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The world’s best supply chain



Imagine an organization delivering 130.000 lunches every day and employing about 5.000 people. Most of them can’t read or write. This organization works without computers and even without mobile phones. Moreover, this organization works in an ecologically responsible way or with a small CO2 footprint, as we call it nowadays. Yet, this simple but extremely effective organization is able to perfectly deliver 99.9999% of all orders. This corresponds to an error rate of 1 in a million! Discover one of the world’s best supply chains!

Some time ago, I had the pleasure to work a few days in the metropolis where this organization is active: Mumbai. It’s a city with more than 18 millions of inhabitants and one of the most chaotic traffic systems I have ever seen. It’s the place where 5.000 dabbawalas pick up lunches from the people’s home six days a week, in order to perfectly deliver them to the right person, man or son, on their own workplace. For transport, these dabbawalas use their handcarts and bikes in combination with Mumbai’s extended train system.

Actually, the low tech delivery always takes place, no matter if there are inundations, monsoons, wars or terrorist attacks. Meanwhile, this system is existing for more than 100 years and it still functions almost in the same way as in the beginning.

Professor Thomke, linked to Harvard, analyzed this organization and discovered four pillars leading to its success: organization, management, process and culture.
  1. The dabbawalas work in small groups of about 25 people each. It appears to be the ideal group size. Every dabbawala is self-employed. He personally negotiates on the price with his customer. It is a very flat organization, almost without hierarchy.
  2. Each group works with buffers in order to easily counterbalance setbacks. They always dispose of several stand-ins. Since all dabbawalas are generalists, this isn’t a problem at all.
  3. Each lunch box has a standard dimension. Since they are working with as less variation as possible, the error rate remains extremely low. Moreover, by means of a simple coding system, the dabbawalas exactly know where they need to deliver their lunchboxes.
  4. Culture. Decisions about hiring new dabbawalas are taken together with the group. There is no boss. In this context, it would be interesting to make the comparison with the philosophies developed by Ricardo Semler, the Brazilian serial entrepreneur, working more or less in the same way. They work within a close team. Since people often work together during their entire life, there is a deep emotional solidarity between the dabbawalas.
Many lessons can be drawn from the dabbawalas’s system. However, one of the most important ones for me is that you don’t necessarily need to only attract expensive people in your organization in order to deliver sustainable top performances. If you develop an effective system, the organization can also deliver top performances. The organization’s leaders must pay attention to all aspects, including the culture.

The dabbawalas give us food for thought.

Have a nice weekend!

Click here to watch a 4-minutes video in English about the dabbawalas.

Paul

By Paul Donkers

"my purpose is to help improve strategy execution, to create high performing teams and coach for effective business leaders"

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