Tech saves the day for India’s leading dairy brands as lockdowns become new normal

July 1, 2020

Akshatha M, CR Sukumar & Ayan Pramanik | ET  Bureau

BENGALURU / HYDERABAD — When the Centre announced nationwide lockdown in the last week of March to contain the spread of Covid-19, it left several retailers engaged in the supply of essential items nervous. RS Sodhi, the indefatigable managing director of Gujarat Cooperative Milk Marketing Federation, popular by its dairy brand Amul, was not one of them, though. “There will not be any problem,” he declared with an air of confidence, back then. And, he walked, or is still walking the talk as the lockdown has stretched beyond three-weeks, and parts of India, including Mumbai, are still in a gridlock.

Amul brand, along with GCMMF’s 18-member unions, touches the lives of 3.6 million farmers across about 18,700 villages of Gujarat. India’s biggest dairy brand with one million plus retail touch points required an infrastructure that can support data-intensive and demanding workloads. The cooperative giant’s faith and steady investment in latest technology over the past 10 years has helped it wither the lockdown storm with little or no pain to dairy farmers or consumers.

The diary giant says its modern servers help in tracking the milk supply chain where any delay in the processing of milk can hurt the quality of the end product. “We are probably the largest users of technology in the dairy system in the country. Right from procurement from farmers to touching the customers, it is completely touched by technology,” Sodhi told ET.

The company invests between Rs 600 crore and Rs 800 crore every year on technology that ensures technology adoption from sourcing milk from farmers; shifting to coolers, chilling the milk and ensuring that the quality is maintained and then shifting to tankers to reach out to consumers. Technology is adopted in quality, online payment to farmers, and distribution management system for vendors to book orders as well as adoption of enterprise resource planning software from SAP.

“We do more than Rs 50,000 crore business every year, without technology you cannot be in the dairy industry,” said Sodhi. The dairy mogul is using IBM’s latest servers to run its core operations and deliver milk and dairy products across the country.

Technology has been helping Amul capture data points from the last Kirana store of the network and analyze varied datasets, IBM India Director (Systems) Viswanath Ramaswamy told ET. This helps the diary giant to tweak the production of a certain product in sync with the fluctuation in market demand, with ease.

Over a period of time, many smart analytics tools have been added to the technology support infrastructure to effectively manage Amul’s supply chain, said Ramaswamy. In the coming years, the cooperatives, like many consumer product companies, will see use of artificial intelligence in order to make better decisions, he added.

Nandini, the second largest dairy brand after Amul, owned by the Karnataka Cooperative Milk Marketing Federation (KMF), is in the process of a technology overhaul. “We are going in for the latest ERP technology in KMF and its units,” said BC Sateesh, managing director of KMF. Its member union Bamul in Bengaluru, for example, has adopted Oracle-based ERP. “Our district unions have been using their own software, and some are switching to modern ones,” he said. Nandini has an annual turnover of about Rs 14,000 crore, and sources milk from about nine lakh farmers across about 254,000 villages.

KMF’s Mother Dairy unit in Bengaluru, Sateesh added, has cloud-based ERP, and all its new milk processing units are end-to-end automated with Siemens technology. Tech adoption, he said, has helped in uninterrupted supply to consumers, while at the same time, farmers are relieved their milk got marketed even in a lockdown situation.

Hyderabad-based private sector diary brand, Heritage Foods, is also investing big on technology. A user of IBM infrastructure, its executive director Brahmani Nara said: “SAP integrated solution enables timely automated milk payments to village level suppliers. We have honoured hassle-free 100% milk procurement and payments to farmers.” Technology, she added, has become the backbone in maintaining business. During lockdown, the firm ensured door delivery of products, with leads captured using WhatsApp and social media.”

According to her, milk transport vehicles are monitored through GPS Solutions to ensure they reach their destination in time and to maintain consistent quality. “Technology has become the backbone in maintaining business discipline and we were able to smoothly close our annual accounts in time and adhere to all compliances, despite relaxations by the Government,” she said.

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