History of the Dabbawala System

Supply chain management is the important part of this organization and the Dabbawala system organization is very famous because of its abilities . The Dabbawala system has the ability to provide the fastest as well better services of home made food because of the large number of employees are working in that sustainable enterprise. The management of the tiffin services is done by the employees of the Dabbawala system or NMTBSA and look after the batches of the tiffins delivered to the offices, houses  and also checks the quantity of the tiffins that delivered in total.

Talking about Australia, there are many countries that are doing the business of tiffin or catering and one of the examples found through the studies is “Tiffins Melbourne” At this company, the workers of the Tiffins Melbourne provides Indian food to the people of Melbourne and deliver the Indian food with the great spirit. The company is highly inspired by the Indian organization “Dabbawala system” and this is the company located in Mumbai and Invented the idea of Lunch boxes.

In this report, the proper analysis is given in the case study with a deeper explanation of the challenges as well as the recommendations to grow in the market in the next coming years. 

The case study is about the organization  which receives many awards for its significance performances with a low cost tiffin service. This case study talks about all the elements of the Dabbawala with regard to its mission, services, resources, management and challenges faced by the organization.  A Dabbawala is the person living in Mumbai who is hired by the service industry. The main responsibilities of the  person is to pick up the lunch boxes from the residence, deliver the cooked food to the customers and then collect the empty boxes and return those tiffins to food workers. The person used the cycle as a mode of transport. Talking more about the history of this business, it was the time when British people ruled the Indian economy and they did not like the local food. Then, one day, a Parsi banker hired a man to deliver the homemade food at their place. The colleagues of that person also liked the idea of lunch boxes and they also started eating that food. In the year of 1890, the company had 100 men to start the lunch box  services. The business decided to do the partnership business with the charitable trust registered as NMTBSA (Nutun Mumbai Tiffin Box Suppliers Association). This association is  headed by the Raghnath Medge.

Management and Services

However, this Dabbawala system has covered 60 to 70 Km area of the city and the 5000 employees are working at this organization to deliver 2,00,000 tiffin on a daily basis. The total time taken by the employees to deliver the order is 3 hours minimum. The Dabbwala system is famous because of its quality of food as well as for the on time delivery of the tiffin boxes. The supply chain management of the organization is good, but still facing some of the challenges because of the increase in population, inflation, environmental factors, competition and changing the behavior of the employees as well as customers. The Mumbai Dabbawala system has started using the new technologies as well as new strategies with the change in the time. The leading Logistics companies like FedEx specially came to India just to learn about the Dabbawala system (Mishra, 2013).

A Value chain Management  is the reason behind the success of the Dabbawala system, it will help to identify the Tiffin that is delivered as well as the required by the customers, office workers. It is very important to take care of the delivery and customer satisfaction of the customers with regard to the tiffin services. The supervision with regard to meeting the requirements of the customers  is important.  The Dabbawala system has the ability to provide the fastest as well better services of home made food because of the large number of employees are working in that sustainable enterprise. The management of the tiffin services is done by the employees of the Dabbawala system or NMTBSA and look after the batches of the tiffins delivered to the offices, houses  and also checks the quantity of the tiffins that delivered in total. As it is clear fact that the demands and needs of the people are changing and these demands are not static in nature.  Thus, it is recommended to analyze their demand of the customers as well focus more to meet the expectations of the employees (Anand & Gulati, 2016). 

SIX SIGMA performance: The quality assurance study was conducted by the Forbes global magazine in 1998 and the Dabbawala system receives a rating of 99.9 in six sigma efficiency. As per the study, only one error is made by the Dabbawala in six million transactions. In the terms of statistics, 6 sigma is the standard deviation that gives the results about the defects per million. In simple terms, six sigma performance is assumed as a quality improvement and business strategy.

Challenges Faced by the Organization

There are  many disciplines or rules are set for the employees. These disciplines are as follows:

• Timely reports about the duties
• Proper organizational behavior of the employees
• Respect the clients
• Avoid alcohol  at the time of work
• Use of White cap at the time of working hours
• To carry out the identity proofs 

 Latest marketing strategy: – Talking about the marketing strategies used by the company is marketing pamphlets in the tiffins. The Tv channel Start Tv hired the services of the Mumbai Dabbawala and focusing on 2-lakh people in just 4 days  by distributing the pamphlets hosting KBC. Also the government of Maharashtra makes use of the Dabbawala  channel for creating HIV awareness among the people. However, Dabbawala is the only way to reach the people living in each corner of the Mumbai. These marketing strategies used by the other companies add income to the Dabbawala system (Deepak, 2015).  

Organisational structure & working style: – The organizational structure followed by the Nutan Mumbai Tiffin Box Suppliers association (NMTBSA) is a very simple and it includes the three levels. The three levels are the governing councils, Supervisors, and Dabbawalas. The Governing councils involve the president, vice president, directors, and General Secretary. The councils conduct meetings for the supervisors and Dabbawalas in a month. In these meetings,all the problems facing by the Dabbawalas are discussed and to find out the possible solutions of these problems.

 

The Process of the supply chain: – As per the analysis of the case study, it is found that the transport that is used by the Dabbawa’s is the bicycle. The collection of tiffins from the workers home and also collecting the empty tiffins from the customer places are some of the activities done by the workers on cycle. The process of the supply chain is very simple.  The people working as Dabbawalas are not educated, so the tiffins have some sort of marks like color or symbol on them for their identification. The tiffin is then collected in one place and pick them up all for sorting. The lunch boxes sorted into groups and  put all the groups of tiffin boxes into trains with the marks on them to identify the destination location of the tiffins.  At each station, the boxes are handed over to the other members like local Dabbawalas who then supply all the tiffins at a designated place.

 

Coding: –  There are many different ways to mark the tiffins and these are as follows:

• Number of words for the collection points
• Colors for the different stations
• Numbering according to the destination
• Marking as a building or Floor for the convenience of Dabbawala

Dabbawala’s   also now started using the new technology as now they are allowed for delivery request through SMS.

 

In the above diagram, coding has been shown where

• VLP stands for Vile Parle (Suburb in Mumbai),
• 9EX12-  Coding mentioning building name and floor like EX is the express tower and 12 is the floor No.
• E is the code for Dabbawala
• 3 stands here for destination station that is Churgegate station 

Recommendations for Future Growth

Uninterrupted services: – After studying the case study, the services of the Mumbai Dabbawala are uninterrupted as they are working in the severe weather conditions also. The organization works in the bad weather conditions also like in Monsoons. The local Dabbawalas and the population have a good of trust and confidence. The uninterrupted services are the best part of the organization.

It is found by the many researchers that  the many countries are inspired by the Indian tiffin services and started their home based business. The article “The Tiffin Carriers Of Bombay, India: An Organizational And Logistical Analysis” is written by the Stephen T Margulis. The author talks about the supply chain management and organizational structure of the tiffin service organizations.  The article is based on the Tiffin services in Mumbai, where the tiffin man picks up the lunch boxes and deliver the homemade lunch to the 2,00,000 people in 3 hours. This also explained the influence of the urban infrastructure on the structure of the organization as well as on the employee behavior. The logistics system of the Indian organization is technically unsophisticated  with regard to the western standards. Supply chain risks impact to the organization’s performance in some certain ways (Ravichandran, 2005). The Supply chain is associated with all activities of production, procurement, productions for their planning and management. Accordingly an article that was published in 1999 by Sharma and Chrisman supply chain risks have negative as well as positive impact to the organization. Their approach was rooted in the Markowitz portfolio selection theory. And in another article that was published in 2014 by Vikulov and Butrin classify the supply chain risks in business process and their impacts on them. The followings are business process and impact of supply chain risks to them.

• Suppliers: Supply chain risks associated with the suppliers can direct impact on the product production and product delivery process. Delivery schedules would be changed due to the impact  the product.
• Transport: The supply chain risks on the transport service of the organizations can damage of goods while transport and loss of goods (Patel & Vedula, 2006).
• Warehouse: Risk associate with the warehousing and their impact are during storage good damage and changes in taxes and other costs of warehousing that are rented, security.
• Production: Supply chain risks have a great impact on organization’s production performance in the form of quality issues, over productions, machinery failure and procurement issues.
• Marketing: The risks of supply chain that cause wrong forecasts and take wrong promotion strategy and the failures of networking sales. The market value of the organization will decrease and organization will not able to stand in the market with their competitors (Purohit, 2011). 

Moving further, there are many foreign countries who are doing the same business and earning good profits. Talking about Australia, there are many countries that are doing the business of tiffin or catering and one of the examples found through the studies is “Tiffins Melbourne” At this company, the workers of the Tiffins Melbourne provides Indian food to the people of Melbourne and deliver the Indian food with the great spirit. The company is highly inspired by the Indian organization “Dabbawala system” and this is the company located in Mumbai and Invented the idea of Lunch boxes. The business is running very successfully in the Australia. In Australia, the food is cooked by the experts, chefs and  all the meals are delivered on time. 

Impact of Supply Chain Risks on Organizations

Although the business of providing tiffin services is the same, but the working of the both the companies is different in nature. The Dabbawala system is a very old organization and believes in quality and punctuality. The Punctuality  is also the main focus of the Melbourne company. The researchers found that by comparing both the companies is that the company is following the different working process. The company Tiffin Melbourne is using the new technologies for taking the orders online, whereas the Mumbai based organization is not using any internet or SMS services. The Payment method is also different in both the companies. The Melbourne Tiffin services can take the cash on delivery as well as can take the payments directly into the accounts through debit or credit cards. On the other hand, the Dabbawala system receives money only in the cash form. The price of the one tiffin in Mumbai is Rs 250($4.00) and in Australia the price is $12 per Tiffin box. Talking about the mode of transportation used by the Australian organization is the environment friendly tricycle and bicycle and public transport is used to deliver the hot food to the people (Keeley, 2016). The tiffin used by the Dabbawala system is made up of aluminium and on the other side tiffin is thermally insulated. There is a huge difference in the management and the organizational culture or working style of both the companies. The success factors of both the companies are given below: –

1. Quality of Food
2. Punctuality
3. On time delivery
4. Zero fuel cost
5. Customer  satisfaction

The  analysis of the case study involves the economic analysis and SWOT analysis. Both the analysis of the case study helps to determine the economic conditions of the organization and  as well as the Strength and weaknesses of the organization.

Economic Analysis: – Talking about the monthly remuneration paid to the Dabbawalas then it is eight thousand rupees per month. As per the New York times report, the industry is growing at the rate of 5 to 10% continuously as there is zero percentage expenses on fuel, technology, disputes and these lead to the 99.99% performance for the 100% satisfaction of the customers. The biggest challenge the company can be faced is the problems related to the police, municipal corporations as the disputes can be adjudicated by their own system for the Dabbawalas.  The charitable trust NMTBSA also take Rs 15 from each tiffin man for the maintenance of the welfare funds. 

Similar Businesses in Other Parts of the World

SWOT analysis: Swot analysis of the case study identifies the strengths, weaknesses, opportunities and threats of the organization.

Strengths: – The strength of the Dabbawala system organization is its achievements, teamwork and the discipline followed by the each member of the company.  The on time delivery and 100% results of the Company results in  the customer satisfaction. The company receives the six sigma rating because of its services and the quality of food. The expenses of fuel and new technology are zero as the company is still using the cycles for the transportation and use the traditional method for the supply chain also.

Weaknesses: – On the other side, the company is highly dependant on the Mumbai local trains.The  Government body is not able to implement the welfare schemes because of the limited fund flow of the association.  

Opportunity: – The Dabbawala system can be expanded if the organizational ties up with a variety of dishes like diet food, Chinese or continental food. Adding more, the organization has the opportunity to expand its services to the metro of Mumbai and BRTS. The organization can also use the new technology like the internet and SMS services for the booking of the orders.

Threat: – The biggest threat to this system is the home delivery services offered by the other restaurants and other food joints. There are many catering services also that also offering the tiffin services.  

This part of the report focused on the past performance of the sustainable enterprises in the case of the supply chain management and also review the challenges faced by the Mumbai based tiffin Organization. As we know that, to survive and success in the competitive world , it will be very important to plan about the supply chain strategies as well as to identify the current requirements or expectations of the customers from the food services industry.  

Looking into the trends in the catering business is found to be remain consistent in the last 3 years. The tiffin or catering services growth of Indian food shows no sign of abating as it is again the top trend and people are still availing the services of tiffin. Moreover, the healthy and nutritious food is the second choice for people. It is analyzed from the previous years that the company is performing consistently  in two years 2014 and 2015. The third year trend has shown some growth because of the introduction and usage of the new technology. The Dabbawala system in the year of 2016 started using the SMS services for the booking of the orders and it will lead to growth and increase the sales of the company. 

It has been seen from the trends that the digital and technology are playing a vital role in the growth of the business. As it is clear fact the technology is developing very in these days and the new mobile apps, online delivery orders, online payment option that attract the people and also increase the expectations of the customers (DHL, 2010).

It has been observed that the new methods of payment are very interesting and they are secure in terms of accounts and money. For example, the Paytm was launched last year to pay and receive the payment directly into the accounts. In Australia, the Tiffins Melbourne is using the different mode of receiving the payments. The different type of payment methods are the credit card, debit cards, internet banking  and cash on delivery. These all payment solutions are increasing rapidly and becomes very popular in nowadays (Chandra & Jain, 2007).

As per the observations, it is accounted that, in last year,  1% to 3% transactions used these apps. This percentage can be increased by making some more improvements in these payment methods like adding marketing and delivery rewards that will lead to retain the customers for a longer period of time.

 The last year report has proved that the takeaway sales has been increased by 55% as the many restaurants and catering business people uses the customer loyalty schemes to retain its customers.  The customer loyalty schemes are the way to attract the client by offering them the services on 25 % less rate.

 

In the above diagram , the trend has been shown as from the year 1900 to 2003. As it is clear that with time the company is growing continuously in terms of the number of customers as well in the terms of prices also. Presently the company has the turnover of Rs 60 Crores per annum. As the company is having transaction of 2,00,000 daily and the cost of tiffin is 250. The total turnover can be calculated as the multiplication of the Number of tiffins with the price of the one tiffin that is resulting into 5 Crores per month and 60 Crores approximately in one year (Team, 2012). 

As it has been observed from the previous performance of the company that it is growing rapidly and on the basis of that analysis the future growth of the catering sector will also grow in the coming few years. As the organizations started using the new technology that will definitely enhance the performance of the  catering service sector. 

 

In the above diagram, it has been clear that the growth of the company in the coming years has been shown on the basis of the previous performance of the organization. The expected revenue of the company in the year of the 2020 is assumed to be USD $645  billion (IIPE, 2009).

After analyzing the case study, it has been found that the in the emerging economy like India, Dabbawalas faced many challenges. Looking at the managerial point of view, it is very difficult to increase the employee engagement and performance and to get the maximum results from the workforce as teamwork. It is very important to motivate the employees or members of Dabbawala to perform extraordinary by giving them some financial rewards. There is a possibility that the members of the Dabbawala get discouraged because of this lack of financial rewards. It is very difficult to retain the workforce at the time of inflation as the company is rising at 10 percent and in the same way the inflation rises by 5% that creates a problem for the organization in retaining the workforce.

In the developing economies like India there are many other environmental factors that affect the sustainable business like Dabbawala services and these factors are like pollution, poverty, and natural resource depletion.  As the organization is highly dependable on the public transportation. The population of India is increasing very fast and it will obviously create more pollution from the automobiles and also the increase in the usage of vehicles bring the road networks jams because of traffic. These traffic jams and pollution affect the business in delivery times. Moving further, the city like Mumbai has stormy weather during the season of Monsoonan and that creates problems for the Dabbawalas to deliver the food in a safe manner and on time (KPMG, 2016).

As the Dabbawala system is very famous and with the increase in the population, more and more clients availed these Dabbawala services. The organization is facing challenges now in building the strategies to deal with the increasing clientele, environmental factors, diseases and expectations of the customers.

Moving further, the management of the Dabbawala system found it very difficult to deal with the increasing costs of labor, cost of transportation and expectations of the members with the salary and also the changing tastes for food items  of the people. The organization afraid from the strikes by the unions and members of the municipal corporation as it will affect the business of the organization. The Dabbawala system organization kept the strong bond between management and workforce to carry out its with the changing environment. As it was found that , the time has changed from aluminium lunch boxes to the sleeker tiffin boxes. Comparing the prices of the tiffins, then the price of tiffin is Rs. 250 per lunch box as it was used to Rs 50 in the year of 1980. There are many other things that are still same and those are the dress, dedication and punctuality of the Dabbawala system.

Moreover, India is also attracting towards the westernization and preferring to focus more on fast foods. As the time has changed, people also found it fashion to have lunch with the families at McDonald’s, KFC, Pizza hut and its an old fashion to have the lunch boxes on the desk.  The analysis of the Dabbawala organization has shown that the they are focusing more on the office workers and employees. As per their experience of the organization,  if they shifted to the restaurants and canteen, they will be back after 3 months for sure.

Lastly, the biggest challenge for the organization is its competitors. The main competitors of the Mumbai Dabbawala are food plus by HDFC, fast food chains, Udipi chain, restaurants, Magic-o-meal. The nature of Competition is different because it involves the distribution only, whereas the home made is the USP of the Dabbawala (Vaart & Donk, 2008).  

It is very important to understand the factor that the company should maintain the quality of the food to maintain its reputation and to achieve the objectives successfully. The Indian homemade food is healthy  and safe in nature, but that should be tasty enough so that the people will not get bored of this.  The Dabbawala system organization needs to dependant on the food maker and the Dabbawala’s for the delivery of the tiffins. It is very important that there should be proper communication between the customers, Dabbawalas and the supervisors (Bidvest Foodservice, 2016). A Quality management process should be applicable with following suggestions:

• The quality of the food in the tiffin boxes should be of good quality in terms of tastes, healthy and nutritious food, and in good in quantity also.
• The Mumbai based Tiffin Services should give surety about food safety and quality to their customers and also guarantee great efforts to improve their management systems.
• The company should use the cars the transports during the season of Monsoon to avoid the delay in delivery. It should be used only in emergency cases and the rest of the time company should continue using the bicycles in normal days (Kadapa-Bose, 2016).
• The Mumbai based tiffin service organization also represents the framework for the concern and realization of management goals and all these goals needs to be set up in the different departments of the organization (Capegimini Consulting, 2017)
• The organization should use all the latest technologies to grow and build a good reputation in the market.
• The company should also make use of the different payment methods as the Australian companies used.  
• It is very important that all the guidelines of delivery the tiffins, meaning of the coding language and safety are properly conveyed and understood   by the employees of the  organization;
• All the empty tiffins should be collected from the customers place to reuse them for the next day (Nath, 2014).
• It is very important to expand the business by providing its services in more areas of the Mumbai.
• The Dabbawalas should be able to communicate with the customers to get the feedback from them properly. There should be proper training given to the employees.
• The organization should offer different varieties of the food in its tiffin like non veg food or the Chinese or continental food (Abudheen, 2012).
• The organization should offer good monetary rewards to its employees so that they will perform well and give the company other heights of success.

Conclusion

The report is mainly based on the analysis of the case study as  well as to understand the concept of the supply chain management in the tiffin service sector. Supply chain management is very important for the satisfaction of the customers. The main focus of the Dabbawala System is to satisfy the demands of the consumers. The report concluded the challenges faced by the people in the supply chain and the whole report is divided into two parts. The first part is all about the case study and the analysis of the supply chain management. In order to improve the sales of the companies, it is very important to understand the positive and negative effect. It is analyzed that with the help of the new system and technologies, it is very easy to book the order for food and to make the payments easily.

As per the analysis, it has been shown that the Mumbai based company has very strong organizational structures and the company is performing extraordinary because of its punctuality and quality standards. The Mumbai based tiffin services has a great impact on the other countries as there are many countries started that tiffin service business in their own countries and earning lots of money and the economic conditions of the country. The company has received the six sigma quality award for the extraordinary performance and there is only error found in the sixteen million transactions.  At last, it is suggested that the proper strategies and the planned activities should be followed in the proper management of the supply chain in the NMTBSA and customer retention.

References

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