East African Business Week (Kampala)
15 November 2008
Early this year (2008), a historic event that will transform Uganda's dairy sector for ever, took place in one of Kampala's industrial hubs. Uganda's President Yoweri Museveni opened a US$15 million powder milk plant whose investment is expected to expand markets for Uganda's milk sector to generate up to $40 million annually.
There was joy and jubilation as President Museveni that day flagged off a consignment of 15 tonnes of milk powder for export to Syria. It was also the day the government of Uganda announced that it would import breeds of dairy cattle from either Canada or Australia to help boost a dairy sub-sector that needs more raw milk than ever before following a turn around that Sameer Agriculture and Livestock Ltd (SALL) has engineered.
The plant, a joint venture between the Kenya-based Sameer Group and the RJ Corp, of India which bought the former Dairy Corporation Limited (DCL) will process 250,000 litres of milk daily to produce over 20 tons of milk powder per day.
SALL took over DCL in 2006, at a time when raw milk collection stood at a mere 50,000 litres. Since then, SALL has more than doubled-now standing at 120,000 litres of raw milk.
The turn around that SALL has overseen has resulted in an unprecedented growth of the dairy sector, now producing 1.4 billion litres of milk up from 700 million litres in 2000. During the official launch ceremony, Mr. Naushad Merali, the chairman of Sameer Group, said more capital would be invested in the company.
The export market has also already reacted to the development, with some 25 tons of milk powder having been exported to Rwanda. Orders have also come in from Kenya, Tanzania, Yemen and Sudan. SALL is also prospecting in Syria, Mozambique, Ethiopia and DR Congo. Plans are also in the works to establish a model dairy farm/institute to provide free training to farmers.
SALL's product range now stands at skimmed milk powder, full cream milk powder, pasteurized milk, plain and flavoured yoghurt, plain and flavoured UHT milk in tetra bricks and low fat UHT milk in tetra brick; UHT milk in tetra fino (pillow type), ghee, butter and fresh cream and machines have been ordered to add ice cream to the product range.
The past 22 months since SALL took over have seen investment in equipment, technology and human resources which have started to pay off.
Besides growing milk collection, SALL is injecting on average Ush1.4 billion up from Ush330 million to the dairy farmers. Collections are likely to jump to 300,000 litres per day.
Currently, SALL exports over 300,000 litres of UHT milk every month and exports of the product are growing fast.
Nearly 50,000 farmers partner with SALL all over Uganda. With the expanded processing capacity of over 400,000 litres per day, SALL offers dairy farmers a guaranteed market for their milk. To try and build capacity so the milk supply is maintained or pushed up, SALL is engaging in offering regular trainings on milk collection and testing for clean milk production.
Management
Nobody, however, can dispute the fact that such huge business dreams and having them achieved in time needs an excellent manager. And to this direction, Sameer got it right. The face of all these achievements and grand plans is a simple amiable man; Mr Gaggar who would rather, the credit goes to the entire Group and team behind the good work.
But he is not shy to repeat the company dream to make Uganda a dairy hub of Africa through increased processing and quality capacity. Gaggar is responsible for an aggressive marketing campaign to assert SALL's position in the local and-yes, the international market. And all this, says Gaggar, is not meant to push anybody, including raw milk vendors, out of the market.
"The mission of Sameer is to generate customer need. We ensure that the product is of good quality, is available, affordable and that we understand the customer need and ultimately, every management has to work hard to satisfy the customer's need," he says. Gaggar, by virtue of being the top executive of the Group carries the obligation-the pledge to improve the quality of life of dairy farmers on his shoulders.
"Sameer is committed to contributing to the increased generation of wealth of dairy farmers and down the lane we want to work towards livestock feed management to better the quality and quantity of milk and hence improve on earnings across the dairy chain," he admits. "The idea is to give the farmer a platform to produce more on the principle of quality."
Gaggar has worked in various sectors as a senior manager. He believes that the principles of management are similar world over. "The most important thing is to tune your experience to suit the local needs of the market," he observes.
This probably has marked his success in transforming a once a sleeping and dying giant called Uganda Dairy Corporation into one of the reference entities in Uganda's rejuvenated industrial sector.
But Gaggar has a sense of humility to owe it to the Group he works for: "Sameer worldwide is a giant investment and that is why it was able to come to Uganda; and that is why it is easy to do a good job for the company," he says. Before joining Sameer Gaggar was the Executive Director at Jaipuria Group of India. He has variously trained in food and beverages, textiles but his professional grounding is in chemical engineering.
Some of the major things he and the team have had to fix in the old dilapidated Dairy Corporation include working on the obsolete technology and plant, fix the people skills, overhaul the technology, putting in a lot of hardware and software systems in place and establishing the rural farmer networks.
"We cannot rest until we have reached a certain stage of development," he says-a sign of total commitment to work.
When you probe this man's inspiration to work to achieve, you find it in a sort-of -small document of work: He is able to be a good leader because he respects the values of human dignity and equality, high standards of responsibility for self and for others, hard work and perseverance, competence of skill and knowledge, productive, analytic and creative thinking habits, and is passionate about the business he is doing. These, qualities, says Gaggar, are universal guidelines that every leader or manager must have.
So blessed with a man with these rare leadership qualities, SALL has rebuilt the confidence of farmers by maintaining prompt and regular payments for milk delivered. The milk collection network has expanded from south-western Uganda to central Uganda, and is gradually expanding to eastern Uganda. SALL will soon launch farmer's education programmes with field extension services to educate them on various issues like animal health, disease control, animal feeding and nutrition, dairy animal breeding etc.
The company has repaired the chilled water and the entire refrigeration system. It has repaired and expanded the pasteurized milk and the UHT milk lines, expanded both pasteurized and UHT milk packing lines.
Before SALL took over, the plant was only producing UHT tetra brick packets. As a result of the expansion work, the plant can now produce UHT tetra fino packets as well.
The manual yoghurt production system has now been fully automated, the capacity boosted and the line is now housed in a specially built room.
A completely new laboratory has been established to handle a wide range of both analytical and microbiological tests and a complete captive power generation capacity of 3250 KVA, along with new transformers and a capacitor bank have been put in place.
Today SALL is pursuing at most quality that is critical to such an industry.
"We started a journey to implement ISO 220000 certification in January 2008 and we are proud to announce that after final audit of our systems by Nemko of Norway, we received the ISO 22000 certification in Septemeber 2008," Gaggar told this writer recently.
ISO 22000 was launched in the world in 2005 and there are not many companies in the world having this certification.
SAAL started the quality revolution from day-one of its operations. In the year 2007 the company received ISO 9001:2000 QMS certification, followed by UNBS (Uganda National Bureau of Standards) product quality mark.
"The objective is to prevent food borne hazards at the point of consumption by providing adequate controls throughout the food chain like through the equipment, packing materials, cleaning materials, additives, ingredients etc," says Gaggar.
True to a corporation worth its salt, the standards will certainly enhance the business reputation and corporate image, and help the company to access new markets as well more share from existing customers.
"The company also wants to communicate to the customers that we care for them and have a commitment to their well being," he says.
"SALL is the first dairy processor plant in East Africa to receive ISO 22000 certification. This will enhance our business reputation and corporate image and help us to access new markets. For example we are in a dialogue with Nestle and Cadbury to sell milk powder to them. The new certification will facilitate our registration with them. Nestle and Cadbury will certainly conduct their own pre-audit of out facilities and systems."
SALL has set eyes to achieve ISO 14000 (environment management systems) and ISO 18000 for occupational hazards and safety management systems. In just about 22 months since take-over, these are miles to celebrate, milestones that speak of good management and milestones that should be told to the world.
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