Fi Vietnam 2018
Four factors to succeed in health-focused product innovations: Ex-Unilever VP of R&D
Keir Steinke said food firms that were standing are actually lagging behind, because all major food companies, such as Danone, Nestle and Unilever, have put healthier innovation at the top of their agenda.
He said just fiddling with a product and putting it out there as a new innovative product in the health space isn’t going to work. The product has to have something that is significantly better in terms of technology or service that will ensure consumers will buy the product.
Steinke shared four key organisational building blocks to achieve innovation success and business growth.
1. Develop an innovation culture
First of all, he said what is really important is to know and observe one’s market from farm to fork — from where one’s product starts until the consumer eats it.
“You have to know that pathway intimately,” he said.
“It is no longer good enough to just know the element that just concerns your product. You need to know that pathway from beginning to end.”
Questions like “Why?”, “Where does this come from?”, “Why do we do this?”, and “Can we do it differently?” are very important.
“In many cases, the answer I got when I asked those questions was: ‘We’ve always done it that way.’ That’s not an acceptable answer in today’s world,” said Steinke.
There is now also a search for the younger generation within the company, the “intra-preneurs”, to develop and come up with new ideas.
“We need to look after them, take care of them, make sure they feel the business is a safe place to experiment,” he said.
He said there needs to be innovation “champions” or mentors to help these young people bring their ideas into the business and to protect them in the business environment.
Creating a safe environment to experiment is also very important, to learn to find ways to experiment on new ideas and new products — fast, cheaply and effectively.
Furthermore, incubating innovation at all levels in the business is essential as top-down innovation or direction seldom works, he added.
2. Prioritise a good innovation programme
One tip Steinke gave was to look at the consumer through two sets of eyes: A marketing set of eyes which is about market insights, trends, habits and attitudes, and user profiles, and a technical set of eyes encompassing what taste, texture, colour, functionality and packaging consumers like, and how the product compares technically to your competitor’s product.
“Once you have that understanding, you can start prioritising the technologies that you have available or that you need to work on to solve some of those consumer issues or needs,” he said.
He said that while many companies have a lot of technologies available, they have to better identify the most disruptive developments that they want to pursue.
Once a company has a good innovation programme, it would have to manage it well.
“You need to use tools like decision trees and roadmaps and milestones, to continuously monitor how your projects are going, are they delivering, do they need to be reshaped and what the future looks and feels like in terms of delivery,” he said.
3. Harness powerful R&D capabilities
“A good R&D team naturally has great formulators, packaging people, process engineers, and research scientists. But many R&D organisations do not tend to focus on critical competitive capabilities,” said Steinke.
He said these critical capabilities include food safety, clinical capability to support why the food product is healthy and what it does, expert nutrition knowledge, understanding the regulatory environment and how to protect technology patents.
Steinke said that consumers no longer accept health claims without solid evidence.
Unilever spent a lot of money doing clinical trials and was able to scientifically prove that the increase in plant sterols reduced the Low-Density Lipoprotein (LDL) cholesterol levels.
As a result they were able to make big claims, that consumers could trust, about how phytosterols in their margarine help to reduce cholesterol levels in blood and reduce the risk of coronary heart disease.
“Don’t look at claims and regulations as barriers but look at them as opportunities,” said Steinke.
4. Build networks
Steinke said many organisations are not effectively tapping into the talents of all its people. It is important to build a strong internal network and use that knowledge and experience that the company has to help drive innovation, he argued.
“Six weeks after anybody joins my team, they have to tell me how many people they have met in the organisation, what those people do, and how those people can be used in their job, and what is missing. Also, what they need in terms of people and relationships to do their job better,” he said.
He also stressed on the development of strong external partnerships with suppliers, universities and institutes, and “anybody who you believe can and should be helping in the growth and development your business from an innovation point of view”.
He added that firms shouldn’t be afraid to work with more than one partner.
“Put three of them in a room and get the benefit of three different groups of people and knowledge and experience working together, instead of working separately,” he said.
“If you do that well, you will have innovation, and your business will grow,” he said.
These views were shared at Fi Vietnam 2018.