As keynote speaker at Food Engineering's seventh annual Food Automation & Manufacturing Conference, General Mills' Rory Delaney set the stage with an overview of how the Minneapolis-based corporation manages innovation and controls risk when developing new technologies. Delaney, senior vice president of strategic technology, oversees 150 members of General Mills' technology development team.
"If you're in the innovation business, you're in the risk business," he acknowledged, but innovation is vital in slow-growth industries like processed foods. A disciplined approach that nurtures development while managing the cost of failure will be critical for food and beverage manufacturers, particularly in the mature $300 billion US market.
Performance measurement specialists at Pattiglio Rabin Todd & McGrath blame high product development rates in food and beverage on the industry's immaturity in using established tools for managing across projects, portfolios and partners, according to Delaney. He blames "an overly marketing-centric approach to innovation" that overlooks the importance of project management and the need to align technology and business strategies. "The pendulum needs to swing back toward technology, and it's beginning to," he adds. To achieve technical advancement, companies must dedicate staff to development and, if internal expertise is lacking, form alliances with outside experts.
At General Mills, each business unit's technological health is assessed to determine its current and future competitive position. This helps prioritize where innovation investments need to be made. Projects are subject to a stage-gate process to prove the principle, the concept and the practice of a given technology. Engineers are key players on the proof-of-concept team, but the psychological profile of the individuals is as important as their skill level. General Mills has found M.J. Kirton's creativity continuum for grading participants as creators and adaptors to be a valuable innovation tool. "You need both," Delaney says simply, adding, "I wouldn't ignore the naysayers. Try to get the issues in the open, and listen to questions you don't want to hear. Those are the questions you need to answer."
Innovation implementationTechnology rolls out on a bumpy road. Two speakers shared their experiences: Brad Galles of Wells' Dairy and Kathy Jordan of the Ross Products division of Abbott Labs.
Galles, process control manager at the LeMars, IA, ice cream manufacturer, guided development of the company's RFID implementation. "Most RFID experts were on the IT side," he recalled, but Wells' management wanted staff engineers to design and implement a program to meet the requirements of Wal-Mart and other customers. "If you throw out terms like OPC (open connectivity), they don't know what you mean," he said, explaining why RFID development wasn't assigned to IT.
Because of the plant's automation level, tags had to be formatted, applied and verified automatically. System redundancy was critical, customized firmware for data filtering had to be developed by Rockwell Automation, and staff engineers had to write middleware programs to interface with the plant's data-collection system. Along the way, new problems were uncovered, such as finding a tag adhesive that could remain tacky in a -40
Jordan, program manager of packaging R&D at Columbus, OH-based Ross, outlined the hurdles encountered when plastic packaging for the adult nutritional Ensure replaced a metal can. The change was needed to freshen the product's image among baby boomers who viewed it as a geriatric product. The impact on production was significant. "Pilot plants do not perfectly simulate production conditions," she noted. "At the end of the day, you have to use commercial facilities for your R&D, which is a good way to mess up manufacturing."
Out-of-spec bottles, shoehorning new equipment into an old facility and training operators without seriously disrupting line efficiencies were some of the issues confronted by Jordan. Supply-chain challenges such as accounting for old and new packaging with the same UPC codes had to be resolved. Processes had to be revalidated to satisfy kosher-certification inspectors. Whatever the issue, the key to resolving it was the involvement of personnel from cross-functional areas, including manufacturing. "I invited all the manufacturing guys to meet with us up front, even though they don't contribute much at the design stage," she said. "If you simply hear their concerns, very often they will find the solutions themselves."
Quality fixationProduct quality joined efficiency as a manufacturing priority years ago, and some conference participants questioned if quality-improvement techniques have lost their relevance. "If Six Sigma is your company's mantra, you're fighting the last battle," suggested Alan Huster, process engineering manager at Oregon Freeze Dry, Albany, OR. High quality is a requirement today, and "you had better win the quality battle and move on to the next battle, which is productivity."
Those are fighting words to Paula Marshall, CEO of Tulsa, OK-based Bama Foods Inc. Six Sigma and other continuous improvement tools are core values at her multinational bakery, which received the Malcolm Baldrige National Quality Award two years ago. A disciple of W. Edwards Deming, Marshall pointed out the father of total quality management had as much to say about organization psychology as he did about the statistical underpinnings of quality measurement.
"When people get afraid in the workplace," she observed, "the probability goes up exponentially that they will not do quality work." Eliminating fear and improving communication pays off with increased quality and efficiency. To illustrate her point, Marshall cited the handheld pies her company produces for McDonald's: since 1990, the wholesale price of those pies has not increased.
"Innovation is talking together, talking to customers and putting together products that disrupt the market," she said. "Those are interpersonal conversations."
sidebar 1:With an average of 30 years food industry experience, the engineers on the conference's Ask the Experts panel brought a diversity of experience to the forum. Despite that diversity, they spoke with one voice on the issue of immigrant labor and the consequences to the industry if it is sharply curtailed.
Expert panelists vent on labor issues, intellectual property
"If we shut the borders off and don't help these people help us, we should turn the lights off and go home," remarked Eldon Roth, CEO of Dakota Dunes, SD-based Beef Products Inc. "It's past just the low-paying jobs," with labor shortages impacting operations at Roth's machine-fabrication business. "We're starting to train Hispanics for those jobs because we're not getting a lot of takers at $20-$25 an hour" Roth said.
At least half the positions nationwide in further processed meats are being filled by "people of various backgrounds," pointed out Waheed Kahn, vice president-engineering and manufacturing strategy at Aurora, IL-based OSI Group. "The low-paying jobs are being filled by the immigrant community. We have to find a solution (to the foreign-worker situation) that makes sense to everyone."
Del Monte Foods and The J.M. Smucker Co. are affected on the raw ingredients side of their businesses. "We are tied closely to farmers, and California farmers are having difficulty accessing labor," noted Scott Butler, Del Monte's vice president-engineering and technical services. "Our supply side is concerned." Similarly, strawberry harvesting remains labor intensive, said Smucker's Engineering Manager Vernon Petty, and "the cost of that labor is not going to go down. (Immigration policy) is going to influence all of us going forward."
Protection of intellectual property (IP) drew a more diverse response. "If companies don't maintain their IP state, the future looks pretty bleak," insisted Vijay Arora, the Kraft Foods Fellow who posed the IP question and suggested manufacturers without important trade secrets and patents were doomed to be commodity providers. While some panelists sympathized with that view, others suggested execution trumped proprietary technology. Quoting a one-time mentor, Butler said, "In the food industry, there's a lot of secrecy and not many secrets." Speed to market, delivered price and quality are more important, he said.
Management missteps and other factors, not IP protection, relegated Apple Computer's superior operating system to a distant second in its industry, added Roth.
Sidebar 2:Crude oil prices breached the $70 a barrel mark hours before she spoke, and Melinda DeLuca of Miller Brewing Co. cited that milestone in prefacing her remarks on getting an ROI from energy-efficiency projects. As manager of energy & utilities for the Milwaukee-based brewery, DeLuca monitors a handful of pricing forecasts every day to see if paybacks from energy projects remain on track.
The case for energy ROI
Miller's eight US breweries can generate more electricity from coal, gas and oil than the 10-17 MW needed to operate the facilities, and deciding which fuel to use, when to go off the electrical grid and how much to invest in efficiency improvements requires accurate and timely measurement of energy pricing and consumption trends. "At the end of (efficiency improvement) projects, you are required to come back and say if you're going to get the return you expected," notes DeLuca. "If you're not going to get that return, it's not looked on favorably."
Advanced controls for a powerhouse infrastructure that includes boilers and turbines can deliver fast returns and ongoing efficiency improvements. She cited a $800,000 investment in Emerson Delta V distributed controls and EMS model predictive software at Miller's Trenton, OH, brewery as an example. Besides determining the optimal state for cogeneration of steam and electricity, the controls monitor real-time prices for energy. Instead of a two-year payback on the project, "the price of coal doubled, which gave us a one-year payback," DeLuca related. More importantly, the advanced controls are helping forecast when the plant should be buying energy instead of generating it. The facility had been generating 1 mW more power than it should have.
Grants from states, utilities and the federal government can change the economics of energy programs. Miller's Irwindale, CA, facility is installing a wastewater biogas system that will "substantially reduce" sanitary discharges and generate enough energy to run all of the treatment plant's new gas engines. ROI will be accelerated thanks to a $1 million rebate, she says. "Make sure you ask for funding; it's out there."