Creating New Foods. The Product Developer's Guide

CREATING NEW FOODS
THE PRODUCT DEVELOPER'S GUIDE

CHAPTER 8
Summary: Bringing It Together

8.7 THE CLIMATE FOR INNOVATION

For successful innovation to occur, an encouraging climate is required both inside the company and in the environment surrounding the company. The level of innovation and type of innovation are also determined by the attitudes, wants, behaviour and knowledge in both the internal and the external environments.

There are people who can break through both these environments; we are all familiar with the stories of the enthusiasts who started in the garage and built up a completely new area of technology. But even they have problems maintaining the truly innovative atmosphere once the initial waves have passed and they have a successful company.

Vision is important, the ability to be aware of the present situation and to look ahead into the future - where society is moving, where industry is moving, where consumers are moving, where technology is moving - and to relate these visions to an achievable future for the company.

The company has to decide if it is to be:

an innovator at the beginning of the market;

an improver of present products once the new market starts to evolve;

a 'me-too' copier of what is already on the market; or even

a die-hard, ignoring innovation completely.

The company has to decide if it wants to make significant jumps in technology, or to develop slowly from the base it has. How the company organises and resources the product development project depends on these decisions, which should be made explicit so the team can work effectively in its own environment.

The outside environment also affects the method of innovation and the type of innovation. There is movement and change in the food system and its different parts.

At the present time, the structure of the food system consists of a few large multinational companies with large proportions of the market together with lots of little companies. In some cases, there is vertical integration from the producer to the retailers and sometimes even to the consumers.

Often in the past, innovation in the food industry has started in small companies which then amalgamated into large companies. With the present structure, more of the innovations will come from the large companies, which therefore need to develop new products for large markets. This is not always easy for a product innovation may take several years to grow into a large market.

A global philosophy and management are appearing in the design, development, production and marketing of foods. Although central product development is still important in the large companies, there is increasing tendency for products to be designed, developed and produced in the most suitable geographic area and then transferred to the other market areas of the company.

The chemical and pharmaceutical companies are introducing new food ingredients and their methods of product development may move into the food industry. They spend very large amounts of money on research to find the successful innovation, which can make large returns with high prices in the short term and because of patent protection can also make substantial profits in the long term. This is the opposite of food product development practice, but maybe the development and experience of nutriceuticals and functional foods may lead the food industry towards the methods of pharmaceutical companies.

Increasing population and urbanisation are also leading to larger-scale manufacturing which needs new technology.

Consumers pull the process by their wants and needs as their knowledge grows from education and the media. They are increasingly polarised by their economic status into two groups:

the over-fed affluent and comfortable;

the poorly-fed underclass.

In some countries the gap between the two is decreasing, in others widening. It is largely related to the proportion of food costs to total income in the family unit.

These groups present different targets for food product development. The affluent are worried about obesity and are increasingly concerned about the nutritional value of food, the safety of food, the health effects of food and also being bored by food. Product development for them puts an emphasis on difference - it has to be more knowledgeable and creative. For the other group, perhaps product development should be a continuation of much of the product development of the past - aiming for quantity, cheapness and sufficiency.