2012 R&D Survey: Exciting New Products – With a Side of Cost Control

'New product development' is still the top R&D priority, but processors are creating brand extensions, cleaning up current ingredient statements and keeping an eye on costs.

By Dave Fusaro, Editor in Chief

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The list of ingredients you'll be adding or subtracting this year closely resembles last year's list. Sodium remains the main culprit, with 46 percent pursuing its removal (last year was 49 percent). Added sugars was and is next, at 30 percent. Removing trans fats is still a concern, although it dropped a point to 24 percent.

2010 Dietary Guidelines
Ingredients to add or reduce
 R&D Budget

Adding fiber is the significant ingredient addition. A little further back is fruits & vegetables.

As for how long it takes to get these wonderful new products to market, the biggest segment (38 percent) answered nearly a year, but the average of all responses was 8.7 months.

Budgets for R&D departments are about a wash with last year's numbers.

There are no great changes in staffing, either. And while a lot is written about a shortage of talent in technical fields, 72 percent of you say your R&D department has no problem finding qualified job candidates.

Who's on the team?
While the bulk of our readers are at larger companies, we count among our readers food processors of all sizes. So it's not surprising to find 24 percent of our respondents do not have a formal product development team – a number that's been pretty consistent over the past few R&D surveys.

For those that do have a product development team, it's also not surprising that R&D is represented on virtually all of those teams (that 87 percent in Table XX does not include about 12 percent who answered the question they do not have a formal team — so that's 87 percent of 88 percent). Perhaps more interesting is who else plays on the team.

Confirming that product development is a collaborative and cross-functional effort, Marketing representatives are on 62 percent of teams, following by Manufacturing at 47 percent. Corporate Management likes to get involved at 40 percent, and Purchasing and Finance sit in on about a quarter of the teams. Note the significant penetration by multiple suppliers and consultants.

As for setting product development goals, the R&D people wield the most power, but they are fairly closely followed by Marketing & Sales. Despite R&D's presence and power above, they only get to make go or no-go decisions at about one-eighth of companies. Centralized, high-up decision-making is the norm.

Then there was this comment – and it doesn't sound like it came from a traditional food technologist: "Really implementing Stage Gate! That means no more R&D and Sales working behind everyone's back. It means R&D does not get to do what they want but what is defined by Marketing. My guess is people will have to leave the company before they will change."

Stage-gate is a highly structured project management technique in which a project must get manager or steering committee approval, based on a review of all the needed resources, before it can move on.

A more optimistic comment is: "We are working to become category leaders in every segment of our business, improving our products to such a level that they way surpass the quality of all our competitors."

Change is hard. But change is necessary. Thank you for your insights in this long-running survey.

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