DIGITAL DAIRY MANAGEMENT

DIGITAL DAIRY MANAGMWENT

Safe & Smart technologies for food Safety and food chain integrity

Cow udder to customer mouth, safe and healthy product, with safe and smart delivery technology

VIVEKANAND NALLA

IDD, BA, PGDRD, LLB, MBA, M, sc, M, Phil, PHD

https://in.linkedin.com/in/vivekanand-nalla-4b1a9728

The Indian dairy industry is fraught with many difficulties such as inefficiency, deterioration of perishable food items, unsatisfactory quality of commodities, malpractices in weights and measures, mismatch of demand and supply, long waiting times, exorbitant corruption, rude behavior of shopkeepers and poor service delivery. Streamlining of SCM processes will result in increased operational efficiency, thereby reducing transit losses and pilferages.      

From Cow udder to customer mouth , providing  with the perfect solutions to in all operations  challenges in terms of design,  development procurement and production site  operations,  thorough  understanding of production processes, building utilities and site management, plant performance will  be increased by enabling team   Members at every level to work with greater efficiency and high confidence

Digitalization will cover entire enterprises operations will make in to one hub, with enable IT solutions one of the most complex areas to manage is the integration of IT and staff commitment to new ways of doing business and support for smooth integration.

  •  Technical architecture
  •  Project management
  •  Strategic partner management
  •  Quality assurance
  •  Technology prototyping
  •  Business requirements management
  •  Enterprise architecture
  •  User experience design

Indian dairy business challenges and system streamlining 

Small holder Challenges:

  • Inadequate feeding of animals
  • More disease incidence
  • Low genetic potential of animals
  • Lack of chilling capacities
  • Exploitation of farmers
  • High production costs
  • Delayed payment of dues

Procurement Challenges:

  • Milk base mainly consisting of small holders
  • Involvement of too many intermediaries:
  • Gaps in information
  • Absence of a screening system
  • Lack of Infrastructure
  • Manipulation of the quality of milk by the farmers

Co-operative Challenges:

  •  Less number of member farmers
  • Lower participation in the decision making process
  •  Losses
  • Low prices of milk
  • Inefficient services
  • Insufficient Infrastructure

Process Challenges:

  • Seasonality of production and fluctuating supply
  • Absence quality standards
  • Adulteration and Food safety
  • Lack of trained and skilled workers

Storage and Logistics challenges:

  • Lack of cold storage facilities
  • Gap in the cold chain and transport facilities

Marketing challenges:

  • Majority of the Market is still unorganized
  • Acceptability of the Consumer base
  • Less penetration to the rural Market
  • Lack of transparent milk pricing System

 

Measuring an organization’s total impact helps to show the best route forward

  •  Improve capital and labour productivity
  •  Define architecture for obtaining necessary environmental clearance for new   factories and reforms on land acquisition
  •  Resolve IT adoption issues
  •  Avoid duplication of efforts with the existence of multiple stakeholders
  •  Reducing gaps in demand and supply

Preventing postponement in project implementation:

            Streamlining of business processes and adoption of advanced technologies in the sector is expected to enable them to overcome such strategic hurdles to a large extent.

  • Innovation
  • Business process re-engineering
  • Enterprise resource planning (ERP)
  • Business intelligence (BI)
  • Document management system (DMS)Dashboards
  • RFID tagging
  • Multi buyer and multi system (MBMS) system
  • High-value consumer management system (HVCMS)
  • Estimation and tendering systems

            The common major problem of transparency and data inconsistency, Processes are generally driven by skilled people and, predictability across projects is missing. While improving processes is a natural change and a function of industry maturity, technology is being seen as a lever for making this change in a faster and more predictable manner.

Preserving  maximum margins :

Traditionally, manufacturing companies have pursued a blend of four approaches to preserving margin.

  1. Product price increases are one way to ensure desired margins, particularly in the face of input cost inflation, but as we wrote in a Perspective last year, deciding to take a price increase and getting it to stick in the marketplace are very different.  Increasing both the quality and the frequency of product innovation can be an effective way to refresh the product portfolio to "beat the fade" and recover premium margin opportunities and new product development.
  2. Adjusting product mix is an approach companies have successfully employed in the past promoting higher-margin items at the expense of lower-margin alternatives  yet in today's commercial environment, where consumers are trading down to stretch disposable income and maximize perceived value, the luxury end of many manufacturers' product portfolios is not performing well.
  3. Driving out unnecessary waste with cost-efficiency programs has proven to be a very effective way to preserve margin levels and has enabled companies to be leaner and more agile in responding to market forces, yet very few companies "cost cut" their way to prosperity, and there is the very real fear of marginalizing product quality of losing sight of the "total cost" picture when chasing cost reduction targets.

            The most immediately available tactic for margin preservation is cost reduction, and it has been a primary focus for the vast majority of supply chain organizations. Yet effectively reducing costs can be tricky, with companies discovering that cost savings in one part of the supply chain can be more than offset by unintended consequences elsewhere.

Total dairy supply chain costs = S (Production cost + Transportation cost + Input inventory cost + Output inventory cost)

Strategic supply chain plan and operations don't go as expected results. These costs can arise as a result of disconnects between:

  1. Strategic decisions, such as supply network design, inventory policy, and service-level obligations
  2. Tactical decisions, such as supplier selection, factory-run strategies, or logistics partners
  3. Operational decisions, such as out-of-footprint sourcing, expedited shipments, or accessorial charges

Connecting the decision-making process across strategy, tactics, and operations is important, but having visibility into these decisions and the consequences is just as important.  There will always be unanticipated costs things go wrong in supply chain operations after all.

A. Identify the unplanned cost elements; collect the necessary data.

B. Analyze the data, understand the business drivers of the unplanned costs, and identify a pattern to properly assign costs.

c. Assign the costs to suppliers.

  • The purpose of this effort is not to penalize suppliers in the short term but to evaluate the optimal set of suppliers based on full disclosure of total cost. The end result may well be the replacement of a supplier with a more efficient alternative; however, it also may be that the driver of unanticipated costs falls at the feet of the manufacturers that can make changes to their role in the relationship that will eliminate the issues. Further, this approach is empowering to those in the supply chain organization who have a role in both identifying and reducing supply chain costs.

What is DIGITAL DAIRY MANAGEMENT SYSTEM:

  • DIGITAL  DAIRY MANAGEMENT  is a dairy  based Project  prepared for a  future  focus knowledge application for DIGITAL DAIRYMANAGEMENT :
  • Technology for Farmers:
  • Real time price information
  • Online ordering of inputs
  • Online cash, loan, relief payment with mobile banking
  • Technology for Security
  • Mobile Emergency Services
  • Technology for Financial Inclusion:
  • Mobile Banking
  • Micro-ATM program
  • UPI system

  Technology for Justice:

  • e-Procurement , e-Production, e-promotion, e-Payment
    • Technology for Security
      • Dairy  Cyber Security Co-ordination Center
  • The Programme:
    • Pulls together many existing system.
    • These systems will be restructured and re-focused.
    • They will be implemented in a synchronized manner.
    • Many elements are only process improvements with minimal cost.
  • The common branding of programmes as DIGITAL DAIRY MANAGEMENT highlights their transformative impact.

Vision of DIGITAL DAIRY MANAGEMENT: Focus on 3 Key Areas

Vision and focus areas:

  • Area1 :Internet Infrastructure as a Utility for Every Dairy dept
  • Area 2:Management & Services on demand
  • Area 3:Digital Empowerment of farmer/Staff/customers
  1. Internet  Infrastructure as a Utility of every dept
  • E-Governance of ( 3P’s )  Services  :(Procurement/production/promotion

Dairy Business Process Re-engineering using IT to improve transactions Form Simplification, reduction/ Online office and tracking, Interface between departments Use of online repositories, Integration of services and platforms: Receipts, Payment Gateway, Mobile Platform.

            E.g. Payment, purchases, other business transactions etc

  • Electronic Databases – all databases and information to be electronic, not manual
  • Dairy Grievance Redresses  -By using IT to automate, respond, analyse data to identify and resolve persistent problems – largely process improvements

Digital dairy four pillars:

  1. E-GOVERNANCE OF PROCURMENT WITH AMCU AND ONSITE MILKING TECHNOLOGY.
  2. ONLINE SMART SENSOR DAIRY PROCESSING BY PLANTS AUTOMATIONFOR QUALITY AND DATA ACCURACY.
  3. E-MARKETING WITH COLD CHAIN MONITORING.
  4. E-ADMIN/FIANANCE MANAGEMENT

Dairy business key stake holders:

Stake holders

Key consideration

Veterinary and medicine services

AI services

Veterinary / Medicines services

Feed producers

High input feed and grain costs significantly the production variable costs

Short and medium term Climatic conditions

Dairy producers

High dependence on climatic changes

High input cost associated with production and farm management as well as volatile retail prices inhibit producers from increasing production

Dairy processors

Increased pressure on margins

Alternative supply arrangements by super markets (private labels ) leading to supply chain complexities

Dairy product manufacturers

Large inventories of unallocated dairy produce

Competition  local  and private dairy players

Dairy exporters

EU’s policy changes that will come in to effect in 2015 will significantly impact milk procurement and processing resulting in distribution challenges

Demand surge in emerging markets

Challenging production conditions and high operational costs resulting in substitutions risks 

Retailer’s

Consumers remain value oriented and open to considering non-branded products spurring the growth of private labels

Low food prices inflation as retailers continues to compete on prices and focus on private labels strategies

Increased competition from food services outlets as they are emerging as alternate source for dairy producers

 

  1. Broadband  for all Rural collection Centers

            Daily, Weekly, Monthly Reports via Email – location-wise, vendor-wise, capacity- wise Community Milking Parlors and solutions Easy to use, integrated, Internet-based AMCU

  1. Broadband for all  BMC/Chilling centers
  2. Dairy  Digital Information Infrastructure for plant

Milk Lifting schedule adherence & compliance detection
1.  Correlation with milk procurement data and milk lifting data Next generation Android Tablet based Milk Procurement
2. Portable system for door-to-door milk collection Advanced reports and trend analysis

The key business drivers for investment in technology surveillance are

  1. Regulatory Drivers
    • Near-time and real time monitoring capabilities
    • Horizontal Trade Surveillance Model
    • Emphasis on pre-emptive controls and robust trade surveillance Platforms
    • Global Legal Entity Identifier (LEID) data hierarchy requirements
  1. Technology Drivers
    • Measurement and monitoring of unstructured data
    • Collective screening of unstructured data and structured data for complete trade reconstruction
    • Reduction in false positives
    • Improved visualization for senior management decisions
  1. Operational Drivers
    • Record-keeping requirements: maintaining historical data over a period of time
    • Blind spots between disparate systems
    • Sourcing, capturing, and maintaining a data ecosystem for analysis
    • Surveillance across Chinese walls

The overall project focuses on advanced methodologies to guarantee the Dairy business, and new technologies for improvement           of competitiveness, sensory quality, and for the maximization of    customer satisfaction and environmental protection.

The competitive advantages of companies can stimulate and support collaboration. Competitive advantage is the ability of a company to protect itself against its competitors. Mainly five factors     contribute to the competitive ability: competitive pricing, premium pricing, value-to-customer quality, reliability of delivery and  innovation in production

  1. Procurement AMCU operations
  2. Plant process efficiency
  3. Innovative systems for packaging
  4. Measurement and control of product quality
  5. E-Marketing
  6. ICT-based logistics platform
  7. Data accuracy
  8. Validation of the prototype
  1. E-Governance –of Procurement with  advanced technology Daily milk collection system through AMCU: ( From agent level  collection )

The initiative of installing the AMCUS – Automatic Milk Collection Unit Systems at village level to enhance the transparency of transaction   between the farmer and the Dairy, These system not only ensured the             transparency but also gave a unique advantage by reducing the processing time to 10 percent of what it used to be prior to this. Indeed          got the entire supplier information through the systems integration. The             Information related to members, fat content, volume of the milk   procured and the amount payable to the member are accessible to the members in the form of a database.

 The benefits of the AMCUS system:

  • The rural people are getting benefited much by the IT initiatives,
  • The benefits of various projects such as DISK are yet to be realized.
  • The following are the demonstrated benefits of the ICT platform.
  • Time reduction
  • Reduction of pilferage
  • Reduced human errors
  • Transparent  quality and qty analysis
  • wastage is reduced
  • Transparency of operations and payments
  • Total Operational integration

Advantages of AMCUs:

1. Saving in quantity of sample milk

2. Saving of chemicals and detergents

3. Saving of expenditure on glassware

4. Saving in stationery and time

5. Saving in expenditure on staff.

6. Gaining confidence of milk producers

Through transparent system and increased, Milk procurement quality and hygiene

2. Automation of manufacturing plants:

  • Process flow automation :
  • The need for technology up gradation in the infrastructure sector, to reduce gestation lags and improve the quality of products that can maintain the balance between sustainability and development is more than ever.

Automatic Process Monitoring:

The use of digital imaging technology for the automatic monitoring of dry sugar granules and powders, this system provides particle size data to production line operators for process control and product quality improvement.

Measurement and control of product quality:

Prototypes of devices (sensors) will be developed to measure key parameters for monitoring and maintaining the quality of transported and stored products, but also useful in tracing the productive chain.  Innovative biological physical technologies will be applied to protect the products after harvesting and during transport/storage.

Shaping automation process system

Measurement and control of product quality:

 Prototypes of devices (sensors) will be developed to measure key parameters for monitoring and maintaining the quality of transported and stored products, but also useful in tracing the productive chain.  Innovative biological physical technologies will be applied to protect the products after harvesting and during transport/storage.

Regular Utilities:

  • Monitor energy usage
  • Reduce energy costs
  • Diversify energy sources
  • Monitor water quality
  • Reduce effluents
  • Produce energy from
  • waste biomass
  • Produce green energy

CIP Station:

  • Reduce cleaning downtime
  • Recover water – mix products
  • Clean multiple equipment at  the same time
  • Ensure equipment cleaning and sanitizing
  • Reduce water consumption
  • Reduce chemical usage

Plant management:

  • Reduce Inventories
  • Measure and reduce product and energy  loss
  • Download work orders from ERP system
  • Improve processes on-line
  • Improve HACCP system
  • Implement global production tracking
  • Manage products and materials genealogy
  • Manage Process and Machine safety
  • Produce healthy and affordable products
  • Reduce packaging costs and materials
  • Maximize performance
  • Flexible line changes
  • Track and traceability

Innovative systems for packaging: New packaging will be designed considering the final destinations; respecting the existing standards; with technical, structural and micro structural characteristics calibrated depending on the product, ensuring the best possible hygiene, with an economic and environmental impact as limited as possible, and packaging to extend the shelf- life and improve the “perceived quality” and natural aromatic component of food products;

 The project involves the introduction of the concept of excellence of with innovative production processes and improved packaging that stabilize or maintain the quality of dairy food products throughout their conservation.

Innovation in dairy packing

  • Convenience
  • Healthier foods
  • Reduced portions
  • Natural ingredients
  • Energy boosting drinks

Various packing categories

  • Different size packages  /Multi-packs
  • Variety packs /Retail ready displays
  • Sustainable packaging

Consumer Choice based packing

  •  Low fat  / Fat-free / Reduced sodium and sugar / Lactose-free  /Organic  /
  •  Probiotic cultures, fortified with nutrients, calcium and protein

Process efficiency:  Infrastructure processes are complex and require strong technical and functional skills. Being an industry which is highly labour intensive, throughput of work that gets completed on a daily, weekly and monthly basis will be strongly aided by technology. Unlike conventional manufacturing industry ERPs, this industry requires several real-time, mobility and analytical solutions which will get more out of the individual.

Data accuracy: Trusting data that originates from a site, a toll plaza, earthmoving equipment in use is always a challenge. Manual representation in any format always has room for data getting adulterated, unconsciously or otherwise. This has eroded trust in the infrastructure space. The social perception for this industry is therefore taking a beating. Eliminating manual intervention, capturing the moment of truth and using more decision support systems will certainly create a strong connect with both the investor as well as the user community.

Scalability: While scalability is usually associated with volume, in the infrastructure industry it needs to get associated with heterogeneity. Hence, technology needs to transcend the boundary of infrastructure and look at how financial services, the concept of enterprise architecture, use of social analytics, machine-to-machine interaction as well as the internet of things can certainly be explored.

Achieving energy efficiency:

Sustainable solutions are divided into four stages:

  1. Measure to identify sources of energy savings or malfunctions
  2. Install energy saving systems and equipment
  3. Improve long-term use through control system management, support and training tools while maintaining a high level of performance
  4. Analyze gains through ongoing maintenance, supervision and controls

3. E Marketing – Electronic technology SCM system of delivery of goods:

Technology for Marketing e-Education

  • All agents connected with broadband
  • Free Wi-Fi in all agents / retailers
  • Digital Literacy program for Dealers/ agents/marketing retailers 

Technology for Healthy e-Marketing

  • Online sales consultation
  • Online milk and product sales
  • Online service Cold chain parlours should  establish in market coverage area
  • Milk e- wallets , e- payments

Technology for Planning

  • Technology based decision making
  • Dairy GIS Mission Mode Project

ICT-based logistics platform:

  • It will standardize as far as possible, the use of hardware and software technologies to reduce delivery times; to allow continuous      monitoring and real-time recording of parameters that are critical for storage of products; to ensure compliance with mandatory rules of hygiene and traceability of the productive chain, fight against waste (failed deliveries) and increase the number of satisfied customers.
  •  Strategic supply chain plan and operations don't go as expected    results.  These costs can arise as a result of disconnects between:

1.   Strategic decisions, such as supply network design, inventory policy, and service-level obligations

2.   Tactical decisions, such as supplier selection, factory-run strategies, or logistics partners

3.  Operational decisions, such as out-of-footprint sourcing, expedited       shipments, or accessorial charges

4.  Connecting the decision-making process across strategy, tactics, and operations is important, but having visibility into these decisions and the consequences is just as important.  There will always be unanticipated costs things go wrong in supply chain operations after all.

  • Identify the unplanned cost elements; collect the necessary data.
  •  Analyze the data, understand the business drivers of the unplanned costs, and identify a pattern to properly assign costs.

Assign the costs to suppliers.

The purpose of this effort is not to penalize suppliers in the short term but to evaluate the optimal set of suppliers based on full disclosure of total cost. The end result may well be the replacement of a supplier with a more efficient alternative; however, it also may be that the driver of unanticipated costs falls at the feet of the manufacturers that can make changes to their role in the relationship that will eliminate the issues. Further, this approach is empowering to those in the supply chain organization who have a role in both identifying and reducing supply chain costs.

Validation of the prototype:

The program will conclude with the development and validation of a prototype logistics platform, which will be based on all the results obtained by simulation approaches. A qualitative and quantitative assessment of the benefits in terms of reliability, reproducibility, safety, effectiveness and efficiency (cost reductions) will also be carried out. The program will end with the completion of the prototype of logistics platform.

The overall project focuses on advanced methodologies to guarantee the Dairy business and new technologies for the improvement of competitiveness, sensory quality, and for the maximization of customer Satisfaction and environmental protection.

4. E Admin/ Management for All

  • Online Hosting of Information and             documents
    • Open, easy access to information
    • Open data platform
    • All payments and receipts through cashless transactions
  • Dairy pro-actively engages through social media and web based platforms to inform customers
  • 2-way communication between farmer/customer and Dairy
  • Online messaging to customers on special occasions/programs
  • Largely utilization of existing infrastructure – limited additional resources needed.

As a final point: The availability of safe, sustainable and healthy food is increasingly becoming a major issue, given the continued growth of the world       population and the increasing environmental and sustainability             concerns. The need to meet consumer demands in terms of high quality   products, healthy diets, and affordable prices, fair and equitable relations in the Dairy supply chain, food safety, and ethics of productions are a huge challenge. In addition, climate change, competition for       agricultural land use and shifting dietary habits are constantly changing         the supply/demand scenarios. In order to make the food supply chain systems safer, more performing, resilient, efficient and fair, it is necessary to take account of the links between product quality, health and       welfare of customers and issues related to the exploitation of        ecosystems, sustainability and biodiversity.

Protecting the dairy value chain is a target that can be achieved only by a multi disciplinary effort, taking into account the different stages of the dairy production chain.

Ex: The costs can arise as a result of disconnects between:

1.  Strategic decisions, such as supply network design, inventory policy,     and service-level obligations

2.  Tactical decisions, such as supplier selection, factory-run strategies, or             logistics partners

3.  Operational decisions, such as out-of-footprint sourcing, expedited       shipments, or accessorial charges           

The application of new  enabling technologies within the    Supply Chain Integrated Approach could help redefine the dairy-      food     scenario will reshape the value chain  towards advanced  scenarios in       which all the enterprises benefit from better management  processes           and new products and services. In fact, a strict control of raw materials         could help detect all risks and act quickly in critical phases (using appropriate corrective measures to prevent the processing of non-conforming products), with obvious advantages for all the operators involved in the entire supply chain.          

In addition, these new integrated technologies, allow the    creation of an “intelligent” scenario of systems and devices capable of           interacting with all operators to significantly improve the level of              knowledge   and management processes related to product quality and safety. As regards foods safety more specifically, a comprehensive approach (from primary production to the final consumer) to Supply Chain Integration could ensure its effective optimization and             improvement throughout the supply chain in which therefore distinguishes it on national and international markets.