Innovation at International Foods2

Mini Case

Innovation at International Foods2
Josh Novak gazed up at the gleaming glass-and-chrome skyscraper as he stepped out of the cab. “Wow!” he thought to himself. “I’ve hit the big time now.” The International Foods Group (IFG) Tower was a Chicago landmark as well as part of the company’s logo, which appeared on the packages of almost every type of food one could imagine— breakfast cereals, soft drinks, frozen pizza, cheese, and snack foods, to name just a few. Walking into the tower’s marble lobby, Josh could see displays of the company’s packaging from its earliest days, when its dairy products were delivered by horse and wagon, right up to the modern global entity it had become.

After signing in with security, Josh was whisked away to the 37th floor by an efficient

attendant who walked him down a long hall of cubicles to a corner office

overlooking Lake Michigan. On the way, Josh passed display photos of the company’s

founder, old Jonas Wilton looking patriarchal, and several of the family scions, who

had grown the company into a major national brand before the IPO in the 1980s had

made IFG a public company. Josh, having “Googled” the company’s history last night in

response to this summons, knew that IFG was now the largest purveyor of food products

the world had ever known. While many decried the globalization of the food business,

IFG kept right on growing, gobbling up dozens of companies each year—some because

IFG wanted to stomp on its competition and others because it wanted their good ideas.

Josh’s own small company, Glow-Foods, a relative newcomer in the business, was

fortunately one of the latter, but Josh was a little puzzled about this command performance.

After all, he himself wasn’t anyone important. The owners of the company

all received multiple millions and were sticking around—as per contract—during the

transition. The next level, including Josh’s boss, had mostly jumped ship as soon as the

“merger” was announced. “This isn’t my thing,” drawled Nate Greenly over beer one

night at the local pub. “Corporate America isn’t going to let us stay as we are, no matter

what they say. Get out while you can,” he advised. But Josh, with a freshly minted

MBA in his pocket, thought differently. And so here he was, walking into the CIO’s

office hundreds of miles away from the cramped loft in Toronto where Glow-Foods was


As the office door swung open, two people dressed in “power suits” turned to

meet him. “Uh oh, I’m not in Kansas anymore,” thought Josh as he mentally reviewed

his outfit of neatly pressed khakis and golf shirt, which was a big step up from his

usual attire of jeans and a T-shirt. A tall man with silver hair stepped forward with his

hand held out. “You must be Josh,” he boomed. “Welcome. I’m John Ahern, and this is

my associate, Tonya James, manager of IT marketing. Thanks for coming today. Please,

have a seat.” Josh complied, slinging his backpack over the corner of the leather chair while taking in the rich furnishings of the office and the panoramic view. After a bit of

chitchat about the weather and the prospects of their respective baseball teams, John

pulled out a black leather folder.

“Well, we won’t keep you in suspense anymore, Josh. As you know, when we took

over Glow-Foods we decided to completely align our processes, including IT. It doesn’t

make any economic sense to run separate data centers and applications, so we already

have a team in place to transfer all your hardware and software to our centralized corporate

systems over the next month. We’ll be replacing your Macs with PCs, and everyone

will get training on our ERP system. We’re going to keep a small team to deal with

the specifically Canadian issues, but other than that we see no need for an IT function

in Toronto any more.” Josh nodded glumly, thinking about his friends who would be

losing their jobs and all the fun they’d had during those all-nighters brainstorming new

ways to help Glow-Foods products go “viral.” Nate was right, he thought glumly. They

don’t really get us at all.

“That said,” John continued. “We are very impressed with the work you and your

team have done in using social networking, mashups, and multimedia to support your

marketing strategy. Your ability to reach the under-thirty demographic with technology

is impressive.” He turned to Tonya, who added. “Here at IFG, we have traditionally

marketed our products to women with children. We have a functional Web site—a place

where customers can find out about our products and where to buy them. More recently,

we’ve added their nutritional content, some recipes, and a place where customers can

contact us directly with questions, but it’s really unidirectional and pretty dry.”

Josh nodded in agreement with this assessment. The difference in the two companies’

approaches was night and day. Although not everything they had tried at Glow-

Foods had worked, enough of it had succeeded that demand for the company’s products

had skyrocketed. Young adults and teens had responded en masse to the opportunity

to post pictures of themselves drinking their Green Tea Shakes in unusual places on the

Glow-Foods Web site and to send a coupon for their favorite Glow-Foods product to

a friend. Serialized company mini-dramas popped up on YouTube and viewers were

asked to go online to help shape what happened to the characters—all of them using

Glow-Foods products extensively. Contests, mass collaboration in package design, and

a huge network of young part-time sales reps linked through Facebook all contributed

to making the brand hip and exciting—and drove sales through the roof.

John adjusted his French cuffs. “We want to tap into the youth and young adult

market with IT, and we think you’re the one who can help us do this. We’re going to

give you a team and whatever resources you need right here in Chicago. With our

global reach and much larger budgets, you could do great things for our company.”

John went on to outline a job offer to Josh that sent tingles down his spine. “I really

have hit the big time,” he thought as he signed the documents making him a team manager

at IFG at a salary that was almost double what he was earning now. “I can’t wait

to get started.”

Six weeks later he was being walked down the same hall by Tonya, now his

immediate boss, and into her office, a smaller version of his with a window looking

onto another high-rise. “What’s next?” he asked. “I’ve booked a meeting room for

you to meet your new team at ten-thirty,” Tonya explained. “But before that, I want to

go over a few things with you first. As the manager of IT Marketing, I am personally

thrilled that we’re going to be experimenting with new technologies and, as your coach and mentor at IFG, I’m going to make it my job to see that you have the resources and

support that you need. However, you may find that not everyone else at this company

will be as encouraging. We’re going to have some serious obstacles to overcome, both

within IT and with the larger company. It will be my responsibility to help you deal

with them over the next few months as you put your ideas together. But you need to

know that IFG may have different expectations of you than Glow-Foods. And you may

find you will get a better reception to your ideas if you look a bit more professional.”

Josh winced and nodded. He’d already ramped up the wardrobe for his first day with

a sports jacket, but clearly he needed to do more. “Finally, I’d like you to come up here

every Friday afternoon at four o’clock to go over your progress and your plans. My

schedule is usually fully booked, but if you have any questions you can always send me

an e-mail. I’m pretty good at getting back to people within twenty-four hours. Now let’s

go meet your new team. I think you’ll be happy with them.”

An hour later Josh and his new team were busy taking notes as Tonya outlined

their mandate. “You have a dual role here,” she explained. “First, I want you to work

with Ben here to develop some exciting new ideas for online marketing. We’re looking

for whatever creative ideas you have.” Ben Nokony was the team’s marketing liaison.

Any ideas would be vetted through him, and all proposals to the individual product

teams would be arranged by him. “Second, I need you to keep your eyes open and your

ears to the ground for any innovative technologies you think might work here at IFG.

These are our future, and you’re our vanguard.” Josh glanced around at his team, an

eclectic group. They seemed eager and enthusiastic, and he knew they were talented,

having had a say in choosing them. With the exception of Ben, all were new to IFG,

experienced in using a variety of new media, and under thirty years old. They were

going to do great things together, he could see.

The next couple of weeks were taken up with orientation. Ben introduced each

of the major product divisions to the team, and everybody had come back from each

meeting full of new possibilities. Tonya had also arranged for the team to meet with

the chief technology officer, Rick Visser, who was in charge of architecture, privacy and

security, risk management, and the technology roadmap. Rick had been pleasant but

cool. “Please remember that we have a process for incorporating new technology into

our architecture,” he explained as he handed over a thick manual of procedures. “In a

company our size we can’t operate without formal processes. Anything else would be

chaos.” The team had returned from that meeting full of gloom that their ideas would

all be shot down before they were even tried. Finally, they had met with the IT finance

officer. “I’m your liaison with corporate finance,” Sheema Singh stated. “You need to

work with me to develop your business cases. Nothing gets funded unless it has a business

case and is approved through our office.”

Finally, having dragged some chairs into Josh’s eighteenth-floor and marginally

larger cubicle and desk, the team got down to work. “This is ridiculous,” fumed Mandy

Sawh, shuffling her papers on her lap. “I can’t believe you need to book a conference

room two weeks in advance around here. Who knows when you need to get together?”

“Okay, team, let’s settle down and take a look at what you’ve got,” said Josh. One by

one, they outlined their preliminary ideas—some workable and some not—and together

they identified three strong possibilities for their first initiatives and two new technologies

they wanted to explore. “Great work, team,” said Josh. “We’re on our way.” The problems began to surface slowly. First, it was a polite email from Rick Visser

reminding them that access to instant messaging and Facebook required prior approval

from his group. “They want to know why we need it,” groused Veejay Mitra. “They

don’t seem to understand that this is how people work these days.” Then Ben got a bit

snippy about talking directly to the product teams. “You’re supposed to go through

me,” he told Josh’s team. “I’m the contact person, and I am supposed to be present at all

meetings.” “But these weren’t ‘meetings,’” Candis Chung objected. “We just wanted to

bounce some ideas around with them.” Next, it was a request from Sheema to outline

their proposed work, with costs and benefits, for the next fiscal year—beginning six

months from now. “Can’t we just make up a bunch of numbers?” asked Tom Webster.

“We don’t know how this stuff is going to play out. It could be great and we’ll need lots

of resources to scale up, or it could bomb and we won’t need anything.” Everywhere

the team went, they seemed to run into issues with the larger corporate environment.

Tonya was helpful when Josh complained about it at their Friday afternoon meetings,

smoothing things over with Rick, helping Josh to navigate corporate procedures, and

even dropping by to tell the team they were doing a great job.

Nevertheless, Josh could sense his own and everyone else’s frustration as they prepared

for their first big project review presentation. “They want us to be innovative, but

they keep putting us in a straight-jacket with their ‘procedures’ and their ‘proper way to

go about things,’” he sighed to himself. Thank goodness, the presentation was coming

together nicely. Although it was only to the more junior executives and, of course, John

and Rick, he had high hopes for the vision his team was developing to get IFG out and

interacting with its customers.

“And in conclusion, we believe that we can use technology to help IFG reach its

customers in three new ways,” Josh summarized after all of his team members had

presented their ideas. “First, we want the company to connect directly with customers

about new product development ideas through an interactive Web site with real-time

response from internal staff. Second, we want to reach out to different communities

and gain insights into their needs and interests, which in turn will guide our future


plans. And third, we want to implement these and other ideas on the ‘cloud,’

which will enable us to scale up or down rapidly as we need to while linking with company

databases. Any questions?”

There was a moment of stunned silence, and then the barrage began. “What’s

the business value of these initiatives?” asked Sheema. “I can’t take them upstairs to

our finance committee meeting without a clear commitment on what the benefits are

going to be.” Ben looked nonplussed. “We don’t really know,” he said. “We’ve never

really done this before, but we like the ideas.” “I’m concerned that we don’t bite off

more than we can chew,” said John thoughtfully. “What if these customers don’t like the

company or its products and say bad things about us? Do we have any procedures for

handling these types of situations?” “There’s definitely a serious risk to our reputation

here,” said Rick, “but I’m more concerned about this ‘cloud’ thing. We haven’t even got

cloud in our architecture yet, and this plan could make company intellectual property

available to everyone in cyberspace!” Sheema spoke again. “I hate to mention this, but

didn’t we do something like this community project about ten years ago? We called it


management, and it flopped. No one knew what to do with it or how to

handle the information it generated.” On and on they went, picking holes in every part

of every idea as the team slumped lower in their seats. Finally, Tonya stood up. “I’d like to thank you all for raising some legitimate and

important concerns,” she said. “And I’d like to thank Josh and his team for some fine

work and some excellent ideas. Marketing was looking for creativity, and we have

delivered on that part of our mandate. But now we have a more important job. And that

is innovation. Innovation is about more than good ideas; it’s about delivering the best

ones to the marketplace. We’re in a new world of technology, and IT can’t be the ones

to be saying ‘no’ all the time to the business. Yes, we need to protect ourselves, and we

don’t want to throw money at every half-baked idea, but we’ve got to find a way to be

open to new ideas at the same time. We know there’s value in these new ideas—we saw

it work at Glow-Foods. That’s why Josh is here. He has a proven track record. We just

have to find a way to identify it without taking too much risk.” The room sat in stunned silence as Tonya looked from one to the other. At last,John cleared his throat. “You’re right, Tonya. We want creativity and innovation, and we need a better way to get it than we have now. I think what we need is a process for creativity and innovation that will help us overcome some of the roadblocks we

put in place.” As Josh mentally rolled his eyes at the thought of yet another process,

Tonya replied. “I think you’re partially right, John. Processes do have their place, but

we also need some space to play with new ideas before we cast them in concrete. What

I’d like to do over the next two weeks is speak with Josh and his team and each of

you and then develop a plan as to how we can, as an IT department, better support

innovation at IFG.”

Discussion Questions

  1. In discussion with Josh, Tonya foreshadows “some serious obstacles to overcome.”

Describe these obstacles in detail.

  1. How can Josh win support for his team’s three-point plan to use technology to help

IFG reach its customers?

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