GCMMF's Cooperative Structure

            
 
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Case Details:

Case Code : BSTR205
Case Length : 15 Pages
Pages Period : 1991-2006
Organization : GCMMF, AMUL, NDDB
Pub Date : 2006
Teaching Note :Not Available
Countries : India
Industry : Dairy Products

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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EXCERPTS Contd...

The NDDB-GCMMF Tussle

While GCMMF laid the foundation for the development of dairy industry in India, the Indian Government on its part made efforts to support the dairy industry in the country by encouraging the establishment of dairy cooperative societies.

The government came up with the Delhi Milk Scheme in 1959 and several state governments also introduced similar schemes during the 1960s.

Most of these schemes were not successful because of the middlemen and contractors, who exploited the Government-run plants owing to the perishable nature of milk. When the milk supply was insufficient, the Government purchased imported milk powder which made things worse for dairy farmers.

As milk supplies to urban areas could not be maintained in the summer months, state governments started rationing the sale of milk...

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The Road Ahead

Several sections of the media and the analysts opined that GCMMF had been unfair with Kurien. They said that Kurien's fears of NDDB taking the cooperatives away from the farmers appeared to be coming true. Kurien feared that Mother Dairy might take undue advantage of the cooperative retail chain to push its interests forward.

He felt that sooner or later the government would divest its stake in the joint ventures, and the dairy farmer would be the ultimate loser. According to Kurien, "There is an inherent contradiction that the government-owned NDDB, through its subsidiaries, is getting into fresh business activities at a time when the Centre is considering further divestment in all existing areas including those in the dairy sector such as the Delhi Milk Scheme." On the contrary, some analysts were of the view that Kurien opposed the joint venture between NDDB and state federations as he feared that stronger regional brands would make the market highly competitive for AMUL...

Exhibits

Exhibit I: The Anand Pattern
Exhibit II
Exhibit III: Functions of Village Cooperative Societies, District Union and State Federation
Exhibit IV: Organization Structure of GCMMF
Exhibit V: NDDB and Operation Flood


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