FLORICULTURE CLUSTER IN PUNE, INDIA

Best practices

By Laura Dos Santos

Sarah Gay

Saki Hanzawa

& Louise Penin

ECO3. I’m ready to

export my products

ENV1. I measure

my impacts on

environment

ENV2. I reduce

my impacts

ENV3. I

innovate to

reduce my

SOC1. I set up conditions

to keep up the social

performance

SOC2. I do have

good working

conditions

SOC3. I implement the

social performance to

the strategy

GOV1. I identify

my stakeholders

GOV2. I am in

contact with

them

GOV3. I

collaborate

with them

I KNOW I DO I EVOLVE

Best practices Global view

ECO2. I reduce

waste in my

production

ECO1. I organize my

process of production

Governance Toward a collaborative communication

GOV1. I IDENTIFY MY

STAKEHOLDERS

GOV3. I

COLLABORATE WITH

THE STAKEHOLDERS

Governance is a transversal

s t a k e f o r s u s t a i n a b l e

development and CSR. The aim

is to gather stakeholders around

o n e o b j e c t i v e o f g l o b a l

performance.

To gather stakeholders, there are

three phases: the identification,

the communication toward them

and, the collaborative work with

some of them.

In our cluster, the main objective

is to create a synergy between

al l actors and make them

sharing their resources to be

m o r e e f f i c i e nt w i t h f e we r

resources.

GOV1. I

identify my

stakeholders

GOV2. I am in

contact with

them

GOV3. I

collaborate with

them

GOV1. I IDENTIFY MY

STAKEHOLDERS

The first step toward a collaborative business is the identification of the stakeholders, that

is to say know who they are, how they can impact you and what your level of depend-

ence regarding them is. The aim of this best practice is to realise a cartography of all the

stakeholders to see the strong and the weak points.

BENEFITS

Stakeholders are part of the business so they need to be clearly

identified to be included in the strategy. Without doing this, you can

do anything to improve your business, you will never know the im-

pact and so never really thrive and develop sustainably.

STEPS

1. You have to know who the other actors of the cluster are, that

is to say: their name, activity and size. You can fill the table 1

below to have a global view of them.

2. You have to know all your stakeholders, that is to say your cli-

ents, providers, subcontractors, employees and other public

institutions. For this, you can be able to position each of them in

a cartography, like in table 2 and place everyone in a scheme

like scheme 3.

Regarding employees, you may be able to fill the table 4 for

safety reasons but also to know their abilities, especially for dai-

ly workers & adapt your needs to the resources..

3. You have to know who your final consumers are in order to sat-

isfy them and to develop new markets. So you need to have

the percentage of your flowers which are sold in each market

place in Europe. If you don’t know this data, do not hesitate to

contact your export agent.

EXAMPLES

Table 1 for clusters’ actors:

Table 2 :

Scheme 3 :

Table 4 for employees contact :

Name of the firm Name of the boss Number of employees Type of production

INTEREST LEVEL

Weak Strong

Weak Keep satisfied Key actors POWER

Strong Minimal effort Keep informed

Name Gender Age Contact in case of emergency Speciality

GOV2. I AM IN

CONTACT WITH MY

STAKEHOLDERS

Once you have identified who are your stakeholders, establishing a strategy means not

only knowing they exist, but also knowing what they want and how you can play win-win.

For this, you need to be in contact and communicate with them. The aim of this best

practice is to formalize a contact with the shareholders.

BENEFITS

The company will be able to set up a strategy on the long term

thanks to the inclusion of the stakeholders. Indeed, without including

them, the strategy is precarious because without foundations.

STEPS

1. You have to communicate with the other actors of your cluster

to create visibility and synergy. You can choose various means

more or less formal and more or less computing.

We suggest you to do it by an intranet if it exists, a newsletter or

regular meetings but you can be as innovative as you wish

once they know you and want interact with you.

2. You have to communicate with the external stakeholders you

have identified before. This will create visibility and credibility.

You can choose various means more or less formal and more

or less computing. We suggest you to do it by editing charters

to describe you mission, vision and values, your commitments

and everything which could describe you. This is an example

but you can be as innovative as you wish once you broadcast

it in order to be understood and known.

REFERENCES

Chapter 7.5 of ISO26000 norm is dealing with the communication

with the stakeholders regarding CSR.

GRI Guidelines are also recommending communicating to stake-

holders, following their indicators.

STEPS

3. Each of the consumers (wholesaler) who buy your flower

should be able to know more about you, and why not be

able to contact you if he is convinced by the quality of your

product?

You can choose various means but preferably formal and

computing solutions.

We suggest you to do it by creating a website page with your

contact and all kind of information you think your final clients

could be interested in.

GOV3. I

COLLABORATE WITH

THE STAKEHOLDERS

Once you have identified your stakeholders, you communicate with them and you

know your business position, your aims and your strategy thanks to this knowledge, you

need to go further your restricted action field: you need to collaborate with other actors

of the cluster to look out the outlook on the long term. The aim of this best practice is to

create a synergy between all the cluster actors, made of resources sharing.

BENEFITS

Create a synergy between cluster actors through a common vision

will make them cooperate and help each others. It will be easier to

progress but also to face problems and crisis. Indeed, with resources

sharing, risks are lower while benefits are higher. Thanks to this best

practice, we can hope for the cluster a growth to propel it amongst

the biggest floriculture actor in India.

STEPS

1. Now you know and communicate with other clusters’ actors,

you have to benefit from the synergy to gather and create

global vision and values. So you have to create a document

with these commitments, agreed and signed by several actors.

See Kenyan’s floriculture cluster example on reference 1.

2. You have to report in a common document, published once a

year to explain what you did and what you will do economi-

cally, environmentally and socially. ISO26000 norm and GRI are

referring to this practice (cf. ref. 2). Read also our “create your

sustainable development report” guide on Blueprint21.

REFERENCES

Reference 1 : http://www.fpeak.org/about.html

create your sustainable development report is a guide you can find

on our blueprint21 platform.

Reference 2 : Chapter 7.5 and following of ISO26000 norm is dealing

with the communication in sustainable development field and par-

ticularly in reports. Global Reporting Initiative is a guideline to help

creating CSR reports.

Reference 3 : muressa.org (in French) - 4 kind of exchanges are pos-

sible : skills, logistic resources, tools and expériences

STEPS

3. To be the more efficient possible, you have to share your

resources with other clusters’ actors.

You have to imply a computer system to know resources

available and match them with your needs.

A French project, detailed in reference 3, aims at valorising

resource sharing and explains what the advantages are.

Economics Toward a lean management

Flower is perishable agricultural

product, so in order to avoid

losses as many as possible, it is

the most economical to produce

the product what customer

needs, the exact amount, and to

deliver it at the right place, at

the right time. For example,

r e s p o n s i v e o r d e r s y s t e m ,

production schedule following

the order, shipment instructions

to growers, and fast reliably

distribution from producers to

customers. For build it, we are

inspired by Just-in-time of Toyota

Production System or method of

e l i m i n a t i n g w a s t e , a n d

eventually we will adapt the

s a m e m e c h a n i s m t o

international export.

ECO2. I REDUCE

MY WASTES OF

PRODUCTION

ECO3. I AM

READY TO EX-

PORT MY PRO-

ECO3. I’m ready

to export my

products

ECO2. I reduce

waste in my

production

ECO1. I organize my

process of production

ECO1. I ORGANIZE

MY PROCESS OF

PRODUCTION

India has good prospects in the floriculture industry but it is still largely unorganized. So

far growers have not been receiving orders, and they sell the volume of flowers which

could be harvested at the auctions or to the wholesalers. In the first step, we shift from

the old system to the new optimized production process. We aim at establishing a pro-

cess for deploying the order system, building the production schedule and delivering

quickly to customers.

BENEFITS

Farm products are unlike industrial products in difficulty of produc-

tion control. Therefore, in the traditional process, there is no produc-

tion schedule and not enough to respond to customer needs, or a

lot of losses had been made. Thanks to new process, we are able to

achieve quick response to customer needs, lean production and

cutting of losses during transportation. Moreover, we can expect

that the price will be lower when the supply exceeds the demand.

STEPS

1. You should set up an electronic order system which can use

with your customers.

2. You can make a production schedule thanks to orders.

3. You must find transporters or own logistic chain for deliver in

time, at the right place without fail.

REFERENCES

The necessity of precision agriculture. – Use appropriate technology

to bring precision agriculture to Africa and India.

Global-economic-symposium.org

EXAMPLES

For the electronic order system. – The system calls cultivators to har-

vest and shipment after receiving orders from several sales destina-

tions.

Itmedia.co.jp (in Japanese)

For the production planning: interface.highwire.org

For the logistic system: ideas.repec.org , Growdirect.com

ECO2. I REDUCE

MY WASTES OF

PRODUCTION

In the second step, we will completely eliminate elements of production that do not cre-

ate value (MUDA = wastes) in order to reduce the cost while producing timely the high

quality product and receiving customer orders. It calls “MUDA” in Toyota Production Sys-

tem. The most important thing is to continue struggling on elimination of MUDA, and also

to put 5S get clues to find wastes.

BENEFITS

Eliminating MUDA is required in various phases, for example, to cut

extra motion and transportation promotes your operational efficien-

cy. Also, we can expect cost reduction to avoid over-production,

too much inventory and defects. Just keep the workplace neat and

tidy, we can discover wastes, and it will lead to improvement of the

workplace.

STEPS

For eliminate MUDA and improve for the better , there are several

approach.

1. You introduce the method of 5S on your production process.

2. You find ways to visualize your wastes (reference 1).

3. You make an effort for the continuation of improvement.

REFERENCES

Reference 1 : About the seven MUDA, and the 5S :

doshnsclick.files.wordpress.com

EXAMPLES

There is example of initiative that was introduced into agriculture Toyota

Production System in Japan. It was a salad leaves farmer. Similarly, Indian

rose grows fast and it can be harvested several times a year. Therefore it’s

easy to measure the improvement.

Tokyokeizai.net (in Japanese)

ECO3. I AM READY

TO EXPORT MY

PRODUCTION

India’s share in international trade in floriculture is around 0.18%. To compete with Kenya

and Uganda which are major exporters to the European market, we have to take more

overseas orders. For the third step, in order not to miss the opportunity to enter foreign

market, we ready for export such as we could respond quickly to international orders.

BENEFITS

Computerization allows for immediate response and does not miss

the overseas demand. To facilitate both logistics and export condi-

tions in cooperation will lead to lowering the barriers for many farm-

ers to export. As a result, Indian trade would rise in the world market.

STEPS

1. You connect with international customers through real-time or-

der system.

2. You improve your logistics with other farmers in collaboration.

3. You work on the negotiation for conditions of export.

REFERENCES

CBI (Centre for the Promotion of Imports from developing countries) :

cbi.eu

EXAMPLE

Example of joint export in Israel : hortibiz.com

Example of joint project CBI and Ethiopian flowers : cbi.eu

F lo r icu l tu re i s one of the

industries that require a large

labour force with limited skills.

The production involves grading,

packing, harvesting, tending

beds, watering and so on. In

India many of the workers are

p o o r a n d v u l n e r a b l e t o

exploitation. The bad working

conditions are more and more

an obstacle for customers from

developed countries which can

choose a flower which comes

from a developed country where

the workers are probably better

treated. Implement a social

strategy is a way to seek for a

n e w d e m a n d . T h e

recommendations of the Ethical

Trade Initiative, an international

label and the ILO will guide the

establishment of best social

SOC1. I set up conditions

to keep up the social

performance

SOC2. I do have good

working conditions

SOC3. I implement the

social performance to

the strategy

Social Toward a better image of the working conditions

SOC1: I SET UP

CONDITIONS TO

KEEP UP THE SOCIAL

PERFORMANCE

Set up conditions to keep up the social performance means that the company pro-

vides resources to manage the social improvement. It involves criterias of recruitment

which respect human rights but it also involves people among managers and workers

who are spokespersons and responsible of the project

BENEFITS

The social aspects of work in floriculture are more and more

watched by NGOs and occidental consumer which is the target of

your cluster. In Kenya, serious violations of the human rights were re-

ported and pushed the company to re-think their model. Beyond

that, the social performance will prevent from social rebellion and

will assure a better management of human resources. It means to

be able to adapt the work force to any change of the production

process. Responsible persons had to be designed to conduct the

social improvements.

STEPS

1. You need a responsible of the working conditions among

managers. It has to be someone who is comfortable to discuss with

employees, someone who has good interpersonal skills.

2. Design a spokesperson among your employees. He can be

chosen by the employees to be more legitimate

3. Your criterias of recruitments have to include no child labour,

employment freely chosen and no discrimination

REFERENCES

Smith, S. et al (2004), Ethical Trade in African Horticulture: gender,

rights and participation,

Genderandtrade.org

SOC2: I DO HAVE

GOOD WORKING

CONDITIONS

The Declaration on Fundamental Principles and Rights at work (ILO, 1998) written by the

International Labour Organisation, an agency from the UN define standards as

fundamental rights at work. These standards are grouped in four categories: freedom of

association and the effective recognition of the right to collective bargaining, the

elimination of forced or compulsory labor, the abolition of child labor, and the

elimination of discrimination in respect of employment and occupation. As a member of

the ILO, India respects those fundamentals rights and labour laws are the same in every

state. These are the basics to provide good working conditions.

BENEFITS

By respecting basic fundamentals of the human rights at work, the

company will be able to communicate about it and to become a

model and an attractive place to work.

STEPS

1. You register the work-related accidents

2. You have a device control for the working hours

3. You offer at least the minimum wage to all of the workers?

REFERENCES

ILO, 1998 The Declaration on Fundamental Principles and Rights at

work http://www.ilo.org/declaration/lang--en/index.htm

EXAMPLES

A Register example :

Name of injured worker__________________________________________________________

Occupation or job title___________________________________________________________

Date of injury____Hour ____ am/pm

Worker’s exact location at time of injury___________________________________________

Exact description of how injury sustained__________________________________________

Nature of injury and body parts affected__________________________________________

Details of treatment given________________________________________________________

Return to work : yes/no

Name of witness (if any) to the injury______________________________________________

Name of person making entry____________________________________________________

Signature_________________________________________Date of entry_______

SOC3 : I IMPLEMENT THE

SOCIAL PERFOMANCE TO

THE STRATEGY

Social performance is not just about profits for the society, it will be a competitive

advantage for the company. The condition is to implement it into the company’s

strategy. Each crucial decision about the production process, about how to make

create value has to be thought with the human resources. A more ethic trade

approach will be valued for the company and their clients. To be internationally

recognised the Ethical Trade Initiative label wich is based on ILO standards will be an

interesting target. It is a label supported by well known groups as Tesco, Sainsbury, M&S

which could be potential retailers but also holding of horticulture. They have an

expertise in floriculture in Kenya so they are able to propose a well-adapt support.

BENEFITS

Having a real management of human resources will assure to the

company to be more competitive. First by having the right human

to the right place with the right job and then by showing to the de-

veloped countries that they are ethical.

STEPS

1. Establish a monitoring committee in the cluster to control the so-

cial performance.

2.Adapt the ETI base code to your industry with the responsible(s)

and spokesperson(s).

3. Prepare the cluster to apply for the Ethical Trade Initiative label.

REFERENCES

ETI, (2011) The flower industry http://www.ethicaltrade.org/in-action/

issues/the-flower-industry

The f lo r icu l tu re product ion i s

main ly under poly houses in

Ind ia. Th i s way of producing

i s bene f ic ia l fo r a huge

quant i ty of f lowers as i t can

b e c o n t r o l l e d . B u t i t

demands important energy

c o n s u m p t i o n a n d w a t e r

consumpt ion . Moreover , the

use of chemical s can reduce

the qual i ty of so i l . Not on ly

f o r p r e s e r v i n g t h e

env i ronment but a l so in o rder

to reduce use less cost s , i t i s

i m p o r t a n t t o r e d u c e t h e

impacts on env i ronment of

e n e r g y , w a t e r a n d

chemical s . Moreover , Ind ian

government want to develop

t h e s e c t o r o f c l e a n

t e c h n o l o g y . I t ’ s a n e w

opportunity to be more respectful

for environment, save costs, and

become more attractive.

ENV1. I measure my

impacts on environment

Environment Toward a sustainable agriculture

ENV2. I reduce my

impacts

ENV3. I innovate

to reduce my

impacts

ENV1. I MEASURE

MY IMPACTS ON

ENVIRONMENT

This first best practice is a diagnostic of the actual situation. That means setting up right

tools to measure the consumption of the three types of consumption in order to adopt the

appropriate and pertinent acting plan. Diverse tools can be adopted to realize this best

practice. An easy and recognized one to measure its impacts on environment is the

global footprint. Both consumption of chemicals and energy are taken into account and

allow the companies to have knowledge of theirs greenhouse gases is terms of CO2. To

measure the water consumption, the Water Footprint is a tool originally developed by

Arjen Hoekstra et al.

BENEFITS

Measuring impacts on environment through recognized tools as the

global footprint and water footprint will be beneficial for the pro-

ducers because it will show the main post of consumption. As a re-

sult, an appropriate and pertinent action plans of reduction. The

tools we recommend are internationally recognize and reliable.

They will help the decision-makers recognize the impact of ecologi-

cal overshoot on their own policies, investments and projects, and

demonstrate that it is both in their interest and within their power to

turn the tide. It’s just after measuring it that we can make a strategy

to become more responsible. Indeed, it supposes to have the ap-

propriate tools to measure it.

STEPS 1. You know the consumer posts of energy / water / soil in our

company.

2. You have tools for measuring your consumption of energy /

water / chemicals. (Global Footprint, Water Footprint…)

3. You know the consumption of energy / water / chemicals of

your competitors so you can compare yours.

REFERENCES

The ISO 14001 is about environmental management and refers the

life cycle analysis as a condition to be certified. The ISO 14040 and

14044 are the references for measuring the impacts.

EXAMPLES

Global Footprint Network, water footprint : footprintnetwork.org/

ENV2. I REDUCE

MY IMPACTS ON

ENVIRONMENT

After measuring impacts on environment, the company must be able to set up actions to

reduce the consumption of energy, water, and use of chemicals. The company must

have objectives of reduction and an action plan to reach them. Some example of

actions in the area of water consumption is reducing the frequency of irrigation or the

outputs of water. In the case of energy, it could be not to overheat the polyhouse and

turn out the lights when it’s not necessary. As the production is protected, the sun could

be sufficient to assure a good light and a good heat. As for the use of chemicals, it could

be using other type of entrants as bio-fertilizers, more respectful of the environment.

BENEFITS

Reducing its consumption of energy, water and chemicals will be

beneficial for the company as it will reduce its costs. Moreover, it will

improve its image and could have an improvement of the demand.

It will be also beneficial for the producer and the cultivator for its

health and for the environment as it will be more respected.

STEPS 1. You have precise objective of reduction.

2. You set up a strategy to reduce your consumption.

3. You reached your objective of reduction.

REFERENCES

As for the measure of the impacts, the reduction is also referenced in

the ISO 14001 norm.

EXAMPLES

Tissue Innovant (TI) is a Canadian company producing tissues with

chairs or curtains of hospitals for the market of the furnishing. This SME

(SMALL AND MEDIUM-SIZED ENTERPRISE) of 200 employees evolves in

the very competitive industry of the textile. It’s the biggest manufac-

turer in Canada and takes place in the fourth rank in North America,

ISO-certified 9000 and ISO 14001, TI, by its environmental practices,

reduced of 80 % its greenhouse gas emissions, of 24 % its use of ener-

gy, 74 % its water consumption; the company recycles 99,9 % of its

fabrics(tissues), some plastic and some paper, while increasing its

use of renewable energy until a 91 % level.

ENV3. I INNOVATE TO

REDUCE MY IMPACTS

ON ENVIRONMENT

This best practice provides new ways of managing the production in a more eco-friendly

way. In the sector of agriculture, there are plenty of investment to be more efficient and

at the same time more respectful of the environment. Innovation is not only a good way

to adopt a positive impact on environment, but also to be more efficient. Clean technol-

ogies or renewable energy are products and services that reduce the risk of harming the

environment, minimise pollution, minimise the amount of materials used and correct envi-

ronmental damage.

BENEFITS

Innovation in this area demand high investment and adaptation to

learn how to manage it. But it’s not comparable with the benefits

that it can provide. The clean technologies let companies using re-

newable materials and energy sources, limit the energy use, reduce

the use of natural resources, reduce or eliminate waste, and then

reduce costs in a long-term perspective. By investing in clean tech-

nologies, the producers broadcast a new image, more positive and

at the same time can be more efficient.

STEPS

1. You set up a process of competitive intelligence in clean tech-

nologies.

2. You invest in clean technologies to be more efficient.

3. You do R&D in the environmental area.

REFERENCES

The sustainable agriculture network (SAN) is working to improve farm

standards to make them more respectful through environ-

ment. Every few years, the SAN does a complete overhaul of the

standard for farms that want to promote their products as Rainforest

Alliance Certified™. Their principles for a sustainable agriculture are

sanstandards.org

EXAMPLE

Bhubaneswar: Chief Minister Sri Naveen Patnaik has felicitated

farmer Soumendra Behera for his innovative endeavour in floriculture

in a special function “State Level Agricultural Fair” organized by Agri-

culture Department. orissadiary.com

Horticulture cluster 2020 project in Netherlands: a new concept has

been developed to tackle the issue of energy : the greenhouse as

an energy source. innovatienetwerk.org