Revealing Secret Recipes

Over the last few years, we witness the growing media exposure of gourmet cuisine. To quote a famous Milanese chef: "Twenty years ago it wasn't like today. The chef's activity was not valorized and the final consumer was unable to appreciate all the research and effort that went into the dish served at the table."

Increasingly, the world of high cuisine is shown in books, symposia, and especially on dedicated cable and satellite channels. This growing media exposure has led to an interesting phenomenon: an intense private communication between chefs, who are more often than not competitors, right down to hitherto jealously protected recipes, cooking techniques and food suppliers. In certain cases, there are even swaps of waiting and kitchen personnel.

This exchange among competing firms is a double paradox. On one side, competitive advantage in the industry largely depends on the uniqueness of good creations and continuous renewal of the supply offered to consumer. Exchanging information with competitors, or making it public, could potential undermine a chef's creation of value. On the other hand, the industry in question is marked by the impossibility of securing intellectual property rights. As a highly regarded chef remarks: "How can you copyright your creation, when just a superficial recipe change can ward off any sanctions?". Once it is out of the firm's boundaries, information easily falls prey to imitators, losing value. In spite of this, information exchange is increasingly frequent. As one haute cuisine chef recounts: "Once chefs kept their recipes hidden. Today there's constant interchange. There are events where we share the same kitchen and prepare the most renowned dishes side by side." How can this phenomenon be explained? And what makes it sustainable? Answering these two questions has important implication for many high-innovation sectors. First of all, for those sectors characterized by low protection of intellectual property, which are precisely those where Italy excels: fashion, publishing, design. Secondly for those industries where the traditional protection of intellectual property rights no longer works, due to the speed of innovation (health care) or the growing involvement of third parties in the innovation process (software and the Web). In our work Kitchen Confidential? Knowledge Transfer and Social Norms in Gourmet Cuisine, co-authored by Andrew A. King of the Tuck School of Business, we provide two alternative explanations, on the basis of an experimental questionnaire which interviewed more than 500 Italian chefs included in the 2009 Michelin Guide. Chefs confirm the existence of an alternative system of intellectual property protection based on social norms. Chefs have developed a code of conduct which dictates behaviors for anyone wanting to be considered worthy of respect by his or her own peers. Faced with the exchange of a recipe, a technique, the information on an ingredient, chefs know what is allowed and what is not. There's also the implementation of strategies that minimize the eventual damage coming from an improper use of information. Think about a very innovative chef: the value of a single recipe will be undoubtedly decrease in the case of copying. Or consider two chefs that share the same cuisine philosophy and want to promote it. In this case the exchange of information benefits both sides, enriching the knowledge of both and mutually supporting the new approach. Summing up: yes to the transfer of knowledge, but as a function of the transaction in question, of the competitive position occupied, and of the strategic value of the exchange.