The PD Process coordinates the specific research activities such as product design,
process development, engineering plant design, marketing strategy and design
with the aim of producing an integrated approach to the development of new
products. The overall aim is to create a product that an individual consumer or a
food manufacturing company or a food service organisation will buy. The two
parts of product development – the knowledge of the consumer’s needs/wants and
the knowledge of modern scientific discoveries and technological developments –
are both equally important. The PD Process combines and applies the natural
sciences with the social sciences to systematically produce innovation in industry.
The PD Process is a system of research for the individual product
development project and the product development programme. It varies in
detail from project to project but overall retains the same structure of four main
stages, subdivided further into 7–9 stages in some product development models
(Cooper, 1996; Earle, 1997). The four stages are product strategy, product
design and process development, product commercialisation, product launch and
evaluation. Between the four stages, there are critical evaluations and top
management decisions on the project and the products, called stage gates
(Cooper, 1990) or critical points (Earle, 1971). Critical points are an essential
part of the PD Process. For the critical decisions to be made, certain knowledge
has to be generated in the research – the outcomes from the various stages. To
build this knowledge, specific research is needed – the activities of the various
stages. The project teams choose different procedures for these activities – the
techniques used in the activities. There are important interrelationships in the
four main stages between:
Critical decisions C36 Outcomes C36 Activities C36 Techniques
3
The product development process
This PD Process can be called the Critical PD Process because it is based around
critical decisions, and because there is critical analysis of the activities/
techniques and the outcomes throughout the project.
3.1 Product strategy
Stage 1: product strategy, starts with the finalising of the product development
strategy and product development programme. Then the aims of the individual
product development projects can be set. The project starts with the generation
of new product ideas and the outlining of the product design strategy, and ends
with the product concept and product design specifications. There is real
dichotomy in the decisions and activities; there is on the one hand, the need for
freedom to be creative, and on the other, the need to set boundaries in the
product design strategy. Before top management can make the critical decision
to fund the further stages of the project, or to stop it, or to return it to the team
for more knowledge, there are three critical decisions:
1. Is the product concept a unique product satisfying the needs and wants of
the target consumer/customer?
2. Will the product concept and the project deliver the financial and other aims
set in the business and product development strategies?
3. Does the product concept harmonise with the company’s business and
environment?
Top management, to make these decisions, needs knowledge on the processing,
production, distribution and marketing technologies for the product. Knowledge
will be incomplete at this time. The financial predictions (sales revenue, gross
profits or margins, the probabilities for success, the returns on investments or
break-even times), and future costs and time for the project are very
approximate. There will be other specific requirements for each project, such
as enhancing health (Ericson, 1997), environmental effects, food regulations and
trade barriers. But of course the most important knowledge is the description of
the product idea in the product concept and the product design specifications.
The project team has to build up this knowledge throughout the stage, and the
type of knowledge identified will determine the critical activities that have to be
completed in the product development project (Earle and Earle, 1999). The
knowledge is built up in substages and decisions are made at the end of each
stage usually by product development management, but sometimes by top
management if the project is a major innovation and costly.
The substages in Stage 1: product strategy for the individual project are:
? defining the project;
? developing the product concept;
? identification of processes, distribution and marketing;
? development of product design specifications;
96 Food product development
? planning of the project;
? predictions of project costs and financial outcomes.
This is total technology research incorporating product, processing and market
research with consumer and society studies. At this early stage, the knowledge
may be generalised, and the aim is to make it greater in breadth and depth
through the later stages of the project. This stage sets the direction for the
product development project, and has been identified in much research as most
important to the final success of the project.
3.1.1 Defining the project
The aim, outcomes and the constraints have been identified in the product
development programme and presented to the product development team or
manager for the project. But there is usually a need for further desk research by
the team to determine the accuracy of the aim, outcomes and constraints and
also to ‘flesh them out’ to give a more detailed project definition that can drive
and control the project (Rosenau, 2000). This is also the time to select a suitable
PD Process for the project and to set out an outline project plan.
There are four aspects of the initial research to define the project by developing
more detailed aims: product ideas, consumers, technology and market as shown in
Fig. 3.1. The research includes all aspects of the PD Process. At the same time the
team is developing new product ideas, and relating them to the market possibility,
to the technology possibility and to the product possibility. What are the products?
Can they be made? Can they be sold? Who wants them? What do they need?
These are the types of questions being discussed by the team and it is an important
time for team interaction. This is only ‘desk research’–using information in the
company, outside records, published textbooks and papers, which are easily
available. There is a maximum use of tacit knowledge within the group and within
the company. Information technology has improved the storage and use of
knowledge in product development, in particular the use of product models with a
framework of raw materials, ingredients, packaging and production methods
(Jonsdottir et al., 1998).
Think break
In a project, the aim was changed from:
Export a nutritional product to Thailand with a market size of $5 million.
to:
Export a protein product, minimum 20% protein, to the Thai middle class, urban
market, marketed through gyms and supermarkets; processed in the spray dry-
ing plant or the UHT plant and distributed at ambient temperatures. It must
have sales greater than $4 million.
The product development process 97
The second aim allows two different methods of processing. In other aims
there may be two target markets, or two methods of marketing, as it is not clear
at that time just which is the direction to go. Aims can be adjusted during the
project but there must be agreed reasons for doing this.
The outcomes for the different stages of the PD Process are developed from
the aim, the company’s PD Process for this type of product, and the decisions
that the top management has indicated for different times in the project. In
particular the decisions identified are used to determine the outcomes as shown
in Fig. 3.2. There are both product and project decisions to be made, the product
decisions and outcomes are ovals in Fig. 3.2. The general decisions are similar
for many projects but there will also be specific decisions for each project.
Therefore other outcomes will be needed. It is important to recognise the
decisions that have to be made, and by whom, and to then select the knowledge
needed in the outcomes to make these decisions. Outcomes are sometimes called
objectives; they are the knowledge goals that have to be reached at the end of the
different stages of the PD Process. In some projects, especially large projects,
1. Study the aims and discuss how the first aim has been improved in the second
aim as a focus for the project.
2. How would you improve the second aim to make it clearer for all people in the
project?
Fig. 3.1 Defining the project: activities, outcomes and constraints.
98 Food product development
critical decisions may be made more often in the project; again these decisions
have to be recognised and the required outcomes defined.
It is important to select the outcomes by balancing the need for knowledge
against the resources and time needed for the activities to give the outcomes.
With the recent emphasis on faster but quality product development, more
attention is being paid to selection of outcomes. The choice of outcomes and
Fig. 3.2 Identifying the outcomes necessary for the decisions (After Earle amd Earle,
1999, by permission of Chadwick House Group Ltd).
The product development process 99
therefore of project activities depends on the risk of failure the company is
prepared to take. Teams often seek extensive knowledge so that they are surer
of the whole picture, but this can be expensive and take too long and even
sometimes result in failure. There is history of some companies seeking too
much information in the test markets, and being overtaken by other
companies. Outcomes that are fundamental to the project and whose
completion is necessary for the project are always included. Identifying
possible outcomes at the beginning of the project and selecting the critical
outcomes for the company and its environment, which are within the money
and time the company is willing to provide, ensure a project that is efficient
and effective.
The constraints are any factors defining the area of the project. Some of
these, such as financial resources and time for launching, will have been
specified in the product development programme. At this time it is important to
identify constraints on the product, processing and marketing, and also the
constraints placed by the company and by the social and political environment.
For example, the constraints from the food regulations and from society’s
attitudes to production, processing, food additives and safety need to be
identified before product design starts. There are sometimes constraints caused
by the availability of people and equipment. A checklist for studying constraints
is shown in Table 3.1.
The constraints need to be recognised but they must not be too tight as this
could stifle the creativity in product design and process development. For
example, specifying the protein level as exactly 20% for a perceived consumer
need and not a requirement of the regulations could restrict the other product
characteristics. But a protein range of 20–30% could satisfy the consumer but
allow more freedom in design. It is important to criticise the constraints – are
they all needed, are they too tight? Sometimes a company constraint may stifle
the project, and it is important to revisit it with management to see if it can be
changed.
The aim(s), outcomes and constraints direct and control the project. They are
used as factors in screening and evaluating the product ideas and product
concepts, and then in evaluating the different prototype products. They are the
Table 3.1 Project constraints: a checklist for product development projects
Product Processing Marketing Financial Company Environment
Eating quality Equipment Channels Fixed capital Strategy Local government
Composition Capacity Distribution Working capital Structure National government
Nutrition Raw materials Prices Investment Expertise Industry agreements
Packaging Wastes Promotion Project finance Location Farmers’ agreements
Shelf life Energy Competitors Cash flows Management Economic status
Use Water Size Profits Innovation Business cycle
Safety Personnel Product mix Returns Size Social restrictions
Source: From Earle and Earle, 1999, by permission of Chadwick House Group Ltd.
100 Food product development
basis for identifying the activities and choosing suitable techniques and for the
project plan, which directs and controls the process.
The outline project plan is based on the PD Process selected for the project
and the outcomes identified. The PD Process varies according to the type of
product – industrial, consumer and food service, and also whether the product is
incremental or a major innovation. The activities are selected to give the
outcomes previously identified. Choice of activities is not only determined by
the knowledge needed in the related outcome, but also by the resources and time
available. The description of the activity defines the outcome needed, the time
frame to be met and the resources that can be used. The outline plan is set up so
that everyone in the project can identify their place in the project and what they
are aiming to achieve. They can start to select the techniques for their section of
the project, particularly for the early stages.
3.1.2 Developing the product concept
The food industry has seldom used the word design except as related to
packaging and to advertising. The development of the product has usually been
called ‘product development’ and had connotations of laboratory formulation
Think break
In Chapter 3, we are going to do the initial stage of a PD project, either a project from
your company or using the Case Study in Section 7.4. Obtain from the management
of your company the general aim, constraints and resources for this project. In this
Think Break, search for more information and develop the final aim(s), outcomes and
constraints for management’s approval.
1. What is the market type – consumer/retail, consumer/food service, business to
business/industrial, business to business/food service? Identify the target
market, its possible size, needs and competing products. Use Fig. 3.1 as a
guide, try to find information to answer the market/consumer questions.
2. Identify the type of product development in the project – me-too, improvement,
product line extension, innovation on the same product platform, a new platform;
and also the type of market. Then select/design the PD Process.
3. Using Fig. 3.2, identify the possible decisions to be made and then discuss them
with management. Select the final decisions.
4. Determine what knowledge is needed to make these decisions and then select the
outcomes that are needed for the decisions at the various stages of the project.
5. What are the principal constraints already identified for this project – economic,
physical, political, social? Now use the checklist in Table 3.1 to discover any
other constraints that might be important. Rank the constraints from critical to
not important and select the final constraints for the project.
The product development process 101
and sensory panel. But today, there may be real benefits in adopting food
product design and in associating food product design with other areas of design.
The product is an amalgam expected by the consumer of the hard values or the
basic qualities and the soft values or the differentiating qualities such as aesthetic
appearance and environmental friendliness. Product design, or the product
creation process, is therefore an amalgamation of the disciplines of consumer and
market research, technology and engineering research with design practice as
shown in Fig. 3.3. Product design is an essential part of the product creation
process in equal cooperation with engineers, marketers and consumer researchers
(Blaich and Blaich, 1993). All come together in the technology of the product.
? Consumer researchers build the consumer/product relationship throughout
the PD Process.
? The market researchers analyse markets and design the marketing and
distribution methods in the market strategy.
? The food engineer and technologist research the product and the process
together in co-engineering and design the production and physical
distribution methods.
? The food product designer researches the social and cultural backgrounds and
designs the holistic product.
It is important that these are all integrated from the beginning of the PD Process.
As the product concept and the product design specifications are built up, all
aspects are brought together; then as the project progresses, the people involved
understand what is needed in the design of product, production and marketing to
satisfy the consumers’ needs, wants and behaviour.
Fig. 3.3 Integrating the main disciplines in product creation (Source: After Blaich and
Blaich, 1993).
102 Food product development
The product design process is subject to a set of requirements (product design
specification), including basic and desirable product functions, performance,
aesthetics and cost (Dasgupta, 1996). This is common to many industrial areas
but is now only becoming accepted in the food industry. Firstly, the consumers
and product designers, very often with marketers, come together to develop a
product concept, and then the technologists and engineers are brought in to
develop the product design specification. Some of you may be thinking that this
is sounding rather complicated, but actually you do it all the time but may be
doing it without clear directions. Designers and the consumers have difficulty in
working in the abstract and there is some design taking place either in drawings,
computer descriptions or ‘mock-up’ products. Creativity starts here. It is a
useless exercise for marketing to work alone with consumers to develop a
product concept and then hand it to the food designer/technologist and say make
this! That seldom leads to unique products. There needs to be cooperation
among marketing, consumer and the product designers (or food technologists/
product developers as they are often called in the food industry).
The areas in building the product concept for design are (Ulrich and
Eppinger, 1995):
? identifying consumer needs;
? establishing target product brief;
? analysis of competitive products;
? concept generation;
? concept selection.
The project team works between these areas. Firstly they study consumers,
trying to build their needs into more specific terms in the product brief, and at
the same time studying the competing products. Then they go back to the
consumers with more defined product types to generate specific product
concepts. Finally they work the product concepts into more specific and detailed
product descriptions and go back to the consumers to find their reactions.
The product concept progresses through the product development project
from the original idea to the final product specifications controlling production
and the final product proposition that is the basis for the marketing. It is refined
and expanded in two different ways because of the different end uses – in a
technical, quantitative description and in a consumer-based, in-depth, descrip-
tion as shown in Fig. 3.4.
The outcomes needed in the first stage are the design product concept and the
design product specifications. These start from a name or a simple description in
the product development programme, and firstly the team generates ideas for the
product and then with consumers builds simple product idea concepts. After
evaluation these are reduced to one or two product ideas, and research with
consumers and the market gradually builds up the product concept for design.
This is then integrated with the processing and marketing technologies, and the
product concept is built up by product concept engineering into metric
descriptions in the product design specification. The design product concept is
The product development process 103
the consumer’s description of the product and includes the product character-
istics, benefits and position in the market as identified by the consumer. The
design product specification is developed from the product concept with
reference to the technical aspects of the product, processing and distribution. It is
the precise definition of what the product has to do, it is metric and has a value
(Ulrich and Eppinger, 1995).
A product has several layers and these are being built up gradually during the
product development. There is the company’s basic functional product, the total
company product (with packaging, aesthetics, brand, price and advertising) and
the consumer’s product (which relates it to the competitors, the environment, the
media, the society, as well as its communication and use) as shown in Fig. 3.5.
There is a continuing interaction between these three layers of the food product,
and therefore between the four groups of people – consumers, product designer,
technical and marketing – during the development of the product concept and
the product design specifications.
To research the products, there is a need to identify the following:
? Product morphology, the breakdown of a product into the specific
characteristics (or attributes) that identify it to consumers or/and business
customers. Determined by analysis of the product family and the individual
product (Schaffner et al, 1998).
? Product characteristics (or attributes), the features identifying the product
to the company, the market and the consumer. Identified by consumers and
designers in the creation of the product concept.
? Product benefits, the product characteristics important to the consumer.
Identified in the consumer/product designer discussion groups. The product
benefits are in four main areas – basic product benefits, package benefits, use
Fig. 3.4 Product concepts and product specifications in the product development
project.
104 Food product development
benefits and psychological benefits – and these need to be integrated into the
final consumer preference.
? Product profile, the group of product characteristics which is the unique
identification of the product – it is the product’s DNA or fingerprint.
In developing a product strategy to introduce meat pies to Malaysia by a New
Zealand company, the activity was to identify the product benefits required by
Chinese and Malaysian consumers; three techniques were used – focus group,
consumer survey, and multidimensional scaling (MDS) as shown in Table 3.2.
Fig. 3.5 The total food product (Source: From Schaffner, Schroder and Earle, Food
Marketing: An International Perspective, C223 1998, by permission of the McGraw-Hill
Companies).
Table 3.2 Product benefits for meat pies in Malaysia
Multidimensional Focus group
C121
Consumer survey*
scaling*
Taste (sweet–savoury) Convenience Taste
Product type (bread–non-bread) Freshness Cleanliness
Origin of product (local–foreign) Smell Freshness
Local flavour Healthy (good for you)
Healthiness Convenient to obtain
* Chinese and Malay women in Malaysia.
C121
Malaysian students in New Zealand.
Source: After Lai, 1987.
The product development process 105
The consumers compared the pie, particularly in the MDS, against the sweet and
savoury baked/fried snacks already eaten in Malaysia. The MDS identified the
main characteristics, and the focus group and the consumer survey identified
general product benefits. To design the products more information was needed,
and a sensory ideal product profile was identified by a small group of the
consumers tasting the preliminary experimental products. The consumers’
sensory characteristics were 7 for the pie top, 5 for the pie bottom and 14 for the
pie filling. The five scales for the pastry bottom with the consumers’ ideal scores
are shown in Fig. 3.6.
The scales with their ideal points were included in the product design
specification. The product profile needed to be analysed in two ways – what do
the consumers mean by an ideal score of 5 for the pastry thickness? Can a
physical measurement mimic this sensory characteristic? It is easy for thickness.
Texture can also be measured in a physical instrument, but it may be necessary
to train a panel to judge ‘flour smell’ and ‘oiliness’ unless a chemical test can be
found for them.
The important product benefits may include the type of raw materials and
processing, as in organic foods and environmentally friendly foods, as well as
the recognised consumer concerns of nutrition, safety, eating qualities and the
psychological benefits such as prestige and fun (Earle and Earle, 2000). There
has been a concentration on sensory benefits as shown by the rapid development
of sensory science but this needs to be made much wider to include all benefits.
An example of a product concept strongly based on the psychological needs is
described in Box 3.1, a product concept for pet foods.
The concept of the package often follows the more traditional path of
industrial design, developing a product architecture that defines the major
subsystems of the package such as the inner, outer, closure, seals. Product
architecture can also be useful in building up products such as complete meals
with various meat, vegetables and noodles in some type of display pack.
Fig. 3.6 A product profile for pastry (Source: After Lai, 1997).
106 Food product development
Box 3.1 Four-legged trends
How many times have you seen a cat prey on a chicken or, heaven forbid, a
turkey? But then cat food with blackbird or field mouse doesn’t sound very
discerning to a petfood shopper. Let there be no doubt that Britain’s petfood
shoppers are discerning and willing to show the colour of their money to
satisfy their pet’s taste buds.
The dominant trend over recent years has been the humanisation of petfood.
Supermarkets stock an awesome display, encompassing not just a plethora of
brands but also variants. A cosseted cat can start the day with a bowl of
muesli and a splash of cat milk, enjoy chicken in jelly for lunch and perhaps
have some tuna for supper. Meanwhile, the family dog can enjoy beef chunks
at noon and ‘a complete dry meal’ to round off the day. In essence, the
petfood sector has expanded to cater for owners’ perceptions of what their pet
requires. This is echoed in pack design.
In design terms, humanisation manifests itself by mimicking the same brand-
building cues used for human brands. For example, Trix dog snacks bear a
striking visual similarity to the human treat Minstrels, or equally they could
be mistaken for a beef flavour packet of crisps. Similarly the packaging of
Whiskas cat milk seems to draw inspiration from Carnation long-life milk.
There is also a move towards injecting ‘appetite appeal’ into petfood
packaging, with stylised displays of the product depicted on-pack. The use of
expensive illustrations and top food photographers confirms this move. It has
reached the point where the only difference between human and petfood
packaging is the animal images on-pack.
The way forward for packaging design in the petfood sector is to aim for the
right balance between traditional petfood brand values and those of the tinned
food destined for human consumption. Yes, appetite appeal is a very
important sales tool in this arena, but the trade-off shouldn’t be a loss of
whimsy and humour.
Source: From Petrie, 1995 by permission of Marketing Week, published by Centaur
Communications (London).
Think break
For the project identified in the previous Think Break:
1. Generate five ideas for new products within the area of the aims.
2. Consider these product ideas against the aims and constraints for the product
and choose the three most suitable products.
The product development process 107
3.1.3 Product design specification
Building the product design specification from the product concept includes
both research and design. Market research provides more details about the target
market characteristics and size, the methods of marketing that might be used and
the position of the product as compared with the competitors. The market study
is progressing into consumer and retailer surveys in consumer marketing and
customer surveys in industrial marketing. The technical research involves the
searching of the scientific and technological literature, including patents, as a
preliminary investigation into the possible products, processing and physical
distribution. The designer is starting to create the products and often needs to
make models so that ideas on the product characteristics can develop. The
modelling can be on paper or computer, and some preliminary laboratory
research makes the products on a small scale. Of course in incremental
development, the basic product is already known and both the marketing and the
technical research, and product model building are much less and indeed may
not be done at all.
The product design specification has for a long time played an important part
in design in other industries and now is considered the area that has a major
effect on quickening development and ensuring product success. The use of
computer techniques such as CAD (computer aided design), CAID (computer
aided industrial design), CAM (computer aided modelling), especially with
more modern versions, has given the opportunity to design on the computer and
to present the product ideas on the computer to other project members and even
to consumers. The computer designs can be transferred into engineering design
and linked to small-scale production units producing the experimental prototype
for the consumer to discuss. Some of the newer tools in product design are
shown in Table 3.3.
All of these new developments are changing industrial design and making it
quicker. These techniques can be used for food packaging and for a structural
food such as a loaf of bread and snacks. Snacks have already been designed
using earlier CAD versions. Word descriptions of food product characteristics
have been used in computer techniques such as conjoint analysis for a number of
years to build and evaluate food product concepts (Moore et al., 1999). The
question is how far can the food industry use computer design techniques in
building up product concepts and product design specifications? Certainly the
3. With some consumers build simple product idea concepts for these product
ideas.
4. Expand the product idea concepts with knowledge of the processing, marketing
and the technical characteristics of the product. Select the two most promising
product idea concepts with the consumers.
5. Finally with the consumer group, build product concepts for design of the two
remaining products.
108 Food product development
personal computer is being used actively in the product concept stage – Internet
for desk research, software for interpretation of statistical market research,
computer-based literature searches and databases (Hegenbart, 1997). Newer
developments are the use of detailed product models of present and past
products to use as an information base to design new products (Jonsdottir et al.,
1998).
What are specifications for product design? The product concept states
clearly the needs and wants of the consumer or customers, but it does not
provide specific guidance for design of the product in technical terms. It is often
subjective and leaves room for different interpretations. Product concept
engineering interprets the consumers’ product characteristics into measurable
terms, metrics, which can be tested in the product prototypes to see if the design
is meeting the specification. An individual specification consists of a metric and
a value, for example protein content between 20 and 30%; or thickness between
0.1 and 0.2 cm, or an ideal target value with an acceptable range, for example,
strength of onion flavour, 7, range 6.5 to 7.5 on a linear flavour scale. Metrics
and their values should be:
? critical to the consumer;
? consumer-acceptable ideal value and range of values;
? practical and capable of being achieved.
The product design specification is a set of individual specifications. Too
many metrics should not be included, as this will limit the area in which the
designer works and cause problems with too much testing. Only the metrics
recognised as important by the consumer, or needed for the consumer such as
safety, or for food regulations, are usually included, but sometimes there may be
specifications dictated by the process or the distribution. Also it is important to
choose metrics that are achievable, for example it may not be possible to choose
vitamin C as a metric because heat processing conditions needed to ensure a
Table 3.3 Tools at the cutting edge of product design
3D solid modelling software
Describes both the exterior and interior of the product in three dimensions
Virtual-reality design tools
Aid interaction of the computer models in a manner that resembles real life using
stereoscopic eyewear which tracks with the computer
Rapid-prototyping
Tests new design concepts with models using plastic materials such as polyamide/epoxy
resins
Collaborative design tools
Use an internal Net or the Internet so that people can design together.
Source: After Schmitz, 2000.
The product development process 109
critical metric safety (microbiological) value, will destroy it. And metrics must
be practical, for example there may be no measure for spicy hotness in a food so
the acceptance of different levels in the new product have to be tested with
consumers during design.
Choosing metrics and their values is simple if it is an incremental product or a
copy of a competing product in the market. The metrics are already identified
and the values can be chosen by competitive or company product benchmarking
(Ulrich and Eppinger, 1995). With the radical innovation, there is not sufficient
previous knowledge and there will be a need to continue the metric
identification into later stages of design. As prototypes are developed and
tested both technically and by the consumer, the metrics for the consumer-
identified product characteristics are built. The design specification evolves to
the product prototype specification at the end of the design process, so it does
change, but care must be taken that critical metrics are neither dropped nor
changed in value without consumer acceptance of the change. Factors
sometimes causing changes in metrics are costs, availability or variability of
raw materials and processes, new competing products, contradictions between
product characteristics, difficulties in design. Nothing is black and white:
usually various forms of grey have to be accepted.
3.1.4 Product feasibility and project plan
From the detailed knowledge, a more quantitative comparison can be made of
the ideas for the new product. The consumer study gives in the product concept a
Think break
1. Evaluate the two product concepts remaining after your work in the last Think
Break, for marketing and production suitability. Make a checklist of all the
important factors to consider in marketing and production and score the two
product concepts.
2. Calculate a prediction of the possible sales volumes, prices and sales revenue
for the two product concepts.
3. Do an evaluative comparison of the two product concepts and select the best
product concept.
4. For the remaining product concept, write down the product benefits identified by
the consumers and the other critical product characteristics you have so far
identified. Suggest a metric for each product characteristic – this can be a
physical, chemical, nutritional, sensory or microbiological metric.
5. What are the product characteristics for which you have not identified a metric?
Can you create an empirical metric for them?
6. What are the raw material, processing and distribution requirements that need to
be included in the product design specification?
110 Food product development
comprehensive description of the product characteristics wanted by the target
consumers who are more clearly identified. The market research gives an
indication of the probable sales of the product, the position of the product in the
market, the possible prices, promotion and market channels. The technical study
describes the possible products, processes and the probable costs and time for
development and production. By a qualitative evaluation of the suitability of the
product concepts and a quantitative estimation of the profits and costs ratio, and
by predictions of the probabilities of successful development and launching, the
most suitable product concepts for development can be selected.
The various activities needed for the project are firstly developed in the
outcomes and then in the building of the product design specification. They are
all brought together and integrated in the operational plan for directing and
controlling the project. For the plan:
? list all the major activities;
? place them in a logical sequence, noting activities that run in sequence, in
parallel, and those that need to be integrated (project logic flow plan);
? time each activity from start to finish (project scheduling plan);
? identify the money, resource needs, personnel, for each activity (project
resource plan);
? identify activities that are critical for time and resources (critical path
network).
Review the network so that it meets the required launch date and is within the
resources designated for the project (project operational plan).
3.2 Product design and process development
The themes for Stage 2: product design and process development, are
integration, creativity, systematic planning and monitoring. Food product
development is process-intensive, the characteristics of the product are highly
constrained by the processing. Therefore the process and the product are
developed together. This tight integration of process development and product
design, called concurrent or simultaneous engineering, is becoming more
important because of the time and cost constraints on getting the product to the
market (Fox, 1993; Stoy, 1996). Jonsdottir et al. (1998), reviewing concurrent
engineering in seafood companies, defined the overall goal of concurrent
engineering as quality, cost, schedule, product user requirements and reduction
of the time the product takes to reach the market. They emphasised the
information technology applications in product models, in particular the
knowledge of the product’s functional and structural characteristics, and the
development of a system model that secures the integration and reuse of
knowledge in the different stages of the product development process. The
concurrent design also integrates with marketing and production (Hollingsworth,
1995) as shown in Fig. 3.7. Often in incremental development, the production
The product development process 111
plant is already in place, and the product has to be designed for that plant and the
process can only be varied between narrow limits.
The company’s identity or company’s image is the sum of product design,
communications design and environment design (Blaich and Blaich, 1993).
Communication design directly supports the product in the marketplace with
branding, packaging, advertising and promotion; therefore it needs to be closely
integrated with the product design. Environment design is a concept that is not
always considered, but it does influence the product and communications
design, and the final acceptance of the new product. If a company wants to
communicate the appropriate perception about its products, it must concern
itself with the entire milieu surrounding the products, both inside and outside the
company. If the company image diffused to the employees and the customers is
quality, the new product is also seen as quality; if it is fresh and innovative, the
product will be recognised as excitingly new. The company and distribution
environments give the company and its new products an ‘image’ to the
customers. Therefore product design needs to be integrated with communication
and environment design throughout the design process.
3.2.1 Stages in product design and process development
The stages of the product design and process development are shown in Fig. 3.8;
the activities are in the boxes, the outcomes in the ovals.
At the beginning of Stage 2, product design is the major part of the work,
with process development considered in the design of the product. As the project
progresses and the area for the product is more clearly defined, the study of the
variables in the process becomes important so as to achieve the optimum
product. The variables include both input and output variables.
? Input variables: raw materials (type, quality, quantity) and processing
(types of processing, processing conditions).
? Output variables: product qualities and product yields.
The two main areas for research are formulation and processing; the first
studying the type and quantities of raw materials and the second studying the
Fig. 3.7 Integration in product development.
112 Food product development
Fig. 3.8 Product design and process development: activities and outcomes.
The product development process 113
effects of changing the processing conditions, but it is important that these are
not studied separately as they are strongly interactive. The design is a continuous
study of the relationships between the input variables and the product qualities,
so that the final product is the optimum product under the conditions of the
process. The prototype products are tested under the individual specifications set
for the product design, so that product testing needs to be organised along with
the product design and the processing experiments (Earle and Earle, 1999).
Regular consumer testing of the product prototypes is necessary to confirm that
the product has the characteristics identified in the product concept and not
characteristics that are undesirable to the consumers.
Seldom does product design and process development occur in a straight line as
in Fig. 3.8. There is back cycling because the prototype product is not completely
acceptable to the consumer or the costs are not within the cost limits, or the chosen
equipment cannot produce the product at the right yield or quality. It is important
in each of these steps that there are technical, consumer and cost testings (Earle and
Earle, 2000). The costs develop in stages from an identification of the parts of the
company’s cost system for this type of product and the limits for the various costs.
Usually at the early stages, the raw material costs, their limits on the formulation,
and the general costs of manufacturing are identified. The product, packaging and
processing costs can be determined during the experimentation for the optimum
product. After yield results during the production scale-up have been obtained and
costs of marketing predicted, the total costs can be assessed.
3.2.2 Important factors in product design and process development
In food product design, there are some important points to consider:
Raw materials and ingredients
In many industries, there is increasing recognition of the place of suppliers in
product development. In the past, the manufacturing company studied the effects
of different raw materials and ingredients in the development of the product, and
then produced specifications for the raw material/ingredient. Today, there is an
increasing emphasis on working with suppliers in product development, and this
is prevalent in the food industry (Hood et al., 1995). The ingredient supplier is
introduced to the initial problem in the product design specifications and then
cooperates in developing the solution. This is sometimes called the ‘black box
approach’ and it is claimed to reduce the time for the project (Karlsson et al.,
1998). Certainly the ingredient processor can be developing the process for the
ingredient at the same time as the manufacturer is developing the consumer
product. There needs to be a good relationship between the supplier and the
manufacturer for this codevelopment to be successful. The food ingredient
suppliers have actually gone further than this and developed the ingredient, the
manufacturing process and the consumer product and handed this to the
manufacturer. The reason for this may be the greater knowledge of product
development in the food ingredient companies.
114 Food product development
Quantitative techniques to integrate product and processing
In the past 20 years, there has been an increasing use of experimental designs
and statistical analysis in food design and process development (Hu, 1999).
There is software available that indicates suitable designs for the experi-
mentation and analyses the results. Techniques such as linear programming
have been used in animal feeds and petfood formulation for many years but
have been slow to be used in human foods. Some of the problems in using
quantitative techniques have been the variety of critical product characteristics,
the poor definition of some characteristics and non-linear relationships
between processing variables and product qualities. Food product design is
complex but with increasing knowledge of the reactions in processing and new
software, quantitative techniques will be increasingly the norm, but this will
need increasing level of knowledge of the product designers and process
developers. Hegenbart (1997) noted in product formulation, the use of
spreadsheets to calculate formula costs, electronic information sources for
ingredient supplier details, and company database of in-house ingredients; and
in product testing the use of software for prediction of microbial growth in
food and for sensory testing.
Aesthetic skills in product design
In the design of food, there has been extensive use of sensory science in
developing a sensory product acceptable to the consumer. The industrial
designers have not been greatly involved in the design of the appearance,
colour, shape, but there has been interest in recent years (Pearlman, 1998;
Capatti, 2000). Extended design is most immediately applicable to haute
cuisine, but enters also into such items as extruded shapes and packaging. The
package design is often by industrial designers and therefore relates to the
artistic environment of the time. Airline meals (Kabat, 1998) and restaurant
meals are influenced by aesthetic design and we have seen this with
development of art nouveau, post-modern and other influences in meal
presentation. Today, many food products are completely artificial, in that they
are made from processed ingredients, and their design can be varied according
to aesthetic environment. This is the area where aesthetic design can be a strong
part of design – the question is how to encourage the industrial designer into
food design or for the food designer to adopt some of the practices of industrial
designers.
Values of the product characteristics
It is easy to spend a great deal of time designing a product characteristic that is
of no importance to the consumer. Technical characteristics are often beloved by
engineers in design but are of little consequence to the consumer. They may of
course be an integral part of the product and therefore need some concentration
in design. Value analysis or value engineering relates the cost of a product
characteristic to its importance; and then selects the characteristics with the
greatest value. There is a need to recognise the main aim of the product, for
The product development process 115
example long life, and then to identify the characteristics of the product that
relate to this, such as low water activity and controlled atmosphere, and then the
cost of achieving them. There will be other characteristics, such as convenience,
sweet fruity flavour, which also need to be fulfilled and other characteristics of
less critical importance. The cost of these characteristics in the design can be
determined to see if the cost is too high for the product characteristic, in other
words above the value to the consumer. The highest valued characteristics are
then the major part of the design.
Ergonomics
A neglected area in some food design, particularly in packaging, is ergonomics,
the relationship of the physical product to the person (Ulrich and Eppinger,
1995). An example of poor ergonomics is an aerosol can for depositing a dairy
cream on a cake or a dessert, that is mostly used by women and children, but
cannot be held and used in one hand by them. Food is opened from a package,
used in cooking, served and eaten; so design needs to take into consideration the
physical aspects of the product and their relationships to humans using and
eating it in all these steps.
Semi-production plant facilities
The stumbling block in technology transfer is the movement of the product from
the laboratory to the full-scale plant. This is caused by various factors such as
lack of processing knowledge of the food designer, the change in the processing
conditions as equipment is scaled up, the difference in process control in the
experimental and production plants, the transportation by pumps and lines in the
production plant. Some products made and poured from a bucket or a jacketed
pan will collapse when pumped around a factory. Many of these problems can
be studied in a semi-production plant, without incurring excessive costs in
materials and processing. When new products are based on incremental product
changes, a semi-production plant can be used for a number of years and so the
capital costs are paid back.
Internal and external capabilities
In the past, the aim was to have and build up the necessary expertise inside the
company; then in the last ten years there was a popular movement to contract
expertise from outside the company. On the one hand there is a need to have the
activities of strategic importance inside the company so that the direction of the
project is maintained. But on the other hand, there is a need to accept
opportunities when they appear and if expertise is not available internally, to go
out and buy it. Usually it is agreed that it is best to have an internal product
development process championed, directed and understood by people inside the
company, and to buy expertise from outside as needed. In other words have the
company define the decisions, outcomes and activities in the PD Process, but
contract out some of the tasks used in the activities.
116 Food product development
Review and control of design process
The design process delivers the optimum product in the predicted time and costs
– too idealistic? Yes, the design process is creative and working in the unknown,
so it is difficult to be specific about product quality, time and costs. But there is a
need to follow the product by regular testing – by the design group in the
beginning and by consumers as the prototypes become more refined – to see that
it is delivering the product. There also needs to be a time and resource plan
which can be reviewed at different times in the design process by peer review to
see if the project is effective and efficient (Fox, 1993). Problems will be
encountered and there needs to be a recognised method of problem solving
available to solve the problem quickly before the project collapses.
3.2.3 Conclusions to product design and process development
It is important that there is a clear end to this stage, and also the knowledge
available to make the decision to go on or stop the project before the more
expensive next two stages. This may not be the time to commercialise or the
time to launch, so the project has to be shelved; or it has to be admitted that the
product did not fulfil the expectations and the project must stop. Five important
outcomes are:
? clearly defined final product prototype with consumer acceptance;
? product specifications including processing method, physical distribution;
? market strategy including distribution, promotion, pricing;
? prediction of investment needed and financial outcomes;
? probability of achieving project completion and financial outcomes.
Think break
1. For the product design specifications you prepared in the last Think break,
identify the stages in designing the product prototypes and developing the
process.
2. Create the basic product options by doodling on paper or computer or on the
bench, evaluate them and select the most suitable basic product.
3. Identify the raw materials and processing variables related to the specified
product qualities, and outline an experimental programme to identify the ranges
of variables where the optimum product could lie.
4. Design an acceptable aesthetic product using the basic product, including
appearance, shape, colour, sensory attributes and relating the product to the
present culture of the target consumers.
5. Identify the packaging needs for the product, including protection and use, and
also the needs for promotion of the product.
6. Combine all the knowledge you have so far created, and develop the final
design for total product and package.
The product development process 117
3.3 Product commercialisation
Stage 3: product commercialisation, is full scale-up of both production and
marketing. These two developments need to be integrated throughout product
commercialisation. Also design continues for the product, the production and the
marketing, leading into the operational production and marketing. There is a
need for integration, between the design and the operations. Product commer-
cialisation ends with full integration of the product, production and marketplace.
So the important factor in commercialisation is integration. Other factors to
consider are the costs and the time. The costs really start to increase at this stage
– maybe a plant has to be designed, built and commissioned; or fast-food outlets
designed and built, or new distribution facilities built, all having a high capital
cost. The risk of high financial losses increases as shown in Fig. 3.9.
There are four important stages in product commercialisation:
1. Setting up the commercialisation.
2. Design of marketing, production and distribution.
3. Testing of marketing, production and distribution.
4. Final integration of marketing, production and finance.
3.3.1 Setting up the commercialisation
The first activities in the product commercialisation are to agree on the aim, the
resources and the final definition of the product and consumer relationship by
developing an integrated project plan, and finalising the market and the product as
shown in Fig. 3.10. All the people who are to be involved in the commercialisation
need to be in the discussion, together with the product designers, so that there is
technology integration between the design and the commercialisation. The
Fig. 3.9 Increasing costs in the product development process.
118 Food product development
business strategy is revisited at this stage to ensure that the product is still in
harmony with the business. The aims and outcomes are becoming more specific
because of the increasing knowledge created in the product design. It is very
important that the aims, constraints and outcomes for the product commercialisa-
tion are considered in a combined discussion so that the different groups are not
going in diverse directions and working towards different outcomes. For a drastic
example, marketing and production may be aiming for different sales volumes, or
marketing may be working to a price outcome not related to production’s cost
outcome. From the joint agreement on aims and outcomes comes joint
identification of the necessary activities and then integration of the activities in
the project plan. New constraints may have appeared because of competitive
actions or changes in raw material availability, or changes in the finance for
capital investment and some of them may have become critical. It is important to
revisit and re-identify the critical constraints. Finally the timing and the costs for
the various activities are identified so that the combined plan for commercialisa-
tion can be as efficient and effective as possible.
The other consideration in setting up the product commercialisation is to
finalise the product and relate it to the target market. The total product concept
needs to be built up from the market and product design (Earle and Earle, 2000),
defining the core product, the total company product, the consumer’s product
concept and the society’s product concept. There may be a need for some further
product design to optimise the total product concept.
3.3.2 Commercial design
There are four types of design in product commercialisation – marketing,
product qualities, physical distribution and production plant, as shown in Fig.
3.11. This is a time for many creative activities and they can career off into
different directions. Nothing is worse than product qualities at variance with the
marketing image of the product; for example product designers designing high-
vitamin dog food and marketing building an image of a high-protein food. It is
Fig. 3.10 Setting up product commercialisation.
The product development process 119
Fig. 3.11 Design in product commercialisation.
too late when the advertising designs come out and the designers say that that
product is not what we designed! There needs to be close integration during the
design and a final integration in the operational plans.
These are the general areas of activities but the choice of specific activities
and techniques depends on (Earle and Earle, 2000):
? the type of product (incremental, innovation);
? the type of marketing (consumer, industrial, food service);
? the amount of learning needed by the company, the distributors, the
consumers (high learning, low learning);
? scale of entry (local, national, international);
? the time (long, short) and timing (wide range, crucial).
For example, the time for the launch could be crucial because of competitive
activity or the season, but the design has taken longer than expected, so the
product commercialisation has to be rushed and the risk taken to drop some of
the important activities. Companies often drop test marketing and business
analysis when rushing to launch. But in all projects, time is expensive during
commercialisation – an extra two weeks may make the costs shoot well over
budget. So it needs to be well controlled.
Creating knowledge is another important aspect of the marketing and production
design – as in all other designs. This is a major area of industrial research. For the
incremental new product, the company has a great deal of past production and
marketing knowledge and it is a case of fine-tuning the knowledge to include
perhaps some production improvement and some new competitive marketing
activities. But for the product innovation, it is a learning experience for company
staff, distributors and consumers. The path of diffusion of the new product is
identified, through all functional groups and top management in the company, the
sales staff, the storage and transport operators, the retailers, the buyers, the users and
the final consumers of the food. The learning experiences of all participants need to
be incorporated in the activities in the final plan. Costs, revenues and profits are now
assuming major importance and need to be followed carefully in the designs so the
final financial plan is acceptable to the top management and the launch agreed.
3.3.3 Testing
The final product testing includes many aspects of the product:
? technical product qualities – core product qualities, packaged product
qualities, agreement with regulations, services with the product;
? consumers’ product concept – acceptance, competitive difference, unique-
ness, aesthetic worth, brand attitude, product worth;
? marketing’s product – product image, product position, promoted product,
product price, retailers’ product image;
? company’s product – market share, sales revenue/profits, product effective-
ness in business strategy, product problems, company fit;
The product development process 121
? society’s product – reliability, truthfulness of claims, protection from defects,
value for money, social responsibility, environmental responsibility.
Combined with the testing of the product, there is production, distribution
and marketing testing as shown in Fig. 3.12. Consumers test at least the total
company product, with the packaging, advertising and public relations material;
if time and cost allows the total product and the total marketing is studied in a
test market. This can be an individual market or it can be the first phase in a roll-
on marketing programme. Other important testing in the food industry is
distribution testing which tests both the changes in product during transport and
storage, and also the reactions of the retailers to the product. All food
deteriorates with time – some in a few days, some in a year, and the effects of
the temperatures, humidity, atmospheres and time during the transport and
storage before sale has to be predicted. This is related to the label of the food
with ‘best by’ dates.
An important aspect of testing today, which will increase with the trends into
nutriceuticals, is ethical product testing. Ethical testing is related to a particular
society; and the type and degree of testing depends on the ethics of the society.
Basically people want to trust the food industry: firstly not to harm them and in
fact to improve their health, and secondly not to use fraud and deceit when
providing them with food. It is not ethical for the food industry to claim a lack of
knowledge when being criticised by the society for unethical behaviour. When
launching a new food product onto the market, the company must have
extensive and detailed knowledge of the product’s benefits and defects, of the
raw materials and ingredients, and of the truth of the advertising claims. Always,
the company knowledge must be more than the general knowledge in the society
and in particular the consumers’ knowledge, and the company must be willing to
provide their knowledge. The company must not deceive any one about either
Fig. 3.12 Testing in product commercialisation.
122 Food product development
the benefits or the defects or the problems associated with the product (Legge,
1999).
3.3.4 Final integration
The final step in product commercialisation is to bring together the knowledge from
the design and the testing and to decide if the product is feasible; if it is, how it
should be launched on the market. Integration is vital at this stage so that the launch
can be efficient and effective (Andreasen and Hein, 1987). Obviously good decision
making by top management is also vital, but management can only make decisions
with the knowledge provided. The integrated knowledge is shown in Fig. 3.13.
The strategic orientation and the organisational capability are detailed at this
stage. It is useful to develop a method of problem solving which can be
introduced to everyone before the launch. Problems nearly always do occur in a
launch and it is necessary to have a method of solving them to reduce both the
chances of failure and the time taken for problem solving.
3.4 Product launch and evaluation
‘Effective product launch is a key driver of top performance, and launch is often
the single costliest step in new product development. Despite its importance,
Fig. 3.13 Integration of product commercialisation.
Think break
1. For your product designed in the last Think break, identify the aims, constraints
and outcomes for the product commercialisation.
2. According to your expertise and knowledge, design the production, distribution
or marketing. Ask some colleagues with different expertise to design the areas
outside your knowledge.
3. Integrate the three design areas to give the total product/production/distribution/
marketing of the product commercialisation.
4. Evaluate the integrated design for its effectiveness in achieving the project aims
and for obeying the constraints on the project.
The product development process 123
costs and risks, product launch has been relatively under-researched in the
product literature’ (Di Benedetto, 1999). How true this is. Much of the research
has emphasised the ‘fuzzy’ front-end activities and there is little on the critical
back-end activities; in fact many PD Process models show seven or nine steps
but only one for product launch!
There are three important parts of the launch – strategy, activities and
demand outcomes (Guiltinan, 1999). The demand outcomes sought from the
launch of the new product set the basis for strategy and the activities, and of
course in the actual launch the strategy and the activities determine the sales
outcome! This interrelationship between strategy, activities and demand
outcomes is the major basis for planning the launch. The other important factor
to consider is the evaluation and control of the launch; no matter how extensive
the predictions for a launch, the unexpected always happens and there is a need
for an evaluation and control plan.
3.4.1 Demand outcomes from the launch
The general demand outcomes include trial and repurchase, customer migration,
innovation adoption and diffusion. The choice of demand outcome depends on the
relationship between the consumer and the new product. Trial and repurchase, if
the product is acceptable, is usually the buyer behaviour with incremental food
products where the risk of purchase and eating is perceived as small. Buyers
recognise the product as related to other products, the price is small and there is no
great loss to the consumer unless there is a problem with food safety. Customer
migration, the movement of competitors’ customers to the new product, is the
desired demand outcome when the product represents a significant improvement or
change. The new product has a greater value for the consumer than the
competitor’s product and the ability to replace the existing product. Some of the
situations for selecting particular demand outcomes are shown in Table 3.4.
Innovation adoption and diffusion are chosen where the product is new to the
market and the consumer. This follows the traditional innovation curve with the
Table 3.4 Demand outcomes for product launch
Demand outcome Product development project
Trial and repurchase New product in existing market
Line addition in existing market
Emphasis on selective demand
Customer migration Product improvement
Emphasis on replacement demand
Innovation adoption and diffusion New-to-the-world product
Emphasis on primary demand, adoption and
diffusion
Source: After Guiltinan, 1999.
124 Food product development
innovators, influentials, followers and die-hards as shown in Fig. 3.14. The
diffusion curve can vary a great deal: the initial sales may be very slow and then
there is a sharp rise, or there may be a fast initial rise and then a plateau. The shape
of the curve is related to the product/consumer relationship but the launch tactics
can affect it. The consumers may take some time to recognise and want the product
so there is a slow uptake; or the product may fulfil an important need of the
consumer, so they buy it immediately and sales increase rapidly. However, after
the innovators have bought the product, the influentials and followers may take
some time to buy and there is a plateau in the sales curve. Promotion and
advertising can make consumers aware of the product more quickly than by word
of mouth, and so they will buy earlier and the rate of sales growth will increase.
Another marketing method to quicken the sales rate is to give consumers samples
to taste in the supermarket; this gives them the opportunity to try the product at no
cost, and if they accept the product they are encouraged to buy it. In launching, it is
very important to understand the consumer/product reaction and how launch
strategies and tactics affect it.
3.4.2 Launch strategies
The launch strategy can be described as the marketing, production and
distribution decisions to introduce the product to the market and to start to
generate sales. The launch strategies include the targeting strategy, the timing
strategy and the product’s innovation level. The perceived innovation level
depends on the target market and also the competing products in the market. The
target market can be a mass market or a niche market; the choice often governed
by the size and resources of the company. New products may be aimed at a
market segment, which is likely to be attracted to the new product, and then may
be expanded to other market segments. Mass customisation in which the product
is modified for specific groups of consumers is also another possibility. So there
must be a strategy for reaching the target market segments.
Another launching strategy is to lead or to follow the competitors. This is an
important timing strategy. With an innovation, the costs of being the pioneer can
be high and if sales growth is slow then it takes some time to recover these costs.
Fig. 3.14 The product diffusion cycle.
The product development process 125
But of course if there is a reasonably fast sales growth, then the product can win
the major share of the market for a long time. With the incremental product, it is
important to do this continuously with the succeeding products, so that the
market share is either held or grows. To increase the market share, people of
course make a product change so the new product must have their desired
benefits and also needs marketing tactics to encourage them to make the change.
Hultink and Robben (1999) grouped the launch strategy decisions as:
? strategic product/market decisions – relative product innovativeness,
targeting, introduction objectives and product newness;
? timing-related decisions – timing of market entry, speed to market.
These decisions have to fit into the company environment, its capabilities and
resources, and the working environment of technology, market and competitors,
as well as the surrounding societal environment. Successful launches were found
to be related to perceived superior skills in marketing research, sales,
distribution, promotion, R&D and engineering (Di Benedetto, 1999). Having
cross-functional teams making key marketing and manufacturing decisions, and
getting logistics involved in early planning, were strategic activities that were
strongly related to successful launches.
3.4.3 Launch activities
There are two important decision areas for activities:
1. Marketing-mix decisions – relative distribution and promotion expendi-
tures, relative breadth of product assortment, distribution channels used,
marketing communications channels used, branding and pricing.
2. Production and distribution decisions – raw materials quality and quantity,
production outputs, product quality, inventories, logistical times and
quantities for delivery.
There are many activities in these two areas as shown in Table 3.5 and the
problem is to choose the activities and integrate them. Very often there is
emphasis on marketing tactics in the launch (Guiltinan, 1999) but the production
and the logistic tactics can often make or break a launch. The launch strategy
integrates the launch; and the launch tactics need to integrate the production,
distribution and marketing activities so that they are focused on the same desired
demand outcomes. Common pricing tactics are market skimming with a high
price, and market penetration with a lower price. In choosing one of these, there
needs to be consideration not only by marketing of the demand but also by
production and distribution on the capability of producing the volumes and the
costs of inventory in storage. Good launch management with control of activities
and in particular of their timing and costs is the basis for a successful launch.
The timing of the launch is all-important and sometimes activities have to be
shortened to achieve this timing; this may cause problems for staff but it usually
results in a successful launch unless everything falls apart!
126 Food product development
A very important aspect of launching is logistics; the aim is to have
sufficient product on the shelves but not for too long. In the past, there was the
practice of filling up with product the pipeline from the factory to the retailers’
shelves, according to the predicted sales demand. This meant having a large
inventory, which was costly, and in the case of introducing product lines did
not allow for different rates of uptake of the individual products. A lean launch
Table 3.5 Activities in product launch and evaluation
Marketing organisation Production organisation
Organising for the launch
Finalise promotion Design, build, commission plant
Media advertising contracted Quality assurance finalised
In-store material prepared Raw materials contracts
Sales presentation to staff Physical distribution contracts
First introduction to retailers Production finalised
Market channel/physical distribution organisation
Product launch
Launch targets finalised
Complete selling to retailer Produce the product
In-store material distributed Distribute the product
Merchandising in supermarket Check product quality in supermarket
Release advertising Check product safety
Release product for sale
Product launch evaluation
Merchandising Improving production efficiency
Advertising Reducing product quality variation
Sales recording Checking product in distribution
Buyers’ surveys Checking product in retailers
Competition study Improving distribution efficiency
Marketing costing Production and distribution costing
Financial analysis of costs, revenues
Analysis of production, distribution, marketing
Comparison of actual results with targets
Adoption of product into the company
New phase of advertising Standardising production
New phase of in-store promotion Total quality management in place
Pricing revamping Raw material procurement revised
Sales recording Output increased
Future costing Costs reviewed
Sales analysis Logistics optimised
Buyers’ studies Retailers’ handling optimised
Future developments of product, production, marketing
Financial analysis of investment, costs, revenues and profits
Future returns on investment predicted
Source: After Earle and Earle, 1999.
The product development process 127
strategy based on logistics and supply chain collaboration can greatly reduce
the costs and the risks of the product launch (Bowersox et al., 1999). The lean
launch strategy is based on response-based logistics, a flexible and responsive
system with agile supply and manufacturing which can react quickly to real-
time information from point-of-sale data transmitted via electronic data
interchange (EDI) and Internet communications. The aim is to plan for lean
inventory and to focus on in-stock position to support product successes, reduce
stock of product failures and manage stock for niche markets. This gives better
management of start-up costs, as sales will more rapidly balance costs and
make a profit more quickly.
3.4.4 Evaluating and controlling the product launch
Evaluating and controlling the product launch is critical to success. The launch
involves people and functions from all parts of the company, and the
organisation of these people and their actions is complex. A well-planned
organisational structure plans the activities, and can also quickly respond to
problems caused by product quality, competitors’ reactions and non-predicted
consumer behaviour. Changes to activities or their timing can be made during
the launch to counteract any problems arising.
Companies tend to build a ‘launch’ structure and use this for successive
launches. For example in the food industry, it used to be a big TV campaign,
backed by in-store promotions and simultaneous wide distribution in super-
markets. With changes occurring in the food system, there is a need to be more
adaptable so that the organisation system is permanent but the activities and
techniques are selected for each project. In other words, the adaptability of the
earlier stages of the PD Process is transferred to the launch. It is the most
expensive stage and therefore requires the greatest knowledge from past
experience. It also creates a great deal of knowledge, which should be captured
for future launches.
Targets will have been set for the launch: short-term targets of sales volumes,
sales revenue and market share, and long-term targets of a certain profit and
return on investment and a time to recover the development and launch costs.
Quantitative recording and analysis systems are set up to continuously analyse
the sales and to improve the sales predictions. As the launch proceeds, the
evaluation will become more definitive as more accurate data accumulate, and
more realistic predictions of future cash flows can be made. The data necessary
for the evaluation include production costs, prices, unit sales, sales revenues,
marketing costs, company costs and finance costs. This is not just a recording
system, it is also the basis for action during the launch.
One of the most difficult decisions is to change/not change the activities and
the timing. If one reacts to every out-of-target result, then the whole system may
get out of control; if a decision is delayed, the opportunity for success may be
lost. It is important to follow trends and make decisions on these trends, not on
spot data. The raw materials and direct processing costs are continuously
128 Food product development
checked to see if they are improving and are within or better than target. The
distribution costs, delivery times and product losses during distribution (which
also are an important cost) need to be recorded regularly. There needs to be
systematic monitoring during the launch in costs, finance and market as shown
in Table 3.6.
Following sales is only one of the outcomes that need to be monitored and
controlled during the launch. It is necessary to check how the product is
performing in distribution, storage and retail outlets – is the quality correct, is
the product becoming unsafe, are there many product rejects in the system? The
retailers’ and the consumers’ attitudes to the product are monitored – how has
the retailer placed and promoted the product? How much are the consumers
buying and rebuying? What do consumers like/dislike about the product? The
answers to these questions are crucial to the future of the product and need to be
found in retailer and consumer surveys during the launch. Some important
factors to follow are summarised in Table 3.7.
Table 3.6 Costs, finance and market monitoring during launch
Costs data
Finances Analysis
Raw material costs Cost trends
Production costs Costs breakdown
Distribution costs Production efficiency
Advertising and promotion costs Distribution efficiency
Product losses costs Marketing efficiency
Wastes costs Additional operational costs
Company costs
Financial data
Finances Revenues Analysis
Total costs of launching Total sales revenues Gross profit/loss
Cost of financing Profit margin
Capital investment Pay-back time project
Working capital Pay-back time launch
Financial condition Return on investment
of the company Additional capital investment
Additional working capital
Market data
Sales, marketing Analysis
Sales total volume Market share overall
Prices, range, specials Market share in individual retailers
Sales individual retailers Per capita sales rate
Buyers’ purchasing patterns Purchase/repurchase pattern
Competitors’ sales Ratio of sales against competitive
products
Predicted future sales
The product development process 129
3.5 Service in product development
The previous sections discussed new product development in general, but
sometimes new services have to be developed as well as the physical product. In
Table 3.7 Monitoring of production, distribution and marketing
Production Distribution
Raw material quality Delivery times
Raw material availability Delivery quantities
Process variations Product losses
Yields Quality of product on delivery
Waste – processing material, Quality of product on sale
product, packaging Inventory in company stores
Quality of product Inventory in customers’ stores
Equipment breakdowns Breakdowns in delivery
Response of staff
Marketing
Retailers Consumers Prices
Reaction to delivery times Consumer awareness Price range
Product returns Consumer reaction Specials prices
Shelf space Consumer buying Price/demand relationship
Promotion initial
Prices re-buy
Orders Consumer segments
Relationship to other products
Advertising and promotion
Coverage Effectiveness Communication
Impact Precision Focus
Reinforcement Relevance Emphasis
Retention Acceptance
Think break
Using the knowledge from your product commercialisation in the last Think break:
1. Outline the demand outcomes wanted from the launch of your product.
2. Develop for your product launching
(a) relative product innovation level strategy,
(b) targeting strategy,
(c) timing strategy.
3. Outline the critical monitoring points in the launch and describe the information
you would collect at these points.
4. Discuss how you would analyse this information and use it to make decisions on
the launch.
130 Food product development
these cases, a product and a related service are developed together. In
developing new industrial products, the new product benefits and the service to
the customer need to be developed in tandem to give the optimum integrated
product. In food service, the service component is of major importance; for
example in a high-class restaurant, the service of individual attention, and in a
take-away chain, the service of fast convenience, is all-important. The basic
four-stage PD Process is the same for new product and service development, but
the activities and the organisation can be different. An integrated process
including product and service needs to be used where product and service are
developed together.
3.5.1 Services
Services are intangible as compared with tangible products. They are intangible
experiences that are produced and delivered simultaneously. An important
feature of the service is that it is adaptable and can change with different
customers; this is just about the opposite of the tangible product, which stays the
same for all customers. Service customers want individualised experiences that
yield strategic benefits for them as individuals. The customer and the company
employee are parts of the service; it is their interaction that is the service.
Therefore service quality is highly variable, but it is very important, as the
customer reaction is immediate (Terrell and Middlebrooks, 1996).
The customer’s concept of the service includes the company’s service system
as well as the company skills and knowledge. From the customers’ point of
view, important features of a service are (Walton, 1992):
? treatment of the customer;
? speed and convenience of service;
? price of the service;
? variety of services;
? quality of the tangibles that accompany the service;
? unique skills that constitute the service offering.
From the company’s point of view, a service has three parts: the service itself,
the augmented service (service firm’s reputation, quality of the interaction with
the firm’s system and staff) and the marketing support (Storey and Easingwood,
1998). The total service is shown in Fig. 3.15. In developing a new service, the
three layers of the product have to be integrated so that the total optimum
product is achieved.
3.5.2 New service development
With growth in the service industries in the 1980s and 1990s and the increasing
need for new ‘products’, there grew an interest in the method of developing new
services. In the 1980s, new service development started with the basic model of
Booz, Allen and Hamilton (1982). A typical process was to develop a business
The product development process 131
strategy, develop a new service strategy, idea generation, concept development
and evaluation, business analysis, service development and evaluation, market
testing and commercialisation (Bowers, 1989). As service development grew,
specific service development processes were produced (Johne and Storey, 1998).
Scheuing and Johnson in 1989 proposed four stages – direction, design, testing
and introduction, and identified a 15-step sequence of activities.
? Direction (or service strategy): formulation of new service objectives and
strategy, idea generation, idea screening.
? Design: concept development, concept testing, business analysis, project
authorisation, service design and testing, process and system design and
testing, marketing programme design and testing, personnel training.
? Testing: service testing and pilot run, test marketing.
? Introduction: full-scale launch, post-launch review.
This model emphasises the intricate interplay between the design and testing
functions during the design of a new service. The involvement of the operations
personnel and the users is an important feature in the design stage. Customer
participation is an essential part of new service development. Employee
participation is also necessary, as the front-line employees are delivering the
service. They are psychologically and physically close to the customer, and can
identify customer needs and problems. If employees and customers are involved
in the development, they will also behave knowledgeably and willingly in the
delivery of the service. Therefore the design process in service development
Fig. 3.15 Augmented service product (Source: After Storey and Easingwood, 1998).
132 Food product development
needs to include the designer, the customer and the employee as shown in Fig.
3.16. The designer, customer and the service employee are usually not
individuals, but three separate groups – the customer’s group, the development
group in the company and the company marketing organisation.
The question is how well can new service development fit into a service
development process? Edvardsson et al. (1995) concluded from their studies that
innovation of new services is an extremely complex process when it comes to
planning and control. Their four stages were idea phase, project formation
phase, design phase and implementation phase; they suggested it was not a
sequential process but an interacting process. The stages overlapped and could
not be clearly identified. Edgett (1994) found that the launch plan must be part
of the development process. It needs to be well planned and coordinated, with
communication materials and marketing targeted correctly and backed with
sufficient resources. New service development can be a planned process
following the four stages of the PD Process, but there is significant iteration in
and between stages because the strong involvement of customers and service
employees does not allow a rigid sequential structure. Two important stages are
the service strategy and the service design.
Service strategy is the direction for development based on the business
strategy. Some of the service innovation strategies include positioning, process,
new service, employee/customer relationship and communication (Stinson,
1996). Examples in the food industry are:
? commodity meat suppliers repositioning to ingredient meat suppliers with
products tailored to high class hotels and restaurants;
? restaurant changing from table service to self-serve;
? frozen food company introducing a new home delivery of frozen meals,
nutritionally balanced for different age groups;
? starch ingredient supplier developing a buyer contact group with recognised
product development skills;
? soy products company opening an on-line data base so that their clients can
formulate new products.
Service design includes service concept, service system, service process
(Edvardsson and Olsson, 1996). The service concept is a description of the
customer’s needs and how they are satisfied in the form and the content of the
Fig. 3.16 The design triangle in service development.
The product development process 133
service. As in product development, the customers have needs, wants and
expectations. Expectation is critical in service – as can be seen from the attitude
of any diner in an expensive restaurant, or a child in McDonald’s. Expectation is
based on the customers’ needs and wants but it is also influenced by the com-
pany’s image or reputation on the market, the customers’ previous experience of
the service company, the service company’s marketing. The customer
perceptions of the company and the service, especially as compared with
competitors, have to be taken into consideration in the design of the service.
The service system in the company is mainly the people in the company, not
just the front-line staff but the whole chain of customer relations in the company.
The customer is relating to the technical resources and administrative routines
and procedures in the company, as well as the marketing personnel. There is also
a relation with finance as they are setting limits on prices, financial contract and
investment. The whole company system is a part of the service design as shown
in Fig. 3.17. The service system includes the resources available for the service
development and operation. The finance section is involved not only in allowing
the resources but also in setting the financial arrangements with the customers.
Marketing has a key role in building up the part of the customer in the service, in
particular to inform, educate and give them the skills to take part in the service.
The technical people are involved in designing the hardware and software
supporting the service.
The service and the customer outcome are generated in the service process.
The customer is present in the process and affects the result (Edvardsson and
Olsson, 1996). The nature of customer contact is a factor in the design – is it
mail, telephone, face-to-face; long-term or short-term relationship; casual or a
contract? There are individualised customer experiences in which the company
may wish to be involved or keep at a distance. The behaviour of the customer
must be taken into account as the service process is built up. In designing the
service process, a framework of activities is built up from the customer
introduction to the service to the customer outcome of the service. The service
process consists of a clear description of the various activities needed to generate
Fig. 3.17 Company service system and customer group within the design triangle.
134 Food product development
the service – service company staff, the customers, the physical/technical
environment and the organisational structure. The service process depends on
the resources – people, knowledge, skills – in the company and how they are
organised. The customers also have knowledge, skills and procedures that need
to be taken into account in the design of the actual process for delivering the
service. The service process designed is a framework, but it will vary with every
customer; every customer makes it an individual customer process.
In developing from the service concept to the new service, there is constant
interaction between the service concept, the system and the process; and testing
of various combinations with the customers and the employees. This gradually
expands with increasing numbers of customers into pilot testing, test marketing
and the final launch.
3.5.3 Industrial food products and services
There are two different groups in industrial business-to-business relationships –
the industrial buyer (food processor or manufacturer) who employs raw
materials and food ingredients in manufacturing a food product, and the
industrial supplier of raw materials or ingredients (farmers, primary processors,
ingredients processors). There is a great variety of buyers and suppliers, and also
a wide variety of products. The product development varies from a branded
coffee for one-person coffee bars, which is similar to consumer product
development, to the highly specific ingredient for one large multinational food
manufacturer. But there are some general factors to consider in developing new
industrial products (Schaffner et al., 1998).
The types of products
These could be raw materials from farm and sea, specialised commodities, bulk
industrial products, partially processed materials, processed products, processed
speciality products.
The industrial food-product characteristics
The industrial product can be divided into the tangible product, the uses of the
product and the services that are marketed with the product. Some important
features of industrial food products are shown in Fig. 3.18.
There is a tangible product that has specific composition, microbiological
levels, physical properties and sensory properties, and there is the customer’s
product which includes the qualities directly related to the buyer – their uses and
also the quality of the derived product made from the raw materials, usually the
consumer product. In the customer’s product there are also special features,
quality and specifications, packaging and branding. Services included implicitly
or explicitly with the industrial product can be reliability, safety, availability and
replacement, technical information and help, delivery and credit. The service
product can also include some or all of the features in the service augmentation
and marketing support shown in Fig. 3.15. Products are not just a physical entity
The product development process 135
but an array of economic, technical and personal relationships between buyer
and seller.
Industrial buyers
Industrial buyers can be grouped together as market segments. The buying
company can be buying directly for their own use or for reselling to the users.
The users can be segmented as shown in Table 3.8.
Fig. 3.18 The industrial food product (Source: From Schaffner, Schroder and Earle,
Food Marketing: An International Perspective, C223 1998, by permission of the McGraw-
Hill Companies).
Think break
A large oils and fats ingredient company plans to develop a new pastry margarine
product and is trying to identify a target market and new products. Possible target
markets are pie manufacturers, frozen pastry manufacturers, croissant manufac-
turers, biscuit manufacturers, cake shops, small retail bakers, supermarket bakeries
and hotel patisseries.
1. Choose some suitable segmentation factors from Table 3.8 and assign the
target markets into the segments. Select what you think are the two most
suitable segments for a new pastry margarine product.
2. Identify possible new products, both incremental and innovations, for each
segment.
3. Evaluate these new products and select the two most promising ideas.
4. Identify the most important ‘customers’ to include in the design process for these
two new product ideas.
5. What tangible product qualities would they need?
6. What services would they need?
7. Sketch the complete product concepts for the two products.
136 Food product development
The needs and wants of the buyers
All buyers are interested in firstly the ease of using the ingredient in the process
and secondly the cost and quality of the final products. Although the buying
action is logically based on these needs, there are still some psychological
reasons for buying. Basic needs and wants of the industrial buyer are shown in
Table 3.9. Actual needs and wants do vary with the different people in the
buyer’s company. For example:
? Production personnel – delivery time, reliability in supply, constant quality,
ease in processing.
? Product development personnel – ease and shorter time for development,
final product qualities.
? Quality assurance personnel – raw material specifications, ISO standards,
narrow range of quality variation.
? Purchasing personnel – reliability of supply, price, size of delivery, regular
deliveries.
In looking at these needs, one can see that there is an emphasis on service as
well as the product, and this reinforces the need to develop the service with the
Table 3.8 Methods for segmenting industrial buyers
Stage in the food chain: primary processor, secondary processor, caterer, retailer.
Type of processing: for example baking, freezing, dry mixing, sterilisation.
End consumer products: for example snack foods, takeaways, breakfast foods.
Size: number of employees, amount of capital, turnover per year, production volume.
Technical knowledge and skills: high technology, average technology, craft.
Usage rate: large, medium, low; regular, variable.
Type of purchaser: new, old, repeat, contract, casual.
Organisational structure: private or multinational company, farmers’ cooperative.
Table 3.9 Needs and wants of the industrial buyer
Availability Use
Ease of delivery Convenience in processing
Ease of storage Uniform, stable, processing
Ease of ordering Technical simplicity in processing
Reduced risks Costs
Safety Costs, discounts
Financial losses Value
Product failure Payment method
Staff failure Payment time
Equipment failure
Knowledge Outcome
Technical information Production of uniform, acceptable products
Formulations Satisfactory sales and profits
New and improved consumer products Competitive advantage
Help in processing Few equipment problems
Information on derived products Efficient staff use
Marketing help with derived product
The product development process 137
product. In developing industrial products, there is a need to identify the
important people in the buying company as regards this type of ingredient and to
find from them their needs and wants in the new ingredient, and decide how
their needs and wants relate to the buying company’s critical needs. In other
words, the product development team in the supplier’s company needs to
understand the buying company’s overall needs in product and services, and also
the needs and wants of some individuals.
The PD Process
The PD Process is therefore a combination of product and service development.
In the past, these have been done in sequence, completing the product
development process, and then starting the service development. This leads to an
increased time for development and also sometimes to a lack of harmony
between the product and the service. In Fig. 3.19, there is an attempt to combine
the product and service development processes to give an integrated product and
service. The integrated product/service development process is particularly
useful when new products are being introduced with a new service process and a
new service system. The service system may already be in place and a new
product and a new service process will be developed. This still means
integration of the two development systems.
De Brentani (1995) has suggested three successful scenarios for industrial
service development:
? Customised expert service: expert capabilities and resources providing
customers with customised and high-quality service.
? Planned pioneering venture: pioneering new service ventures aimed at
attractive, high-volume markets.
? Improved service experience: enhanced speed, good service quality and
reliability.
Think break
The sales office of a large flour miller has just received a bread-baking mix from the
production department. Recently there was a marked increase in the number of small
hot-bread shops and the salespeople think that these small bakers might be a good
market for this product. A salesperson knows a small baker and takes a bag of the
mix to him. The baker promises to try it and in a day or two the salesperson has a
telephone call from the baker to say that the product was a failure – there were
difficulties in processing and the final loaf was small and hard.
1. How might the salesperson have handled this better?
2. How did the company go wrong in its industrial product development process?
3. Suggest a product/service integrated product development process for this
company to ensure more successful new industrial products.
138 Food product development
3.5.4 Food service development
In food service, there are three participants – the food manufacturer/food
processor, the food service organisation and the customers – and two product
development processes – the food manufacture and the food service. The two
product development processes may be working in parallel or in sequence. The
supplier’s product development usually follows the standard sequence of the
industrial product development process; in food service, product development is
a major part of menu planning. The food service product involves the dishes
Fig. 3.19 The product/service development process for industrial products.
The product development process 139
offered and the service delivery of those dishes in the dining/eating environ-
ment. Both the food service operator and the customer want service as well as
the product. Therefore food service development is a complex interweaving of
product and service, through two development projects. There may even be
another commercial customer between the food service and the customer; for
example, in flight catering there are food manufacturers, flight caterers, the
airlines and then the passengers. In developing new in-flight meals, the airlines
regard new meals as service development, the catering services as service and
product development, the food manufacturers as product development with
some service development. Some new developments for in-flight meals are
shown in Box 3.2 to illustrate the variety of development taking place.
Food service development is usually based on menu planning, which has five
major aims: creative, nutritional, marketing, economic and logistical (Roberts,
1997). This food design is strongly aesthetic, but there is also a price direction
and a serving need. Today, there is an increasing inclusion of nutrition into the
design aims. The basis for the new development is the design of dishes, which
are combined to give the new menu or in the case of institutions a whole meal
structure (Ngarmsak, 1983; Roberts, 1997). In some instances such as
takeaways, there is only one dish to be designed, although this has to be
related to the overall takeaway product mix. Usually there is an existing menu,
which can be improved by adding new dishes, or which can be used as part of a
new menu. Development of new dishes is the basis for the menu change as
shown in Fig. 3.20.
The supplier can give the new ingredient to the menu planner and let them
take this through their PD Process of ideas, idea screening, recipe formulation,
trial dishes, trial dish evaluation, standard recipe, menu design, menu trials,
Fig. 3.20 Menu planning for new menu (Source: After Roberts, 1997).
140 Food product development
menu launch, or they can work with the menu planner in developing the meal
ingredient or meal part. This combined product development occurs in stages
as shown in Fig. 3.21. These are the overall activities in the two interacting
PD Processes, but of course there are variations caused by the different
situations.
The menu planner in the PD Process can be the product development
manager for a large chain, the owner of a restaurant or the senior chef managing
Box 3.2 Developing new products and services for
in-flight catering
Product: Meal components
Delta Daily Foods are a medium-sized food manufacturing company based in
the Netherlands producing food items for both flight catering and super-
markets. They have developed a system for freezing individual vegetable and
meat products, moulded in specific shapes that can be assembled by hand and
even robot machinery into main dishes for in-flight trays.
Service: British Airways ‘well-being in the air’ concept
Based on extensive research into food trends, nutrition, macrobiotic diets and
the oriental art of well-being, this takes the form of an advice pack for
passengers on how to prepare for air travel, what to eat and do on board, and
ideas concerning exercises and relaxation. Meals are designed to blend with
this concept.
Process: Materials-handling system
SAS Service Partners and British Airways central production unit at
London’s Heathrow airport applied technology developed in the motor
industry to flight catering equipment handling. This entails moving food
trolleys on hooks suspended from a moving beltway from the unloading
dock, through the wash-up area and into storage.
Software: Electronic reproduction of meals
Abela/Gate Gourmet developed a software package that produces electronic
reproduction of images for catering. This system stores detailed recipes and
dish specifications, along with full-colour digital menu pictures originally
captured on video camera. The coded, kitchen-proof, keyboard enables chefs
to access any menu or dish and enter the number of meals required. The
system then computes the amount of each ingredient required and provides
full specification and digital image on a colour printer.
Source: After Jones, 1995.
The product development process 141
a hotel, restaurant or institutional kitchen. The wants and the abilities of the
menu planner are important in planning the activities in the PD Process. Two
other important groups are the consumers and the providers of information to the
menu planners, such as other suppliers and their professional associates. The
management of the food service company strongly influence the overall product
and service, particularly as regards price and choice of supplier. There are two
important relationships: supplier/food service and food service/consumer. In
designing an ingredient, the supplier has to bring these two relationships
together, preferably by conducting research with both consumers and food
service outlets; or if this is not possible, by obtaining consumer information
from the food service company. Product development activities in food service
are also influenced by:
Fig. 3.21 Developing meal components and menus.
142 Food product development
? menus – menu analysis, menu planning, menu changes (type, timing –
periodical, continuous);
? food service company – outlet type, meal periods, size, development
capability, skills and knowledge, needs, wants;
? supplier company – type, size, development capability.
The products from the supplier to the food service include basic ingredients,
meal components, partially prepared–not cooked meals, and pre-cooked,
complete meals. The benefits of new products that the menu planner/chef
usually identifies are in the areas of ease of use, safety, prestige of product and
reliability. Two fundamental needs are value and risk; increased value of the
dish or decreased costs is wanted, but risks of failure and indeed food poisoning
are always present.
The benefits identified by chefs at the product concept and product
development stage for two meat products in the hotel and restaurant market in
Melbourne, Australia, are shown in Table 3.10 (Roberts, 1997). The study
compared a meat product with little processing (thin beef slices) with a meat
product with moderate processing (fricadelle, an alternative to the beefburger).
The sliced beef was a basic ingredient, and the fricadelle was already prepared
and only needed grilling. The chefs were looking for ingredients that would save
time but also could be used for different dishes. In this situation with chefs
selecting the products, beef slices were favoured over the fricadelle. It was
interesting to see that there was a change in attitude between the written product
concept and the actual prototype. The quality of the beef slices increased, but
that of the fricadelle went down.
The risks were also studied in these two products. The important risks
identified by the chefs were increased staff costs, food safety risk, too high use
of one piece of equipment, increased storage capacity required, high financial
losses, chef skills vulnerability, poor peer recognition and failure of the product
in the marketplace.
Table 3.10 Product benefits identified by menu planners for two meat products
Percentage of respondents scoring highly
Product Tender beef in thin slices Fricadelle
benefits
Product concept Product prototype Product concept Product prototype
Save time 94 81 61 70
Versatility 68 68 42 40
Value for money 65 58 55 27
Quality 26 55 23 23
Need 55 32 39 17
Source: From Roberts, 1997.
The product development process 143
The stages in the adoption process used by menu planners are product
awareness and interest, product concept, prototype trial and product adoption
(including post-purchase evaluation). For awareness and interest, direct word-of-
mouth communication between developer and adopter is important. Concept
evaluation is a vital stage in the new product development process for
satisfactory development of product specifications. The decision to try the new
product is often based on cost, quality, need to save time and risk involved. The
quality is often related to the consumers’ needs as well as the chef’s needs, so
consumer testing is necessary. It may be organised by the supplier so that the
food service has evidence on how the product is accepted by the consumers, but
of course the chefs will also trial it themselves, probably in a blackboard menu.
Product adoption by the food service company may not be systematic, but a case
of trying it in the kitchen and giving opinions on the dish’s acceptability and the
cooking benefits and problems.
3.6 Where is the product development process going?
The project development process has settled into a well-proven stage pattern
with critical reviews at each stage (the Critical PD Process). These reviews give
opportunities for careful examination of progress, which if passed leads to the
next stage and if not to abandonment or recycling as appropriate. Generally a
four-stage PD Process is clear and sufficient, though in some projects substages
may be necessary, especially for major innovations taking time for development.
The importance of the activities and their sequence within the stages are
determined by the level of innovation, the resources available to the company,
the timing of the project, the company’s risk level, and the knowledge and skills
in the company.
One important factor is the degree of novelty, ranging from product
improvement to a major product innovation. There can be a standard PD Process
with a reduced number of activities for each project where there is:
? more or less continuous modification of an existing product line with fairly
minor changes to produce variations on products;
? processes, equipment and markets are substantially unaltered; and
? no major shift in structure and organisation of the company’s product
development.
If the company has a data recording and storage system for product
development, there may be sufficient knowledge of consumers, markets,
products and production to reduce the research in the first stage, and also in the
product commercialisation. Even the product launch can be a standard
procedure. For these incremental changes in products, there can be a standard
PD Process which is steadily improved after the analysis and evaluation at the
end of each project. The efficiency and the effectiveness of the product
development process can be improved over time.
144 Food product development
For major discontinuous changes, there is a need for more exploratory
activities in the first stage of the PD Process, and also because of the large costs
involved there will be more project and business analysis throughout the project.
The decisions are major because of the resources needed, and therefore a great
deal of knowledge is required which usually has to be created in the project. A
consistent, logical process is needed, but it cannot be highly structured because
of the unknown nature of the project. The process is usually more exploratory
and less customer-driven than the typical incremental product development
process. It concentrates in the first stage on recognising the application of
developing technologies in new products for the company, so there is an early
design of product prototypes before opportunity analysis, assessment of market
attractiveness, market research and financial analysis (Veryzer, 1998).
Technological research is necessary to identify what is possible, before the
consumer can study product ideas and develop product concepts. In the later
stages, there is important design of the plant, production and the market strategy,
which again needs design ideas, evaluation and then application.
Figure 3.22 indicates how new product placement can often be related to the
three major components – aesthetics, technicalities and service. Placement
yields more useful lines of emphasis in choosing, planning and executing
activities in the product development process than just putting products into
categories of industrial, consumer and food services, because of the wide
Key:
Strength of relationships: C0C0C0 weak; C136C136C136 moderate; C17C17C17 strong
Fig. 3.22 Indicative influences affecting activities choice in the PD Process.
The product development process 145
variations in products in these categories. Placement aids the selection of
activities and ensures a product development process that runs smoothly and
with a better probability of success.
A very important influence is the market. On the one hand for a consumer
market, the influences of aesthetic factors, which persuade customers into trying
a new product, can be much more significant than technical considerations.
Hopefully their acceptance leads towards brand acceptance and therefore
consistent support with little further effort needed on choice. On the other hand,
industrial products move to a much more stringent, technical scrutiny. Careful
definition of specifications, examination of pricing and longer-term contractual
detail lead to dominance by technical considerations with little or no emotional
overtone, and with a close eye on service and on convenience-of-fit to further
processing or manufacture. Food service industries again emphasise technical
detailing of ingredients, but in developing dishes and meals quite often
aesthetics are a major thought; consistency, reliability and service are critical
factors.
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