hence only out

of experience and experience is the way of life. In life a person enhances his / her knowledge

only when exposed to real world situations, and by being exposed to the real conditions in a

systematic manner. He / she understand how to live and face various unforeseen situations. This

is exactly what the MBA course does to its students. The MBA course has the “in-plant training

program” as the part of its curriculum to make the students experience the actual corporate world

and learn its ways of functioning. In this competitive world this kind of an approach is extremely

indispensable. Students coming out, as MBA’s would be ready to have an interface with the

corporate world with determination, confidence and competence. Today’s corporate world

demands for all these qualities, without which facing the corporate world is a difficult task.

The working of the dairy is well planned. Especially the production department, Quality control

and the packing section. Every human being consumes milk but not everybody knows how it

reaches him or her pure and fresh. Before interacting with dairy I had thought of the complication

and quality standards to be maintained for getting the packed milk. After my experience in

GOMAL, I have understood that milk is not a simple thing to be just procure, packed and sold to

consumers it involves a lot of procedures, efficiency in maintaining the quality and overall a

commitment to sell the best to the consumers for whom it is an important drink consumed

directly or indirectly. Systematic and committed working is the most important lesson that I have

learnt by studying the entire organization. I have also understood that organization do not exist

only to make profit but to serve the society by producing the quality goods.


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Bibliography:

[1] “Human Resource Management”, K. Ashwathappa

[2] “Marketing Management”, Philip Kotler

[3] “Financial Management”, Prasanna Chandra

[4] “Organizations Induction Manual”, KMF

[5] “Harbinger”, KMF

[6] www.indiainfoline.com

[7] www.indiandairyindustry.com

[8] www.nddb.org


http://www.indiandairyindustry.com/

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7.5 Finance Statements:

Profit & Loss A/c 1st April 2004 to 31st march 2005

Particulars Amount Particulars Amount

Opening Stock 40,91,807.92 Sales account 17,26,52,795.23

Purchase account 10,91,61,813.05 Closing Stock 46,40,533.36

Direct expenses 2,03,28,093.08

Gross Profit 4,37,11,614.54

17,72,93,328.59 17,72,93,328.59

Indirect expenses 4,30,21,939.76 Gross profit 4,37,11,614,54

Net profit 39,15,745.26 Indirect income 32,26,070.48

Total 4,69,37,685.02 Total 4,69,37,685.02

Balance Sheet as on 1st April 2004to 31st march 2005

Liabilities Amount Assets Amount

Capital Account 3,73,83,176.29 Fixed Asset 5,64,00,522.15

Loans (Liability) 2,31,93,654.36 Investment 83,500.00

Current Liabilities 3,76,38,024.15 Current Assets 1,74,63,361.99

Branch Division 63,88,247,62 Net Loss 3,06,55,718.28

Opening Bal 3,47,71,463.54

Current Bal (-) 39,15,745.26

Total 10,46,03,102.42 Total 10,46,03,102.42

Profit & Loss A/c 1st April 2005 to 31st march 2006

Particulars Amount Particulars Amount

Opening Stock 46,40,533.36 Sales account 18,24,17,590.92

Purchase account 11,77,51,675.90 Closing Stock 86,63,788.85

Direct expenses 2,30,75,792.35

Gross Profit 4,56,13,378.16

19,10,81,379.77 19,10,81,379.77

Indirect expenses 4,73,06,079.67 Gross profit 4,56,13,378.16

Net profit 7,39,731.74 Indirect income 24,32,433.25


47


Total 4,80,45,811.41 Total 4,80,45,811.41

Balance Sheet as on 1st April 2005 to 31st march 2006

Liabilities Amount Assets Amount

Capital Account 4,66,99,230.57 Fixed Asset 5,74,46,594.68

Loans (Liability) 5,12,62,409.96 Investment 96,500.00

Current Liabilities 93,64,803.72 Current Assets 2,34,13,942.54

Branch Division 58,24,043.50 Net Loss 3,21,93,450.53

Opening Bal 3,08,22,204.75

Current Bal (-) 7,39,731.74

Total 11,31,50,487.75 Total 11,31,50,487.75

YEAR WISE PROFIT/LOSS (IN LAKHS)

YEAR PROFIT

2000-01 -119.48

2001-02 -58.79

2002-03 -61.07

2003-04 4.31

2004-05 37.52

2005-06 7.39


Documents

AN ORGNIZATIONAL STUDY KMF-GUMUL