TreeHouse Foods, R&D Team of the Year in the large category, is unique in product development in a number of ways. First, as a private label manufacturer, it spends as much time developing products specified by branded clients, usually grocery stores, as it does innovating itself. Second, as a collection of acquired companies less than 15 years old, it has diverse and fresh perspectives on a number of product categories.
But innovate, it does, with 250 product development team members spread among two dozen facilities in the U.S. and Canada. And while we'll call them an R&D team, the acronym at TreeHouse is RDI (Research, Design and Implementation).
"A key feature of TreeHouse is the team structure we have built to ensure customer intimacy and partnership in order to deliver ideas to market in the private label space," says Jess Sweley, senior vice president of RDI. "R&D and Commercialization-Launch teams are often distinct and separate functions.
"We found a good deal of inefficiency resided in the transitions where conventional R&D meets implementation, so we integrated all technical functions – including product development, processing, packaging, labeling, graphics, data management, regulatory, and project management – to work with our retail partners and ensure successful delivery of the full end-to-end process.
"We also work cross-functionally with our sales, business team and supply chain partners to ensure the ideas and products we take to market are a win for both TreeHouse and for our customers," Sweley says.
TreeHouse has approximately 100 degreed food scientists, complemented by several dozen packaging and process engineers, labeling and regulatory specialists, graphics designers, and project managers.
The company's showcase laboratory and innovation center is in suburban Chicago (Downers Grove, Ill.). With typical benchtop spaces, a pilot plant for bars, culinary kitchen and even a packaging laboratory, that's the impressive space most customers will see.
But most of the daily grind goes on at 26 small labs across the country, most attached to plants and most the result of acquisitions with specializations.
Centralized, yet decentralized
"TreeHouse has a hybrid model of centralized and decentralized RDI," says Adam Pawlick, who has the long title of senior director of RDI-Emerging Technologies, Breakthrough Innovation, Processing, and Packaging. "Many of our team members are in the plants where they can rapidly commercialize ideas to support our customers, while at the same time we have a core group of centralized resources.
"One strategic advantage TreeHouse has enjoyed is that we have been able to take the best of the various cultures and work processes in the companies we have acquired and blend them into something unique that you won’t find elsewhere.
"A great example is in our In Store Bakery group based at our Ogden, Utah, plant. They rapidly innovate in-store bakery cookies in a fun and customer-focused way. They turn out hundreds of new formulas a year. Every season, every customer, every occasion has its own cookie design, frosting type, color, and sprinkle options."
Since TreeHouse's products compete with national branded products, "We need to provide everything the national brands do, just faster and at lower costs," says Pawlik. "Not only are we very cost-conscious, but we must have all of the food safety and quality controls that our national brand competitors have. The products we design and manufacture represent not only TreeHouse’s name and values, but also our retail customers' name and values."
"Our level of partnership varies by customer," says Sweley. "Many retailers take a very active role in the development and commercialization of their products, while others are more hands-off. In either case, it is critical to work from a foundation of trust. We want our retail partners to be successful with all the products that are developed. We are really stewards of their brands."
Project ideas come from everywhere. "Sometimes ideas are prompted by market analysis and trends; other times they may be driven by emerging technology," says Sweley. "Perhaps most distinct to private label, many of our ideas originate from our customers themselves, who have ideas and insights on how best to grow their own brands. We really look at our retail customers as our partners, and our greatest success has usually been found when we are finding these common spaces to grow."
At the same time, private label has become more than just competition with national brands. "For example, we are seeing significant growth in the organic and better-for-you product segments that do not necessarily mirror national brands," says Pawlick. "The interesting thing is that as the demographics of the country shift, we are finding more and more consumers are allowing private label to drive innovation. So, we are definitely taking advantage of that and driving some new technologies and new products to market that we haven’t seen before.
"One of our most important, recent accomplishments is the success we are seeing in the e-commerce space," he continues. "The changes taking place in the marketplace due to the emergence of e-commerce are happening quickly, and it is something we’re working to solve through our agility and customer partnerships.
"We recently formed a core team focused on designing, developing, testing and ultimately commercializing several new products in the e-commerce channel. The investments TreeHouse made to have in-house capabilities for prototyping package and graphics design, completing full ISTA [International Safe Transit Assn.] testing to obtain instantaneous responses, and making redesigns as necessary enabled us to significantly increase speed to market. This sort of capability is comparatively unique for a private label manufacturer, and gives us great opportunities to forge partnerships and serve customers in this emerging channel."
"We focus on listening, learning and adapting," adds Sweley. "It is a great responsibility and thrill to provide our customers’ shoppers with high-quality, great-tasting food at great prices. We’re very optimistic about the future of private label and how TreeHouse and our RDI team can continue delivering success."