The Dabbawallas Sep06

Amit Rangnekar, NMIMS-PhD-2004 Copenhagen, Sep2006

The Dabbawallas of Mumbai

Amit Rangnekar NMIMS PhD 2004


Quotes

• “People study business books and then practice. We practiced first and have now become case studies” R Medge President

• “ It’s a model of managerial & organisational simplicity” CK Prahalad


Belief- WORK IS WORSHIPCredo- We deliver come what may, the

customer shall never go hungry

Tiffin crate weight:75-80 kgs.


Efficiency

• Zero % fuel

• Zero % investment

• Zero % modern technology

• Zero % Disputes

• 100 % Customer Satisfaction

• Average education levels- 8th Standard

• 50% illiterates


Operations

• Employee Strength: 5000

• Number of Tiffin's: 200,000 Tiffins

= 400,000 transactions every day

= 400,000*25 days*12 months= 120,000,000 (120 million or 12 crore transactions per year)

• Time taken: 8 hrs, wartime is 3 hours

• Success rate: 100%

• Delivery: On time, every time


Results• Error Rate : 1 in 16 million transactions• Six Sigma performance (99.999999)• Technological Backup : Nil.• Cost of service - Rs. 280-330/ month

($6-8 £3-4, €5-6 per month)• Standard price for all (Weight, Distance, Space)• “No strike” for 115 years, a record, as each one is

a share holder


The Need

• Late 19th century

• Work driven migrations to Mumbai

• No families

• No canteens / fastfoods

• Early work hours, no time to prepare food

• Different communities, different tastes

• Satisfied only by home cooked food


The Seed

• Mahadev Bache, identified the need gap and pioneered lunch delivery in Mumbai

• Recruited youth from his native village

• Youth with insufficient agri-incomes to feed large families

• Youth with no skills or education


The Rising

• Operations began in 1890

• 20 dabbawallas

• Expand to 100 dabbawallas

• Charged Rs 2 / month, target mill workers

• Most Dabbawallas from Western Maharashtra


The Boom

• 1950s & 1960s

• Industrial boom

• Proliferation of offices in South Mumbai

• Preference for home food

• 200,000 Dabbas delivered per day


Getting Organised

• Nutan Mumbai Tiffin Box Suppliers Charity Association (now Trust) formed in 1954

• Offices at Grant Road, Dadar, Chembur, Ghatkopar, Mulund, Andheri

• Western Harbour & Central Lines covered


1970s

• Boom time

• Dabbas in 3 shifts in many mill areas

• But

• Bank nationalisation changed working hours

• Rail strike ensured disruption in services


1980s

• Textile Mills start closing

• Majority of the mill workers, the biggest segment, stops availing the service

• Daily business slips to 150,000 dabbas


1990s +

• Gain clients who yearn home cooked food, shun outside food

• School tiffins surge• Daily business again reaches 200,000 dabbas

But,• Offices start moving to the suburbs• Industries start moving outside Mumbai• Most mills closed



Key players• One group has 20-25 dabbawallas• Each dabbawalla picks up 30-35 dabbas, travels

between 2-10 km by bus / cycle / on foot to deliver• 1970s &1980s, 40-45 dabbas were picked up but

plastic tiffins being wider, occupy more space• Each group led by a Mukadam, who controls and

coordinates the activities• Group areas not demarcated, 3-4 groups operate

in the same area• Seamless co-ordination of activities of collection,

distribution and delivery through relays • Each change is called a ‘badli’


ORGANISATIONAL STRUCTURE

PRESIDENT VICE PRESIDENT

GENERAL SECRETARY TREASURER

DIRECTORS ( 9 ) MUKADAM (800)

MEMBERS ( 5000 )

13 Decision Makers

Key duties- Conflict resolution, administration, welfare


30%60%

10%


Wartime: Emergency measures being taken to ensure delivery


Prime-time




12 coach train, 4,000 commuters8,000 disputes, But no excuses, Duty first

12 coach train, 4,000 commuters, 8,000 disputes, no excuses, duty first

Sorting at Churchgate

Origin station Destination station


Sorting

• Sorted by destination

• 30-35 dabbas packed in wooden crates

• Crates loaded in packed train luggage compartments

• Building wise / lane wise sorting at destination stations


Distribution• 70% deliveries at CST & Churchgate• Frantic activity at noon• Sprint / cycle to deliver• High volume areas like

Nariman Point, Fort , CST have dedicated crates, carrying 150 tiffins, pushed by 3-4 elderly dabbawallas


Reverse in top gear • 2pm to 6pm

• Collect the empty dabbas

• Assembling and sorting

• Delivered back to where they came from by evening


• The return journey is more pleasant due to a lighter load and the dabbawallas indulge in fellowship, light hearted banter and catch up with their accounts


What’s Unique

• Different dabbawallas pick up, sort and deliver• Co-ordination is seamless• The person who delivers does not know the

origin address and vice-versa• Nowhere on the dabba is the owner’s name or

address put, but there are no delivery errors • Errors do not occur due to mistakes by the

dabbawallas, but due to pilferage in trains or sorting areas

• No ‘Parking’ issues although such a huge load is processed



Binding Agents

• All are stakeholders

• Many are relations

• Similar customs and traditions

• Faith in Lord Vithoba of Pandharpur

• “We cannot deliver only if the trains in Mumbai do not run, but in that case, no one can reach office either”

Gangaram Talekar- General Secretary


Code of conduct

• Rs 25- Not carrying ID card

• Rs 25- Not wearing white cap

• Rs 100- Smoking on duty

• Rs 500- Drinking on duty

• Rs 1000- Leave without intimation, sacked if repeated in 2-3 instances


Financials• A dabbawalla makes Rs 5500-6000

($125, £60, €100) per month

• Incidentals- Railway pass + crate costs+ luggage pass + incidentals Rs 500 ($11, £6, €9) per month

• Rs 400 go to the parent association

• Net monthly earnings range from Rs 4500-5000 ($100, £50, €75)


Adaptations / Innovations• Express delivery system (pick up at 11am)• SMS a dabba• www.mydabbwallas.com (under construction)• Tie-up with a group of housewives to cook & supply home-

cooked food• Tie up with Dr Vijaya Venkat, who supplies food based on

medical ailments of the patient, after examining them

http://www.mydabbwallas.com/


CSR

• Each dabbawalla donates Rs 15 per month

• The trust has set up 4 dharamshalas, schools and temples at their native place

• Help during medical emergencies

• Family members of dabbawallas who die / are incapacitated while in service are absorbed into the system / compensated



Strategic Issues

• Expansion into Navi Mumbai / Panvel• Model duplication across other cities• Franchising in other cities• Backward integration into catering • Forward integration into couriers• Networking through surrogate homes for single

persons• Foray into Call centers /BPO/ ITES / Retail with

dual delivery shifts


Challenges

• Offices- Shift to central / suburban/ Navi Mumbai• Proliferation of Local eateries, tendency to eat

out• Inhouse cafes / canteens/ lunch coupons• Second generation dabbawallas residing in

Mumbai , not joining the profession• Morning tiffins difficult as working women

increase• Attrition rates high• Average age of the dabbawallas is 52 years


Key drivers

• Committed workforce

• Stakeholders faith

• Teamwork

• Operational flexibility


Sustainable Advantage

• Mumbai’s efficient rail network

• Simplicity and scalability of operations

• Employees as shareholders

• Economy pricing deters corporates


Opportunities

• Demand for home cooked / fresh food would rise due to increased awareness

• Offices shifting to areas connected by rail- BKC, Lower Parel, Navi Mumbai, Panvel, Western suburbs

• Retail / Call centers/ ITES / BPO

• Increasing petrol prices

• Metro rail in the offing



Opportunities, Challenges & Options


Are the dabbawallas going to be extinct?

“How can it be ? Sure, some clients may move away, but children will continue to go to school and people to offices. As long as people feel the desire for home cooked food, the dabbawallas would always deliver” • R Medge, President


With their most famous student

• Issues?

• Problems?

• Symptoms?

• Analysis?

• Diagnosis?

• Synthesis


Strategy Square

Conditions Consumer

Competition CostsCorporation

(Dabbawallas)

SWOT


Strengths Weaknesses

Opportunities Threats

Porter’s 5 Forces- Industry Attractiveness


Gap Analysis

Integrative

Intensive

Diversification

Desired Goal

StrategicPlanningGap

Current Portfolio

Period

Sal

es

Strategy Map

Courier

Collection

Customer

Catering

Delivery

Transportation

ITES

BPO

Retail

Ally

Buy Diversify

Build

Strategic Options

Potential

Dabbawallas

Articulated Needs

Unarticulated Needs

UnservedServed

Ansoff’s Model


Capture value?

Short Term

InstantCapture

Value

Long Term

Mid Term

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The Dabbawallas Sep06

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