2011 R&D Survey: We Expected Recovery, We Got Caution
'New product development' is still No. 1, but processors are hedging their R&D bets.
By David Feder, RD, Technical Editor | 05/09/2011
Then we put the question another way: "What are the big, big issues your team will face in the coming year?" This time processors put "Healthier/Better-for-you Foods" at the top, with 56 percent calling it No. 1. Right behind were Consumer Trends at 50 percent. New Regulatory Issues made for a close No. 3 with 45 percent.
That's where the new USDA Dietary Guidelines enters the picture, with almost two thirds of those responding saying the new guidelines are reasonably important and 13 percent calling them, "huge" and acknowledging they will "impact nearly everything we do." So we added a question to coincide with the guidelines' January release: "What ingredients noted in the Dietary Guidelines will you be working most on this year?" It's probably no surprise that removing sodium was Job One. Nearly half of those polled on this question targeted this ingredient.
Tied for second place were the removal of added sugars and trans fats, with the addition of fiber a fraction of a percent behind them (although also at 25 percent due to rounding up). Saturated fats reduction was close behind at 23 percent. (Respondents could choose more than one answer.)
Worth mentioning on the guidelines track are that nearly one fifth (18 percent) of processors say they will be working on replacing refined grains with whole grains, and 15 percent want to add more fruits and vegetables as ingredients to their products and product lines.
Seven in 10 of our processors noted they have a formal product development team. That team, no surprise, is led by R&D (87 percent), but Marketing representatives are on 69 percent of teams. Also present are Manufacturing (54 percent of teams), Corporate Management (44 percent), Purchasing (39 percent) and Finance (28 percent).
Centralized decision-making is way up, indicating top brass is holding the reins in a tight economy. However, that was contradicted somewhat when we asked respondents who sets R&D goals in their company — it's R&D, of course. Looking at last year's numbers, nothing has changed at all. CEO/CFO/President, General Management and R&D had nearly identical "very involved" and "somewhat involved" scores compared to 2010.
There was a slight shift compared to last year vis the involvement of the Marketing & Sales team in goal setting: They lost clout in that the percentage "not involved" nearly tripled, from 2.7 percent to 7.5 percent. Those percentage points (and more) went over to the steel-toed boots guys and gals, who saw a rise of "very involved" go from 23 to more than 29 percent.
How do our processors' R&D squads identify new product ideas after goals have been set? 85 percent rely on basic internal research. This is up slightly from last year's 81 percent. And reliance on focus groups also is up several percentage points, from 2010's 44 percent to nearly 48 percent. Suppliers are tendering about the same input as they did last year (up a single percentage point, from 42 to 43). But external product development companies are pitching in a bit less, down to just over 15 percent compared to more than 17 percent of processors using them last year.
So while the economy has left its mark in the form of an adherence to the status quo for many issues, there are positive signs. As they look toward deploying their R&D teams, manufacturers may recognize the field of "healthy" and better for you" formulations is becoming the rule rather than the exception. That opens up numerous R&D prospects. In other words, this is the time for R&D to shine.
In addition to links to the survey posted on our website and positioned in the magazine, we sent links to the survey out to all Food Processing readers bearing administrative and R&D titles. This year we received nearly 400 responses. As with all Food Processing surveys, personal information is kept strictly confidential and is used only for research purposes. Thanks to all for participating, and we hope to hear from you for next year's survey.