Get instant access to this case solution for only $15

ITC eChoupal Initiative Case Solution

Solution Id Length Case Author Case Publisher
1019 1249 Words (5 Pages) David M. Upton, Virginia A. Fuller Harvard Business School : 604016
This solution includes: A Word File A Word File

This case is based on a developmental initiative in the agricultural model of the villages in India. The farmers in Indian villages were given no options but to sell their crops to government-employed middlemen who got a greater share of the profits. The development of this initiative led to the commissioner agents system to decline and facilitated the development of the rural area. The reduction in information asymmetry was the main strength of the project that facilitated the development of such a transparent and fair system.

Following questions are answered in this case study solution

  1. Describe ITC's e-Choupal initiative to engage the farmers to the next level. Flow is version 3.0 is different from the earlier two versions?

  2. Analyze the proposed responses of the company to its competitors and offer your comments.

  3. What stages of evolution e-Choupal experiment has gone through? What do think is the main strength of the program and what could be the benefits to the innumerable farmers?

  4. How can mass technology (e.g., mobile telephony) play a part in supporting the envisaged transformation of rural areas?

Case Analysis for ITC eChoupal Initiative

1. Describe ITC's e-Choupal initiative to engage the farmers to the next level. How version 3.0 is different from the earlier two versions?

E-Choupal was an initiative to create a virtual marketplace for the farmers. The main aim of this initiative was to impart knowledge to the farmers who had no means to get the information. The only source of information about the actual marketplace was from word-of-mouth knowledge distribution. The asymmetric information gave an additional advantage to the government commission agents (CAs). They offered less to the farmers and being the middlemen, they kept the profits to themselves. Also, they weighed the crops unfairly resulting in the farmer losing out on the actual weight of the crops. Thee-Choupal initiative empowered the farmers with information and gave them the choice to opt for sales to the ITC or the Mandi. As farmers experienced more gains from thee-Choupal as compared to the Mandi, they moved to the next level. The trusted people of the village were offered job opportunities to them. These people were termed as Sanchalak, who represented the people of the village serving as middlemen. They earned a commission more than the CAs of the government. The system was organized, and the farmers got fair and more profits for their crops. Other additional services of insurance and credit are benefits to the farmers.

2.  Analyze the proposed responses of the company to its competitors and offer your comments.

The ITC’s competitors were the Mandis established by the government. The commission agents (CAs) hired by the government to bid the price for the crops were the ones who were the parties affected by this development. The CAs played the role of the middlemen, and they offered low prices to the farmers for their crops. They sold it for a greater amount and kept the profit margins. They also weighed the crops unfairly, and the system was a monopoly with the farmer's helpless. They had no choice but to sell their produce to the CAs because there was no other better alternative available to them.

ITC started off by buying soya from the Mandis. They developed their system of supply and developed contractual and formal relationships between the buyers and the farmers. The development of a system that was transparent and fair, and aimed at reducing information asymmetry required a lot of investment. The system prevalent before the ITC was governmental and monopolistic. Breaking through that system was a difficult task. The development of such a system in other states in India and other developing countries would depend on the power of the government in these areas. Also, it would depend on the adaptability of the people to technological developments.

3. What stages of evolution e-Choupal experiment has gone through? What do you think is the main strength of the program and what could be the benefits to the innumerable farmers?

Thee-Choupal initiative started from a small kiosk with a computer, backup power supply, internet access, and a printer. This initiative grew from a small computer set up at a choupal to organized centers for the sale of the crops. The choupal is a place that is designated for social gatherings at a village. The people in the villages do not have any other form of entertainment other than interacting in social gatherings that are conducted every day in the evening. After the choupal, the model was expanded with a setup for sale to the ITC rather than going to the Mandi. The disadvantage for farmers there were the transportation costs for the farmer as well as the unfair weighing and low payments.

Get instant access to this case solution for only $15

Get Instant Access to This Case Solution for Only $15

Standard Price

$25

Save $10 on your purchase

-$10

Amount to Pay

$15

Different Requirements? Order a Custom Solution

Calculate the Price

Approximately ~ 1 page(s)

Total Price

$0

Get More Out of This

Our essay writing services are the best in the world. If you are in search of a professional essay writer, place your order on our website.

Essay Writing Service
whatsapp chat icon

Hi there !

We are here to help. Chat with us on WhatsApp for any queries.

close icon