8/8/2019 Putting Together the Strategic Intent at Dabur India Limited

1/3

PUTTING TOGETHER THE STRATEGIC INTENT AT DABUR INDIA

LIMITED*

Cholera, malaria and plague have been killer diseases in India. In 1884, Dr. S.K. Burman embarkedon a mission to provide nature-based, effective and affordable treatment for these killer diseases

for ordinary people in far-flung villages of Bengal. He adopted ayurveda, the traditional Indiansystem of medicine. Dr. Burfnan established a pharmacy that set up a manufacturing plant in 1896

and research laboratories in 1919, becoming a full-fledged private company in 1936 that 50 yearslater, in 1986, became a public limited company. He came to be known as Daktar {Indian

pronunciation of 'doctor') Burman. The organisation he founded came to be known as Dabur.

Dabuivis a leading consumer goods company in India, having three subsidiary companies and 13manufacturing plants. It operates in nearly 50 countries, making it an Indian multinational company.

Within the company, there are two strategic, business units (SBUs): Consumer Care Division (CCD)and Consumer Health Division (CHD). CCD deals with consumer products in personal care and

health care. CHD deals with classical ayurvedic medicines. It markets its products through anextensive wholesale and retail network of 47 agents, 5000 distributors and 1.5 million retail outlets.

The vision of Dabur is stated as: 'Dedicated to the health and well being of every household.'

There is no specifically-stated mission statement but a statement of strategic intent having severalelements such as:

Developing a platform to become a global ayurvedic leader

Synthesising knowledge of ayurveda and herbs with modern science to develop naturalsolutions for meeting the health and per sonal care needs

Providing superior returns to shareholders relative to rivals in industry Being a responsible corporate citizen com

mitted to environmental protection Nurturing core brands across cate

within India and outside

Being a professionally managed employerattracting, developing and retaining quality

personnel Improving operational efficiency by

leveraging technology

There are six core values that Dabur practices: ownership, passion for winning, people develop-

ment, consumer focus, team work and innovation. Its- corporate positioning statement is 'celebratelife' that goes with its bright green and brown coloured logo depicting a banyan tree.

The brand name 'Dabur' is claimed to mean different things to different people. It operates at

three distinct levels: as the company's corporate brand identity, the mother brand for a whole range ofproducts and it also percolates down to individual product names.

Dabur has tried to alter the product concept of ayurveda medicines as consumer products sold

over the counter. For instance, it has the distinction of changing the product concept ofchyavanprash from being a traditional compound of herbs and plant extracts having anti-oxidant

8/8/2019 Putting Together the Strategic Intent at Dabur India Limited

2/3

properties, to a branded consumer product sold over the counter for general health upkeep of thewhole family.

1

Dabur follows a four-year time horizon strategic planning. The 2002-2006 strategic plan envis-aged Dabur becoming a Rs. 2000 crore-company by the period 2006-2007. It has been successful in

realising that objective. In the next four-year strategic plan, its objectives are to continue the

growth momentum at a similar pace. It aspires to be a global FMCG company where more rev-enues come from outside India. In the next strategic plan, it aims to raise the revenue share from

international operations from the present 12 per cent to 20 per cent.

The business model of Dabur is based on pushing through high growth parameters, in the

range of 10 to 15 per cent annually, in the core domestic FMCG businesses in the consumercare division and even higher growth rates of 25 to 30 per cent annually from businesses

outside consumer care.

The strategies adopted are a combination of internal growth and external growth through ac-quisition that it terms as organic and inorganic growth respectively.

Generally, Dabur haS performed well except in cases where it had to deal with tough

competition in the intensely competitive consumer goods in India. Analysts say that thecompany has perhaps been eyeing too many divergent new product categories over the years.

Dabur's strategy for the nextfew years seems to be: growth through domestic and

international acquisitions, launching new products and penetrating deeper into rural Indianmarkets.

In the near future, Dabur will have to decide whether it wishes to be a pure herba brand or a

leading FMCG player, neither of which it can claim to be with conviction today.'

8/8/2019 Putting Together the Strategic Intent at Dabur India Limited

3/3