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Public Distribution System (PDS) of India and Its Supply Chain Management

CASELET, OPERATIONS MANAGEMENT
ET Cases, 5 pages
AUTHOR(S) : R. Muthukumar and Dr. Nagendra V. Chowdary

Case Preview

Public Distribution System (PDS) of India and Its Supply Chain Management

 

In India, nearly 1.2 billion people are fed 6.2 million tonnes approx., food grains every year with the help of a strong Supply Chain Management (SCM) as the  backbone. According to experts, the Procurement, Storage and Transportation of food grains to various parts of India was possible only because of this all-inclusive spectrum of supply chain network ensuring better livelihood of people.

In India, a Public Distribution System (PDS) and its improved version Targeted Public Distribution System (TPDS) was carved out as a novel system of safety net  operations for the distribution of scheduled commodities to the targeted citizens through a network of institutions comprising Food Corporation of India (FCI)  warehouses and Fair Price Shops (FPS). However, this system is fraught with many difficulties such as inefficiency, deterioration of food grains, unsatisfactory quality of commodities, malpractices in weights and measures, mismatch of demand and supply, long waiting times, exorbitant corruption, rude behavior of shopkeepers and poor service delivery. Though having a long history, it was not able to improve its performance and efficiency.

The History of PDS

The history of the PDS in India goes back to more than half-a-century when rationing was first introduced in 1939 in Bombay by the British Government as a measure to ensure equitable distribution of food grains to the urban consumers in the face of rising prices. Thus, rationing in times of crisis like famine was the historical precursor to the national policy of stabilization and management of food grains...............

How it Works?

FCI guaranteed the procurement of Wheat, Paddy and coarse grains from farmers with minimum reasonable compensation to them for their produce. The establishment of number of purchase centres at various Mandis and key points facilitated the expedition of the produce. Such extensive and effective support operations carried by FCI in turn encouraged higher investment in agriculture sector for improved productivity with the incursion of big giants like ITC who implemented E-Choupal System to check the market prices at a click of a button................

The Problems

PDS had many problems such as inefficiency, deterioration of food grains, unsatisfactory quality of commodities, malpractices in weights and measures, mismatch of demand and supply, long waiting times, exorbitant corruption, rude behavior of shopkeepers and poor service delivery. The PDS had been criticized for its urban biased and for its failure to serve effectively the poorer sections of the population...........

The Future Ahead

India could intrinsically dream of becoming an economic super power by developing its accessibility mechanism through SCM.

In August 2014, the Ministry of Consumer Affairs, Food and Public Distribution and the FCI formed an eight-member High-Level Committee (HLC) to strengthen supply chain of food grains............

Teaching Note Preview

Public Distribution System (PDS) of India and Its Supply Chain Management

 

Synopsis

This caselet is meant for learners pursuing a course in Operations Management. The caselet helps to understand and describe supply chain and supply chain management in the context of India’s Public Distribution System. In India Public Distribution System (PDS) and its improved version Targeted Public Distribution System (TPDS) distributes scheduled commodities to the targeted citizens through a network of institutions comprising Food Corporation of India (FCI) warehouses and Fair Price Shops (FPS). However, this system is fraught with many difficulties such as inefficiency, deterioration of food grains, unsatisfactory quality of commodities, malpractices in weights and measures, mismatch of demand and supply, long waiting times, exorbitant corruption, rude behavior of shopkeepers and poor service delivery. How can these be avoided? What would be best way to manage supply chain of PDS? This caselet gives scope to debate and answer the above questions.

Prerequisite Conceptual Understanding

  • • Jay Heizer, et al., “Chapter: Supply Chain Management”, Operations Management, 9th Edition, Pearson Education, 2008

 

Case Positioning and Setting

This caselet can be used in MBA/Executive MBA program for Operations Management course to illustrate the concept of supply chain, its components and Supply Chain Management.

Assignment Questions

  • I. Draw out the PDS supply chain.
  • II. How does this supply chain differ from that in a manufacturing firm?
  • III. What are the major operations objectives of each stage of PDS supply chain?
  • IV. .......................................

 

Suggested Orchestration

The classroom discussion and analysis for this caselet could be summarized and facilitated under two broad sections [Exhibit (TN)-I].........

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Abstract


This caselet is meant for learners pursuing a course in Operations Management. The caselet helps to understand and describe supply chain and supply chain management in the context of India’s Public Distribution System. In India Public Distribution System (PDS) and its improved version Targeted Public Distribution System (TPDS) distributes scheduled commodities to the targeted citizens through a network of institutions comprising Food Corporation of India(FCI) warehouses and Fair Price Shops (FPS). However, this system is fraught with many difficulties such as inefficiency, deterioration of food grains, unsatisfactory quality of commodities, malpractices in weights and measures, mismatch of demand and supply, long waiting times, exorbitant corruption, rude behavior of shopkeepers and poor service delivery. How can these be avoided? What would be best way to manage supply chain of PDS? This caselet gives scope to debate and answer the above questions.



Pedagogical Objectives

  • To explain the strategic importance of the supply chain
  • To discuss and debate on the issues and opportunities in the supply chain

Case Positioning and Setting

This caselet can be used in MBA/Executive MBA program for Operations Management course to illustrate the concept of supply chain, its components and Supply Chain Management.




This Case Pack Includes:
- Abstract
- Caselet
- Teaching Note (**ONLY for Academicians)
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