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How company culture drives organic food innovation

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Can new food product innovation be driven through changing the corporate culture?

Yes if it’s the right cultural change.

I am writing this blog after spending a week inside the corporate headquarters of Organic Valley Foods in La Farge, Wisc., and meeting with executives, department managers and farmers. Organic Valley (CROPP Cooperative) has quietly become the largest organic food company in the United States. Although CROPP originally started as a produce cooperative, it has  expanded its product line to include a wide range of dairy and meat products. Through a series of timely and shrewd decisions, CROPP has become a vibrant business success throughout the past 10 years for shareholders and employees alike.

My obvious question for them was What is the key to Organic Valley’s business success?

I quickly concluded that it was their business culture.

However, the cultural difference is not in the corporate business process that many companies try to establish to lay the foundation for new product innovation. The real cultural difference is that producing, processing, marketing and selling organic foods is a “way of life” for every Organic Valley employee and supplier.

For many employees who choose to work for Organic Valley, the company represents a job and career destination point – and most employees are small farmers in their own right. All new product innovation and quality improvements stem from living the organic mindset.

I was able to identify several distinguishing business traits that influence and drive new product innovation at Organic Valley. First and foremost, all ingredients and products are certified organic – not just natural. All farmers and producers must pass Organic Valley’s stringent USDA (NOP) and corporate certification standards. The farmers also sit on the Board of Directors, so they become an integral part of the product development process.

Second, Organic Valley adheres to a strict new product development StageGate process beginning with the ideation phase through the entire new product commercialization process. The StageGate process ensures that each development phase is signed off in a timely manner by individual project managers and team members that support each step of responsibility. They also use sophisticated project management software systems to track team member responsibilities and accelerate the timely introduction of new products to the marketplace.

Third, new product development is driven by a keen awareness of customers’ organic product needs and interests. Since employees live the organic way on a daily basis, they become aware of needs through their own personal experiences and shared experiences with friends and neighbors. Those needs can take on many forms such as low calorie dairy and cheese products, dairy products with pre- and probiotics, vitamin fortification and other health formulations. Other needs may sprout from more convenient packaging – whether that means resealable bags, individual servings, or changing the moisture and vapor transmission properties of produce packages to increase the shelf-life stability for sensitive products.

Fourth, Organic Valley adheres to, and exceeds, animal welfare standards regarding the humane treatment and care of animals. They employ some of the leading experts in sustainability and animal welfare, and are continually researching new and better ways to manage and sustain their farmer’s livestock.

Fifth, the company adheres to green principles throughout their physical corporate headquarters building. Three large solar panels positioned in front of their corporate offices help to replace their dependency on traditional electrical power. Employees are encouraged to recycle aluminum cans, plastic bottles, paper and other renewable materials. Building materials made from recycled materials are used whenever available, and incentives are provided to carpool to and from the work office. Their employee wellness program also supports the organic way of life.

Sixth, only organic food and beverages are sold or served throughout the entire corporate building. I especially looked forward to eating in the corporate cafeteria every day because of this component – and many recipes are local employee favorites. The menu generally consists of organic salads, dairy products, hot and cold lunch entrees, desserts and beverages.

Every day, Organic Valley proves a company can become a business and financial success while adhering to strict organic, green and sustainable standards. Yes! Organic Valley’s new product innovation success rate is truly a direct outcome of a companywide organic cultural mindset.

Please contact me at dsuderman@foodbevbiz.com or follow the Food Innovation Institute website (www.foodbevbiz.com) for more information on our 2011 Organic Food Innovation Workshop.

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