Nestle USA: Global Resources, Local Tastes

Our 2009 Process of the Year is sprinkling nutrition, health and wellness in products as varied as Lean Cuisine and Butterfinger.

By Dave Fusaro, Editor in Chief

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Product development at the biggest food & beverage company in the world is … well … big. And dispersed. It’s designed to draw upon the resources – and uphold the goals -- of a $101 billion global company while ceding most of the actual recipe development and ideation to teams in the local markets.

At the very top is what Nestlé SA claims is the world’s largest private nutrition research center, outside Lausanne, Switzerland. It provides “the scientific and technological basis for renovation and innovation of products across the whole of Nestlé.”

Fanning out from Lausanne, the Swiss parent also maintains four specialized research centers (two for cereals, one each for beverages and chocolate) and 10 product technology centers around the globe, which are aligned with particular Nestlé businesses to provide expertise for specific product categories. Together they form a hub for global product and process development.

A half-step beneath them, but still managed directly by the Swiss parent, are 13 R&D centers, which work closely with the product technology centers but are geared toward meeting regional product development requirements and providing input to local application groups. Finally, application groups are located within the regional Nestlé divisions to ensure products comply with local taste preferences.

That’s 28 research centers in all.

Innovation partnerships throughout the research and development process is a key component of the Nestlé SA formula -- from early-stage collaborations with universities, start-up and biotech companies to late-stage partnerships with key suppliers.

On the corporate organizational chart, Werner Bauer sits just below CEO Paul Bulcke as chief technology officer and head of innovation, technology, research and development. There is no single spokesperson for R&D in the U.S. But the Nestlé Prepared Foods unit in Solon, Ohio, is symbolic of R&D efforts at the other units.

This former Stouffer’s facility is the home of both a corporate R&D center – this one focused on frozen and chilled foods – and the product application activities specific to the Stouffer’s, Lean Cuisine and Buitoni brands and Nestlé Baking (Nestlé Toll House, Libby’s Pumpkin and Nestlé Carnation milks brands). Hot Pockets and Lean Pockets are headquartered in Denver, where they have their own product application team.

“Nestlé looks at product development from the global perspective of the strategic business units, for example, Food, Coffee, Nutrition, etc.,” says Liz Pretzlav, product applications vice president for Nestlé Prepared Foods. “But the markets also have the opportunity to act locally, particularly in the case of food.

“A good example of a global strategy applied locally is nutrition, health and wellness,” she continues. “Nestlé SA asks each business unit to look at their product portfolio and ask, ‘What makes sense for our consumers, when considering a nutrition, health and wellness perspective?’ We’re always looking for the best way to apply that commitment to our innovation and renovation activities within the company.”

Some examples include using Nestlé R&D technologies that deliver “all natural” products, as well as solutions to further reduce sodium, sugar and fat in products while maintaining taste.

Another expression of the company’s commitment to nutrition, health and wellness are 85 “wellness champions” stationed in business units across the globe. They assist the local product developers in various ways to ensure the corporate wellness goals are being met in the units. Chavanne Hanson, who was a market nutritionist with the Prepared Foods unit, is now the wellness champion for Nestlé USA.

Cross-functional teams

Product development at Solon is a cross-functional affair, with marketing, manufacturing and supply chain, quality management, packaging and purchasing represented alongside food technologists. The team meets formally at least twice a month but more often as required. Often subsets of the team convene to address specific issues.

Solon also has a culinary center, a gleaming state-of-the-art facility opened in 2006 under the direction of culinary innovation director Chef Lucien Vendome. The center was designed to embrace cuisines from around the world and accelerate creation of new products.

“We’re a very consumer-driven company,” says Pretzlav. “We spend a lot of time talking to our customers and consumers to understand opportunities, the unmet needs.”

That’s the history of the Prepared Foods business unit. In response to a growing demand for calorie-controlled meals with excellent taste, Nestlé introduced the Lean Cuisine brand in 1981. With more than 100 frozen entreés, pizzas and dinners, Lean Cuisine has become the second largest diet brand behind Diet Coke, according to the company, and one of Nestlé’s most successful U.S. brands. It is also sold in Canada, Mexico and Australia.

All products in the Lean Cuisine range contain less than 10g fat, 4.5g or less saturated fat and less than 95mg cholesterol. They also contain between 150 and 410 calories, and as a result of product reformulation, 36 million extra servings of vegetables have been added to the American diet through Lean Cuisine products since 2007.

“Innovation and renovation” are oft-stated themes. “Sometimes the opportunities exist on products already in the portfolio,” continues Pretzlav. “We study the evolving needs of our consumers, and improve or enhance our products continuously, to meet those new needs or requirements. That’s what renovation means to us.”

Case in point is the Lean Cuisine Spa Cuisine line, developed to provide additional benefits beyond calorie control. First came the introduction of whole grains, followed by “twice the vegetables.” Now the line is increasing fiber and reducing sodium while adding new varieties.

Product and process development went hand-in-hand in the recent development of the Stouffer’s Easy Express line. The family-sized, three-item line cuts microwave cooking time to 20 minutes or less, the result of perfecting the recipes to work optimally in their paperboard packaging, a first for Stouffer’s multiserve products.

Look out in 2010 for the Buitoni brand to make a run at the Unilever Bertolli turf. The Italian-food brand was developed from a long-ago acquisition made by the Carnation Co. Today, Buitoni is known for refrigerated sauces and pastas. The brand took a step forward this year with the introduction of the super premium Riserva line, which combines time-honored Italian culinary techniques with the integrity and flavor of carefully selected ingredients. Starting in 2010, Buitoni will debut a line of premium, frozen Italian meals for two that mark the brand’s first foray into the frozen aisle.

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