Amul Case Study
Reasons for GCMMF’s diversification
Action plan (competencies to be developed; organizational issues to be addressed to)
To be developed at the end of the discussion Should GCMMF get into processed foods business? Reasons for getting into
Reasons for not getting into
Strengths of GCMMF
Weaknesses of GCMMF
Link the strengths and weaknesses to the pros and cons
GCMMF faces three major difficulties:
(i)constraints on the supply of milk;
(ii)(what it sees as) unfair competition being a cooperative society; and
(iii)a low margin in its one of its main businesses, namely liquid milk.
GCMMF is considering diversification in a substantial way into non-milk processed food businesses. It should decide whether it should go ahead with this diversification or concentrate on its core business of milk and milk products.
1. Why is GCMMF considering diversification into the processed foods business?
2. Will the proposed diversification result in the resolution of the problems faced by GCMMF?
3. How similar is the proposed food products business to GCMMF’s core business of milk and milk products, really?
4. What should GCMMF do?
5. What are the organizational implications if it diversifies into the processed foods business? What should it do if it does not diversify into the processed foods business? (It may be helpful to look at the product portfolio now and after diversification).
Reasons why GCMMF is considering this diversification.
(i)GCMMF is facing a problem of adequate supplies of milk, whose growth in production is tapering off in the country. It seems to be growing at around 6 percent per year. There is also increasing competition to the milk produced. New players are entering the scene of milk and milk products such as Britannia, the biscuit major in India. The case also mentions that supply constraints would pose serious problems. Dr. Kurien also seems to share this view. Demand
Action plan (competencies to be developed; organizational issues to be addressed to)
To be developed at the end of the discussion Should GCMMF get into processed foods business? Reasons for getting into
Reasons for not getting into
Strengths of GCMMF
Weaknesses of GCMMF
Link the strengths and weaknesses to the pros and cons
GCMMF faces three major difficulties:
(i)constraints on the supply of milk;
(ii)(what it sees as) unfair competition being a cooperative society; and
(iii)a low margin in its one of its main businesses, namely liquid milk.
GCMMF is considering diversification in a substantial way into non-milk processed food businesses. It should decide whether it should go ahead with this diversification or concentrate on its core business of milk and milk products.
1. Why is GCMMF considering diversification into the processed foods business?
2. Will the proposed diversification result in the resolution of the problems faced by GCMMF?
3. How similar is the proposed food products business to GCMMF’s core business of milk and milk products, really?
4. What should GCMMF do?
5. What are the organizational implications if it diversifies into the processed foods business? What should it do if it does not diversify into the processed foods business? (It may be helpful to look at the product portfolio now and after diversification).
Reasons why GCMMF is considering this diversification.
(i)GCMMF is facing a problem of adequate supplies of milk, whose growth in production is tapering off in the country. It seems to be growing at around 6 percent per year. There is also increasing competition to the milk produced. New players are entering the scene of milk and milk products such as Britannia, the biscuit major in India. The case also mentions that supply constraints would pose serious problems. Dr. Kurien also seems to share this view. Demand