One of the largest French agricultural co-ops is the result of the integration of several dozens of companies that merged to form as a leader in food production and agricultural services. These services range from the production of seeds, crops, poultry, foie gras, vegetables, wine, etc., to the supply to farmers of products and services. Its annual turnover is close to 1.5 billion euros.
The cultural and structural integration of the legacy companies had never been fully conducted, leaving the co-op operating as a collection of SME’s with their own distinct culture and set of business practices, as opposed to a unified organization. During the last fiscal year, the co-op was confronted with several sectorial crises that deeply impacted its profitability. The Executive Committee addressed the imperative to develop a more rigorous approach to its innovation efforts in order to speed up the monetization of innovations and optimize its spending on longer-term research and development.
Through a series of eight work sessions over six months, the participants revealed that the entrepreneurial spirit that was at the source of the success of the different BUs led to the development of many innovation initiatives that lacked deep strategic analysis and financial rationale. One of the first milestones in this endeavor was to create a clear mandate to innovate and manage innovation across all BUs, given by the CEO and supported by the Executive Committee members. The group set out to develop a comprehensive pipeline of innovation projects—145 in the first consolidation—with rigorous and shared evaluation criteria.
The engagement produced the following results for the co-op:
- A clear mandate to innovate and rules to get innovation projects funded
- A rigorous stage-gate process through which each innovation process has to go through before investments get approved
- The valuation of a pipeline of innovations worth 100m€+ additional turnover in the next three years
- The identification and acceleration of key innovation projects to be supported and expanded to maximize their ROI
- The identification and immediate removal of 10m€+ of unnecessary spending on projects with low chance of success
- A harmonized innovation culture and practices and an elevated professionalism among innovation project leaders
- A group innovation steering committee that now has a clear control over the innovation arm of the co-op future performance.