Staying ahead of the curve: Innovation has been a core part of Lundberg Family Farms since it was founded

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After witnessing the Dust Bowl’s impact on the Midwest, the founders of Lundberg Family Farms decided they needed to take care of the soil and treat it as a living organism when establishing the Sacramento Valley business in 1937.

“When they arrived here, they started to farm using cover crops that would produce nitrogen from the air, like a legume or vetch. They also would idle the ground. At that time, it was counter to the methodology of burning,” says Grant Lundberg, CEO of Lundberg Family Farms and grandson of one of the company’s four founders.

The organic rice pioneer continues to innovate, earning top honors for Ag Innovation last December at the 29th annual Regional Innovation Awards presented by Innovate North State.

Leading the organic movement

One major innovation at Lundberg Family Farms involved a decision in the 1960s to raise organic brown rice. While that might seem like an obvious choice given today’s marketplace, it was a pretty risky move at the time, Lundberg says.

“First of all, doing your own rice milling and linking directly to the consumer was counter to what growers were doing. So that was a different paradigm,” he says. “The other was brown rice. At that time all rice was milled white, or about 99.9 percent of it. The idea that you would leave the bran on, where a lot of the nutrients and vitamins are, was counter.”

The organic gardening publications produced by Robert Rodale and Rodale Press had a major influence on the Lundbergs. Management approached Rodale to talk about organic farming because they knew he would understand how to do it on a certain scale.

“They had a choice to make. At a time when everybody was growing large amounts of commodities and selling it to cooperatives, they decided they were doing something that was valuable and there were consumers who would appreciate it,” Lundberg says.

“It seems obvious now, but it was a 180-degree shift back then. People basically thought they lost their minds.”

Organic farming fit right into the company’s culture, following along the path set at the beginning in trying to take better care of the soil. While many decisions at Lundberg Family Farms seem to go in the opposite direction of competitors, they are based on core values.

“Those values serve as our compass, and as we’ve grown our consumers expect that of us,” Lundberg says.

The decision to move to organic farming was based both on philosophy and business improvement.

“It came out of this philosophical bent on how we wanted to take care of the land, which cascaded out of the Dust Bowl,” Lundberg says. “But we also wanted to find value in what we did and take care of our family. So both drivers were at play. And it made good business sense because we could differentiate ourselves.”

Managing processes

Lundberg Family Farms follows a model based on the Stage-Gate development process to manage projects and make decisions on what to pursue.

“It’s pretty widely used in the food industry, and a discipline we’ve internalized and worked with to move along our product,” Lundberg says.

The process has been helpful in answering questions such as:

  • Why are we going to do this?
  • Should this product move forward in the process?
  • Have we done the research and understand the risks?

“We have a team process, including a couple of folks who work full time in different parts of product development,” Lundberg says. “We also have a food scientist and research scientists.”

It’s not just about product, but processes as well, because it’s an organic certified organization and needs to follow certain standards.

“We don’t use any chemicals. So to take care of weevils and grain bugs, we have to use a nonchemical process,” Lundberg says. “One of the challenges with businesses is how to solve given restraints. For us, the constraint is that we can’t use man-made chemicals in the storage process.”

Sanitation, temperature controls and product cleaning techniques are the main methods employed in place of chemicals.

“Really, the chemical process has only been developed since World War II. So it’s just understanding how to do it and innovating different techniques and methods,” Lundberg says.

Branding the business

It’s important for any company to establish its brand identity. For Lundberg Family Farms, its brand is associated with organic farming and family, the source of the values that led to the decision to go organic.
Lundberg says company executives didn’t predict back then that consumer demand for organic foods would grow to the extent it did.

“I don’t think there was this grand vision of the future. That is where our values helped guide us,” Lundberg says. “For us, it’s been a 30-year process at a minimum. Except for the really committed supporters, when we’re trying to push into new markets people weren’t aware of us.”

Management has always made decisions with succession and the next generation in mind, which Lundberg says is a powerful idea.

“We have to take care of the capital and ownership and bring them along with ideas, or we’ll never keep it together,” he says. “The family is very committed to that governance principle and respecting the needs of ownership, management, labor and land.”

Keeping the future in mind includes staying relevant to consumers, which is why Lundberg Family Farms is looking at new grains like quinoa and different beans that are growing in popularity.

“We want to make sure we understand where our retailers and consumers are going, and where it is OK for our brand to go out and deliver on,” Lundberg says. “We’ve taken on this quick cooking, entrée area that’s important to us. So we’ve invested in that and continue to innovate in those categories.”

Innovation has been part of the company’s culture from the very beginning and will always be important, Lundberg says.

“Our website has a page that gives our mission and values. Innovation is in our mission. There’s a rich history about us being innovators. But you can’t rest on that, you have to use it as a source of energy and drive for the future,” Lundberg says.

Learn more about Lundberg Family Farms:

Facebook: www.facebook.com/lundbergfamilyfarms
Twitter: @lundbergfarms

How to reach: (530) 538-3500 or www.lundberg.com