The Dabbawala System: On Time Delivery Every Time: Supply Chain Management

SUPPLY CHAIN MANAGEMENT
The Dabbawala System : On time Delivery

Every time
Group – 02
Nishant Yadav – 18PGP135
Rahul Roshan – 18PGP143
Sarthak Navalakha – 18PGP169
Sarvasuddi Akhila – 18PGP170
Sharath R - 18PGP175
Shubham Raj - 18PGP184
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1) How does the dabbawala organization achieve its high service performance? What is its secret
for success?
The Dabbawala system is a 120-year-old organization that distributes lunch boxes to offices in
Mumbai. The dabbawalas are engaged in the pickup, delivery and return of the lunchboxes on a day
to day basis and the operational efficiency of this daily process matched the six sigma standards.
The following factors contributed towards high service performance of the dabbawala organization:
1. The extensive rail network of Mumbai was critical to the delivery system of dabbawalas. The daily
delivery schedule was heavily dependent on the local trains and the railway platforms served as
hubs of sorting with different delivery routes , thus forming the hub and spoke distribution system.
Such distribution system built around railways helped in achieving high service level.
2.The dabbawalas used a simple and comprehensive system of identification codes that was based
on universally identifiable colours, symbols and character. Such coding enabled dabbawalas to
segregate and handle thousands of lunchboxes each day with amazing accuracy.
3. The dabbawalas had built in buffers to deal with any glitches or bottlenecks in the delivery system
because of various reasons. The workforce was cross trained in all activities such as collecting,
sorting, transportation and customer relations to increase speed and efficiency.
4. The flat organizational structure of the dabbawalas enabled them in quick decision making when
the delivery system got strained because of variety of factors.
5. Building and maintaining customer relationships through reliable and on time delivery on a
consistent basis.
6. New hires were made from friends or recommendations by existing members and these new hires
shared the same culture, language and food. This led to high level of cooperation, coordination and
mutual understanding at work that translated to higher service performance.
Further, the secret of success of the dabbawalas can be attributed to the high level of commitment
and focus towards the core mission of delivering dabbas to the customers.. The core operating
principle of dabbawalas was based on the philosophy that dabbas were not just containers but
medicines for the ill. In addition, a consistent and on time delivery of dabbas with tremendous
accuracy was also one of the key factors in the success of dabbawalas.
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2) FedEx and Dabbawala both specialize in delivery and operate on a hub and spoke model.
Dabbawala does this in ways different from FedEx and similar organizations.
The complexity of logistics in Mumbai is very high, with disruptions expected occasionally. Studying
the Dabbawala system will help FedEx operate in areas across the globe that meet such high
complexity.
Dabbawala system works with a minimalistic usage of technology. FedEx can thus learn from this
system and leverage technology to function at a broader scope.
Despite the limited access to resources and constraints on their cost, Dabbawala has achieved six-
sigma level efficiency. Analysing this will help FedEx reduce its costs, while maintaining/improving its
efficiency.
Biggest resource for Dabbawala system is its members. An important part of Dabbawala’s success is
– how new members are added; who is added; how are they replaced. All of this is very crucial in
setting up the culture of commitment and work ethic within the organization. This can help FedEx
can align its work force with its operational strategy.
3) A consultant wants to move the dabbawala system into the twenty-first century and proposes
several changes. How should Raghunath Medge respond?
(a) Stop the consultant immediately.
(b) Make changes to the system.
Please list specific examples of what you would change
Raghunath Medge should make minor changes to the system like SMS / WhatsApp with a cheaper
mobile like Jio phone which would help in easy communication and also increase in customer
satisfaction levels which is already higher. Also, they could try out with other parcel deliveries by
having pre-bookings and payment options on the website and also create an app for the same after
doing a cost benefit analysis and feasibility studies. Also, training would be needed for the
Dabbawalas to get in trained with these technologies. Hence a sample study should be done before
implementing.
More technical changes would lead to increase in costs which would in turn lead to increase in price
for the customers. The customers in general are working middle class who value the marginal cost of
money and hence would be a trouble for them also. And also, the Dabbawalas are from lower
sections of society who would be technically handicapped, and so training would be difficult for the
same. And there are already companies like FedEx which are technologically better and hence would
already have better economies of scale as compared to the Dabbawalas.
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SUPPLY CHAIN MANAGEMENT

The Dabbawala System : On time Delivery

(a) Stop the consultant immediately.

(b) Make changes to the system.

Please list specific examples of what you would change

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