The food product development process

3THE FOOD PRODUCT DEVELOPMENT PROCESS

IntroductionThe current process for developing new food products isseriously flawed. Of the 8,077 new food products (stockkeeping units or SKUs) introduced to US retail markets in1993, only about one-quarter of them were novel – notsimply line extensions[1]. Although there are no publisheddata on successes and failures of new food products, it isestimated that 80 to 90 per cent of them fail within one yearof introduction. These are just the products that made theretail cut; consider all the products whose efforts fell shortand retail introduction never took place. This means thatonly about 200 novel food products introduced in 1993 willmake it after their first year on US retail shelves in 1994.The failure cost to the US food industry is estimated at $20billion[1]. This cost results from missed sales targets, lostrevenues and postponed profits in addition to wasteddevelopment resources.

Being complex and iterative, the food productdevelopment process has proved difficult to define andmodel. It begins with a concept and ends with either theentry of the product in the market or the maintenance ofthe product in the marketplace, depending on whosemodel is studied. Barclay’s review of research work intothe process of product development (not only food) andthe way in which it has progressed over 40 years showsthat much of the work studying the new productdevelopment process is unknown to product developmentmanagers[2]. After investigating current practices in newproduct development at 149 UK-based companies, only 78were found to have some form of a new product guide tohelp manage the process, and 65 of the 78 stated theirguide had originated through experience. Only onecompany based its new product development process onliterature describing process models.

Traditional approaches to managing the productdevelopment process often fail because they result inunbalanced milestone structures. Typically, there is no

preplanned structure of milestones that identifies thedeliverable for each functional group at each step of theprogramme. Project managers apply their often limitedexperience to develop a programme plan that emphasizestheir area of expertise. Often, milestones for followingproduct performance are absent. For example, productiondata are not fed back to the team members who developedthe product. Furthermore, management traditionallyconcentrates on the process only when authorization forlarge amounts of money is requested. Managementattention, therefore, is focused typically on the purchaseof equipment, not on concepts or brain work.

We believe that Arthur D. Little, Inc. has developed acomprehensive philosophy to guide food productdevelopment activities. It is based on establishing clear,consistent milestones for the entire development processand identifying the required deliverables by each of thefunctional elements contributing to product developmentwithin the firm. Milestones are viewed as an opportunityto monitor progress against a planned set of goals, toreview the next tasks and anticipate problems, and toinitiate programme changes. This approach to milestonesis analogous to the use of a bivouac site by a mountainclimbing team to regroup and make adjustments beforeproceeding on the journey. Figure 1 depicts the milestonestructure graphically, highlighting the natural andeffective shifting in the level of activity for eachfunctional area.

While the peak activities shift, it is critically importantthat each group provide input to all of the milestonesthroughout the process. As Barclay states, “The [foodproduct] development process needs to be linked with thecorporate objectives and to the external environment toallow new ideas into the organization”[3].

The Arthur D. Little (ADL) milestone-driven productdevelopment process recognizes that a good process isflexible and continuously evolving. The many advantagesof this process for project leaders, team members andmanagement are based on the following features:

The food product developmentprocessMarvin J. Rudolph

Progress must be monitored against a planned set of goals

British Food Journal, Vol. 97 No. 3, 1995, pp. 3-11 © MCB University PressLimited, 0007-070X

4 BRITISH FOOD JOURNAL 97,3

● Use of common, project-specific vocabularyfacilitates communication among the case team,management, and project reviewers.

● Development of a standard framework ofmilestone deliverables reduces project start-uptime.

● A consistent definition of milestone structureallows for internal benchmarking.

● A proven methodology allows for more accurateproject planning, including: allocating resources,establishing budgets, and scheduling tasks.

The total milestone-driven food product developmentprocess under investigation is illustrated in Figure 2. Itcan be envisioned as a skier racing in a three-phase giantslalom, the phases defined as product definition, productimplementation, and product introduction.

Phase I: product definitionStrategic planThe skier (product developer) begins the race byproceeding from the starting gate under a strategic planimplemented by what we at ADL refer to as “thirdgeneration R&D”[4]. Third generation R&D is simply aholistic linking of business and technology goals.

Prior to the early 1960s, there was first generation R&D,which can be defined as the strategy of hope. A researchcenter was established, usually separated in distance from themain activities of the corporation, whose mission was to comeup with interesting phenomenon. Work was self-directed,with no explicit link to business strategy. R&D activities werea line item in the corporate budget. If something came out ofthe effort, so much the better. However, the attitude wasfatalistic – expectations usually were non-specific.

From the early 1960s to today, we have second generationR&D, which is best characterized as “hope for a strategy”.Second generation R&D is an attempt to apply a rationalapproach to R&D management on a project-by-project basis.

It is characterized by a mutual commitment to goals by uppermanagement and R&D, consideration of the corporatestrategy when setting these goals, and the implementation ofa control system to track progress towards the goals. There is,however, no corporate-wide integration of R&D activities.

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Typical levelof activity

Time

Milestones

Func

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ManagementMarketing

Research and developmentManufacturing

SalesDistribution

Product support

All organization functions are involved throughout the project,but the level of activity varies for each function

Figure 1. Organizational involvement in the productdevelopment process

Start: strategic planA vision of the company's direction; markets served,market positioning, competitive environment, regulatory hurdles, core competences,profitability targets, etc.

Product business plan

A document describing the market opportunity and the programme required to realize the opportunity

Market opportunityassessment

Product definition

Consumer researchwhich characterizesthe market opportunity

The integration ofconsumer perceptions,business objectives,product definitionrequirements and regulatoryrequirements

Product definition phase

Figure 2. Milestone structure

Market strategyand testing

Forecasts of long-run sales are made based on market-test analysiswhich predicts trial and repeat purchase intent

Prototypedevelopment

Scale-up andtrial production

Development of a "works like and looks like" product prototype which meets the established business objectives

Manufacturing of the new product and development of a total quality programme

Product implementation phase

Finish: product support

Production introduction

Led by sales and supported by marketingand distribution functions,the product at this milestoneis ready to be revealed toconsumers in its final form

Product introduction phase

Build product successand repeat business byfeedback to otherfunctional areas


The future belongs to third generation R&D, emergent inleading companies. It articulates the issues that the firmmust consider as it decides how to define overalltechnology strategy, set project goals and priorities,allocate resources among R&D efforts, balance the R&Dportfolio, measure results, and evaluate progress. Thecrucial principle is that corporate management ofbusiness and R&D must act as one to integrate corporate,business, and R&D plans into a single action plan thatoptimally serves the short-, mid-, and long-termstrategies of the company. A major output of thirdgeneration R&D is a vision of the company’s direction; itcharacterizes the markets served and that competitiveenvironment, details regulatory hurdles and identifies thecompany’s market positioning, core competences andprofitability targets.

Market opportunity assessmentOnce the strategic plan is in place, the second gate totraverse is the characterization of the market opportunity.This means that market requirements must be defined. Inthe food industry, this usually means consumer research.Frequently, focus groups (realtime knowledge elicitation)are conducted to identify potential opportunities for newproducts. The appeal of focus groups is in the “freeformat” – usually resulting in qualitative (anecdotal)comments that may be misinterpreted when a strongobserver bias exists. Lack of a rigorous method for siftingthrough consumers’ verbal comments may result in amisunderstanding of the real trade-offs that consumersare making or a failure to uncover an opportunitybecause of insufficient probing.

On the other hand, quantitative methods, like conjointanalysis[5], are criticized because of the limited andunrealistic nature of the options that can be presented andevaluated by the consumer.

The Arthur D. Little approach to conducting real-timeknowledge elicitation combines the advantage of theunrestricted choices offered by free-choice profiling withthe powerful collection of quantitative data for statisticalanalysis. We use a software tool for real-time data captureand analysis during the focus group. The online analysisprovides the moderator with feedback on how well theconsumer descriptions differentiate the samples. Themoderator can then pursue further probing to uncoversubtle yet important differences among samples.Subsequent statistical analysis is used to reduce thedimension set to those sensory characteristics thataccount for the majority of the variance.

The method is effective in explaining the full range ofsensory dimensions where individuals are able todiscriminate effectively between items. As alternativefeatures are defined, these consumer opportunities can

then be translated into product concepts for furthertesting during consumer real-time knowledge elicitationactivities. This can improve the success rate of theconcepts as they move further through the milestonegates.

The business planThe output of consumer real-time knowledge elicitation isthe identification of new consumer needs and productconcepts that can be incorporated in a product businessplan[6]; a document that describes a market opportunityand the programme required to realize the opportunity.The business plan, usually written for a 12-month period,does the following:

● defines the business situation – past, present, andfuture;

● defines the opportunities and problems facing thebusiness;

● establishes specific business objectives;

● defines marketing strategy and programmesneeded to accomplish the objectives;

● designates responsibility for programmeexecution;

● establishes timetables and tracking mechanismsfor programme execution;

● translates objectives and programmes intoforecasts and budgets for planning by otherfunctional areas within the company.

Product definitionThe last step in this phase is product definition. The keyto product definition is the integration of multiple, andoften conflicting, objectives. The integration of consumerrequirements, business objectives, product deliveryrequirements and regulatory requirements is illustratedin Figure 3.

Consumer requirements• Operational needs• Use environment• Service• Maintenance

Product delivery requirements• Installation• Distribution• Sales• Support

Business objectives• Cost targets• Competitive analysis• Manufacturing constraints

Product safety/regulatory issues• Nutritional labelling• Package tamper resistance/

evidence• Generally recognized as safe

(GRAS) ingredients

The key product definition is the integration of multiple,and often conflicting, objectives

Figure 3. Integration of objectives


Arthur D. Little has pioneered a structured approach tointegrating research of consumer needs and descriptionsof the competitive environment with technical realitiesinto a unique product specification. We use a productdefinition process based on quality functionaldeployment (QFD) to help us combine and translateconsumer requirements into product specifications.QFD[7] was developed in Japan as a tool to providedesigners with an opportunity to consider the qualitiesof a product early in the design process. QFD is a methodthat allows us to consider the qualities of a product,process, or service. It helps us to focus our activities onmeeting the needs of the customer:

● Who are the customers?

● What is it they want?

● How will our product address those wants?

Using QFD leads to a better understanding of customerneeds that the product must meet to exceed competition.

QFD methodology evolves around the “house of quality”(see Figure 4), a graphical representation of the

interrelationships between customer wants andassociated product characteristics. It maps productrequirements, helps to identify and understandrequirement trade-offs, and predicts the impact ofspecific product features. Additionally, it provides ateam-building tool for interdisciplinary productplanning and communication. It is a method that is animportant part of the process to develop successfulproducts that fit the strategic and tactical needs of thebusiness.

Phase II: product implementationPrototype developmentOnce the food product is defined, a “works like, looks like,tastes like” product prototype is constructed orformulated. To demonstrate that the product prototype inits conceptualized final form will meet the technical andbusiness objectives established, Arthur D. Little staff usetheir profile attribute analysis (PAA) method[8].

PAA is an objective method of sensory analysis that uses anexperienced and extensively trained panel to describe

Relationshipsbetween

customer needsand product

attributes

Customerrequirements

Customerperceptions

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Design specifications

Competitive assessment

Customers

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What is QFD?

QFD methodology evolves around the"house of quality", a graphical representation of the interrelationships between customer wants and associated product characteristics

Figure 4. The house of quality

numerically the attributes of the complete sensoryexperience of a product. These attributes are a limited set ofcharacteristics which provide a complete description of thesensory characteristics of a sample. When properly selectedand defined, little descriptive information is lost. PAA is acost effective tool for product development that takesadvantage of the use of powerful statistical techniques, suchas Analysis of Variance.

PAA is used in product prototype development in twoways: competitive product evaluations (benchmarking);and product optimization.

BenchmarkingCompetitive product evaluations provide formulatorswith objective information regarding the flavour qualityof competitive products and the areas of flavouropportunity. The following example demonstrates acompetitive product evaluation of several nationallybranded oatmeal cookies. The products sampled (fourfull-fat oatmeal cookies, two reduced fat cookies, and ano-fat oatmeal cookie) are identified in Table I.

The evaluation was conducted to determine whetherreduced fat and/or no fat products provide sensorycharacteristics similar to those of their full-fat counter-parts.

● A panel of trained sensory analysts evaluated tworeplications of each of three lots of each type ofcookie. The samples were presented in a randomorder with no visible identification of the brand.

● The panel used PAA to evaluate the productsagainst the 13 sensory attributes shown in Figure 5.

● Summary indices for texture and flavour weredeveloped using principal components analysis tosummarize the attribute data, and were interpretedas shown in Table II.

● The resultant flavour map of the flavour andtexture indices (see Figure 6) shows that the fullfat Pepperidge Farms Santa Fe oatmeal cookie isnot significantly different from the NabiscoSnackwell’s reduced fat oatmeal cookie.

When the balance and flavour indices are shown in theflavour map (see Figure 7), the reduced and no fatproducts, as well as two out of the four full fat cookies(Pepperidge Farms, Pepperidge Farms Santa Fe),exhibited a thinner, less blended flavour. The Archwayand Nabisco full fat products had a fuller, more blendedflavour but differed significantly in texture. Archway is asoft, fragile type of cookie and Nabisco is a moister,chewier cookie.

The results of this study indicate formulationimprovements to the flavour of the reduced and no-fatcookies should be focused on improving the balance andfullness of flavour.

Product optimizationResponse surface methodology (RSM) can be used toachieve product optimization. In experimental foodproduct formulations with multicomponent mixtures, themeasured response surface, usually a flavour attribute,can reveal the “best” formulation(s) that will maximize(or minimize) the attribute[9]. An RSM experimentaldesign for optimizing a ketchup formulation is illustratedin Figure 8.

Professional panelists characterized the initial marketsamples from five plants with six code dates and thesubsequent reformulated experimental products. Thethree most important variables were identified aspercentages of salt, acid, and high fructose corn syrup.The experimental design called for the manufacture and


Table II. Summary indices for oatmeal cookies

Higher scores Lower scores

Texture index Less crumbly More crumblyHarder SofterMore moist More dryMore chewy More tender

Flavour index More starch aromatics Less starch aromaticsMore others Fewer othersLess blended More blendedThinner flavour Fuller flavourMore mouthfeel Less mouthfeel

Note: Summary indices for texture and flavour weredeveloped using principal components analysis to summarizethe attribute data

Table I. Profit attribute analysis (PAA): competitive productevaluation

Full-fat cookies Archway oatmeal cookiesNabisco oatmeal cookiesPepperidge Farms oatmeal cookiesPepperidge Farms Santa Fe cookies

Reduced fat cookies Pepperidge Farms wholesome choiceoatmeal cookies

Nabisco Snackwell’s reduced fatoatmeal cookies

No-fat cookies Entenmann’s no-fat oatmeal cookies

Note: The sensory analysts evaluated two replications of eachof three lots of each oatmeal cookie product. The samples werepresented in a random order with no visible identification ofthe brand


1 2 3 4 5 6 7

HardSoftHardness

Textureattributes

BrittleCrumblyFracturability

ToughTenderChewiness

MoistDryMoistness

MuchNoneToothpacking

UnblendedBlendedBalance

FullThinFullness

StrongNoneFlavour aromatics

StrongNoneStarch aromatics

StrongNoneSweet

StrongNoneMouthfeel

ManyNoneOthers

StrongNoneAftertaste

Flavourattributes

The panel used profile attribute analysis (PAA) to evaluate the products against 13 attributes that best describe important sensory characteristics

Figure 5. Sensory attributes of oatmeal cookies

9.0

8.5

8.0

7.5

7.0

6.5

6.0

More starch aromaticsMore othersLess blendedThinner flavourMore mouthfeel

Less starch aromaticsFewer othersMore blendedFuller flavourLess mouthfeel

Flavour index

WholesomeChoice reduced fat

Entenmann's no fat

Pepperidge Farm full fat

Archway full fat

Santa Fe full fat

Snackwell's reduced fat

Nabisco full fat0.48

0.87

LSD

4 5 6 7 8 9 10

More crumblySofter DrierMore tender

Less crumblyHarderMore moistMore chewy

Texture index

LSD = Least significant difference

On flavour and texture, the Nabisco Snackwell's reduced fat and the Pepperidge Farms Santa Fe full fat products are not statistically significantly different

Figure 6. Texture index v. flavour index, oatmeal cookies


sensory analysis of 15 ketchup formulations and acontrol. Each formulation was evaluated three ways: withunsalted french fries; with salted french fries; and neat.The RSM results revealed that our client’s originalevaluation design (without including different “carriers”)was misleading:

● Ketchup evaluated neat has different flavourcharacteristics from ketchup evaluated withfrench fries.

● The original “optimized” formulation wasacceptable in limited use situations.

● The resultant optimized formulations wereacceptable in all ketchup uses when a standardmanufacturing process was followed.

When RSM is utilized, product optimization time isgreatly reduced from traditional “cook and look”optimization techniques that depend on subjectiveformulation and evaluation procedures and often stopshort of fully realized product improvements.

Market strategy and testingAt this point in the product development process, theorganization has invested time and money in developinga new product from the initial concept to productoptimization. If marketing forecasts look good, thetemptation is to prepare for a full-scale launch. But theproduct definition phase is based on models that arereasonably accurate representations of market response,but not of reality. Things can still go wrong, as witnessedby the failed national introductions of “New Coke”, MilkyWay II candy bars (25 per cent fewer calories and 50 per

Saltper cent

Acid per cent

HFCS per cent

RSM experimental design

Professional panel evaluations of ketchup:• Market sample: five plants, six dates

• RSM: 15 formulations and control

Each formulation was evaluated in three ways:1 With french fries – unsalted2 With french – salted3 Neat

Sensory evaluations

After identifying three or four of the most important factors using a screeningdesign, we use response surface methods to optimize the formulation,for example, we helped to optimize a ketchup product

Figure 8. Response surface methodology experimental design

5.0Less blended

More blended

Balance

Wholesome Choice reduced fat

Entenmann's no fat

Archway full fat

Santa Fe full fat

Snackwell's reduced fat

Nabisco full fat

0.31

0.48

LSD

6.5 7.0 7.5 8.0 8.5 9.0

Less starch aromaticsFewer othersMore blendedFuller flavourLess mouthfeel

More starch aromaticsMore othersLess blendedThinner flavourMore mouthfeel

Flavour index

LSD = Least significant difference

4.8

4.6

4.4

4.2

4.0

3.8

3.6

3.4

3.2

3.0

Pepperidge Farm full fat

The reduced and no-fat products as well as two out of the four full-fat cookies (Pepperidge Farms, Pepperidge Farms Santa Fe) exhibited a thinner, less blended flavour. Improvements to the flavour of the reduced and no-fat cookies should be focused on improving the balance and fullness of flavour

Figure 7. Flavour index v. balance, oatmeal cookies


cent fewer calories from fat), and ConAgra’s Life ChoiceEntrees (low-fat diet regimen).

Long-run sales are based on two types of consumerbehaviour, product trial and repeat purchase. Forecastsof long-run sales can be made if market test analysis canpredict the percentage of consumers who become repeatusers as well as those who will try the product.Numerous models have been developed that present thenew product to consumers in a reasonably realisticsetting and take direct consumer measures leading to theforecasting of cumulative trial and repeat purchases.Although they will not be discussed in detail here, someof these models are based on previous purchasingexperience, the so-called stochastic, or randommodels[10, p. 391], attitude-based pre-test marketanalysis models[10, p. 395], and a combination oftrial/repeat and attitude models[10, p. 397]. New servicesare constantly being developed commercially, and it isclear that technically strong models and measurementsystems will be widely available to forecast sales of newpackaged food products.

Scale-up and trial productionUltimately, the new food product has to be manufacturedto meet the needs of the consumer. Early involvement ofthe manufacturing function in the product developmentprocess helps to avoid problems that invariably surfacewhen consumer expectations conflict with engineeringconstraints. The product’s success is often linked to thelevel of compromise that is reached between the R&D andmanufacturing functions.

Implicit in the scale-up and trial production of the newfood product is a total quality programme thatcontinuously identifies, analyses and controls risk. Therisk controlling process, as shown schematically inFigure 9, begins with the identification of all potential

hazards and proceeds through the screening, analysis,ranking, quantification and evaluation stages, ultimatelyto the controlling of the risks.

A hazard analysis/critical control point (HA/CCP) matrixis a useful tool for identifying and prioritizing hazardswhich may affect food product quality. Such a matrix hasthe following elements:

● identification of critical control point;

● evaluation hazard potential;

● assignment of a degree of concern (low, medium,high);

● development of criteria for hazard control;

● preparation of monitoring/verification procedures;

● designation of corrective action alternatives thatmay be required.

Since food safety is always of paramount concern, newproducts often linger or die at this point in the process ifthe issues cannot be resolved satisfactorily.

Phase III: product introductionThe product introduction milestone is led by sales butsupported through all other functional areas, especiallymarketing and distribution. Field trials have beencompleted and the product is designed to meet the needsof the consumer. The product has been packaged andpriced appropriately to convey the correct messages ofquality and value. Packaging for transport has beentested and the product has been distributed in a timelyand correct fashion so that it flows through thedistribution system without impediments.

This phase is perhaps the most exciting and anxious,where customers see the product for what it is. Theirinitial response generally reveals the potential for successor failure of the product.

Product supportProduct support is a complementary milestone thatbuilds product success and repeat business because itfeeds back valuable information to other functional areasthat can lead the process for line extensions, productupgrades, and the creation of all new opportunities.Product support is the “infantry” for the battle at theretail shelf; the first line of communication from the point-of-sale back to the organization.

ConclusionsIt is worth assessing how effectively your companycontrols the basic product development process.Symptoms of a “broken” process are:

Risksunknown

Risksquantified

Risksrecognized

Risksranked

Riskscontrolled

Risksevaluated

Hazardidentification

Risk analysis

Preliminaryscreening

Managementintervention

Acceptabilityassessment

Total quality implies the continuous identification, analysis and control of risks

Figure 9. Food industry risk controlling process

● longer development time than competitors;

● missed targeted introduction dates;

● significant number of “crash projects”;

● a succession of stop/go decisions.

If your company exhibits these symptoms, you may needto overcome a common misconception about control:milestones are not an administrative burden imposed bysenior managers eternally worried about the team’scapacity to deliver. Rather, they are a self-help toolwithout which a team can feel hopelessly lost. Ultimately,the mountain-climbing team and the base camp arejointly responsible for the success of a climb[11].

References1. Morris, C.E., “Why new products fail”, Food Engineering,

Vol. 65 No. 6, 1993, pp. 132-6.2. Barclay, I., “The new product development process: past

evidence and future practical applications, Part I”, R&DManagement, Vol. 22 No. 3, 1992, pp. 255-63.

3. Barclay, I., “The new product development process: Part2. Improving the process of new product development”,R&D Management, Vol. 22 No. 4, 1992, pp. 307-17.

4. Roussel, P., Saad, K.N. and Erickson, T.J., ThirdGeneration R&D, Harvard Business School Press,Boston, MA, 1991.

5. Rosenau, M.D., Faster New Product Development,American Management Association, New York, NY, 1990,p. 239.

6. Hopkins, D.S., The Marketing Plan, The ConferenceBoard, Inc., New York, NY, 1985.

7. Sword, R., “Stop wasting time on the wrong product!”,Innovation, Winter 1994, pp. 42-5.

8. Hanson, J.E., Kendall, D.A. and Smith, N.F., “The missinglink”, Beverage World, 1983, pp. 1-5.

9. Cornell, J.A., Experiments with Mixtures, John Wiley &Sons, New York, NY, 1990, p. 8.

10. Urban, G.L. and Hauser, J.R., Design and Marketing ofNew Products, Prentice-Hall, Englewood Cliffs, NJ, 1980.

11. Vantrappen, H. and Collins, J., “Controlling the productcreation process”, Prism, Second Quarter, 1993, pp. 59-73.


Marvin J. Rudolph is Director of Food Product Process Development, Arthur D. Little, Inc., Cambridge, Massachusetts,USA.

The food product development process

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