NITIE, Mumbai :: Mumbai’s Dabbawallas - a complete management workshop!

NITIE, Mumbai
Mumbai's Dabbawallas –
a complete management workshop!

A Six Sigma quality certification endorsed by the Forbes magazine, a fan club that includes Prince Charles and Richard Branson; this guest lecture was sure going to be unlike any other we have had on campus. The speakers were not the normal pinstripe suite clad swanky corporate types who are often spotted in B-school auditoriums. Instead, they were two humble rustic gentlemen dressed in a dhoti and wearing a Gandhi cap. Mr. Raghunath Munde and Mr. Gangaram Talekar, President and Secretary respectively of the Nutan Mumbai Tiffin Box Suppliers Charity Trust or the dabbawallas as they are fondly known, held us NITIEns spellbound with their narration of how a motley gang of 5000 ensures the prompt delivery of over 2, 00,000 lunch boxes every day in the bustling metropolis of Mumbai.

Here is a clutch of statistics that reveals the task that the dabbawallas are up to.

* History: Started in 1880
* Avg. Literacy Rate: 8th Grade Schooling
* Avg. area coverage: 60 Km per Tiffin Box
* Employee Strength: 5000
* Number of Tiffins: 200000 Tiffin Boxes i.e. 400000 transactions every day.
* Time taken: 3 hrs (9 am – 12 pm delivery of carriers, 2 pm – 5 pm collection of empty carriers)
* Cost of service: Rs.200/month
* Turnover: Rs.50 crore per month approx.

As Mr. Raghunath Munde took us through the intricacies of their supply chain, one could not but marvel at the complex organizational dynamics in place. The dabbawallas are a prime example of Porter's five forces theory at work, using which an organization can maintain its leadership position by obliterating the five forces that govern competition.

1. Threat of New Entrants: The experience curve of the hundred year old dabbawallas serves as a huge entry barrier. No one could possibly replicate this supply chain network that uses Mumbai's jam-packed local trains as its backbone.

2. Current competition: Dabbawallas face competition from fast food joints and office canteens. Since, neither of them serves home food, the dabbawallas core offering remains unchallenged.

3. Bargaining power of buyers: The rates of the dabbawallas are as it is so nominal that one simply wouldn't bargain any further. Also, their monopoly status negates any scope of bargaining from their customers.

4. Bargaining power of sellers: The use of minimum infrastructure and a total aversion to technology ensures that they are not dependent on suppliers.

5. Threat of a new substitute product or service: Nobody has thought of one yet!

A few interesting tidbits from the presentation:

* The dabbwallas are extremely disciplined. Consuming alcohol while on duty attracts a fine of Rs. 1000. If found guilty more than twice, the dabbawalla's contract is terminated.

* Unwarranted absenteeism is not tolerated and is treated with a similar fine.

* The Gandhi cap serves as a potent symbol of identification in the crowded railway stations. Not wearing the cap attracts a fine of Rs. 25.

* Selection of new dabbawallas is done very carefully. Only after the antecedents of the applicant are thoroughly verified is he taken into the fold for a six month probation.

As management students we learnt a lot from the dabbawallas. They shattered the myth of technology being indispensable to solve complex problems. Their incredibly efficient supply chain that incorporates advanced concepts such as reverse logistics and multi-level coding is worthy of emulation by modern day FMCGs. However, the most enduring lesson that the dabbawallas left us with is to place the customer ahead of everybody else. It is said that when Prince Charles expressed a desire to meet them during his visit in 2003, the dabbawallas requested him to schedule the meeting such that it did not hamper their mid-day delivery deadlines. With that one act the dabbawallas showed the world that "the customer is truly the king!"

------------------------
Karthik A J
PGDIM 12
NITIE
karthik.aj@gmail.com

Source: E-mail January 18, 2006

published on IndianMBA.com on January 18, 2006

Back to MBA News Flash Main Page

Important Note
Certain articles are published on this website assuming that all the material herein are in the public domain, as the intention of that article is a noble one - to benefit the student community. It's published here with noble intentions for academic purposes. If you find
that this article is copyrighted and is not supposed to be published without permission,
please let us know by dropping an e-mail to
manage@indianmba.com.


	Web IndianMBA.com