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Masterfoods USA Case Study: DrivingInnovation in R&D with Network Analysis
February 2006
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Agenda
About Masterfoods USA
How Research & Development (R&D) Employed Network Analysis toSupport Corporate Strategy
Approach to Applying Organizational Network Analysis
Key Findings and Recommendations
Building Connectivity Across Divisions Using nTags
Critical Success Factors and Lessons Learned
Appendix
How to Interpret a Network Diagram
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About Masterfoods USA
Mars, Inc Masterfoods USA is a division of ., the well-known company that makes such worldwide favoritesas M&M's, Snickers, and the Mars bar.
Like Mars, Masterfoods USA operates three core
businesses confectionery/snackfood, petcare andmain meal food.
Masterfoods USA employs almost 8,000 associates,and generates almost 30% of Mars revenue.
The 15 manufacturing sites of Masterfoods USA aredistributed across 11 states.
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Masterfoods USA is Undergoing Major OrganizationChanges to Improve Consumer Focus
To find new ways to grow, such as through newproducts and businesses, since expanding throughnew markets can no longer provide the growthnecessary for long-term success.
The Mars Challenge
Shift from a conservative culture to one that is morewilling to take risks.
Restructure the organization to market-facing,
demand-led business units, designed to be drivenby the consumer.
Encourage employees to leverage the rightexpertise across the extended network (inside andoutside the organization), to bridge otherwisedisconnected worlds.
What This Means
With the focus on creating new products andbusinesses, R&D became the sharp point of the
spear for change across Mars.
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Network Analysis Provided Critical Insights to AssistR&D in its Transition to a Distributed Function
After operating as a centralized group for several years, the R&D core group ofseveral hundred people were recently distributed into business units. Keepingthe scientists and technicians engaged in productive communities is essential tothe innovation process.
Why Network Analysis?
To identify the R&D network, given that it was about to be decentralized. Byunderstanding the current network, a plan could be created to maintain and buildrelationships necessary for ongoing innovation.
To pinpoint where connectivity needed to be improved so interventions would beaccurate and successful. Management believed in the importance of internal andexternal relationships and wanted to measure the extent of relationships within thedivision, the company and the industry.
To take advantage of the diversity of the three core businesses and the best practicesamong them, particularly related to innovation flow. Although best practices were beingshared, diffusions were informal and erratic.
Diverse networks are more likely to yield great business ideas.Therefore, R&Ds goals included: creating networks made up of peopleinside and outside the company; and reducing the consumer degree of
separation to one within a year.
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The Network Analysis Project Ran for Seven Weeks,and Resulted in Specific Recommendations
Plan create network survey
define community members
obtain senior sponsor
Run test diagnostic with small sub-group
administer Web-based diagnostic
send system-generated e-mails to obtainresponses
Assess create recommendation report provide personalized Web sites
Apply develop and implement project plan
take action on personal network results
Weeks
1 2 3 4 5 6 7 8
In less than two months, network analysis provided importantinsights into the current state of the R&D community and
identified actions that would enable the group to continue tocollaborate even after the reorganization.
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Network Analysis Clearly Identified Gaps and theTargeted Actions Necessary to Close Them
Network Analysis Helped Identify the Healthof the Community and its Key Roles
Understand the current state
Establish a baseline of measurement
Produce and act on a handful of meaningfulaction items
Identify resources for revitalizing a newcommunity
Network Analysis Will Help Track Progressand Target Future Efforts
Survey community members at future date
Analyze impact of productivity interventions
Validate investment and expand scope aswarranted
Illustrative Network: Initial Analysis
Illustrative Network: After Interventions
By taking a before and after snapshot of collaboration in thecommunity, a leader can both improve effectiveness of their
interventions as well as track progress over time.
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Top Findings and Recommendations atMasterfoods USA
Key Findings Recommendations
Network Connectivity
The overall network is well connected for informationsharing and decision making, but there is a very highreliance on a few people, particularly leaders.
Cross-boundary Collaboration
There are comparatively low levels of connectivity acrosssegments and several disconnects across sites.
Distribution of Expertise Several gaps exist between skills that people have andthose people indicate they need or would like to knowmore about.
In some cases, connections were not made betweenexpertise areas that should have been connected.
Innovation and Learning There is potential insularity within the network. However,
more connected people reach out externally more oftenthan those less central.
People tend to have strong relations with those they haveknown for some time.
Improve business processes and rolesto decrease overload points in the
network (i.e., places where peopleholding certain decision-rights,information and tasks had become soover-loaded they were holding theentire group back)
Deepen functional expertise networksto maintain R&D excellence
Connect layers deeper in organizationto take managers out of key connectorroles
Track changes to rebuild connectionslost in SBU deployment
Connect more broadly to the externalworld to expose the business to newideas and make open innovation areality
Th N k W G d b S Wi h
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The Network Was Grouped by Segment WithSeveral Very Highly Connected People
Network Measures
Density = 5%
Cohesion = 2.8Centrality = 15
Central People
(number of ties)# A (48)
# B (38)
# C (36)
# D (36)
Please indicate the extent to which the people listed below provide
you with information that helps you to accomplish your work.
= Food
= Snack Food
= Pet
Group
= Quality= Other
Network Measures Definitions
Density: Robustness of network. The number of connections that exist out of 100% possible in that network.More points connected often can mean quicker and more accurate information flow.
Cohesion (Distance): Ease with which a network can connect. Shows average distance for people to get to allother people. Shorter distances mean faster and more accurate transmission/ sharing.
Centrality (Degree): Identifies influential people (individual measure). Number of direct connections (ties) thatindividuals have with others in the group.
Managementwas
surprised bythe peoplewho were
most central.
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The Number of Relationships in the Network Would Fallby 18% if the 12 Most Central People Were Removed
Including the Most Highly Connected People With the 12 Most Connected People Removed
To avoid over-reliance on individuals, it is important toemploy a retention and redundancy strategy.
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Improving Collaboration Across Departments WouldReduce Silos, Increasing Innovation Potential
Food Pet
Snack
Foods Quality Other
Food (18) 83% 11% 3% 10% 11%
Pet (49) 8% 48% 3% 9% 11%
Snack Foods (91) 2% 3% 30% 9% 23%
Quality (70) 7% 8% 7% 31% 9%
Other (49) 9% 11% 21% 8% 29%
Information Providers
Information
Seekers
Responses of somewhat frequently and frequently
Raw Materials/Ingredient Functionality
The split between Snack Foods and the Food and Pet segmentsare clear. Quality serves as to bridge connections.
= Food
= Snack Food
= Pet
Group
= Quality
= Other
There is little information sharing betweenSnack Foods, Food, and Pet segments.Improved collaboration would enable meatand protein expertise to be shared betweenthe Pet and the Snack Foods segments todevelop new protein-based snacks. Nutritionexpertise should also be shared between the
Snack Foods and Food segments.
Target collaboration across groups (offdiagonal) is dependent on strategy; the goalbetween these segments is above 25% tocapitalize on key innovation opportunities.
Interpretation of Chart Above
Each cell reflects the percent ofinformation seeking ties out of 100%that could exist if everyone were
connected to everyone else at thatjuncture. For example, we see thatwithin Snack Foods, 30% of the
possible collaborative relationshipsexisted whereas only 3% of possibleties existed between Snack Foodsand Pet segments. The table is readfrom row to column when assessingwho seeks info from whom.
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Ideas Would Flow Faster Among Teams with RelevantSkills and Tipping Point Network Positions
Packaging
Supplier
Nutrition
Strong
Tie
Individual-level Assets
Specific Knowledge/Skills
Creativity/Curiosity
Ability to Execute
Team-level Assets
Tech, Business, and Market knowledge
Experience (MFUSA and Industry)
Broad andstrong ties within MFUSA
Leveraging the right expertise and tapping the extended network should result in:
Better and more viable early designs
More effective mobilization of organizational resources Faster development and implementation cycle time
I ti Al Hi U V i ith
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Innovation Also Hinges Upon Voices withDifferent Expertise Being Heard
This network suffered from domination, where the voices of a few central networkmembers were drowning out novel ideas. Several expert scientists had moved intohighly central and influential network positions over time. This subtle and invisiblemovement had created an overly rigid informal screening process for new products.
Dominant competency
Other competency areas
In this case, seniormanagement indicated
that new productopportunities were beingmissed because new and
potentially disruptiveideas from less influential
scientists in othercompetency areas were
not being heard.
More Connections Outside of Mars Particularly
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More Connections Outside of Mars, ParticularlyWith Labs and Academia, Should Be Created
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
within your
project team
outside project
team, within
R&D function
outside R&D,
within Mars
outside Mars
Percentage
0
5
10
15
20
25
30
35
40
45
within your
project team
outside
project team,within R&D
function
outside R&D,
within Mars
outside Mars
Percentage
Central
All
Network analysis identifiedtwo important findings:
People need to build more
ties outside of Mars Less establishedworkgroups with non-coreexpertise tend to becomeinsular and peripheral
Interestingly, the 12 mostcentral R&D people (whoalso tend to be moresenior) seek a significantlyhigher percentage of
information outside R&Dbut within Mars.
Where People Go for Information
Where People Go for Information: All inR&D versus the 12 Most Central
Network Analysis Produced Detailed Individual
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Network Analysis Produced Detailed IndividualAnalyses, In Addition to Group-level Feedback
Each participant in the Network Analysis received a detailed 15-page profile, whichallowed them to assess their own connectivity and ways to improve it, based on thedimensions that research has shown matter for high performance.
Personal action plans are an important vehicle to improve leader and go to person
effectiveness at the individual and team level. Broader actions taken community-wide can leverage these profiles to drive grass roots
change that accumulates into substantial improvement in network effectiveness.
Enhancing Cross-Function Ties
Connecting with Brokers
Building Ties Across Sites
At Masterfoods, the personal
profile provided insights byseveral areas, allowing for atargeted action plan:
Functional Group
Physical Proximity Structured Interaction
Primary Medium of Contact
Time Known
Hierarchical Level
One of the First Actions Taken After the Network
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Analysis Was a Relationship-Building Exercise,Launched During R&D Excellence Week
Purpose for R&D Week
Enhance functional competencies
Extend expertise networks
Instill a new innovation culture
By Measuring our networks
Making our networks visible
Reinforcing the importance of vibrant
networks in R&D
How? By introducing nTAGs to Match on Expertise
The person wearing the tag
The person to whom the message onthe tag is addressed
Expertise Matching Point Award
Indicates an expertise match (you getpoints for these)
Both have same
One has, one wants
Indicates an expertise that only the
wearer has or wants (no points forthese)
During the Exercise the Network Grew in Real
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During the Exercise, the Network Grew in RealTime as Expertise Matches Were Made
Real-Time Display of Network
Just the start: 13people who have
made 8 connections
Rapid growth: 230people who have
made 596 connections
Network explodes: 236people who have made
1,462 connections
This exercise was held during the kickoff, enabling relationships formedto grow during the course of the week. The hope was that the more
important relationships would grow over time.
Factors Critical for Successful Network Analysis
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Factors Critical for Successful Network AnalysisProjects at Masterfoods
An executive sponsor with clout and interest Understanding the people who were well connected, and getting them involved in
the process early on
Beginning by creating a baseline survey and using that to design the full-blownsurvey
Understanding the team behaviors and dynamics and applying that knowledgeappropriately to fill roles such as core team member, leader and facilitator
Engaging the energizers and good networkers on the core team (see EnergizingBehaviors side bar in Critical Connections paper)
Identifying the de-energizers and being prepared to counter their negative influence
Using the data to make interventions
Applying best practices to creating and maintaining the Community of Practice. Forexample, identify a clear purpose, clarify roles and responsibilities, identify and
recruit members (as appropriate), provide mechanisms for communications andcollaboration, engage members and encourage continued involvement. (ReferenceCoP guides.)
SNA makes the invisible informal network visible. And
what you can see, you can improve. Executive Sponsor
https://webapp.comm.virginia.edu/NetworkRoundtable/Portals/0/Networks_and_Innovation_Roundtable_final.pdfhttp://openacademy.mindef.gov.sg/OpenAcademy/Central/HTML%20Folder/KM/bcp/resource_doc.htm#NAVSEAhttp://openacademy.mindef.gov.sg/OpenAcademy/Central/HTML%20Folder/KM/bcp/resource_doc.htm#NAVSEAhttps://webapp.comm.virginia.edu/NetworkRoundtable/Portals/0/Networks_and_Innovation_Roundtable_final.pdf8/6/2019 Master Foods Driving Innovation
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Appendix
Why We Should Focus Our Attention on
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Why We Should Focus Our Attention onOrganizational Networks
Where People Engage
Join and commit to
people Trust accrues in
networks of relations
Where Work Happens
Lack of boundaries
Informal networksincreasingly important
BUT
Invisible Complements formal structure
Where Knowledge Lives
Rely on people forinformation
People can provide more
than databases
Key Reasons Why Organizational Networks Are Important
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How to Interpret a Network Diagram
Central People
Are an important source of expertise
May become bottlenecks
Peripheral People
Are underutilized resources
Feel isolated from the network
Have a higher likelihood of leaving
External Connectivity
Provides balanced and appropriate sources oflearning
Holds relevant influence with keystakeholders
Knowled
geBroker;B
oundary
Spanne
r
Peripheral Person
Ce
ntralPerso
nCentral
Perso
n
Brokers
Are critical connectors between diverseinformation sources and specific kinds ofexpertise. High leverage points.
Fragmentation Points
Affect information flow across boundaries (e.g.,
cross functional, hierarchical, geographical, orexpertise)
Provide targeted opportunities
Personal Connectivity
Improves community leader effectiveness
Enables grass roots network development efforts
Fragmentation Point
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