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Hot Potatoes: Pradip Thakker |
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4,500
semi-literate dabbawalas collect and deliver
175,000 packages within hours. What should we
learn from this unique, simple and highly
efficient 120 year old logistics system?
Hungry kya? What would you like: pizza
from the local Domino’s (30 minute delivery) or
a fresh, hot meal from home? Most managers don’t
have a choice. It’s either a packed lunch or
junk food grabbed from a fast food outlet.
Unless you live in Mumbai, that is, where a
small army of ‘dabbawalas’ picks up 175,000
lunches from homes and delivers them to harried
students, managers and workers on every working
day. At your desk. 12.30 pm on the dot. Served
hot, of course. And now you can even order
through the Internet.
The Mumbai Tiffin Box Suppliers Association (MTBSA)
is a streamlined 120 year old organization with
4,500 semi-literate members providing a quality
door-to-door service to a large and loyal
customer base. How has MTBSA managed to survive
through these tumultuous years?
Hungry kya? What would you like: pizza from the
local Domino’s (30 minute delivery) or a fresh,
hot meal from home? Most managers don’t have a
choice. It’s either a packed lunch or junk food
grabbed from a fast food outlet. Unless you live
in Mumbai, that is, where a small army of
‘dabbawalas’ picks up 175,000 lunches from homes
and delivers them to harried students, managers
and workers on every working day. At your desk.
12.30 pm on the dot. Served hot, of course. And
now you can even order through the Internet.
The Mumbai Tiffin Box Suppliers Association (MTBSA)
is a streamlined 120 year old organization with
4,500 semi-literate members providing a quality
door-to-door service to a large and loyal
customer base.
How has MTBSA managed to survive through these
tumultuous years? The answer lies in a twin
process that combines competitive collaboration
between team members with a high level of
technical efficiency in logistics management. It
works like this.
After the customer leaves for work, her lunch is
packed into a tiffin provided by the dabbawala.
A color-coded notation on the handle identifies
its owner and destination. Once the dabbawala
has picked up the tiffin, he moves fast using a
combination of bicycles, trains and his two
feet.
A BBC crew filming dabbawalas in action was
amazed at their speed. “Following our dabbawala
wasn’t easy, our film crew quickly lost him in
the congestion of the train station. At Victoria
Terminus we found other fast moving dabbawalas,
but not our subject... and at Mr Bhapat’s
ayurvedic pharmacy, the lunch had arrived long
before the film crew,” the documentary noted
wryly. So, how do they work so efficiently?
team work
The entire system depends on teamwork and
meticulous timing. Tiffins are collected from
homes between 7.00 am and 9.00 am, and taken to
the nearest railway station. At various
intermediary stations, they are hauled onto
platforms and sorted out for area-wise
distribution, so that a single tiffin could
change hands three to four times in the course
of its daily journey.
At Mumbai’s downtown stations, the last link in
the chain, a final relay of dabbawalas fan out
to the tiffins’ destined bellies. Lunch hour
over, the whole process moves into reverse and
the tiffins return to suburban homes by 6.00 pm.
To better understand the complex sorting
process, let’s take an example. At Vile Parle
Station, there are four groups of dabbawalas,
each has twenty members and each member services
40 customers. That makes 3,200 tiffins in all.
These 3,200 tiffins have to be collected by 9.00
am, reached the station and sorted according to
their destinations by 10.00 am when the
‘Dabbawala Special’ train arrives.
The railway provides sorting areas on platforms
as well as special compartments on trains
traveling south between 10.00 am and 11.30 am.
During the journey, these 80 dabbawalas regroup
according to the number of tiffins to be
delivered in a particular area, and not
according to the groups they actually belong to.
If 150 tiffins are to be delivered in the Grant
Road Station area, then four people are assigned
to that station, keeping in mind one person can
carry no more than 35-40 tiffins.
During the earlier sorting process, each
dabbawala would have concentrated on locating
only those 40 tiffins under his charge, wherever
they come from, and this specialization makes
the entire system efficient and error-free.
Typically it takes about ten to fifteen minutes
to search, assemble and arrange 40 tiffins onto
a crate, and by 12.30 pm they are delivered to
offices.
In a way, MTBSA’s system is like the Internet.
The Internet relies on a concept called packet
switching. In packet switched networks, voice or
data files are sliced into tiny sachets, each
with its own coded address which directs its
routing.
These packets are then ferried in bursts,
independent of other packets and possibly taking
different routes, across the country or the
world, and re-assembled at their destination.
Packet switching maximizes network density, but
there is a downside: your packets intermingle
with other packets and if the network is
overburdened, packets can collide with others,
even get misdirected or lost in cyberspace, and
almost certainly not arrive on time.
elegant logistics
In the dabbawalas’ elegant logistics system,
using 25 kms of public transport, 10 km of
footwork and involving multiple transfer points,
mistakes rarely happen. According to a Forbes
1998 article, one mistake for every eight
million deliveries is the norm. How do they
achieve virtual six sigma quality with zero
documentation? For one, the system limits the
routing and sorting to a few central points.
Secondly, a simple color code determines not
only packet routing but packet prioritizing as
lunches transfer from train to bicycle to foot.
who are the dabbawalas?
Descendants of soldiers of the legendary
Maharashtrian warriorking Shivaji, dabbawalas
belong to the Malva caste, and arrive in Mumbai
from places like Rajgurunagar, Akola, Ambegaon,
Junnar and Maashi. “We believe in employing
people from our own community. So whenever there
is a vacancy, elders recommend a relative from
their village,” says Madhba, a dabbawala.
“Farming earns a pittance, compelling us to move
to the city. And the tiffin service is a
business of repute since we are not working
under anyone. It’s our own business, we are
partners, it confers a higher status in
society,” says Sambhaji, another dabbawala. “We
earn more than many padha-likha graduates,” adds
Khengle smugly.
The proud owner of a BA (Hons) degree, Raghunath
Meghe, president of MTBSA, is a rare graduate.
He wanted to be a chartered accountant but
couldn’t complete the course because of family
problems. Of his three children, his daughter is
a graduate working at ICICI, one son is a
dabbawala and the younger son is still studying.
Education till standard seven is a minimum
prerequisite. According to Meghe, “This system
accommodates those who didn’t or couldn’t finish
their studies. It’s obvious that those who score
good marks go for higher education and not to do
this job, but we have people who have studied up
to standard twelve who couldn’t find respectable
jobs.” There are only two women dabbawalas.
Apart from commitment and dedication, each
dabbawala, like any businessman, has to bring
some capital with him. The mini-mum investment
is two bicycles (approximately Rs4,000), a
wooden crate for the tiffins (Rs500), at least
one white cotton kurta-pyjama (Rs600), and Rs20
for the trademark Gandhi topi.
competitive collaboration
MTBSA is a remarkably flat organization with
just three tiers: the governing council
(president, vice president, general secretary,
treasurer and nine directors), the mukadams and
the dabbawalas. Its first office was at Grant
Road. Today it has offices near most railway
stations.
Here nobody is an employer and none are
employees. Each dabbawala considers himself a
shareholder and entrepreneur.
Surprisingly MTBSA is a fairly recent entity:
the service is believed to have started in the
1880s but officially registered itself only in
1968. Growth in membership is organic and
dependent on market conditions.
This decentralized organization assumed its
current form in 1970, the most recent date of
restructuring. Dabbawalas are divided into
sub-groups of fifteen to 25, each supervised by
four mukadams. Experienced old-timers, the
mukadams are familiar with the colors and
codings used in the complex logistics process.
Their key responsibility is sorting tiffins but
they play a critical role in resolving disputes;
maintaining records of receipts and payments;
acquiring new customers; and training junior
dabbawalas on handling new customers on their
first day.
Each group is financially independent but
coordinates with others for deliveries: the
service could not exist otherwise. The process
is competitive at the customers’ end and united
at the delivery end.
Each group is also responsible for day-to-day
functioning. And, more important, there is no
organizational structure, managerial layers or
explicit control mechanisms. The rationale
behind the business model is to push internal
competitiveness, which means that the four Vile
Parle groups vie with each other to acquire new
customers.
building a clientele
The range of customers includes students (both
college and school), entrepreneurs of small
businesses, managers, especially bank staff, and
mill workers.
They generally tend to be middle-class citizens
who, for reasons of economy, hygiene, caste and
dietary restrictions or simply because they
prefer whole-some food from their kitchen, rely
on the dabbawala to deliver a home cooked
mid-day meal.
New customers are generally acquired through
referrals. Some are solicited by dabbawalas on
railway platforms. Addresses are passed on to
the dabbawala operating in the specific area,
who then visits the customer to finalize
arrangements. Today customers can also log onto
the website www.webrishi.com to access the
service.
Service charges vary from Rs150 to Rs300 per
tiffin per month, depending on location and
collection time. Money is collected in the first
week of every month and remitted to the mukadam
on the first Sunday. He then divides the money
equally among members of that group. It is
assumed that one dabbawala can handle not more
than 30-35 customers given that each tiffin
weighs around 2 kgs. And this is the benchmark
that every group tries to achieve.
Typically, a twenty member group has 675
customers and earns Rs1,00,000 per month which
is divided equally even if one dabbawala has 40
customers while another has 30. Groups compete
with each other, but members within a group do
not. It’s common sense, points out one dabbawala.
One dabbawala could collect 40 tiffins in the
same time that it takes another to collect 30.
From his earnings of between Rs5,000 to Rs6,000,
every dabbawala contributes Rs15 per month to
the association. The amount is utilized for the
community’s upliftment, loans and marriage halls
at concessional rates. All problems are usually
resolved by association officials whose ruling
is binding.
Meetings are held office on the 15th of every
month at the Dadar. During these meetings,
particular emphasis is paid to customer service.
If a tiffin is lost or stolen, an investigation
is promptly instituted. Customers are allowed to
deduct costs from any dabbawala found guilty of
such a charge.
If a customer complains of poor service, the
association can shift the customer’s account to
another dabbawala. No dabbawala is allowed to
undercut another.
Before looking into internal disputes, the
association charges a token Rs100 to ensure that
only genuinely aggrieved members interested in a
solution come to it with their problems, and the
officials’ time is not wasted on petty
bickering.
learnings
Logistics is the new mantra for building
competitive advantage, the world over. Mumbai’s
dabbawalas developed their home grown version
long before the term was coined.
Their attitude of competitive collaboration is
equally unusual, particularly in India. The
operation process is competitive at the
customers’ end but united at the delivery end,
ensuring their survival since a century and
more. Is their business model worth replicating
in the digital age is the big question
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