One week plan: Kickstart a profit driven innovation pipeline

Most people describe innovators as being big idea people who are inventive and able to find new solutions to consumer and customer pain points. In the food business, great ideas and empathy with the consumer are important. Even so, successful innovation leaders know that creating profitable food products is the true talent required to build a resilient business. It’s a good practice to assess ideas from a finance, operations and supply chain perspective to ensure that the innovation pipeline meet three key criteria:

1. Consumers want to buy these products.

2. Retailers recognize that by carrying these products they could sell more to their existing customers as well as attract new customers to their stores.

3. You can make money selling them.

Disappointment is built into this system as many (so many!) of one’s favourite product ideas will fail to meet all three of these criteria. To succeed in business, innovators must put their emotional attachments aside, be disciplined and work as part of a team.

Regardless of how many decision makers are involved in your food business, you can also apply these lessons. Time and again, new product launches succeed or fail based on how well the innovation lead integrated insights from operations, finance, marketing and procurement. Whether just one person wears all the hats, or if there is a vice president in charge of each individual function, in well-run companies all departments play a role in the innovation process.

In today’s business environment these lessons are more important than ever. Savvy food business leaders are re-evaluating their innovation pipelines and creating strategies that will safeguard profitability. If your organization hasn’t already taken this step, this one-week plan will help you to kickstart the process of creating a profit driven innovation pipeline. Devote two to three hours each day to dig into each idea from a new perspective to identify where it may fall short. By the end of the week, you should have an action plan.


Monday:

• Call a team huddle. Communicate your goal to streamline the innovation pipeline based on projected profitability and instruct this team to show an aligned and focused front. This meeting should take about a half hour, leaving you 90 minutes to focus on R&D.

• Begin by sorting the projects in the innovation pipeline based on the commercialization barriers they will face to manufacture each product. Categorize the projects based on their common challenges. For instance, if significant capital must be spent to bring a product to market, make a note of that fact and move on to the next item. Don’t get waylaid by discussion about the quality of the ideas. The task today is to identify hurdles.

Tuesday:

• We know that supply chains can be disrupted very quickly and take months to recover from sudden shocks. Review with a procurement lens to identify which of the new product ideas in the innovation pipeline can be made with local ingredients. Likewise, it’s prudent to take time now to diversify your ingredient suppliers and start to carry buffer stock of the ingredients that are essential to fulfilling orders for your highest value customers.

• Explore less expensive ingredient substitutes. Request samples the product developers can test to determine whether the benefit of the more expensive ingredient is significant enough to continue using it.

• Evaluate all new product development projects against the current supply chain and identify which new concepts will use ingredients you already buy to identify any volume discount options that might make these items more profitable.

Wednesday: