Opening the door to R&D success

Jeff Bellairs, General Mills’ Director of External Innovation, explains why looking beyond the traditional boundaries of the enterprise is proving a fertile breeding ground for new product innovation.

“I think it's opened our eyes to the tremendous amount of resources out there - the creativity and innovation potential that does exist outside the company”
-Jeff Bellairs

With annual net sales of $13.4 billion, General Mills is one of the world’s leading global manufacturers and marketers of consumer food products. Based in Minneapolis, the US food giant has a huge presence in Europe, where its Haagen-Dazs ice cream products, Old El Paso Mexican food and Green Giant vegetables are amongst the most well known brands on the continent. With the company recently celebrating the first anniversary of its Worldwide Innovation Network (G-WIN) initiative, Food Solutions caught up with programme director Jeff Bellairs to find out how G-WIN is helping General Mills improve its approach to new product development.

FS. First of all, could you tell us a little bit more about the idea behind General Mills Worldwide Innovation Network? For instance, what were the key drivers behind the launch of your initiative?
JB. Actually it was our Senior Vice President of Innovation and Technology, Peter Erickson, who created a dedicated group to work on open innovation, and that happened about three years ago. He set aside some resources, put a team together and asked us to put together a comprehensive program that would allow us to reach out and find new partners on the outside with new capabilities – perhaps a new process, a new package, new ingredients or a new product. In other words, things we could bring in and plug into our innovation pipeline here to accelerate some of the innovation initiatives already taking place within the company.

So we formed the group about three years ago, and it was just over a year ago that we added the General Mills Worldwide Innovation Network (G-WIN) moniker. The first couple of years were really spent trying to figure out how to most effectively put together an open innovation program given our organisational culture.

FS. It’s not the easiest thing to do. Where did you look for potential partners?
JB. We’ve done three different things. We’ve created a web portal that’s on the General Mills home page so that people can approach us with technologies that are patented or patent-pending. We’re trying to get the word out that we’re interested in new technologies, and if people think they have something that might benefit one of our businesses, there’s now a way for them to start a dialog with us.

We’re also working with some innovation intermediaries – companies like NineSigma and YourEncore – that can help us go out and find expertise. We’re always looking for people who might have a technology or the ability to help us solve the big technical problems that are challenging our businesses. So that’s the second way, working with the innovation intermediaries.

Finally, I have a dedicated team that spends an awful lot of time answering the phone and also getting out and travelling from place-to-place, really trying to find innovation where it’s occurring. So we’re travelling to different countries, we’re going to innovation fairs, food fairs – anyplace where we think there is a likelihood that there is a partner out there working to create some new product or process that could benefit one of our businesses.

FS. You recently celebrated the first anniversary of the GWIN project. So what impact has that initiative had on General Mills’ R&D efforts since its launch?
JB. I think it’s opened our eyes to the tremendous amount of resources out there – the creativity, the innovation potential that does exist outside the company. So we have examples at this point where we’ve brought in products that are ready-to-go, products that have been developed by another company, put on the shelves and proven that there is a market out there for them. When married with General Mills’ scale and one of our brands, the belief is we can create a bigger business that benefits both General Mills and the new partner. So we’ve brought in finished products, we’ve licensed technology that has enabled us to create a new platform of consumer benefits in our Go-gurt Fizzix product, and we have partnered much more closely with a number of our key suppliers to develop some very innovative proprietary ingredients that are being used in a number of our new products.

FS. Are there any particular products you can talk about in greater detail?
JB. We have a couple of very interesting fruit products that we have sourced from an external partner. They’re both Nature Valley products; the first was a Natural Valley fruit bar that we put into some of the club stores about two years ago, and we’ve taken the consumer feedback from that product and worked with an outside party to develop a fruit twist that’s currently shipping and doing very well in the club channel.

In the novel ingredient area, we worked very closely with one of our key suppliers to develop a unique fibre source for our Fiber One snack bars. They’re doing extremely well in the US, and the secret there is that these are high-fibre products that taste really good, so there’s no taste trade-off in the product.

We’ve also licensed intellectual property, including the product and process patents, from Brigham Young University that gives us the exclusive rights to do a carbonated yogurt in the US.

FS. It’s certainly been a busy year. Have there been any unexpected benefits to come out of G-WIN so far? Anything you didn’t foresee that has maybe improved operations or improved the way you conduct your research?
JB. I think it gives us the ability to focus a significant number of our resources on cost containment. We saw that the price of commodities was going up rapidly, and we were able to move a significant number of our internal resources over to work on programs to minimise the impact of those commodity cost increases on our products. To keep the new product pipelines healthy, we were able to reach outside of General Mills and really tap into the creative potential of new partners so that we didn’t sacrifice anything as we moved resources over to work on the margin enhancement projects.

FS. You mentioned a couple of products that have been launched in the US, but I know that this is a global initiative, isn’t it? What sort of impact are you having in terms of collaboration in terms of the rest of the world, Europe in particular?
JB. This has largely been a US effort. We do, however, have a partnership with a company in France to produce refrigerated Mexican meals under the Old El Paso brand, and so that’s an example of where we’re reaching outside and leveraging somebody else’s capabilities and expertise to help us create a new business. Those products are currently in tests there.

FS. So do you see those type of collaborations increasing over the next couple of years?
JB. Certainly. We think the pace of innovation in this industry is increasing, and one of the ways that we can be more nimble as a large food company is to partner with people on the outside who have that unique expertise.

FS. Are there any challenges inherent in this type of collaboration – for instance, in managing intellectual property rights and protecting sensitive information, those types of things? What challenges are there in running an open innovation program such as this?
JB. One of the things we’ve found is that it is critical to develop a relationship based upon trust, and it takes a significant amount of time spent face-to-face with potential partners to develop that level of trust. I think that’s one of the things that has been a significant learning for my group – that there are only so many of these relationships that you can physically pursue because of the time element. That’s causing us to be more strategic in the types of relationships we’re pursuing.

When we began the initiative a couple of years ago, we were largely following leads wherever they came from. It was something of a serendipitous process, but now we’re stepping back and trying to scan the globe to really find out who are the global leaders in certain areas of technology and then proactively building relationships with them. So it’s a matter of moving from serendipity to strategy, and one of the things driving that is the resource intensity needed to build solid relationships.

FS. Do you have systems in place to manage the handling of sensitive information and intellectual property?
JB. From a General Mills standpoint, owning the intellectual property is not critical. What we’re looking for is some kind of clear advantage in the marketplace, and so it may be that the ownership of the IP remains with the other partner, but we get a marketplace advantage through exclusivity for a product category or for a geography, or perhaps some kind of a headstart in the marketplace before that technology can be used by our competitors.

These intellectual property concerns are also the reason that at our website we say that we only will accept patented or patent-pending technologies. So we’re not looking for ideas; we’re looking for things that are more advanced, and there is some intellectual property protection afforded to people who have applied for a patent or have actually gotten the patent and have it in place.

FS. Why do you think this type of collaborative approach is proving so successful in nurturing a culture of innovation at General Mills, and do you expect this type of relationship to be adopted by your competitors?
JB. I think open innovation is one of those things that’s a real buzzword right now, and I think there are lots of companies who are looking at the success of other industries, of other companies, and wondering if it’s gonna work for them. I personally travel to a lot of the conferences focused on open innovation, and we do see a lot of our food company peers in attendance and very interested in the programs that we’re pursuing as well as what other people are doing. I think that when you start one of these programs, you quickly realise that it is something that is a bit of a cultural change. They’re asking scientists to play a different role in the innovation process, so rather than being the sole creator, we’re now asking them to be an orchestrator, to find interesting pieces of technology that are on the outside, to work to bring them in and connect them with pieces on the inside. So for some of our scientists, it’s a different role, and I think for General Mills it’s a different way of working. We have to focus and build partnerships; certainly for some of the smaller companies we are working with, there is some concern in working with a big company, and again, we have to spend the time to really be upfront with the potential partner and explain to them the deal structures and the benefits that they could receive by pursuing a relationship with General Mills.

FS. I know health and nutrition is a key area for companies in the food sector right now. Have you made many advances in health and nutrition as a result of this program?
JB. We have a number of different initiatives. Some of them are collaborations with key suppliers, some of them are consortiums that we joined or are working to form, so there are a number of transformational technologies that are in our pipeline right now. I think if you look at some of the things that have already hit the market – the Fiber One bars that are doing extremely well in this country, for instance – their success is due in large part to our collaboration with a supplier that gave us a unique ingredient. We also have a very successful line of Progresso low-sodium soups, and one of the key ingredients that allowed us to reduce the sodium without sacrificing flavour came through a very close collaboration with a supplier to develop a new ingredient. So a couple of things have hit the market, but there are a number of larger initiatives that are still in the developmental pipeline.

G-WIN Success Stories

In its first year, the G-WIN team at General Mills received more than 200 concept submissions. Because of its efforts to drive open innovation, the G-WIN team was able to generate major new product introductions, as well as important technology advancements and key industry partnerships. 2007 innovation highlights include:

Fiber One Chewy Bars: General Mills teamed with an exclusive partner on a fibre ingredient to develop a delicious snack bar with nine grams of fibre per bar. Fiber One Chewy Bars have far exceeded performance expectations. Within months of the product launch, Fiber One bars were among the top 10 best-selling grain bars on the market.

Progresso Reduced Sodium soups: Through a new proprietary partnership with an external company with considerable expertise in healthy foods, General Mills was able to source a great-tasting new lower-sodium ingredient for its Progresso Reduced Sodium soups. The new reduced-sodium soups are performing very well, and are also bringing new consumers to the brand. Around 50 percent of sales for lower-sodium Progresso soups introduced in 2007 came from consumers who weren’t previously buying Progresso. In the first year on the market, sales of Progresso Reduced Sodium soups ranked in the top third of the ready-to-serve soup category. Based on this success, additional soup flavours were added to the line later in 2007.

Yoplait Go-Gurt Fizzix yogurts: General Mills also facilitated the launch of Yoplait Go-Gurt Fizzix, a first-of-its-kind carbonated yogurt that General Mills produced after licensing a product and process patent from Brigham Young University, and the Pillsbury Cooler, a state-of-the-art, environmentally friendly mobile cooler technology created through a partnership with a refrigeration company. In addition, General Mills’ efforts helped create a new food science division within YourEncore, an innovation services company helping organisations accelerate innovation by leveraging the expertise of retired scientists and engineers.

Key learnings

Jeff Bellairs provides his key lessons from the G-WIN programme.

Get some wins on the board early: A number of the things that we did initially weren’t necessarily the biggest projects or the biggest ideas, but we wanted to demonstrate to General Mills’ leadership what an open innovation program looked like for us as a company. Every company has a unique culture, unique capabilities, and so you really need to demonstrate what open innovation could bring to your business.”

Move from serendipity to strategy: “Serendipity gets you started, it’ll always be a part of our program, but we want to spend more time really focused on finding those global leaders who have technologies of products that match up directly with our business needs. Sooner or later, you need to focus on what you are doing in a much more strategic way.”

Keep your eyes (and mind) open: “It’s really opened our eyes to how much potential there is out there. We will continue to focus resources in this area to try and be the first company to find that next big technology that may exist out there in someone’s lab or their garage or some foreign market. You never know where the next big technology shift will come from.”