Coconut Plantation Land Diversification

MR. D.G.A.R DE SILVA

Wayamba University of Sri Lanka

Bachelor of Science Plantation Management

(External Degree Program)

Plantation Land Diversification

In the Plantation context, diversification can be regarded as the re-allocation of some of estates productive resources, such as land, capital, estate equipment and paid labor, into new activities. These can be new crops or livestock products, value-adding activities, provision of services to other estates and, particularly in richer countries, non-estate activities such as restaurants and shops. Factors leading to decisions to diversify are many, but include; reducing risk, responding to changing consumer demands or changing government policy, responding to external shocks and, more recently, as a consequence of climate change.

Definition of Diversification

The term is defined as diverting the current set up in to different segments or expanding through innovative ways in a broader way that would benefit the organization. When you take in to account our pilot project of Chilaw plantations land diversification it’s important that we identify the areas we could use our finances to maximum use in transforming a plantation in major time. What you are looking at now is at major time where sustainability and reusability concepts and innovativeness play key roles in differentiating the current land.

While most definitions of diversification in developing countries work on the assumption that diversification primarily involves a substitution of one crop or other plantation product for another or an increase in the number of enterprises, or activities, carried out by a particular estate, the definition used in developed countries sometimes relates more to the development.

In developing countries such as Sri Lanka, which has been one of the leaders in promoting diversification, the concept is applied both to individual estates and to different regions, with government programs being aimed at promoting widespread diversification. The concept in Sri Lanka is seen as referring to the “shift from the regional dominance of one crop to regional production of a number of crops ...... (Which takes into account)..... The economic returns from different value-added crops... with complementary marketing opportunities”

Opportunities

Changing consumer demand. As consumers in developing countries become richer, food consumption patterns change noticeably. People move away from a diet based on staples to one with a greater content of animal products (meat, eggs and dairy) and fruits and vegetables. In turn, more dynamic plantations are able to diversify to meet these needs.

Changing demographics. Rapid urbanization in developing countries has an impact on consumption patterns. Moreover, a smaller number of estates, in percentage terms at least, have to supply a larger number of consumers. While this may not imply diversification it does require adaptation to new plantation techniques to meet the higher level of demand.

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Export potential. Developing country plantations have had considerable success by diversifying into crops that can meet export market demand. While concern about food miles, as well as the cost of complying with supermarket certification requirements such as for Global GAP may jeopardize this success in the long run, there remains much potential to diversify to meet export markets.

Adding value. The pattern witnessed in the West, and now becoming widespread in developing countries, is for consumers to devote less and less time to food preparation. They increasingly require ready-prepared meals and labor-saving packaging, such as pre-cut salads. This provides the opportunity for plantation’s to diversify into value addition, particularly in countries where supermarkets play a major role in retailing.

Changing marketing opportunities. The changing of government policies that control the way in which plantations can link to markets can open up new diversification possibilities.

Improving nutrition. Diversifying from the monoculture of traditional staples can have important nutritional benefits for estates in developing countries.

Threats

Urbanization. This is both an opportunity and a threat, in that the expansion of cities places pressure on land resources and puts up the value of the land. If plantations are to remain on the land they need to generate greater income from that land than they could by growing basic staples. This fact, and the proximity of markets, explains why farmers close to urban areas tend to diversify into high-value crops.

Risk. Plantations face risk from bad weather and from fluctuating prices. Diversification is a logical response to both. For example, some crops are more drought resistant than others, but may offer poorer economic returns. A diversified portfolio of products should ensure that estates don’t suffer complete ruin when the weather is bad. Similarly, diversification can manage price risk, on the assumption that not all products will suffer low prices at the same time. In fact, plantations often do the opposite of diversification by planting products that have a high price in one year, only to see the price collapse in the next, as explained by the cobweb theory.

External threats. Plantations that are dependent on exports run the risk that conditions will change in their markets, not because of a change in consumer demand but because of policy changes. A classic example is the Caribbean banana industry, which collapsed as a result of the removal of quota protection on EU markets, necessitating diversification by the region’s plantation.

Domestic policy threats. Agricultural production is sometimes undertaken as a consequence of government subsidies, rather than because it is inherently profitable. The reduction or removal of those subsidies, whether direct or indirect, can have a major impact on plantation and provide a significant incentive for diversification or, in some cases, for returning to production of crops grown prior to the introduction of subsidies.

Climate change. The type of crop that can be grown is affected by changes in temperatures and the length of the growing season. Climate change could also modify the availability of water for production. Plantations in several countries, including Canada, India, Kenya, Mozambique and Sri Lanka have already initiated diversification as a response to climate change. Government policy in Kenya to promote crop diversification

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has included the removal of subsidies for some crops, encouraging land-use zoning and introducing differential land tax systems.

Opportunities for diversification

In making decisions about diversification plantations need to consider whether income generated by new plantation enterprises will be greater than the existing activities, with similar or less risk. While growing new crops or raising animals may be technically possible, these may not be suitable for many plantations in terms of their land, labor and capital resources. Moreover, markets for the products may be lacking. The United Nations Food and Agriculture Organization (FAO) has been one of the development organizations promoting diversification by small farmers. So far, it has produced booklets identifying beekeeping, mushroom farming, milk production, fish ponds and sheep and goats, among others, as diversification possibilities.

Measures of diversification

Agricultural diversification is measured in a number of ways throughout the world. For example, one such measure is the index of maximum proportion, which is "defined as the ratio (proportion) of the plantation's primary activity to its total activities". [

Crop Diversification Achievements

Output project target achievement short fall or excess

Forest development

Oil palm development

Other crop development

Social and Environmental Programs

In land diversification not only about the infrastructure and physical resources but also the human resource plays the vital role because it’s the human resource that is available that drive forward the plantation so it’s important their needs and wants are considered and steps are taken to uplift their living conditions and that would directly impact on making the maximum use of land diversification.

When you take in to consideration the human resource that is available in the plantation their behavior to this plantation land diversification is very important.

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In plantation also we have to take to account the organizational behavior because behavior equals performance.

Therefore it explains why a superintendent is interested in a subordinate’s behavior.

The performance brings in the output. The superintendent is responsible for the workers performance. The effectiveness and efficiency of an organization is highly influenced by its culture to understand the linkage it’s better to understand the meaning of concept of culture.in a culture there is the essence of it which is called core values. When the majority shares of the Chilaw plantations core values as shown below and accept the core values it results in a dominant culture. A dominant culture is the force which effects the identity the way that things are done .the attitude .the customers however within the dominant culture certain sub units or certain group of people may have a special cultural relationships which brings out which is non as subculture. When you have primary values and when they are accepted throughout the organization they become the core values of an organization.

The core values of Chilaw plantations.

CPL VALUES

WE Value Honesty, Integrity, Sincerity, Commitment, Loyalty, Discipline, and Punctuality

WE Respect Confidentiality, Independency, Transparency, and Spirituality

WE Treasure Innovative, Qualified, and Skilled Professionalism

WE Achieve Our Winning Goals through Leadership, Empowerment and Motivation of Our Staff

WE Strengthen Our Teams with Human Resource Advancements

WE Treat Threats and Problems as Challenges and Opportunities

WE Aspire To Be Accepted and Respected

WE Pursue To Be Wanted and Demanded

WE Enjoy Life Holistically and Serving Our Motherland.

The living environment of estate workers has long been characterized by lower standards when compared to the general rural population in Sri Lanka. Apart from resulting in low self-esteem, standards of health have also been adversely affected. The project hoped to improve the living environment as well as empower them by providing training in a range of topics to improve the overall quality of life. The implementation of the programs were delayed due to the relatively high contribution (50% of cost) that the Regional estates were expected to contribute. However, implementation was successful due to subsequent changes to the financing method.

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Chilaw Plantations

Vision

Chilaw Plantation aspires to be the world’s best Coconut growing and marketing Company.

Mission

Managing the natural, financial and human resources of the company to maximize the national wealth and prosperity of the island.

1. Name: Chilaw Plantations Ltd (CPL)

MARKET OPPORTUNITY

Coconut Plantations are categorized under Agricultural products. Slowly and surely as technology advances the Demand for genetically superior high quality coconut seedlings, Increase value of lands for development activities, The newest product in the estate the dragon fruit could access untapped markets and potential for further growth, Increase demand for livestock products are things that we can assume that there could be further advances etc…The above mentioned things all do occur up to now but there is no major advancement in any particular category that offers ease of access to any specific user.

We will be mainly targeting local users who would like to purchase, handle and selling of products. We will also be targeting the entire segment of general planters and consumers as well.

The decision to invest in this particular plantation now is because we feel the available market has grown to a significant proportion as such that we need not worry about having to think twice about launching the products and services.

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BUSINESS CONCEPT

CPL is an old company in the plantation industry. We at CPL believe in providing customers with innovative products and services so that they can do things easier. We mainly sell coconut, coconut husk, coir, sheep, goat, paddy etc. We believe that we have the capacity to provide an innovative solution to all plantation related products that currently exist. We know it is an extremely challenging task but we are up to it always.

We will mainly be focusing to sell our products to the following categories of people.

1. Curry market

2. Oil mill owners

3. Retailers

4. Wholesalers

5. Government

6. Cargills,Keels Super

Initially we will be distributing the product across various parts western province and around the

country. Thereafter based on the response and feedback we will be hoping to go worldwide

countries such as Pakistan, Australia, UK, US, Europe etc….

The above-mentioned categories of people would all prefer to buy more according to there

buying power. Retailers, people who do selling and people doing whole selling would really like

this product since there is a big curry market. This will enable them to create an exact replica of

whatever image they were attempting to recreate.

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BUSINESS MODEL

In business strategy, a business model should be planned and developed since this helps in figuring out the probability of profitability of new products and services. It will provide a means of identifying different paths of revenue generation and profit maximization that CPL can pursue with regard to the products and services they offer. It also provides an insight into the current market situation, competitor profiles and existing market competition.

COMPETITION

When launching new Products and Services it is extremely important to consider the competition that exists within an industry so as to determine the amount of profits we can reap from that particular industry. Competition influences the marketing strategies a company will take in order to maximize revenue and thus profit. CPL has competition mainly from KPL, NLDB, CIC Agri Business and etc…

In order to survive in the market processing, further processing and value added products and services have to be introduced to the market.

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POSITIVE

NEG

ATITIVE

INTERNAL

EXTERNAL

STRENGTHS- Quality of Coconut /Copra is above standard-More than 100 years in the industry-Highly Suitable Landscape & soil for Coconut Plantations and other Crops.-High Valued Assets and large Coconut Estates.

WEAKNESSES- No value added Products.-Poor Marketing and product Development programs.- Weak Management.- Unavailability of State of the art Equipment, machinery,laptops,palmtops

OPPORTUNITIES-Increase demand for livestock products.

- The newest product in the estate the dragon fruit could access untapped markets and potential for further growth

THREATS- High price fluctuation in the market.- The staff and Laborers because of lack of knowledge mishandling of finances,equipment,livestock etc.

CPL

SWOT ANALYSIS

The SWOT analysis is a tool which can be used to highlight the strengths and weaknesses of our particular product. Analyzing the strengths of our product will help us to find out any business opportunities that will enable our company to have a stronger market position. Also being aware of any weaknesses that exist in our product will help us to minimize any threats that may reduce the demand for the product. Therefore SWOT analysis proves to be a useful tool that helps to carve business strategies in order to keep a sustainable share in the market. While the strengths and weaknesses are affected by factors internal to the company, the opportunities and threats are related to the external environment which can be defined by the PEST (Political, Economic, Socio-cultural and Technological) factors.

The above diagram shows the SWOT analysis of Chilaw Plantations. It shows the strengths, weaknesses, opportunities and threats that will be faced by CPL once launched fully in to the market.

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CPL SWOT ANALYSIS

STRENGTHS (Internal) WEAKNESSES(Internal)1) Quality of Coconut /Copra is above standard. 1) No value added Products.

2) More than 100 years in the industry. 2) Scarcity of Labor and Low Productivity.3) High Valued Assets and large Coconut Estates. 3) Poor Marketing and product Development

programs.4) Highly Suitable Landscape & soil for Coconut Plantations and other Crops.

4)Dependence on Basic Market as a supplier of raw materials.(Fresh nut,copra,husks,trees)

5)Availability of lands for development of main Product- Coconut

5) No Financial backing to start on new Agri Business Ventures.

6) Opportunities for Crop Diversification. Eg:Dragon Fruit,Bannana,Mango,Cinnamon,Ginger,Coffee,Pepper,Arecanut,Pineapple

6) Profits earned by the estate are given to other purposes not related to the estate without utilizing it to increase the salaries of the staff and laborers.

7) High Valued Lands for Infrastructure Developments.

7) Low Palm density, resulting low yields. Senile Palms.

8)Potential for InterCrops,Livestock,Cashew,Timber Plantations

8) Poor Re/Under Planting Program.

9) At Present The Bingiriya Area Estate is running at a profit.

9) Weak Management.

10) Assured profit due to high coconut prices. 10) Non Availability of Proper Cadre system and Human resources.

11) Availability of reserve investment funds for new investments and development.

11) Poor Capital Assets Management.

12) Gov. Owned Business with Organized management structure.

12) Unutilized Land.

13) Copra manufacturing, Further manufacturing of Coconut oil and Virgin oil.

13)Unutilized Fixed Deposits,Funds,Technical Personal

14) Coir Husk Industry. 14)Unavailability of State of the art Euipment,machinery,laptops,palmtops,

15) Turning Coconut Plantation into Agro Business.

15) Private Mgt until May2008 resulted in less Under Planting & infrastructure maintenance.

16) Making Coconut Milk, Coconut Ghee, Coconut Powder..

16) No trained Personnel in the estate.

17) Staff and Laborers are not updated or given training of latest methodologies used in the world in plantation management.

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OPPORTUNITIES(external) TREATS(external)

1) Increase demand for livestock products. 1) High price fluctuation in the market.

2) Close to the fence planting valuable timber.e.g.: teak, Mahogany, Nadun, Jak tree..etc.….

2)Unser eyed Land utilized for paddy cultivation

3) The newest product in the estate the dragon fruit could access untapped markets and potential for further growth.

3)High capital expenditure in dragon fruit cultivation

4) Rain Water harvesting utilized for Fisheries. 4)Soil erosion

5) Mango cultivation in the estate. 5) Robbing of coconut and other products of the estate.

6) Getting an extra income through Dragon fruit and using that money for the betterment of the estate.

6) The staff and Laborers because of lack of knowledge mishandling of finances, equipment, livestock etc...

7) Increase value of lands for development activities.

7)No proper watchers ,no proper training and no mechanism to properly safe guard the estate at all times

8) Demand for genetically superior high quality coconut seedlings.

8) Utilization of Inorganic Fertilizers in adversely affecting the Crops.

9)No product completion(Coconut has less substitutes in Sri Lanka)

9) No funding from the top management in the accurate time.10)Dolamatation In proper time

11) Approval from head office on time.

12) Dead and fallen trees should be removed immediately. Otherwise pest will develop.13)COP due to world market prices.(Petroleum price levels and devaluation of rupee value)

14) Changes of weather patterns affects the production and it’s an uncontrollable factor.

15)Non Availability of trained labor and reluctance of youth for the industry, specially picking, husking

16)Varying trade and tax policy for importation of palm oil ,which is a competitive substitute for coconut oil

17) Unknown diseases and insect damages for the Dragon fruit cultivation.18) High capital expenditure for dragon fruit cultivation.

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Marketing and Alliances

Marketing Objectives

Ever since the establishment of the company, CPL. has launched a great variety of successful

products that are used and trusted by its customers. The first and foremost marketing objective of

our company is to gain the trust of customers and end users within a short period of time. With

over 100 years of experience in the research and development of products for the general public

and various consumers, the company is confident that its latest invention’s the Dragon Fruit will

be readily accepted by its customers and would greatly aid to their convenience.

The company intends to launch the ultimate product, The Dragon Fruit, in the western as well

as the whole market simultaneously in an attempt to earn quite a noteworthy reputation and

increase brand equity from every possible perspective of customers. This is because the product

would face greater competition in the western and whole country, while western province is still

quite a fresh market for such products. However, due to relatively high price of the product, the

scope of sales in western province might be better. Another potential market could be the north

and east. However, due to the economic slowdown, the demand of the product might be affected.

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Target Customer Segment

The main target market segment would be general public and professional high-end consumers.

Another minority target user would be those wanting to learn or experience newer technologies.

The product could be sold to public as well as Agri- companies and various other consumers.

oil mill owners and other plantation realted

owners60%

Curry market

35%

cargills and other super markets and retailers

and whole sailers3%

Government2%

Target Market

Market Research Strategy

Market Research is a key aspect in the development of any new product. It helps us to get a

much clearer picture of the wants and needs of the customers and hence provide them with better

solutions; thus reducing the risk of product failure. Considering this fact, it was intended to carry

out both primary and secondary market research that would provide the company, with business

intelligence to make informed decisions.

Secondary research would enable, to gather information gleaned from studies previously

performed by government agencies, plantations. This in turn would provide statistics about the

population of plantations. Secondary research would also include study of existing products and

their limitations.

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Primary research would be carried out through questionnaires and personal interviews with

potential customers. This would enable the company to identify the difficulties which the

customers face with the existing products and how they can be resolved. This would also help to

get a good idea about which pricing strategies to be used and how much the customers will be

willing to pay for the products and services.

Marketing Mix

The marketing mix for CPL is intended to generate a positive response in the target market by

blending the four P’s in an optimal manner.

The marketing management plan would be strategized in following manner.

Product

The ‘product’ here are the products [coconuts, dragon fruit etc...] and services. The relevant

plantation entities with the government should take care to see that plantations and estates are

given necessary funding and encouragement to produce quality products and services. Both these

types of products and services are equally important to the long-term sustainability of the

industry.

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Price

Marketers should price the products and services according to the demand fluctuation, world

market prices and crops, weather patterns, curry market and research. For an example, when the

rain increases, the crop increases and the price go down. Also, it is reasonable to demand a

higher price from the locals when the world market prices go up.

However, in the case of curry market the people in the country has to be considered and a

reasonable price has to be put up.

Due to four main reasons such as the world market price, rain increase, rain decrease and

demand fluctuation the price is expected to be relatively high. But it is still cost-effective,

considering the benefits that it offers. This would be reflected in the price. The pricing objectives

to be considered when setting the price for the products and services can be prioritized in the

following manner.

Survival of the product

Quality leadership

Maximize profit margin

The demand for the products and service is expected to be elastic, due to the current unstable

economic situation. Therefore a lot of strategic planning and analysis was needed to be carried

out before setting the price of the products and services, specially the coconut price. In addition,

due to rapid technological advancement, high competency and short life-cycle of plantation

products, its value is expected to depreciate over time. In order to overcome this, the company

intends to improvise the product at a later stage to overcome the limitations and hence stay

competent in the market for a longer time.

The price would be set, based on a combination of cost-plus and value-based pricing method.

Cost-plus pricing would ensure that the costs are covered up, plus a certain percentage of profit

is earned on each unit sold. Value-based pricing on the other hand, will pass on the effective

value relative to alternative products; thus ensuring that the product is not under-valued.

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Placement

The Plantation land and business places (place) are extremely important to the industry because

this is where the products and services (product) are delivered to the various markets. The estates

should be in good condition if the plantations producers wish to give out a quality product

(product or service) at the end of the day.

There is no point in producing excellent products and services if there is no place to sell them

with the appropriate technology. More and more producers are using the latest technology in

their productions. But the problem lies in the estates which are seldom upgraded. Thus plantation

companies together with the ministry should see that necessary improvements are done in the

plantation sector so they are equipped with the necessary technology to market products and

services superior.

It is also important to note that the threat of other competitors within the local market as well as

internationally are impacting the revenue of the plantation industry can be heightened if the

consumers are disappointed with the quality of the plantations; in other words if they would

rather buy other products from other plantations.

The product is targeted mainly at a mass market. Therefore, the volume of sales is expected to be

high. The most appropriate distribution channel that could be used is manufacturer-retailer-

customer. In addition to save costs, it was intended to make use of processing, further processing

and other value added products. Due to high volume of sales, there is a need for wholesalers. By

doing the additional things this would save cost because the shorter the distribution channel,

lower the cost. The CPL products would be placed in leading outlets and agri fairs in the

international market.

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Promotion

Promotion or the ways of communication to the target market is crucial if CPL want to get back

a profit. Producing a good quality product takes time. And it is necessary to build up hype from

the begging to the end.

Posters, social media, radio, newspapers, TV are some of the ways promotion of plantation

products and services. With the restriction regarding poster pasting in towns, the significance of

poster are relatively low. On the other hand, promotion through online media is becoming

increasingly favorable with the urban audience. But, the most efficient way to communicate the

coming of a Product or service is through on TV, either at 8 clock news or along with popular

Tele-dramas.

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Diversification beyond Stocks

If there's one thing that even the newest investor understands, or has at least heard of, about a portfolio its diversification - blending a variety of asset classes to reduce exposure to risk. But a well-diversified stock portfolio is just one component of putting together the best possible portfolio.

Diversifying not just among different stocks, but among different assets, is how an investor can truly mitigate risk. Even with a well-diversified stock portfolio, an individual is still exposed to market risk (or systematic risk as finance professors like to call it), which cannot be diversified away by adding additional stocks.

What Exactly Is Diversification? Basically, diversification among various asset classes works by spreading your investments among various assets (e.g. stocks, bonds, cash, T-bills, real estate, etc.) with low correlation to each other; this allows you to reduce volatility in your portfolio because different assets move up and down at different times and at different rates. Thus, having a portfolio diversified among different assets creates more consistency and improves overall portfolio performance.

How Does Correlation Work? Correlation is simple: If two asset classes are perfectly correlated they are said to have a correlation of +1. This means that they move in lockstep with each other, either up or down. A completely random correlation - a relationship in which one asset's chance of going up is equal to the chance of dropping if the other asset rises or falls - is said to be a correlation of 0. Finally if two asset classes move in exact opposition - for every upward movement of one there is an equal and opposite downward movement of another, and vice versa - they are said to be perfectly negatively correlated, or have a correlation of -1.

A Diversified Stock Portfolio vs. A Diversified Portfolio of Assets When we talk about diversification in a stock portfolio, we're referring to the attempt by the investor to reduce exposure to unsystematic risk (i.e. company-specific risk) by investing in various companies across different sectors, industries or even countries. 

When we discuss diversification among asset classes the same concept applies, but over a broader range. By diversifying among different asset classes you are reducing the risk of being exposed to the systemic risk of any one asset class; in other words, the risk that diversification within an asset class, such as stocks, cannot eliminate. 

Like holding one company in your stock portfolio, having your entire net worth in a portfolio of any one asset - even if that portfolio is diversified - constitutes the proverbial "all of your eggs in one basket" . Despite the mitigation of unsystematic risk (risk associated with any individual stock) you are still very much exposed to market risk. By investing in a number of different assets you reduce this exposure to market risk or the systemic risk of any one asset class.    Most investment professionals agree that although diversification is no guarantee against loss, it is a prudent strategy to adopt towards your long-range financial objectives.

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How to Diversify Your Portfolio To this point we have talked more in a theoretical sense. Now, let's look at some examples to sink your teeth into. Bonds are a popular way to diversify due to their very low correlation with some of the other major asset classes, particularly equities. Other fixed-interest investments such as T-bills, bankers' acceptances and certificates of deposit are also popular.

Another viable option is real estate, which has proved its worth during various stages in the economic cycle, and has a relatively low correlation with the stock market.

It's amazing how many people tend to overlook the investment potential of this asset. Investing in real estate doesn't mean that you need to go out and purchase a house or building, although that is a viable option for entering this market.

As an alternative to a direct property purchase, individuals can invest in the real-estate market through real estate investment trusts, or REITs. REITs sell like stocks on the major exchanges, and they invest directly in real estate through properties or mortgages. REITs typically offer investors high yields as well as high liquidity. Because of the real estate market's relatively low correlation with the stock market, by investing in an REIT an individual is able to diversify away some the stock market's inherent risk.

Real estate, and more specifically REITs, is just one of the means to accomplish this reduction in exposure to risk. As the illustration above demonstrates, investors have a number of different options that can all help to reduce the risk of investing in any one asset class.

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Improving Welfare of Plantation Labour force in Sri Lanka

The living environment of estate workers has long been characterized by lower standards when compared to the general rural population in Sri Lanka. Apart from resulting in low self-esteem, standards of health have also been adversely affected.

"A larger labour force does not necessarily guarantee a larger output. In fact, in estates where there is a labour shortage the current difficulties are felt less, because they do not have to employ large numbers even at times of low output.

PEOPLEThe Democratic Socialist Republic of Sri Lanka (formerly known as Ceylon) is an island in the Indian Ocean about 28 kilometers (18 mi.) off the southeastern coast of India with a population of about 21 million. Density is highest in the southwest where Colombo, the country's main port and industrial center, is located. The net population growth rate is about 1%. Sri Lanka is ethnically, linguistically, and religiously diverse.

Sinhalese make up 74% of the population and are concentrated in the densely populated southwest. Sri Lankan Tamils, citizens whose South Indian ancestors have lived on the island for centuries, total about 12%, live throughout the country, and predominate in the Northern Province.

Indian Tamils, a distinct ethnic group, represent about 5% of the population. The British brought them to Sri Lanka in the 19th century as tea and rubber plantation workers, and they remain concentrated in the "tea country" of south-central Sri Lanka. In accordance with a 1964 agreement with India, Sri Lanka granted citizenship to 230,000 "stateless" Indian Tamils in 1988. Under the pact, India granted citizenship to the remainder, some 200,000 of whom now live in India. Another 75,000 Indian Tamils, who themselves or whose parents once applied for Indian citizenship, chose to remain in Sri Lanka and have since been granted Sri Lankan citizenship.

Other minorities include Muslims (both Moors and Malays), at about 7% of the population; Burghers, who are descendants of European colonists, principally from the Netherlands and the United Kingdom (U.K.); and aboriginal Veddahs. Most Sinhalese are Buddhist; most Tamils are Hindu. The majority of Sri Lanka's Muslims practice Sunni Islam. Sizable minorities of both Sinhalese and Tamils are Christians, most of whom are Roman Catholic. The 1978 constitution--while assuring freedom of religion--grants primacy to Buddhism.

Sinhala, an Indo-European language, is the native tongue of the Sinhalese. Tamils and most Muslims speak Tamil, part of the South Indian Dravidian linguistic group. Use of English has

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declined since independence, but it continues to be spoken by many in the middle and upper middle classes, particularly in Colombo. The government is seeking to reverse the decline in the use of English, mainly for economic but also for political reasons. Both Sinhala and Tamil are official languages.There lots of estate workers who are Tamil and are living in line houses. They have been working plantations for generation as labourers.

Social and Environmental Programs

In Plantations not only about the infrastructure and physical resources but also the human resource plays the vital role because it’s the human resource that is available that drive forward the plantation so it’s important their needs and wants are considered and steps are taken to uplift their living conditions and that would directly impact on making profits.

When you take in to consideration the human resource that is available in the plantation their behavior to this plantation is very important.

In plantation also we have to take to account the organizational behavior because behavior equals performance.

Therefore it explains why a superintendent is interested in a subordinates behavior.

The performance brings in the output. The superintendent is responsible for the workers performance. The effectiveness and efficiency of an organization is highly influenced by it’s culture to understand the linkage it’s better to understand the meaning of concept of culture.in a culture there is the essence of it which is called core values. When the majority share the Chilaw plantations core values as shown below and accept the core values it results in a dominant culture. A dominant culture is the force which effects the identity the way that things are done The attitude, the customers however within the dominant culture certain sub units or certain group of people may have a special cultural relationships which brings out which is non as subculture. When you have primary values and when they are accepted throughout the organization they become the core values of an organization.

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The core values of Chilaw plantations.

CPL VALUES

WE Value Honesty, Integrity, Sincerity, Commitment, Loyalty, Discipline, and Punctuality

WE Respect Confidentiality, Independency, Transparency, and Spirituality

WE Treasure Innovative, Qualified and Skilled Professionalism

WE Achieve Our Winning Goals Through Leadership, Empowerment and Motivation of

Our Staff

WE Strengthen Our Teams with Human Resource Advancements

WE Treat Threats and Problems as Challenges and Opportunities

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In order to improve the living standards of plantation labours the earnings should be distributed

evenly by the plantation owners. There should be motivation from superintendents to uplift the

welfare of these hard working labours. Through salary increases and bonuses the population of

labours are mostly motivated to work effectively and efficiently, but the sad part has been for

decades this plantation community of labour’s have been neglected and their wellbeing hasn’t

been even thought of by the owners in going to make quick money and for them to reap the

benefits of the harvest by only the top management of plantations. Pay checks have been delayed

and not paid in some instances.

Developing Livestock functions within the plantation and thus adding value to the plantations products and services and making the most by diversifying the land.

Cows, buffaloes, goats, pigs, sheep and etc…… could be done as livestock.

The cow dune and other animals waste could be utilized as “Bio Gas”. Then the bio gas surrey could be used for agriculture plantations which would do more value adding to the plantation as a whole.

The output of the bio gas could be utilized as a long term sustainable, renewable energy source and would save money to the plantation in one way and make the plantation in the other hand self-sufficient with its own private mini power plant with the use of bio gas.

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Bio gas could be given to people through pipes as gas for gas cookers to utilize which would once again save money for plantation and generate money revenue to the plantation through its processes. The surrey of the bio gas could be used as a fertilizer to cultivate banana or plantains.

Because there’s moisture in the surrey. Moisture that makes the process of fruit bearing faster and nutritious without using artificial chemicals that are harmful for the human body.

Utilization of the waste of the Bio-Gas as a fertilizer for plants such as vegetable’s, coconut, green vegetables and fruits. The waste also can be Recycled, Reuse and reduce the carbon foot print in Plantation Industrialization processes and in other related systems that happen day out day in Plantations.

Inter cropping and mix cropping could be done in between coconut trees. By doing this maximum land utilization happens leaving no room for wastage of the land available within the Plantation Land.Pineapple could be done as a under plantation.Lime,Lemon,Oranges,Mandarin all this tonic giving acid juices could be done as under planting making the space in between coconut plantations very rich, grapes, cashew could be also done as inter cropping. But in the Sri Lankan context most of these under planting, inter cropping and mix cropping are done in plantations because of lack of knowledge and not enough resource personnel to carry out the activities in doing so and adding value to your products and services as well as getting an extra income through these cultivations. And all the above add up to land diversification.

Mukunuwanne, Gotukola like green vegetables could be grown and using the surrey or the waterish waste of bio gas by just connecting the green vegetable cultivation with a pipe to the green vegetable’s growing system.

Pepper, coffee, giniciriya are crops that you could do while having coconut as your main crop. By starting with a substantial amount of capital and assigning a suitable land for these crops, coffee and pepper could be used to export and to look forward for untapped local ,global through that creating a glocal market and expanding it to mass production would in the long term help the coconut plantation even when a recession is hit or if the coconut plantation industry is hit with some disease. To keep the plantation alive in turmoil situations because of various disease’ spreading to coconut trees and the only option is to destroy them. In that kind of a scenario to totally uproot the mass plantations of coconut and to replant new coconut’s plants needs a substantial amount of finances as well as human resource and to build again a plantation from the scratch in such a scenario is hectic.Continously pushing forward for innovative , value adding ventures at present, in major times will do wonders for the plantation as well it will set a benchmark for the whole Sri Lankan Agriculture and Plantation Sector and it could be a significant contributed to the GDP,when Sri Lanka is only a service oriented country where through the HR personnel in diverse areas Money is injected to the National economy, in order

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to develop a country “Production” should increase through, ‘ continuous research & development and the income of the final product or service should be evenly distributed among the population or work force population of the country”, by implementing such a practical mechanism only a country could prosper. Having pepper,coffee,giniciriya,doing inter-cropping, mix- cropping and various cultivations in vast amount of lands and the diversification of land plays a major role in major time .And the diversed crops and cultivation within that was planted in between coconut trees would pay dividends .

“Dragon fruit” a new plant in the Sri Lankan context a foreign plant to the Sri Lankan soil is becoming very popular among the metropolitan population in Colombo and around suburbs. This foreign plant is also being exported and a substantial amount of revenue and foreign exchange is brought back to this country by a few entrepreneurs. ‘Cinnamon” in the 1960,1970 a very popular export spice that attracted the merchants from the middle east and an export money making venture for lots of businessmen in the good old days. A spice that has lots it’s due recognition and reviewing this spice and exporting once again to untapped markets would in years to come by looking forward for mass production by starting small and keep this as a valuable and marketing this spice through branding would create good name for the plantation in the years to come and would keep the loyal customers as well as stake holders interested as well as shareholders injecting more money to the plantation.

Grass could be planted among land that where crops are not planted and also would keep out weed plants and create a green carpet to the umbrella shading which would in turn create a sub culture in the natural environment, that is unique to the coconut plantation. “Weed Management” plays a pivotal role in this aspect when we take in to consideration grass planting. Livestock products animals in diary buffaloes, cows could feed them “.Maze and Sogam” could be transformed in to “Silage”.

“Pig and sheep manure” could be used as fertilizers for coconut trees. This in turn acts like “organic matter”.

“Rain water harvesting” could be used to build water tanks like our forefathers used to do. It is said that Sri Lankan’s were so advance in Irrigation Engineering, the era when kings used to rule this country Sri Lankan irrigation engineers where send to Kashmir to help people both in Pakistan as well as India. The dry zone of Sri Lanka was rich in water when the kingdoms realm was managed by our Kings and Queens. In a drought period utilizing rain water and storage would enable the plantations throughout the year to have a good supply of water as well as to create mini irrigation systems inside the coconut plantation and fisheries could be done and once again expanding rainwater harvesting and fisheries will create alternative revenue and cash injecting ways as well as lots of job opportunities and create lots of alternative income ways to the plantation as a whole and it would be able to enlighten the hard working labours day to day

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livelihoods. By spending the money generated through this rain water harvesting and fisheries would motivate these people and could be taken as an intrinsic factor that would increase labour productivity. Hence happy employees generate high productivity.

THROUGH LAND DIVERSIFICATION BUILDING A COIR FACTORY

Establishing a “Coir Strings Mall”. The coconut tree which is known as “KAPRUKA” in Sinhalese is a tree that Sri Lankan’s think as a tree that gives tremendous amount of advantages especially to the households. One such process that could be designed using “Management Architecture” is a design to “Develop a Coir Strings Mall” and this would be done through “Land Diversification”.

Through the coir which is available in each coconut creating such a facility and implementing a map making process and next when the map making is done to implement 5s and implement “JAPANESE JIT AND JITODA”, The two main pillars any Organization needs, With this Foundation the Chilaw plantations could develop a world class facility. Only the integrity from the Top Management to the Front line Managementand Laborer’s is needed. World famous TOYOTA runs on this Foundationbut they “DON’T IMPLEMENT 6 ZIGMA”.Here in SriLanka5’S is the very popular thing but “5’S is Outdated in the Global Arena and Sri Lankan’s haven’t identified the essence of implementing 5’s but put pictures and fancy words without knowing the through meaning how truly it was implemented and it’s just a basic very small foundation methodology used not a methodology to picture in office’s and make workers memorize the words of the 5s.‘KAIZEN” and other Japanese Philosophies in Quality Management have come to the “Limelight”. The quality in japan is stated as the attitude of the workers, which has enabled them to do work efficiently and effectively. Transforming their war mentality to work efficiently with less talk.Creating this facility through Coconut Land Diversification would need a large amount of Capital and a Strategic Corporate Plan or win –win Corporate Strategy for Sustainable Corporate Growth, to keep this facility moving forward in the years to come in a positive manner.

The problem this industry is facing is that the lack of Coconut Husk, Sky Rocketing cost of Living in Sri Lanka,electricity & increased fuel charges, finding experienced personnel ,export demand declining because of this currently “SRI LANKA’S COIR INDUSTRY is in diastreateous.“High standard quality supervision and maintaining for a long periods of time, lack of knowledge in “Kaizen”, lean productivity, and higher plant efficiency through the autonomous maintenance pillar of total productive maintenance (TPM).Lean enterprise on productivity through Lean Transformation, Manufacturing experience, quality assurance, maintaining the results and challenges, Productivity enhance through Lean and 5s, Acculturation as a strategy to go beyond 6 zigma, the 4 pillar strategy 4 Manufacturing Excelence,Performance improvement in the Public Sector Plantations. The public sector or private sector top management has to make

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major changes to send the income of the public or private companies or plantation’s towards the hard working labuorers,because according to a recent research done on‘‘ Sri Lanka’s economy, 90% of Sri Lanka’s earnings go to the only 10% of Sri Lanka’s Wealthiest people”, the other 10% of Sri Lanka’s earning’s go to the middle class and lower middle class families.

Because of this the population in this plantation sector isn’t motivated to work effectively and efficiently. But if a Practical system, solid process and statistics, facts,figures,insight of industry people and analyzing these would pay dividends in the years to come. This would create an environment to make the laborer’s, workers and managers as shareholders and they would be motivated, not only by money when the plantation implement certain above mentioned kaizen perspectives by changing the attitude of the frontline and middle management human resource there would be external factors created to motivate your workers.

If a plantation can implement these philosophies the advantages you get through these practical ways is immense. These philosophies will certainly enlighten the Plantation Industry in Sri Lanka which is rather stagnated and gloomy.

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DEVELOPING A BALANCE SCORE CARD FOR A COIR FACTORY

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ROI LCC

LP

Q C D

Q O DEFECTS

Q T O O DELAY

INVENTORY

S O UNWANTED ITEMS

S S

O O DUST

UNITENDIFIED ITEMSSEIRI, SEITON, SEISO & SEIKETSU, SHITSHUKE AND SAFETY. (3 S TO START THEN NEXT 3 S TO FOLLOW)

FINANCIAL PERSPECTIVE

CUSTOMER PERSPECTIVE

INTERNAL PERSPECTIVE

LEARNING AND GROWTH PERSPECTIVE

STRATEGIC LEVEL

MANAGERIAL LEVEL

OPERATIONAL LEVEL

FUNCTIONAL LEVEL

Appendix-

1st pillar - ROI –Return on Investment, LP – Labour Productivity, LCC – Labour Cost Company,

2nd pillar- Q – Quality, C– Cost, D – Delivery.

3rdpillar- Q- Quantity, Q – Quality, T- Time,

0 – Zero Defects,0- Zero Delay,0- Zero Inventory

4th pillar - 3 s- denote Seiri, Seitonand Seiso. 5s as a whole could be implemented and you could add safety as the sixth S.

6S

1. SEIRI2. SEITON3. SEISO4. SEIKETSU5. SHITSHUKE6. SAFETY

O denotes- 0 –Zero Dust, 0 – Zero Unwanted items, 0 –Zero Unidentified Items.

Conclusion

The foregoing estimates suggest that, Sri Lanka could make substantial savings in foreign exchange and improve the productivity of coconut plantations.

Diversification is a key building block to anyone's financial plan, including the understanding of what diversification does and how it helps an individual's overall financial position. It is crucial that investors know the difference between systematic and unsystematic risk, as well as understand that by diversifying among asset classes they can mitigate exposure to systematic risk. 

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