Yes, They Still Have Bananas

Oct. 28, 2006
Chiquita continues a 107-year mission with an innovation-planning agenda.

This article is the last in a three-part series on how to persuade senior managers to embrace innovation. In our first article, "CEOs Need To Embrace Innovation," we demonstrated why today's business world demands that successful companies adopt a predictable, consistent approach to innovation. In our second article, "Clorox's Clean Sweep," Clorox vice president John Barnaba explained the role of innovation planning at the Clorox Company.

In this last article, Raul Fernandez, vice president of Technology and Innovation for Chiquita Fresh North America, talks about Chiquita's adoption of innovation as a methodology.

What inspired Chiquita to embrace the notion that there's no set playbook to guide you through the evolution of your business?

Many companies believe that their brand is the playbook -- that they can just live off that. But your brand is a living thing that's sustained by the products and services you provide to customers and by customers' perception of what you provide. A great brand can be quickly killed by a bad product or service. In our case, once we realized that a "playbook" doesn't exist, we knew we had to create a method for continuously generating a sustainable architecture of innovation. We have 107 years of leadership in the produce industry. But the factors that made us leaders 50 or 100 years ago are no longer the factors that make us leaders in the 21st century.

Which systems or techniques helped develop an innovation architecture within Chiquita's corporate framework?

It would be nice to say there's one strategy from A to Z, but the reality is, it's an evolutionary process. It does have three requirements that are universal:

The first requirement is clearly understanding that the status quo is unacceptable. Innovation from the ground up is possible but not sustainable. There must be strong support from the leadership of the organization.

The second requirement is having the courage to look at everything you do and everything you think you're good at, and asking if there's a better way. Challenging even your most sacred cows is vital, and it's important to create the mechanisms in the culture to make critical thinking OK.

The third requirement is a tremendous need to change. Change not once but always. One of the biggest pitfalls many companies encounter is the one-hit wonder. They come up with something great and say, "We got it." Then they milk that idea to death and never plan for the next one until it's too late. By then, they're preempted by an innovative company that looks at the product's success and what that tells them about the direction the market is heading and what is the next big opportunity.

What internal obstacles can inhibit an innovation agenda?

Within every corporation, certain business units are the cash cows. It's extremely difficult to innovate within a cash cow because, by definition, they make money by doing something right. They're the least disposed to change because change implies risk. The challenge is to create within an organization the ability to be extremely good at obtaining the maximum value from your established systems while at the same time nurturing a culture that is creating the next cash cow.

Which lessons did Chiquita learn in building that kind of organization?

The first lesson is, don't try to run before you can walk. You can't build an innovation powerhouse overnight. As you start to celebrate those small successes, you find there's a lot of untapped potential in your organization. In companies the size of ours, with 25,000 employees, there are a lot of good ideas. You pick your best and brightest people -- even pulling them out of areas where they're contributing a lot -- because contributors will find ways to create value. Then you tell them: "OK, don't worry about the day-to-day. Think about how we're going to make our quota two years from now, and think of it in terms of evolving over time from where we are now to where we should be." I call it making the company skate to where the puck will be.

It's like a living organism. It's important that you create a culture where people bring their body, brain and heart to work. Your employees have thousands of ideas, but they may not have the incentive or the method to communicate them. Or they may not know if anybody cares about those ideas. The most important component is creating a top-down culture of innovation and to sustain it with more than words.

What's an example of how innovation transformed the day-to-day at Chiquita?

Traditionally, we've sold bananas in supermarkets, relying on the family shopper to buy bananas as groceries. But we saw a reduction in the consumption of bananas. Why? Because that model did not fit the lifestyles of a significant portion of consumers that valued convenience over price . So we created and launched "Chiquita-to-Go," which allows us to sell single, ready-to-eat bananas with extended shelf life at points of sale where they were never available before. "Chiquita-to-Go" is now available at thousands of convenience and quick-serve locations. That's an example of a successful launch born of an innovative approach.

Raul Fernandez is vice president of Technology and Innovation for Chiquita Fresh North America. Sam Kogan is president and chief operating officer of GEN3 Partners, Inc., a product innovation consulting company. Based in Boston and St. Petersburg, Russia, GEN3 helps manufacturers identify the best opportunities for new products and new manufacturing processes and solve the technical barriers to achieving them.

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