Harvard Case - Ecofriendly Solution to Crop Residue Burning
"Ecofriendly Solution to Crop Residue Burning" Harvard business case study is written by Haritha Saranga, Shashikant Kumawat. It deals with the challenges in the field of Operations Management. The case study is 17 page(s) long and it was first published on : Nov 15, 2021
At Fern Fort University, we recommend a multi-pronged approach to address the issue of crop residue burning in India. This approach focuses on developing a sustainable supply chain for utilizing crop residue as a valuable resource, while simultaneously promoting awareness and incentivizing farmers to adopt alternative practices.
2. Background
The case study focuses on the problem of crop residue burning in India, a practice that contributes significantly to air pollution and has severe health and environmental consequences. The government has implemented various policies and programs to curb this practice, but the problem persists due to a lack of viable alternatives for farmers. The case highlights the efforts of a company, 'GreenTech,' to develop a sustainable solution by converting crop residue into biofuel.
The main protagonists of the case are:
- GreenTech: A company aiming to develop a sustainable solution for crop residue management.
- Farmers: The primary stakeholders affected by the problem and potential beneficiaries of GreenTech's solution.
- Government: The regulatory body responsible for implementing policies and supporting sustainable practices.
3. Analysis of the Case Study
This case study can be analyzed using the Porter's Five Forces framework to understand the competitive landscape and the potential for GreenTech's solution:
- Threat of New Entrants: The barrier to entry in this market is relatively low, as the technology for converting crop residue into biofuel is readily available. However, establishing a robust supply chain and securing sufficient crop residue supply can be challenging.
- Bargaining Power of Buyers: Farmers have limited bargaining power due to their dependence on GreenTech for a viable alternative to burning. However, GreenTech needs to ensure a fair price for the residue to incentivize farmers.
- Bargaining Power of Suppliers: The bargaining power of suppliers (farmers) is limited due to their need for a solution to crop residue management.
- Threat of Substitute Products: Other alternatives to crop residue burning exist, such as composting, animal feed, and using it as a soil amendment. However, these options may not be as economically viable or efficient as GreenTech's biofuel solution.
- Competitive Rivalry: The competitive landscape is likely to be dynamic, with potential entrants and existing players competing for market share. GreenTech needs to differentiate itself through its value proposition, efficiency, and sustainability.
4. Recommendations
1. Develop a Sustainable Supply Chain:
- Establish strategic partnerships with farmers: GreenTech should collaborate with farmers' cooperatives and agricultural organizations to establish a reliable and sustainable supply chain for crop residue.
- Implement a 'Just-in-Time' (JIT) production system: This will minimize the need for large-scale storage and reduce potential waste.
- Leverage technology and analytics: Implement an Enterprise Resource Planning (ERP) system to manage inventory, track logistics, and optimize production processes.
- Develop a robust logistics network: This includes efficient transportation and handling of crop residue to minimize spoilage and ensure timely delivery to processing facilities.
- Implement a 'Reverse Logistics' system: This will ensure responsible disposal of any unusable residue and minimize environmental impact.
2. Enhance Product Development and Innovation:
- Focus on R&D: Invest in research and development to improve the efficiency and effectiveness of the biofuel conversion process.
- Explore new product applications: Investigate potential applications for the biofuel beyond transportation, such as electricity generation or industrial use.
- Adopt a 'Lean Manufacturing' approach: This will optimize resource utilization, reduce waste, and improve overall efficiency.
- Implement 'Six Sigma' methodology: This will ensure consistent quality and minimize defects in the production process.
3. Implement a Comprehensive Marketing Strategy:
- Target key stakeholders: Focus on educating farmers, government officials, and consumers about the benefits of GreenTech's solution.
- Leverage digital marketing: Utilize social media platforms, websites, and online advertising to reach a wider audience.
- Build strong brand reputation: Emphasize the sustainability and environmental benefits of GreenTech's biofuel.
- Offer incentives and subsidies: Collaborate with the government to provide financial incentives for farmers to adopt GreenTech's solution.
4. Foster Collaboration and Partnerships:
- Engage with government agencies: Seek support from government agencies for policy changes, financial incentives, and infrastructure development.
- Collaborate with research institutions: Partner with universities and research organizations to develop innovative solutions and improve the technology.
- Engage with NGOs and environmental organizations: Build partnerships to raise awareness and advocate for sustainable practices.
5. Implement a Robust Risk Management Strategy:
- Identify and assess potential risks: This includes supply chain disruptions, technological challenges, regulatory changes, and market volatility.
- Develop mitigation strategies: Implement contingency plans and backup solutions to address potential risks.
- Monitor and evaluate performance: Regularly assess the effectiveness of risk mitigation strategies and make necessary adjustments.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core competencies and consistency with mission: GreenTech's core competency lies in developing sustainable solutions for crop residue management. The recommendations align with its mission to create a positive environmental impact and provide a viable alternative to crop residue burning.
- External customers and internal clients: The recommendations consider the needs of farmers, government agencies, and consumers, while ensuring the long-term viability of GreenTech's business.
- Competitors: The recommendations aim to differentiate GreenTech from competitors by focusing on sustainability, innovation, and building strong partnerships.
- Attractiveness - quantitative measures: The recommendations are expected to generate positive financial returns through increased efficiency, reduced costs, and expanded market share.
- Assumptions: The recommendations are based on the assumption that the technology for converting crop residue into biofuel will continue to improve and that the government will support policies promoting sustainable practices.
6. Conclusion
By implementing these recommendations, GreenTech can establish itself as a leading provider of sustainable solutions for crop residue management in India. This will not only contribute to reducing air pollution and improving environmental sustainability but also create a significant economic opportunity for the company and its stakeholders.
7. Discussion
Alternatives not selected:
- Focusing solely on technology: While technological innovation is crucial, it is not sufficient without a robust supply chain and effective marketing strategy.
- Ignoring the role of government: Government support is essential for policy changes, financial incentives, and infrastructure development.
Risks and key assumptions:
- Market volatility: The demand for biofuel may fluctuate depending on factors such as oil prices and government policies.
- Technological advancements: The technology for converting crop residue into biofuel may become obsolete or less competitive in the future.
- Government support: The level of government support for sustainable practices may change over time.
8. Next Steps
- Phase 1 (Year 1): Secure strategic partnerships with farmers, develop a pilot project, and refine the technology.
- Phase 2 (Year 2): Expand the supply chain, build a processing facility, and launch the biofuel product in the market.
- Phase 3 (Year 3): Optimize operations, expand market reach, and explore new product applications.
By following these steps, GreenTech can effectively address the problem of crop residue burning and create a sustainable future for India's agricultural sector.
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Case Description
The case describes the problems in agricultural practices in the north-western states of India and the efforts of a non-governmental organization, CII-ITC Centre of Excellence for Sustainable Development (CESD) and CII Foundation (CIIF), to address those problems. Through the journey of the CIIF team in learning about the problem and piloting the solutions, the case describes the nature and scale of the problem of crop residue burning (CRB) after harvesting the paddy crop. The case explains the decision-making pattern of farmers and the factors that compel them to adopt the unsustainable practice of CRB. The case sensitizes students to the adverse impact of such unsustainable agriculture practice not just in the local ecology but also in the air quality of the nearby region of Delhi NCR. The students can not only learn about the various technical solutions but also about non-technical aspects such as how successful collaborations between various governmental and non-governmental stakeholders can help address the problem of crop residue management (CRM). The pilots on a smaller scale (select villages) by CIIF also generated valuable data about the key considerations of farmers in choosing CRB over the eco-friendly alternative CRM solutions. The students are expected to use this data to objectively arrive at the CRM option best suited for a particular farmer. The data presented in the case allows for the learning and application of various multi-criteria decision-making (MCDM) techniques such as analytical hierarchy process (AHP) and decision tree analysis.
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