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.

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