Life at Arla – Innovation is about getting things done

Arun Prabhu, global category director at Arla Foods, spoke to Happen on creating innovations that succeed in the market.


Early in my innovation career, I received some valuable advice from my manager, that I carry with me even today: “Make sure you deliver something tangible.” There are plenty of people who have great reputations for ideas, he said, but sadly, they don’t always follow through with the results.

In many big (and perhaps, small) businesses, innovation and innovators are seen as synonymous with creativity. And while the two things are certainly linked, for me, there are clear distinctions. Creativity is thinking newness. Innovation is doing newness. But it takes more than wacky ideas and fancy presentations to channel creativity into commercially successful innovations. It takes intuition, it takes courage, and it takes conviction.

The place to start is with identifying consumer frustrations. This rarely manifests in focus groups, market data reports and consumer U&A studies. While these can be valuable sources to understand ‘what’ is going on, in order to understand ‘why’, you need to be able to connect seemingly unrelated pieces of information and identify consumers’ deeper level motivations. More often than not, these are needs that consumers have not identified themselves. Case in point: the mobile phone. And if you were to ‘concept test’ these, chances are they won’t survive.

When I first moved to Denmark from the UK, I noticed a couple of things. Firstly, a third of the fresh milk market is organic. However, in the infant nutrition section, all the formula products on offer were non-organic. I joined these pieces of information with my own anecdotal evidence of seeing young couples greatly increase their consumption of organic food when becoming parents for the first time. And finally, I was witness to my wife’s own behaviour as a first-time mother. Intuitively I knew there was huge potential to be unlocked. The result was Arla Baby&Me Organic, which has grown to 20% market share in Denmark in three years and is also now available in Finland and China.

"Can you predict the future? How will you know if you don’t try?"

Arun Prahbu, Arla

Can you predict the future? How will you know if you don’t try? When Arla scientists developed a new process to remove lactose from milk while retaining taste, our challenge was to transform this idea into commercial reality. When we first started working on this project in 2004, there was virtually no awareness of lactose intolerance in the UK – neither among sufferers of the condition nor among the healthcare community. So we looked at how lactose intolerance and lactose-free products had grown in the USA and how they were starting to appear in other countries such as Germany and Finland.

We identified and then engaged with people suffering from lactose intolerance and found healthcare professionals with an interest in, and experience of, the condition. The Lactofree brand we developed as a result now covers more than a dozen products across various dairy categories and is worth in excess of €100m across multiple markets.

What may come as a surprise to some is that the hardest part of innovation is not coming up with the most creative ideas. It’s not even identifying really deep consumer insights. The toughest part of innovation is battling resistance. Between the insight, the idea, and successful implementation lies a long road filled with internal and external obstacles. Successful innovators overcome these, get their products to market and make them a success.