Finding a Race You Can Win

In recent years, the trend data showed the pizza category in steady decline, with pizza becoming commoditized. For Pizza Hut, it was time to innovate.

Kelly Buckley, the chain's chief food innovation officer, said the company realized it needed to look beyond pizza for sales growth—to ask what else it had the competence and credibility to do. With its history as a restaurant and its expertise at delivery, the company realized it had some large opportunities.

In April 2008, Pizza Hut launched its new Tuscani Pasta—a delivered pasta-and-breadsticks dinner for four for $12.99. "A number of casual-dining restaurant chains serve pasta but don't have delivery," says Buckley. "We are combining core competencies."

The launch has been wildly successful, says the excecutive, in part because the company followed the timeless maxim to find a need and fill it. "We start with an insight," says Buckley. "We don't develop product without knowing there's a solution we can provide."

Innovators like Buckley don't set limits on the possible. "Push it over the edge so you can come back, so you know you've gone as far as you can possibly go," advises Buckley. "Keep asking yourself: "What if…?' and "How might…?'"

Fourth-generation farmer Jim Durst manages 500 acres of vegetables and hay in Yolo County, in Northern California, and has been a certified organic grower for 25 years. "The key to marketing our farm is for people to know our story," says Durst, "that there are personalities behind every piece of fruit that comes off of our farm."

Innovation is crucial to the success of America's small farms, and Durst has found his competitive advantage in growing unusual produce varieties. "We try to stay away from commodity crops," says Durst. "We trial new tomato varieties every year, and flavor is the number-one requirement. If it doesn't have flavor, we're not interested."

The farm dries some of its chilies and exports them to Sweden. And for retailers' fall displays, the farm grows a large variety of hard-shelled squashes and pumpkins and sells them as an eye-catching mix. Open-pollinated (non-hybrid) melons such as Galia and Charentais are another specialty. "I've been in pursuit of good melons all my life," says Durst.

The family welcomes visitors for farm tours, hoping to educate customers about agriculture and to put real faces behind the produce. The family's innovative marketing has helped Durst Organic Farms thrive in a challenging era for small farms.

For a large university to try buying produce from local growers might strike some as lunacy. At the least, the effort would cost more. And in Ithaca, New York, where the growing season is short, could local farmers really make much of a contribution to Cornell's dining halls?

The answer is yes. "Last year (2007), we did about $335,000 in local produce," says chef Steven Miller. "That's 32 percent of our total produce purchases."

When Miller ramped-up the buy-local effort in 2005, he used his leverage with his produce purveyor to get results. He and his colleagues developed benchmarks for food safety on the farm—such as having fencing and walking the rows before harvest. Local farms that wanted the Cornell business made the necessary changes to meet the food-safety requirements, and deals were struck.

"We pre-set our pricing, so they know what they're going to get before they put seed in the ground," says the chef. Although costs did go up initially, they have stabilized and may even go down now that the relationships are established.

The high quality of the local produce is unmistakeable. "You can see it, feel it, taste it," says Miller. "And I know we're doing the right thing with our carbon footprint."

Cornell has a student-run organic farm that now grows herbs for the dining halls. And Miller says he is exploring ways to preserve the local summer harvest for winter. He already works with an area cannery to produce pizza sauce and marinara sauce from local tomatoes and is planning to have a processor dry some locally grown organic beans.