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International competitiveness thru Innovation Yves Rey Corporate Quality General Manager Danone

International competitiveness thru Innovation Yves Rey Corporate Quality General Manager Danone. From Breakdown to Breakthrough. International Competitiveness Thru Innovation Focusing on “Research and Development” Focusing on Stakeholders’ satisfaction High quality products.

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International competitiveness thru Innovation Yves Rey Corporate Quality General Manager Danone

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  1. International competitiveness thru Innovation Yves Rey Corporate Quality General Manager Danone

  2. From Breakdown to Breakthrough • International Competitiveness Thru Innovation • Focusing on “Research and Development” • Focusing on Stakeholders’ satisfaction • High quality products. • Free Trade ad Domestic Liberalization are the best way to encourage higher quality standards • Create a Quality Culture

  3. Social Pyramid Danone Corporate Mission- Bring health thru food to as many people as possible International Companies Upper Class Middle Class Poor National Companies COFCO Corporate Mission- Offer nutritious and healthy foods and superior quality life services;- Establish industry leadership; and- Maximize the interests of customers, shareholders and employees 3

  4. DANONE 2010 – Key Facts • About Danone: • Danone is present in over 120 countries on 5 continents • More than 160 production plants • Around 100,000 employees • Sales of € 17 billions, of which half were in emerging markets

  5. A world leader in healthy food industry • N°1 worldwide in Fresh Dairy Products • N°2 worldwide in Bottled Water • N°2 worldwide in Baby Nutrition • N°1 in Europe in Medical Nutrition

  6. Acoherent products portfolio covering needs and demands at every age Growth/ Building Capital Maintenance/ prevention Ageing process/ Problem solving High Specific nutrition/ Food needs Low Infants/Children Teenagers Adults Seniors 6

  7. A unique mission based on 4 axes Health For All Bringing health through food to as many people as possible Nature People 7

  8. Half of business in emerging markets Top 10 countries FY 2010* Sales breakdown in 2010* 49% Emerging markets 39% Western Europe Account for 64% of the company growth 2% Japan + ANZ 10% North America • Innovation account for 40% of the Total sales over the past 3 years 8

  9. Social Pyramid GDP/hab Usually companies only target this part of the social pyramid Gross Domestic Products Rich 1 Billion people $25K $10 - 25 Medium 0,95 Billion people < $10 Poor 4,75 Billion people Bringing health thu food to as may people as possible 9

  10. Business Evolution • Danone is increasingly: • Tailoring its products for emerging-market consumers • Making the products in the markets in which they are sold • Adapting thee products to local nutritional requirements, tastes and … budget • Consumers are Ready to pay if there is a value

  11. Covering the full pyramid with portfolio management Dairy Romania Baby Nutrition Indonesia Price Points 280 180 100 70 11

  12. Business Risk & Opportunity • Danone’s challenge • Work with local raw materials, source and produce locally • Guarantee product safety to these low-income consumers in countries where Quality & Food Safety processes are in their infancy • While supplying affordable products meeting Danone Quality standards to consumers…

  13. Consumer’s hierarchy of needs PRODUCT SUPERIORITY Guarantee Brand Superiority Deliver Quality PRODUCT CONFORMITY Commit to Food safety PRODUCT SAFETY

  14. Food Securityprogram in Emerging Countries • Non-Negotiable requirements • In Emerging countries, it is accepted that our products/processes do not comply 100% with our corporate standards. • Normal procedure is to have an action plan in place how to reach the standards • Some requirements however are so crucial for food safety reasons that we do not accept a non-compliance

  15. Bringing Health thru food to as many people as possible Codex / National Regulation / Danone Corporate Standards & Systems Premium Codex / National Regulation / Danone Corporate/Local* Standards & Systems Value Codex / National Regulation / Danone Non-negotiable criteria Affordable * Consumer Driven requirements

  16. International competitiveness • International competitiveness is built up on: • Product quality • Ability to innovate • Capacity to adjust rapidly to customers' needs • Absence of restrictive practices in the labor market and local regulations • Warning • International norms, standards, rules, and practices may drive businesses toward harmonization…

  17. What can create competitive edge • Innovation product quality and international competitiveness • Higher product quality helps differentiate and gain market share in “reference-priced” and “homogenous” products • Breakthrough innovation is especially relevant in creating new consumers’ experiences and ensuring consumers’ loyalty

  18. Chinese Industry • Chinese industries have made tremendous progress since China opened its door to the world. • China’s national economic competitiveness has been improved significantly over the past 25 years. • Competition only based on lower labor cost will not put Chinese industry in a competitive position in long run. • What are the things that should be done to make Chinese industry stay competitive in the future world market? • Innovation and Product Quality

  19. Social Pyramid International Companies Upper Class Speed to innovate Product Quality Middle Class Poor National Companies From commodities to added value products 19

  20. Provocative Questions • Is « Made in France » an international guarantee of high quality standards? • Has France still the capacity to innovate? • Do we have the educational infrastructure for supporting it • Is France a quality trend setter?... Just like Japan was • Do The Authorities help promote this image • “Due to the bad image of French politicians”…State-run companies don’t help promote “made in France” as label of quality • As French-based international companies, what do we do in this field? • Can IRIS play a role in this field?

  21. Consumer Good Forum:The Consumer Goods Forum (CGF) is a global, parity-based industry network. It brings together the CEOs and senior management of over 650 retailers, manufacturers, service providers across 70 countries and reflects the diversity of the industry in geography, size and product category . Forum member companies have combined sales of EUR 2.1 trillion. Global Food Safety Initiative The Global Food Safety Initiative (GFSI) is a international multi-stakeholders platform collaboration bringing together the world's leading quality experts from retailer, manufacturer and food companies associated with the food supply chain. It is coordinated by The Consumer Goods Forum

  22. GFSI: A unique multi-stakeholder platform across the world North America: 9 Europe: 5 Asia: 3 South America: 1

  23. GFSI Board Members 9 Manufacturers 7 Retailers 2 Food Service

  24. GFSI Technical Committee

  25. GFSI Advisory Council

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