Food Product Development. Maximising Success

384 Pages·2001·6.795 MB·English

by  M. Earle, R. Earle and A. Anderson (Auth.)

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Food product development
Mary Earle, Richard Earle and Allan Anderson
Published byWoodhead Publishing Limited
Abington Hall, Abington
Cambridge CB1 6AH
England
www.woodhead-publishing.com
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First published 2001,Woodhead Publishing Limited and CRCPressLLC
(cid:2) 2001, Woodhead Publishing Limited
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Preface
Managing innovation is a necessary skill for senior management of all food
companies producing new raw materials, new ingredients or new consumer
products. Company growth and even survival depends on the introduction of
successful new products into old and new markets. The dividing line between
productsuccessandfailuredependsonmanyfactors,butthemostimportantare
new product qualities, skills and resources of the company, market and
marketingproficiency,andan organisedproductdevelopment process.There is
aneedtounderstandconsumers’behaviourandattitudesandtobeabletodesign
a product to meet the users’ needs. But it is also necessary to have the
technological knowledge andthe skills, andtheorganisational abilitytobring a
product to a successful commercial conclusion in the marketplace. This book
studies some of these key issues in product development and outlines the
methods of managing them.
The book started on a day in 1956 when Mary Earle joined the product
development team at Unilever Limited, Colworth House, Sharnbrook, Bed-
fordshire. Jack Savage, the leader of this team, was a pioneer of product
development in the food industry. It was his understanding of product
development as a coordination of technology and marketing, always aimed at
the final consumer, that laid the basis for Mary’s work in product development
during the next 40 years. She tried to put these ideas into practice in the food
industry in Britain and the meat industry in New Zealand, and quickly realised
that there was a real need for education in product development for all people
enteringthefoodindustryparticularlytechnologists,engineersandmarketers.In
1965, at Massey University, New Zealand, she introduced courses in product
development and food marketinginthe Bachelor ofTechnology degreein food
technology.Thesecoursescombinedtheoryandprojects,sothatthestudentsnot
x Preface
only could learn basic techniques in product development but also the
philosophy and the practical application in industry. Gradually product
development (PD) was developed as an academic discipline and Bachelor and
Masterate degree programmes in product development were introduced for all
industries at Massey University. Allan Anderson was involved in much of this
development over the years. Dick Earle’s expertise is in process development,
particularly in the New Zealand meat industry, and he developed the
combination of product design and process development in a new venture
producing pharmaceutical industrial products.
Atthesametime,particularlyinthelast20years,therehasbeenagreatdeal
of research in other industries on product development, and today it is
recognisedasaparticularindustrialresearchdiscipline.Thebookhasbeenbuilt
on this research and also the research at Massey University and with the food
industries in New Zealand, Thailand, Malaysia, Singapore, Canada and
Australia. We need to thank the hundreds of undergraduate students for their
work in their product development projects with industrial companies, the
postgraduate students in their research on the activities and techniques in
product development, and in particular the people in the companies who
collaboratedintheseprojects.Examplesfromsomeoftheseprojectsareusedin
thechapters.ThestaffatMasseyUniversityinvolvedinproductdevelopmentin
the Food Technology Department, Food Technology Research Centre and the
Department of Consumer Technology, built up the multidisciplinary, consumer
directed, systematic PD Process used throughout the book.
Part I starts by looking at the different categories of new food products. It
thenidentifiespastreasonsforproductsuccessandproductfailure,andasksthe
reader to identify some of the specific reasons for product success and product
failure in their company. This is to stimulate thoughts on PD in particular
companiesandtolaythebasisforstudyingthecoreelementsinPDandrelating
thesetotheproblemsofPDmanagement.Itendsbyidentifyingspecificaspects
of product development in the food industry.
Part II in four chapters studies the core elements of product development:
1. Developing an innovation strategy
2. PD Process(es)
3. Knowledge base for product development
4. Consumer in product development.
Product development at both the programme and the project levels needs to be
based on the business strategy. It is the responsibility of top management and
they need to set the strategies for the product development programme for the
present and future years, and also the aims for the individual projects. Top
management needs to ensure that there are systematic PD Processes for the
different levelsofinnovationandtypesofproducts.Havingsetthestrategyand
the PD Process, they need to ensure that there is the necessary product,
processing, distribution and marketing knowledge in the company, and also the
abilitytocreate newknowledgeindesign,developmentandcommercialisation.
Preface xi
Finally there needs to be an understanding and consideration of the final
consumer – their needs, wants, behaviour and attitudes – as well as the other
customers in the food system between the producer and the consumer. Part II
studies these core areas, so that the reader develops a basic understanding of
product development.
PartIIIstudiesPDingeneralandtheninthefoodsystem.Managingproduct
development in the food industry varies with the types of markets (industrial,
food service and consumer) and with the place of the company in the food
system (primary producer, food processor, food manufacturer, retailer). Top
management needs to recognise these variations and also identify their level of
risk and the company’s resources in skills and knowledge. From this, they can
build an organisation for product development and also identify the decisions
that they have to make in the programme building and during the individual
projects.Theycanthenspecifyforthemiddlemanagement thecriticalpointsin
the PD Process and the knowledge that must be available for their decisions at
the critical points. From this, the middle management, called product
development manager, product manager, R&D manager, can identify the aims,
activities and outcomes for the individual stages in projects, and also the
coordinated plan for the product development programme. The project leader
can identify the techniques to be used in the project, the resources needed and
thetimeschedule.Forsuccessfulproductdevelopmentmanagement,thesethree
layersofmanagementneedtobecoordinatedandaimingforthesameoutcomes
from the product launch. Four case studies illustrate management at different
stages of the food system, including fresh products, industrial products and
manufactured consumer products. The book ends with a chapter on evaluating
and improving product development. Product development management must
includethecollectionofknowledgefromtheproject,analysisofthisknowledge
and setting improvements for future projects. Product development is
continuously changing and its management needs to change; without change,
not only the products but also the whole system become archaic and lost in the
past.
This book is intended for people entering or in product development
management, at all levels from the project leader to top management.
Throughout the book, readers are asked to apply the knowledge in the chapter
totheircompany,sothattheycandeveloptheirownphilosophyandmethodsfor
productdevelopment.Thisisnotabookontechniquesofproductdevelopment;
it is a book to raise the awareness of different aspects of product development
and to apply the new or revived knowledge in the practical situation of
managing product development in a food company.
Mary Earle
Richard Earle
Allan Anderson
Part I
Introduction
Product development has been a major activity in the food industry for over 40
years,butonlygraduallyhasitdevelopedasastrategicbusinessareaandalsoas
an advanced technology. For a long time it was essentially a craft, loosely
related to the research and engineering areas in the company. The pressures for
product development came very strongly from the needs of the growing
supermarkets for a constantly changing, extensive mix of products and for
continuous price promotions. So there was the drive for product difference,
including minor product changes sufficient to distinguish products on the
shelves, and for cost reductions. There were also underlying social and
technological changes which caused major product development; for example
the increasing number of working women which sparked the need for
convenience foods and eating out, and the development of spray and freeze
drying which was the basis for instant foods.
Whenonelooksatoverallsuccessandfailureinthefoodindustryduringpast
years, socially there has been success in providing sufficient cheap food in
developed countries, but failure through developing such a poor reputation that
thefoodindustrybecamehighlyregulated;commerciallytherehasbeensuccess
in developing large multinational companies, but failure with continuously
reducing margins on food products. Can the failures be related to narrowly
focused business strategies, to lack of innovation strategies and organisation or
to lack of knowledge?
There are now compelling social and technological pressures on the whole
food system to change rapidly, such as the pressures from the growth of
information technology in the more affluent countries, and from the growing
economic strength in some of the developing countries. Can the food industry
meetthischallenge? Hasthefoodindustrytheknowledgeandthepeople? How
2 Food product development
can itrespond?Theaim ofPartIofthebookistolookatthecausesofproduct
success and failure in the past, and to identify the key issues for successful
product development in the future.
1
Keys to new product success and failure
The aim of this chapter is to identify the important factors in food product
development to be studied in detail in the succeeding chapters. Firstly the
differentgroupsoffoodproductsareidentifiedasabasisfororganisingproduct
strategy. Then the published research on the factors in product failure and
product success in all types of industries is used to identify the key factors in
food product development. This leads into the management of product
development at three different levels:
1. Business strategy.
2. Product development programme.
3. Product development project.
Finally specific aspects of food product development are identified as the basis
of the book, and the structure of the book is outlined.
1.1 Food products – the basis of innovation
What are food products? What are new food products? Everyone agrees that a
food is material eventually consumed by humans to satisfy physiological and
psychological needs, but the food company and the consumer can have quite
different descriptions of the food product presented for sale. The company
defines a basic functional product to which it has added packaging, aesthetics,
brand, price and advertising, to give a total company product. The consumer
describestheproductasabundleofbenefits,relatingitstangibleandintangible
attributes to their needs, wants and behaviour. For a basic food product, for
example flour, the description can be simple and pragmatic, but for products
4 Food product development
such as a meal at a restaurant, it can be complex and emotional. The company
defines a new product as having some difference in the basic functions and
aesthetic presentation; but consumers compare it with the ‘old’ product and
competingproductsandiftheyrecogniseadifferencethenitisanewproductto
them(Schaffneretal.,1998).Productdevelopmentisallaboutreconcilingthese
two points of view.
Therearemanythousandsoffoodproductsandtheycanbegroupedtogether
into product categories according to:
(cid:120) food system position;
(cid:120) market they serve;
(cid:120) processing technology used to manufacture them;
(cid:120) basic common characteristics such as nutrition and health;
(cid:120) product platforms;
(cid:120) level of innovation.
Grouping products is a useful method of developing new product ideas using
techniques such as product platforms, product morphology and gap analysis.
One can identify spaces for new developments, methods of product improve-
ment and indeed innovation related to changes in food system or technology.
1.1.1 Food products and the food system
Productsinteractwitheverypartofthefoodsystemfromprimaryproductionto
the consumer as shown in Fig. 1.1. The new cereal, high in protein, may go to
the processor to produce a specialised protein product for bakers, or to a food
manufacturer to make a high-protein breakfast cereal, or to a vegetarian fast-
food outlet as a meat replacer, or to a supermarket as an ingredient for home-
prepared muesli or directly to the consumer for use in a home breadmaker. A
new product in one part of the food system can cause new products in other
parts.
There is a need to distinguish the three groups of products:
1. Primary products from sea and the land.
2. Industrial ingredients from food processors.
3. Consumer products from food manufacturers and food service.
They basically have the same product development process, but there are
activities and techniques specific to each area.
Thereisaneed torecognisethetotal product ineach case.There isaformal
productwithitsassociationssuchasservice,know-howandimageasidentified
bythecompany(Crawford,1997),andthentheproductconceptoftheconsumer
or customer. A McDonald’s hamburger may seem a simple product but it has
strong associated benefits such as convenience, price, fast service and hygiene,
alongwithaverypowerfulallureespeciallyforyoungpeopleofthegoodthings
in American life. Food service products usually have a high proportion of
services, but so do industrial products and increasingly primary products.