Wall Street Journal, June 2, 2006
Kraft Looks Outside the Box For Inspiration
Hungry for new ideas, Kraft Foods Inc. is turning
to a new source of inspiration: its customers.
The nation's largest food company is launching a program to weigh unsolicited
ideas from customers and others. The move represents a departure from past
practice, said Mary Kay Haben, senior vice president at the company. In the
past, she said, "we would have said, 'Thank you, but we're not accepting ideas.'
"
The shift is part of a broader move toward "open innovation" being embraced by
Kraft's chief executive, Roger Deromedi, who has been under pressure to improve
results.
Kraft has its own research and development units charged with developing the
kinds of products that have made the company famous, including Oreo cookies and
Miracle Whip dressing. But the Northfield, Ill., company hasn't had a home-grown
hit since the rollout of DiGiorno pizza a decade ago.
OPEN INNOVATION
Kraft Foods is launching a new program to weigh unsolicited ideas from customers
and others. Profit has fallen 24% in the past two years, and Kraft has announced
plans to slash jobs and shutter plants. In 2005, net income was $2.63 billion,
down from $3.48 billion in 2003, the year Mr. Deromedi was elected CEO.
Details of the program are still being worked out, but links on the company's
Web site will facilitate the submission of ideas. There will also be a toll-free
telephone number.
Ms. Haben said she was inspired, in part, by the success of Procter & Gamble
Co.'s Crest SpinBrush, the brainchild of a team of Cleveland-area designers.
Kraft is pursuing contacts with venture-capital firms and idea brokers such as
NineSigma Inc., a Cleveland firm.
"Who knows what we'll get?" Ms. Haben said. The best ideas, she said, will be
developed ones that Kraft can quickly bring to market. "We love it if it's
already been patented."
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