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VERKA: TRANSFORMING A 50-YEAR-OLD GOVERN...

Saumya Sindhwani, ...

Case

VERKA: TRANSFORMING A 50-YEAR-OLD GOVERNMENT COOPERATIVE INTO A PROFITABLE ENTERPRISE

Saumya Sindhwani; Lakshmi Appasamy

ISB157 | Published May 28, 2019 | 23 pages Case

Collection: Indian School of Business

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The case, set in August 2017 in the state of Punjab, India, follows the transformational efforts of Manjit Singh Brar, the Managing Director of Punjab State Cooperative Milk Producers’ Federation Limited (Milkfed), the apex body of Punjab’s dairy farmers’ union. He had taken the reins of the cooperative in March 2015 after holding several top-level administrative positions as a civil servant. At the time of his appointment as the MD, the cooperative was witnessing a decline in its revenue and profit growth. More importantly, Milkfed’s brand, Verka, was under siege from Amul, a brand of Gujarat Cooperative Milk Marketing Federation (GCMMF), which had invaded the Punjab market. Brar was tasked to turn around the cooperative and also to tackle the threat posed by Amul, a pan-national brand that was not only financially resourceful but also managed by a team of dairy technocrats and commercial experts. After securing the government’s mandate for his transformation roadmap, Brar rolled out measures to overhaul the organization and shake it out of its bureaucratic complacency. He instituted accountability and efficiency across the organization by implementing commercial management principles and practices. He also put the cooperative on the track to attaining sustained growth in revenue and profitability by revamping its brand positioning, distribution and advertising, and by tweaking the product mix. Brar reinforced Verka’s competitive advantage by unleashing defensive strategies and established new means of growing its revenue and market share to fortify its leadership position in the market against Amul. As a financially resourceful brand with a robust procurement network across the nation, Amul was keen on starting a price war in Punjab and disrupting both ends of Verka’s value chain. Brar had to find the means to grow Verka’s revenue and profits amid tough competition from Amul.

The case could be used for graduate, post graduate students of business administration as well as EMBA students to teach concepts such as organizational transformation, leadership and competitive strategy. Students will learn to manage the operational constraints of leading change in cooperatives, overcome organizational transformation challenges, plan, implement and lead change, turnaround organization and evaluate competitive positioning and implement right strategies.