Kraft Celebrates Product Innovation 'Heroes & Rock Stars'

"This is not your father's Kraft," execs say of corporate culture shift

BOCA RATON, Fla. -- Kraft Foods Group Inc. has spent the last three years getting its innovation "groove" back, company leaders said at the annual Consumer Analyst Group of New York (CAGNY) Conference in Boca Raton, Fla., according to a Forbes report.

Speaking at CAGNY for the first time since the spinoff, Kraft Foods CEO Tony Vernon outlined a growth strategy focused on driving meaningful innovation, which has previously been a sore spot for the company. "We understand our obligation to innovate and contemporize," Vernon said. "This is not your father's Kraft."

The $18-billion-in-revenues food products company with iconic brands like Maxwell House, Oscar Mayer and JELL-O became an independent company last October after a corporate split of legacy Kraft's North American grocery business and its global snacking business, which is now called Mondelez International.

Barry Calpino, vice president of breakthrough innovation, outlined how Kraft went on a "transformational journey where innovation went from one of our biggest weaknesses to one of our biggest strengths."

The company moved away from a strategy where quantity of new launches was emphasized over quality. Calpino called it the "field of dreams" strategy--"if we launch it, they will come."

In mid-2010, they decided to focus on the really big ideas that had true potential, said the report. "We went with 13 big bets, got serious about tracking them and invested heavily," he said. The act of focusing contributed to the birth of three new $100 million platforms: MiO beverage mixes, Oscar Mayer Selects deli meats, and Velveeta Skillet packaged meals.

To change a culture where innovation wasn't prioritized, "we fueled a movement," Calpino said. They celebrated the innovators, making them the heroes and rock stars of the company. "Positive discontent" became the new mantra, encouraging employees to get angry and motivated enough to make change rather than disengaging.

"Year two is just as important and often more important than year one, but most companies pull way back after the launch year," said Calpino. "We went just as big in year two as in year one."

MiO grew more than 60% in that second year, the report said. It also showed Kraft employees that they were dedicated to new innovation and meant what they said, which further fueled the culture shift. Going forward, Calpino said the company is committed to continuously learning and being consistent in execution.