Testing The Edges With Mars’ Rainer Struck

Fred Schonenberg
Hello, everyone, and welcome to the VentureFuel Visionaries podcast, where we introduce you to the innovators and builders creating the future of business. I'm your host, Fred Schonenberg. I'm the founder of VentureFuel, where we help the world's best organizations commercialize innovation through startup partnerships.

Today on the show, we're exploring what it really takes to spark meaningful innovation inside of one of the world's largest and most interesting companies. Our guest, Rainer Struck, is the global vice president of innovation transformation at Mars, home to iconic brands like M&Ms, Snickers, Pedigree, Royal Canine, just to mention a few. Rainer's a rare blend of innovation student and practitioner. He taught himself the innovation discipline by studying the world's best innovation systems, and then is now applying those to how Mars develops new products, scales big bets, and drives digital transformation across its global businesses. 

Today, we're going to explore how Mars innovates at scale, how to build a culture that embraces experimentation, and how leaders can drive change in organizations where legacy success might actually be the biggest barrier to what is next. So whether you're a startup trying to collaborate with a global giant, or you're that global giant looking to accelerate innovation, Rainer brings an invaluable inside-out and outside-in perspective that I know you will enjoy.

So without further ado, please join me in welcoming Rainer Struck. Rainer, thank you for coming on the show.

Rainer Struck
Thanks for having me. Super excited to have this conversation.

Fred Schonenberg
So I think one of my favorite moments is just seeing you in the hallway of one of the innovation conferences we both were at, and I felt like I had to get out a pen for the list of books and references you were giving me. So I'm excited about today, and I've already taken a few of those and added them to my library. But maybe you could introduce yourself and share the moment that set your path into this world of innovation.

Rainer Struck
Yeah, absolutely. So you mentioned I work for Mars, have been here for a long time, 25 years, also worked for three years at a retailing company early on in my career. My background is in marketing. I have more than 20 years of experience in marketing for big brands like M&M's and Snickers and create those campaigns. I was paid to make people laugh on brands like M&M's, which is a pretty cool job to have.

I always loved innovation the whole time as a marketer. It turned into a full-time job about six years ago, where I was leading integrated marketing globally. So everything that the marketers need to do their job well, and innovative ways of working from a demand side was one of the areas that was part of my responsibilities.

We then changed our strategy from a confectionery to a snacking strategy. I had the task to look a bit deeper into how innovation is working at Mars Snacking. That led to really exploring this in a lot more detail. And it led to a bit of a transformation that became bigger and bigger the more I looked into it. And we then turned it into a full-time job. Then that was the moment where for me was like, okay, I think I know what innovation is.

Then I started learning and found out I don't know it. I only knew a tiny piece of it. And then I found this whole world that's out there of very well-researched tools and knowledge about how innovation works in large corporations, which is a totally different game from startup innovation. That got me really intrigued and understood what it is. So I spent the last six years really going deep learning.

Still today, I'm using every single commute to listen to podcasts, to listen to books, read something, talk to a big network of other fellow innovators and other companies. And that learning journey, it was really this moment back then that got me, set me off on that journey. I haven't regretted it. So I'm a full-time marketer turned full-time innovator, if you like. It was a fantastic journey and it still continues.

Fred Schonenberg
It's so funny when you kind of open up the curtain here or peel the onion layer back a little bit on innovation, and it's such an interesting space. You mentioned there's these different levels and layers of it from large companies to startups. I'm curious how you define innovation at Mars and maybe how that definition has evolved during your last six-year journey.

Rainer Struck
Yeah, it's a great question. It's a good point to start. So we started there as well. Do we actually know what we define as innovation? The one that we use today is something different that creates lasting value. So very broad. I took this from Scott Anthony, who is someone who I learned a lot from in this journey. And I just added the word lasting into his definition, because one of the issues that we uncovered is that a lot of our innovations were performing really well in year one, but then tailing off really strongly in year two and three, which is the fate of many innovations. 

All the innovators in the audience know that, but that's why I added the word lasting back in. The way we define value in that definition is human value, which in our case is also not only the human, also the pet and the pet parent for our pet food business, and then economic value. We are a business. And then also societal value.

That's in line with our Mars compass and our five principles and our sustainable intergenerational plan, where we always look now at every idea. Does it serve those first two more commercially driven and consumer driven objectives, but also how does it work for the planet? How does it work for our supply chain, the communities that we're part of and building that as part of our definition. So that's what we're using today.

How did it come to that? We had a very product centric definition before, which was more around the classic innovation, renovation, consumer facing. That was the innovation and then renovation was more not consumer facing. So it's very product centric. Now we move to this broader definition and we are now very actively using a horizon model as well to differentiate within that definition. I'm sure we're going to talk a bit more about that because that was a key unlock for us.

Fred Schonenberg
Yeah, I'm looking forward to that portion of this. I have sort of like a, maybe a grounding question and to a lot of people, it might feel obvious, but large successful companies often resist change. They got big for a reason. I'm curious how you protect what makes Mars Mars, what's gotten you to this point across these amazing iconic legacy brands while still pushing for innovation and new business models. How do you sort of combat that probably very good and healthy tension?

Rainer Struck
Yeah, that's actually one of the key areas that I spend a lot of my learning and really diving deep into, like what holds large companies back? Because I realized in this journey that it's not only us who have that challenge. Every large company has that challenge. And what's at the heart of it, I always say the biggest enemy of innovation that goes beyond the core in a large company is opportunity cost. 

There's always a better way to spend the money short term, which gives you a bigger return. If I launch a new variant on M&M's or on Pedigree, that gives me a much bigger return than creating a new business in a new aisle. That's the challenge that you always have. So you're kind of, you're becoming a victim of your own success over the years. That's where we are talking about our innovation pipelines in this horizon model, what is breaking out more from the core versus what is the core, which we continue to nurture and you continuously need to innovate on your core as well.

But it's about protecting the resource allocation so that you're not in this position where you need to compare your long term investment for a pipeline of potential ideas. It's not one, it's many, and many of them will fail. So you protect that while you also run your core innovation at the same time and the trick is the resource allocation. So to do that by horizon and carve it out. 

Also, capabilities are different when you go beyond the core that we learned in some areas the hard way. We thought we had the route to market, but we didn't quite have it, even though it was just one meter down in the supermarket, right? So being very aware of what it takes in all parts, in all horizons, because that capability is different. And then seeing it through with the resource allocation. I'm not saying that we completely solved it. I think probably no company is really excellent at always striking this balance between long term and short term. It's a battle, but it should be a battle of assumptions and that's what we're now doing.

Fred Schonenberg
Yeah, it's interesting. I have a good friend that was at Nike for a number of years, and she said to me, I've got good news and bad news. She goes, when the market is going really well, when sales are doing great, it's really hard to make the case for innovation, because why not just pour more gas on the fire, right? Everything's going great.

And she goes, and by the way, when things get really tough, it's really easy to kill innovation, because times are tight. We got to really focus on the core. And I was like, what's the good news? And she's like, well, it's kind of you're fighting all the time. So at least you know what you're fighting against. I was like, I don't know if that's good news, but I love the idea of you have to allocate it, right? It's something to protect, and it's on different timelines. 

How do you maintain that when times are either going so well that everyone wants to kind of focus on the core, or things are challenged, and everyone wants to focus on the core? How are you carving that out in those battles of assumptions?

Rainer Struck
Yeah, so you just mentioned the word assumption. So that's where it starts. Be super clear with everybody involved, especially the decision makers. What are my assumptions across desirability, viability, feasibility, and how do they translate into testable hypotheses? Because in my experience, that's the way where you get from discussions on should I approve this project based on a belief, or do I do it based on what I know today?

What more do I need to know in order to say yes or no? And that allows you to then talk about the long-term perspective, where we are used to running our pipelines on the core on a regular basis, stage-gated processes, highly efficient, with a pretty good predictability of what success will be. And that cannot compete with something that comes with high ambiguity that might give you a new business five years from now. So the trick is to, like, it's interesting, we always do these projections of investments for the future. We depreciate our assets and things like that.

We create net present values and things like that. I'm very careful with using net present values for breakout innovation, because it suggests planability, and it's not. So the trick is to have a portfolio of ideas, of which you accept right from the start that 80% of them are not going to see daylight. But you need to understand that when it works, they are going to pay for all the losers. And when I look back in our history, we have some great examples that are used to illustrate that. So take care and treat business in pet nutrition.

Dentist stakes, temptations, brands like that, which hopefully many listeners are using to enhance the relationship with the pet. That was a category that we helped start, and it wasn't a straightforward win. It took years of iteration and going there, but we can now look at this, and it's a multi-billion dollar business, and we were able to protect those. So bringing back those memories is often a great lever to engage leaders in trying it again. Let's create the next one.

Fred Schonenberg
Yeah, it's really good to kind of anchor in those wins, and we've talked about it on the show a lot, and something I really believe in is this idea of the power law, where you have a portfolio, you're going to have a number of bets within that, and most of them will fail, but one of them will break out and sort of make up for the ones that, and then some, that didn't work.

I love the idea, and I found most CEOs love the idea from an academic philosophical perspective, and then when they start to see the ones failing, they start to tense up a little bit, because the ones fail before the one succeeds, which is where you really have to have this story and alignment ahead of time really built out and some patience built in.

Rainer Struck
Yeah, yeah, 100%. There's so many pressures of running the day-to-day business, which is always tempting you to go back and, you know, into your core.So a bit of protection of the teams also that are working on those pipelines is super important, having a different mode of operating when you go into those conversations compared to the ones where you are adding another line to build capacity in a new market, for example, where we know really well what to do, and it's very predictable of what the outcome will be. 

That needs to be one conversation, and it's important, very important, because that's making the money to allow you to go into the new stuff, but when it is about the new stuff, it's all about asking the right questions, so which is why this idea of assumptions, that's something, again, I learned from Scott Anthony. He always says, have battles of assumptions, and I absolutely love that.

That was one of my biggest learnings in coaching innovation teams and coaching leaders: how to work with innovation teams. Don't ask for certainty. Don't ask for proof. When I look back at my career, oh my god, there are so many times when I asked for proof because I was used to it. I thought, okay, I know how it works to launch a new pack type, for example, and what I can and should ask for is whether everything is in place to do this and whether it can be done bigger or faster. Those are legitimate questions, but they are almost, you know, totally counterproductive when it comes to very new ideas in new spaces. 

The key question there is: help me understand the evidence you have across desirability, viability, and feasibility. If it's not there and I need more, let's define together how we can find that evidence. My role as a leader is to find that team, identify the next experimentation technique, or connect them with somebody in another company who might have done something similar to find this little nugget of evidence that helps us say, okay, yes, we're going to continue, or if not, kill it. That's very different from the normal mode of operating that we have in day-to-day business.

Fred Schonenberg
Yeah, it's really interesting, we had the CEO of Brooks running on a couple weeks back, and he kept saying, most people that have not been in an innovation role are seeking what the right answer is, the predictability, the guarantee, and he's like, there is no guarantees, there's insights, and you have to have conviction on those insights, and I think here, you're almost saying, like, there are insights, but there are assumptions that we're making, right, and you have to have conviction about those assumptions, which is a really interesting twist on it.

You mentioned some of the frameworks, and the reading, and the studying, and I really, like, from getting to know you the past couple years, you are a student of innovation, and I'm curious if there are any frameworks, lessons, or things you've read or listened to on the podcast you mentioned that most influence how you are talking to teams internally about innovation to help them get there, something that you come back to frequently.

Rainer Struck
Yeah, so at the foundational level, I always come back to three books. One is the Four Steps to the Epiphany, is it four? I think it's Four Steps to the Epiphany, so Steve Blank. The second one is Winning Through Innovation from Tushman and O'Reilly, and the third one is The Innovator's Dilemma by Clayton Christensen. So I found that most of the literature that came after those are somehow going back to these concepts, and so that's what I now recommend to everybody here working in innovation, read those three.

It's not easy to go through those three, but it gives you a really good foundation, and then complement it with, I love the strategizer tools, so Alex Osterwalder, I use the value proposition canvas all the time, business model canvases are really hands-on tools that really help understand concepts like jobs to be done, finding pains and gains, and all of those things, and it's very easy to apply, so I constantly go back to those, and when I had the chance to meet Alex as well, learn a bit more from him directly, it's really, really great work.

And then actually the biggest learning is being in the trenches. So agile, yeah, I did a whole phase where I tried to learn agile and talk to lots of people and read all the books and that stuff. I can clearly say I only learned it when I was in these trenches with the first three, four teams of the 40 teams that I coached on this journey. My God, it's tough. It wasn't easy to get into this agile mode and go out of the building and try something that I would never have tried before, where I would have asked 20 people, am I allowed to do this? 

And I had some good people coaching me to say, yeah, you can find out tomorrow. I said, no, no, no, you mean like tomorrow in half a year? No, tomorrow. Oh yeah. So having done some of that and that experience is absolutely key. So it's not only the theory, it's very helpful to understand that, but it's the application the next day after you've read something that's where I had the biggest learning experiences.

Fred Schonenberg
Is there anything that comes to mind that from the theory standpoint made sense, but when you got into practice, it kind of fell by the wayside. And what I will say is for me, there are two things that jumped to mind.

One is I did not, when I read about not invented here syndrome, I thought that that was going to be an isolated group of one or two people per company that wouldn't look outside of their own four walls. And I have found that to be almost universally true that there is a real ego to, well, we are this company, we created this industry. The best innovations come within these four walls, which also is of course true.

And it's like, except there's also all these other new technologies that are emerging way too fast because you're focused on the four walls. So that one really surprised me. And the second one I would say is I always thought that the demo day or some sort of event to showcase innovation was a little bit of a startup petting zoo. It was an innovative, tourism theater. 

And then I realized the effectiveness of that with attracting senior leaders and more people under the umbrella of innovation to see these new ways of thinking and working. And so it really, it wasn't, I thought it was a little fluffery. Then I realized it was actually a great internal marketing exercise to get more people under the tent. So those were the two that surprised me. I'm curious if there's anything on your side.

Rainer Struck
Yeah, totally echo those two a hundred percent. So being close to the action is just super, super important. Otherwise it becomes an innovation theater where you look at ideas and ideas are cheap. So it's like when the idea turns into a prototype and the prototype is in the hands of a user and I see them hating it, those are the moments where you go, all right, there is something here. Why do they hate it? And how do I find out whether they hate or love it? And what's behind it?

Like the deeper motivation for why people buy something or not. Very often I found that from my marketing experience, I thought I had that understanding, but it was at a superficial level. It was, I was confirming what I wanted to hear rather than peeling the onion and going deeper into like, what really is the job to be done here? There, I launched many things that were good products, tested really well. Everything looked green. They solved the job to be done, but they didn't solve it better.

So in my career, I had quite a few of those where we thought it was a perfect launch and because it was a great product, but there were others that doing it equally well and to get someone to switch in our categories, to switch your pet food, for example, from brand A to brand B, that comes with a risk. So don't expect that people will just switch it to try it out. And it's even the same with the snack. So really understanding, is there something that I'm adding to the propositions that are out there? And it is often not even the product in your category. 

It is another coping mechanism that people have. Many people now drink calming tea instead of having a chocolate bar. And that's what you understand when you really peel the onion. And there's a lot written about that and the theory is right and it's correct, but you only see it when you do behavioral studies. I always say, don't ask people what they would do when it comes to innovation. After you've seen a behavior, you can ask them why they acted in a way they did. And even there, you need to be super careful because everybody lies. And it's not, you know, it's not with bad intent.

It's just what humans do. When you're asked for something, you will provide an answer because you are polite and your brain tricks you into saying something that is not correlating very well with your future behavior. So that's another one where, yeah, the theory is great to find those nuggets. I found that a lot more difficult than what it sometimes seems like when you read the books.

Fred Schonenberg
Is there, looking ahead to the future, right? There's so many digital tools, AI is everywhere, different unique business models, shifting consumer expectations, which you just mentioned. What excites you most about the future when it comes to innovation around Mars space or beyond?

Rainer Struck
Yeah, I think it's the opportunity to crack some of the things that we talked about, the barriers that large organizations have and the opportunity cost by using technology to become more adaptable. And so what do I mean by that? Large companies, they, every company started very agile in their origins. Then you keep that agility and you add new categories and you have these phases where adaptability and agility is suddenly becoming important again. And that's where the real innovation happens.

So what you can do, but the bigger you get, the more difficult this gets, because the opportunity cost increases with every year of growth that you've had. One of the challenges was that you asked for certainty and with technology, you can much faster create evidence. And that's what I see with all the AI tools and things like insight generation is becoming a lot faster, but it also has to be faster because people are changing faster than ever, but you can stay closer to it through all the foresight tools that we have now.

Then prototyping, very excited about what you can do with technology to get to a digital or sometimes also a physical prototype. I'm still a big fan of physical prototypes, by the way, and putting those into the hands of real people. As much synthetic testing that you can do, it's limited in terms of the use case. And I find that when you go into really new areas, you still got to be with real people, but technology can help you to get to that prototype much faster, much cheaper, and it allows you to test the edges. That's the other thing that I find all the time. We tend to stay close to what we want it to be instead of seeing around corners.

So Rita McGrath is another expert that I'm a big fan of, seeing around corners, a book that it's all about not being okay with the first prototype, even if it works. I have lots of examples where we had a working prototype and it was great. And somebody on the team said, like, I think there's something else. Let's look around this corner and do another prototype and make this product blue, not brown. And suddenly you find massive new opportunities when you do that and technology now helps to do that much faster, much cheaper.

So you're reducing the risk by increasing more evidence. And I'm always telling our teams, don't spend time evaluating risks, spend time finding evidence. Because it's two sides of the same coin. It's just much harder to reduce risk than it is to find evidence. I think back to university days, I hated the statistics courses and probability calculations for risk management. It's so complicated. Well, that's me not liking math a lot, but it's difficult, right? When you compare that to getting on a journey to finding evidence, which decreases the risk automatically, that's a much more fun journey. And technology can help with that. So that's what I'm really excited about.

You can see around more corners, faster, cheaper, and find more evidence in a much more divergent way, which is what large companies often struggle with and what startups do really, really well. So I'm always saying, don't try to be a startup, but you can learn from them. And we learn a lot from our acquisitions like TruthRule, Nature's Bakery. They have these ways to learn things much faster and see around corners. And that's a massive opportunity.

Fred Schonenberg
Maybe I'll get you out of here on this, because that is one question I had was, you mentioned some acquisitions, but you're partnering with startups in different ways across digital sustainability and things like that. Corporates, large corporations often misunderstand or get wrong with working with startups. Is there anything that you've seen that makes that partnership successful?

Rainer Struck
Yeah, it's a great question. And it's not easy. And again, the bigger you get, the more difficult it is to fall into these traps. And the key thing that I'm encouraging everybody to look at is, is it mutual? So mutuality is one of the five principles of MAS. And it has been a principle since 1947.

And mutuality means that anyone who is interacting with us, be it a consumer, be it our associates, be it our suppliers, there needs to be a mutual relationship in order to have a long-term value creation that comes out of it. And with startups, we are big, obviously. That's why we are attractive to a startup.

We have all the knowledge. We have a lot of capabilities. But it's not that way around. Startups have a lot of things that we don't have. And acknowledging that and saying, what can I learn from this potential partner? What can I help them with in return? And is there something at the end of this partnership that creates value for both of us? So having that conversation very early on is super important to make any collaboration work. And so rooting it in this mutuality principle.

I think that that's great learning. It's been part of our DNA for a long time, but I'm realizing now how big that value is. Because it can prevent you from disappointing people as well.
When you don't ask yourself the question, would I really scale this relationship if it works? Ask yourself the question at the beginning. It's really worth doing. And then you have good relationships.

Fred Schonenberg
I always frustrate our clients because I always say, so what happens if it works? And they're like, what? We hope it works. I'm like, okay, what happens? Because I want to know that there's a scale up. There's a second project, a second reason or some sort of next step afterwards. Otherwise, if you're just running pilots, it's not really worth either of their time. I'd love mutuality as a framework to think through how those relationships should be structured.

Rainer, thank you so much for taking the time to share your knowledge, your perspective with us. Where can people go to learn more about you, Mars, wherever you'd like to guide our listeners?

Rainer Struck
Yes, I'm on LinkedIn. Reach out always. That was a key source of my learning, actually, to connect with other fellow innovators and learn from them because we all have very similar challenges. 

And learn about Mars, just go to mars.com, there are lots of sources on that. It's a family-owned company, so we are sharing a lot more than we used to and you will find that on mars.com, you know, our sustainability and regeneration plan, like how we work, the different business units, which many people might not know that it's, you know, it's pet care, so pet food, but also two and a half thousand pet hospitals and veterinary clinics. We've got the snacking business, food business, so a little bit of advertising here at the end, but yeah, check it out. It's a great company and there's a lot of information there and reach out by LinkedIn if you want to connect.

Fred Schonenberg
Yeah, I also have to say, you know, I've studied this part of the industry a number of times, but there is a podcast called Acquired that does a deep dive on Mars. That is just, it is really fun to listen and learn about the full history. Warning to the listeners, while we keep our episodes at 30 minutes, that I think is around three hours long, but it is, it goes fast and it is an amazing story. Rainer, thank you so much. It's great to see you as always.

Rainer Struck
Thank you for having me. This was great fun.