How companies can take all the variables that are fundamental to production processes into consideration

Efficiency combined with judgement, and above all with measured effectiveness. In a time during which competitiveness appears to be the overarching goal of every production organisation with a desire to grow (alongside a focus on the social implications of its existence), it seems that identifying efficiency within companies is a crucial step. However, efficiency is a complex element to assess; even identifying it within the ‘behaviours’ of a business can be challenging. As such, reading “Efficienza per competere. La strategia, il modello e gli strumenti per uno sviluppo innovativo delle prestazioni aziendali” (Efficiency in order to compete. The strategy, model and tools for an innovative approach to developing corporate performance) by Alessandro Amadio can serve as a useful resource in forging ahead on a complex and insidious issue.

Amadio writes on the basis of his background as manufacturing director of Meccanica H7, a leading company in precision mechanics, automation and construction of large industrial plants, as well as drawing from his experience with various multinational companies in the food, packaging, automotive and industrial wiring sectors. The author begins with an observation: “The technological breakthroughs achieved in the last few years of Industry 4.0 – that is, the technological innovations introduced in terms of both processes and products, the rationalisation of the use and cost of materials and resources, the increasingly functional distribution systems and the advanced marketing and sales solutions – are still fundamental to success, but in this day and age, these factors are no longer sufficient, especially when not employed in an interconnected manner in order to create that elusive competitive advantage that can guarantee the future of a business.” In other words, what changes is the level of complexity, something that every company must take into account in order to be truly efficient. Amadio refers to a word in U.S. management jargon to summarise all this: Vuca, which stands for volatility, uncertainty, complexity and ambiguity. Companies are increasingly finding themselves dealing with a volatile, uncertain, complex and ambiguous environment, and this concept provides the basis for the author’s argument.

The book begins by looking at the links between trade policies and the organisation of production, before Amadio turns his attention to a series of tools that can be used for analysis and intervention in business management and the aforementioned organisation of production, which brings us to the Balanced scorecard, a tool that is designed to measure organisational strategies and processes within an interdependent system.

Amadio writes as a businessman first and foremost, avoiding a theoretical approach and instead taking a look at the functional tools that the reader needs. He uses diagrams, tables, flowcharts and practical examples in order to get to the goal that he wants to help the reader achieve: to create an “interconnected approach to management” that (successfully) seeks to take into account parameters and aspects of production that until now have not been considered as a whole.

Efficienza per competere. La strategia, il modello e gli strumenti per uno sviluppo innovativo delle prestazioni aziendali (Efficiency in order to compete. The strategy, model and tools for an innovative approach to developing corporate performance)

Alessandro Amadio

Franco Angeli, 2020

The specific way in which production organisations grow and develop in the south of Italy

The environment and infrastructure, as well as the social system, and the opportunities waiting to be seized. The mechanism behind the growth and development of companies differs from region to region. It changes not only in accordance with the various objective conditions that exist, but also in line with the subjective trends that need to be observed and understood. For this reason, “Crescere a Mezzogiorno. Organizzazione di un gruppo di ricerca e alcune evidenze empiriche” (“Growth in the south of Italy. Organisation of a research group and some empirical evidence”), an essay written by Davide Bizjak, Luigi Maria Sicca and Ilaria Boncori (from the Department of Economics, Management and Institutions at the University of Naples, and the University of Essex) and recently published in Impresa Progetto – Electronic Journal of Management, could prove to be of use.

“The design of the entire research project” – the three authors write – “revolves around the dilemma of growth in the business organisations studied (medium-sized manufacturing companies in southern Italy), through the analysis of a number of the characteristics that are inherent to the processes of growth.” The method used in the study is “of a qualitative type”, and is based on “narratives provided by managers and entrepreneurs (…), who have often borne witness to entire generations of stories.” The goal in this instance is to understand the tangible levers that companies in southern Italy have used in order to develop, on the basis of a dual condition: on the one hand, the fact of being “disadvantaged in terms of the ability to raise and use capital”, and on the other, the reality that these organisations are stronger because they are “partly impervious to changes in economic cycles.”

The essay begins by addressing the method according to which the survey was conducted, and then proceeds with an analysis of the qualitative results of the interviews that were carried out, before the three researchers finally explain: “From both an economic and an organisational perspective, businesses in the south of Italy appear to operate almost independently of global economic trends, for better or for worse. Both during the phases of development and during times of crisis, the results of companies in the south are slow to arrive but nonetheless consistent; the development of these businesses echoes the way in which family ties evolve, and indeed, these form a network beneath the stories of entrepreneurial activities gathered during the interviews.” In this way, we observe the outlines of a business culture in an area in which entrepreneurship goes hand in hand with fundamental human ties: a situation which we must seek to observe and understand with care, and which also leads to the emergence of unique figures such as “prudent innovators”.

Crescere a Mezzogiorno. Organizzazione di un gruppo di ricerca e alcune evidenze empiriche(“Growth in the south of Italy. Organisation of a research group and some empirical evidence”)

Davide Bizjak, Luigi Maria Sicca, Ilaria Boncori

Impresa Progetto – Electronic Journal of Management, no. 1, 2020

At the end of the challenging spring of 2020, there are three words that we must focus on when discussing the recovery; the most acute and painful phase of the pandemic may be over, but we are still in a deep recession. The first of these words is “together”. The second is “project”. The third is “responsibility”.

The first word indicates the fabric of shared values that binds Italian society together, and that President of the Republic Sergio Mattarella highlighted during the sober, simple ceremony held on 2 June (Italy’s Republic Day), as he reminded us that “there is something that comes before politics, and this is moral unity, the sharing of a single destiny.” Without suspending political dialectics – the vital force of any democracy – the political powers must nonetheless rediscover “the founding spirit that served as the key driver of Italy’s rebirth.”

The reference to shared values and to our ability to be “together” is fundamental at this point in time in Italy, where the crisis is aggravating old divisions as well as creating new ones. Debate and controversy are growing between the regions, with the resentment of the south towards the north rearing its head once again, and undeserved criticism of Milan and Lombardy rising, with these areas being treated as “super-spreaders” (and indeed, on 2 June, Mattarella quite appropriately headed to Codogno, right where the Covid-19 crisis which has brought so many sick and the dead began). Political pressure against the EU and the Euro has taken centre stage once again. Dilapidated, deserted squares are teeming with life, with protesters from the “Forconi” (Pitchforks) and “Gilet Arancioni” (Orange Vests) movements. Clamorous TV talk shows are stoking the divisions, and on social media channels, the propagandists of personal and social hatred are stirring up trouble once again.

Indeed, at the heart of Italy’s frightened and impoverished society, there lies a degree of social anger, for real reasons (jobs that have been lost or are threatened, incomes that have been drastically reduced, hopes for a better quality of life that have been dashed), and as a result of the widespread psychological suffering that the pandemic and the economic crisis have rendered even more acute. But there are also those who are fanning the flames of distrust, the “entrepreneurs of fear” who are seeking quick and easy political approval. The hold of institutions is a legitimate political concern, and one which should not be underestimated.

“Do not use the suffering of one person against another”, ordered President Mattarella, voicing his concern in the face of the degenerating political and social climate. And indeed, it is essential that all political forces and economic and social organisations continue to look to the Quirinale with attention and respect, as a place of responsibility, balance and clarity; a place that promotes an awareness of shared values. The place where trust will be rebuilt.

We now come to the second of the three words, “project”. Or rather, “projects”. Projects are precisely what the EU is (quite rightly) calling for, when the 750 billion Euro Recovery Fund – whose official title is the futuristic “Next Generation EU” – is rolled out: concrete projects for the green economy and for the development of the digital economy, or in other words, initiatives that together constitute an ambitious plan for balanced and sustainable growth, based on a virtuous synergy between the environment and Artificial Intelligence, quality of life and new, better job opportunities. This is the “paradigm shift” that economists and environmentalists are calling for, along with entrepreneurs with an awareness of the issues surrounding the sustainability of industry and services, in accordance with a healthy business culture founded upon stakeholder values – as aptly expressed in the “Manifesto of Assisi”, signed by the Symbola Foundation, the Franciscans, Confindustria and a number of cultural figures, in the wake of Pope Francis’ speech on the “just economy”.

Here’s the point: the EU is pointing the way towards solidarity, suspending the “Stability Pact” and considering rewriting it, and is working in parallel with the ECB to make significant resources available to businesses and families, facing the Covid-19 crisis in the best way possible, but it is understandably not inclined to give the green light to unproductive public welfare spending. The road ahead is a serious undertaking, and will be far from plain sailing: new infrastructures and reforms in the interests of productivity and competitiveness, the digital economy and new production chains, innovation and training, research and science, and health in the broadest sense (and as such, the sums allocated by the European Stability Mechanism – which stand at 36 billion for Italy – are more than welcome). There is no room for an economy that provides patronage to subsidies – something that has unfortunately been very popular in government circles – nor for generic and demagogic tax cuts and infeasible flat taxes. That is to say, the resources provided by the EU come with certain conditions: investments and no current spending, positive changes in Europe in order to withstand tough and biting economic and political competition on a global level, and a marked turn away from provincial selfishness. The EU Commissioner for Economic Affairs, Paolo Gentiloni, is very clear: “The Recovery Fund is not a cake to be shared out. It must be approached seriously, and viewed as a unique opportunity” (Corriere della Sera, 30 May).

For the political, entrepreneurial and trade union ruling class in Italy, therefore, the challenge is to be up to the job of bringing about renewal and change. Without resorting to anti-Euro small-mindedness and irrational fear. Without low-profile controversies.

After the Quirinale, the Banca d’Italia also serves as a point of reference. In his Final Considerations on 29 May, the Bank’s Governor Ignazio Visco highlighted the urgency of “an agreement for recovery between the government, the world of business and society”, and spoke of digitisation, infrastructure, human capital, research, innovation, natural and artistic heritage and the resources that must be used properly (which means not exacerbating public debt by wasting money and promoting welfarism, but rather working to achieve economic growth, with a view to permanently reducing the ratio between debt and GDP). “The avalanche of subsidies and aid cannot last forever: We need to change course in order to recover”, Visco added. And the position of the Church is in harmony with the aforementioned views: “We must seek to relieve the pain. Not by patching things up through dependency on welfarism, but rather with the vaccine of work, which provides a sense of calm”, announced Cardinal Matteo Zuppi, Archbishop of Bologna on Sunday 31 May, speaking to Walter Veltroni in the Corriere della Sera.

Italian companies are also clamouring for a new policy for recovery, with an appeal to the Conte government published by newspapers on 31 May and signed by Carlo Bonomi (Confindustria), Antonio Patuelli (ABI banks), Ettore Prandini (Coldiretti), Gabriele Buia (the building associations of ANCI, the National Association of Italian Municipalities), Massimo Giansanti (Confagricoltura), Mauro Lusetti (the alliance of cooperatives), Dino Scanavino (the artisan producers of the CIA, Italy’s farming confederation), Maurizio Casasco (Confapi) and Franco Verrascina (Copagri): the presidents of all of the leading business associations in the industry, finance, agriculture, crafts and cooperative sectors. In any case, the indication is clear: beyond the necessary emergency measures (which are unfortunately proving slow to take effect and alleviate the suffering of businesses, families, workers on unemployment benefits and professionals experiencing a major crisis of income), we must do everything we can to rapidly roll out viable projects to modernise and relaunch Italy’s economy. Indeed, Roberto Gualtieri, Italy’s Minister for the Economy, has also spoken of a “recovery agreement”. In essence, there is no shortage of desire to work in harmony, both right now in the depths of the emergency and in the medium term, in order to promote growth. We can do better, and more. It is possible for Italy to break free of the old shackles that have prevented or slowed growth, and to build a better future.

The indications provided for the EU funds are the backdrop for this. In responsible Italy, there is no lack of will. The entities that represent the very best energies – those who must come “together” at the recovery table – have already begun to declare their availability.

And so we come to the third word: “responsibility”. Once again, Italian companies have delivered significant evidence of this in recent years. By investing, innovating, exporting, they have contributed in a decisive manner to rescuing Italy from the doldrums of the Great Financial Crisis of 2008, even if the low productivity of the system (and of the public administration above all) has pushed the growth of the country back down. And companies have always found new niches for growth on tricky international markets, ensuring that Italy remains among the top five countries in the world in terms of positive trade balance. They have maintained the values of the ‘social lift’ (or in other words, rewards for those who are capable and deserving) in a country that is still afflicted by clientele, kinship, corporations and factions. These companies have stood face to face with a difficult climate; one which is hostile to industry, to the market, to skills, to knowledge and to science, and which has unfortunately also found a sympathetic ear in certain government circles.

If we need to talk about innovation, investment, research and sustainable development, Italian companies are first in line. Making plans and implementing these is their job. If we take a close look at the documents, the research, the official speeches and the position statements, we can see that the new course set out by Confindustria, chaired by Carlo Bonomi, demonstrates a strong sense of responsibility and dedication to general values and interests. And the references contained therein are indications of the values which are feeding down from the Quirinale and the Banca d’Italia. In tune with the EU.

On the morning of 6 May 1906, at 6 o’clock on the dot, the first edition of the Targa Florio got under way on the Madonie circuit, not far from Palermo: the dream of its creator, the aristocratic Vincenzo Florio, had finally come true. Many people consider the Targa Florio to be the first real car race in history – it is certainly one of the most famous and, right from its first edition, it became one the great classics of motor sport. The race started from the Buonfornello straight, down by the sea, and then climbed up the narrow winding roads of the Sicilian mountains, from Cerda to Caltavuturo, Petralia, and Collesano. A total of 146 kilometres repeated three times all the way to the finishing line in Campofelice, where a cannon shot and blaring trumpets greeted the winner.

The first to cross the line was Alessandro Cagno in an Itala car that made it round the course in just over 9 hours, at the extraordinary average speed of almost 47 km/h. Behind him came Ettore Graziani, in another Itala, bearing the number 10. The Italians notched up a point in the endless duel between the “Transalpine cousins”, for the Frenchman Paul Bablot came in only third, in his Berliet 24/40 HP. And this was despite the withdrawal of the highly favoured Vincenzo Lancia, a star in the new sport of motor racing, who had entered the race in a Fiat emblazoned with the number 1.

All those years ago, in 1906, Pirelli had only been manufacturing tyres for a few years and had just started to enter the fray of the racing world. Some encouraging successes the previous year, however, with the Marchand runabout, had promised well for the future. The triumph in the Peking-Paris race 1907 with none other than an Itala would soon show that Pirelli Ercole tyres could do their bit. As did the legendary Targa Florio. The first great acknowledgement came in the 1913 race, when Felice Nazzaro, the winner, felt he just had to send a wire to the engineer Giovanni Battista Pirelli in Milan, congratulating him on “your excellent dérapants”. Those tyres had helped him slash a full four hours off the previous record on the Madonie. Ushering in a long – and memorable – series of victories.

In order to tackle mafia organisations and diminish their power, we must follow the money. When we remember Giovanni Falcone, twenty-eight years after his death, this is one of the key lessons that springs to mind, as we write his story and revisit his importance judicially and politically.

Follow the money, or rather, attempt to reconstruct the links between mafia families by documenting payments, exchanges of money and investments, thus creating a map of their shared criminal interests. This was Gaetano Costa‘s instinct as chief prosecutor of Palermo in the 1979 investigations into the Spatola, Inzerillo and Gambino clans, who ran a network of rigged contracts and drug trafficking between Palermo and New York, and who served as the friends and protectors of Michele Sindona, the Mafia’s banker (Costa ended up paying for his investigative brilliance with his life, in August 1980). However, his powerful, lucid and well-founded ideas were taken up by investigating judge Rocco Chinnici (who was also murdered with a car bomb in July 1983; ‘Palermo like Beirut’ was the headline of the shocked and horrified account in the newspaper “L’Ora“). They were followed in turn by Giovanni Falcone and the Anti-Mafia Pool at the public prosecutor’s office and the investigating office, who conducted detailed investigations and checks on banks, holding companies and businesses, stirring up a hornet’s nest of controversy and pressure, even at the Supreme Court, which insisted they ‘put an end to these investigations which are damaging the Sicilian economy.’

In spite of all this, Falcone and the other magistrates went right on, making their financial inspections and banking checks one of the core elements of the so-called ‘maxi-trial‘ that began in February 1986 and concluded with a long series of convictions of Mafia bosses at the Supreme Court. It was an exemplary trial, where the state won and organised crime lost.

They followed the money, and proved the Cosa Nostra and all the other criminal organisations in Italy – the ‘Ndrangheta, the Camorra and the Sacra Corona Unita – to be interconnected structures (though not without their internal conflicts), working for the goal of accumulating power and money. Power in order to make money, and money to strengthen their power, in a vicious cycle of crime and laundering that channels cash into the legal economy, ravaging not only the economy but also society, politics, state administration and institutions.

Beyond the wordy commemorations, when we look back at the dedication of Giovanni Falcone and his fellow magistrates, of the policemen and all the other people killed for trying to stop illegal business and Mafia crime – including politicians, journalists and the extraordinary and good man Giorgio Ambrosoli, the ‘Ordinary Hero’ murdered on the orders of Sindona – we not only keep the memory of their moral and civil commitment alive for new generations, but also heighten awareness of the current strength of the mafia phenomenon: its economic power.

The traces were already there during the first major investigation carried out by L’Ora into the Mafia clans, in its crucial, exemplary headline of 1958: ‘The Mafia brings bread and death.’ Bread being the criminal economy, and death being the penalty for anyone who gets in the way of business. Money, then. Just money. And violence. Without even a trace of the values the Mafia bosses of old once boasted of: honour, respect, a certain sense of popular justice, the ideological outlines of a subculture of power.

Pio La Torre, head of the Italian Communist Party, was well aware that money was the glue that held the Cosa Nostra families together, and was a vocal supporter of a law designed to strike the Mafia where it hurt most – its assets – by seizing and confiscating the ill-gotten financial gains of its criminal activities. Unfortunately, both La Torre and later General Carlo Alberto Dalla Chiesa had to die before the proposal became law. Now, with a number of changes and improvements, this law is still a fundamental weapon in the state’s armoury in undermining the Mafia’s criminal powers.

In following the money, Falcone, Borsellino and other magistrates (with the help of pentiti or ‘penitents’, former Mafia men turned informers) highlighted the trafficking activities of Vito Ciancimino, Sindona, Roberto Calvi and other players in that grey area that shrouds the Mafia bosses’ accomplices, the people who help move most of the business from the regions of the South to Lombardy, Piedmont, the Veneto and Emilia, the cities with the greatest economic power where the ‘Ndrangheta above all is now deeply rooted, dangerously polluting the economy, the markets and the politics.

Indeed, in his book Cose di Cosa Nostra (‘Things about Cosa Nostra’), Falcone maintained: ‘The Mafia is not a cancer that just happens to spread through healthy tissue. It lives in perfect symbiosis with the myriad of protectors, accomplices, informers and debtors of all kinds, large and small, the big powers, the intimidated and blackmailed people who belong to every level of society.’ A tumour, then. One that feeds off complicity.

The example of the magistrates of Palermo must be taken into careful consideration today, in these times of crisis wrought by Covid-19 and the resulting economic recession. Minister of the Interior Luciana Lamorgese, Chief of Police Gabrielli, the national anti-mafia prosecutor Cafiero de Raho and a number of investigators claim that mafia gangs are now taking advantage of the financial weakness of hundreds of companies to gain control and reinforce their presence in the economy, above all in the cities and provinces of Northern Italy. This is a serious alarm bell, and one we cannot ignore. We must take all the steps necessary to ensure a deeper state commitment to fighting mafia organisations. Aside from anything else, this is a fitting way to remember Falcone: to provide tangible proof that his commitment as a statesman was not in vain.

Rewriting the alphabet of work

Working. It’s important to everyone. It’s an act that provides dignity as well as sustenance. Yet even today – and indeed, perhaps more than before – it is a goal that must be won and maintained. The status of being ‘in work’ has strong cultural and material connotations, connotations that affect every social and economic class. And with these considerations in mind, it is both enjoyable and useful to read Lavorare, è una parola. Un alfabeto corale a cinquant’anni dallo Statuto dei lavoratori (‘Work is a word: A harmonious alphabet fifty years after the workers’ charter’), a book just published by various authors, edited by Altero Frigeri and Roberta Lisi.

The collection of 24 essays comprises a sort of dictionary of work, and attempts to pin down some of the key aspects of the theme, using the same number of ‘words’ as a starting point, on which some of the most authoritative voices from the worlds of culture, economy, law and politics share their reflections. As such, a genuine new ‘alphabet’ of work is created, giving tangible meaning to a word that is often abused and distorted. Behind every term selected is a reflection on a crucial aspect of this overarching theme: in this day and age, we cannot discuss work without focusing on the environmental crisis, health and safety and new occupational diseases, migratory movements, the way in which women must reconcile working with caring for others and motherhood, along with themes such as disability, artificial intelligence and the backwardness of Southern Italy.

Nothing is omitted. Not even the more uncomfortable aspects of work, such as the dissolution of entire sectors of the manufacturing industry, the various forms of exploitation, rising unemployment and death. And in the nearly 300 pages of text, there are a few chapters that at first sight might appear out of place – like those dedicated to Bergoglio, to the ‘non-working generation’, to John Maynard Keynes, to the Mafia, to knowledge – but which in actual fact constitute some of the strongest elements of the entire tome.

This book, edited by Frigeri and Lisi, must be read carefully, and will no doubt give rise to further debate and in-depth analysis. It is nonetheless an essential read (and indeed, could even be used as a dictionary, to return to again and again), and is part of the baggage that comes with an increasingly prudent and attentive culture of production.

Lavorare, è una parola. Un alfabeto corale a cinquant’anni dallo Statuto dei lavoratori

Altero Frigeri and Roberta Lisi, eds.

Donzelli, 2020

A thesis discussed at Luiss University raises the issue of the distinction between the tools and attitudes in play in local and international situations

Not just profit. This is a concept that has now been embraced by most production organisations. And yet it remains something that still needs to be consolidated, deeply understood, fully embraced by every company that wants to improve its corporate culture. Especially because ‘not just profit’ cannot and must not mean ‘no profit’. However, corporate social responsibility is a complex theme, and remains the subject of much discussion and literature. Accordingly, it is useful to have something to hand that can provide a simple summary of the steps taken so far. And this is what Guglielmo Costante Salerno’s thesis – discussed at the Department of Law, Chair of Methodology of Legal Science at Luiss University – serves to do (and it is very useful too).

‘Il dibattito sulla responsabilità d’impresa: ascesa, crisi, nuovi sviluppi’ (‘The debate on corporate responsibility: the rise, the crises and the new developments’) begins with the observation that profit has ‘historically been the main objective of business.’ ‘The business of business is business,’ the author reminds us, quoting Milton Friedman, and adding: ‘Taking this blatantly profit-focused vision – and as such, a vision that is also focused on the interests of shareholders – as a starting point, we discover that, over the years, other operators have assumed a key role in establishing the area of activity in which the individual companies will be focused. These subjects, or stakeholders, represent the all the people who, although not partners in the business, have a vested interest in the company in question.’ In addition to this, Salerno explains how it was necessary for the vision of the company and its activity ‘to collide with the increasing role that ethics was playing in economic activities on the one hand, and on the other, with the greater attention focused on the effects of economic activity on society, including by business.’

As such, the thesis travels back through the different stages of the journey that has made corporate social responsibility what it is today, with particular emphasis on the legal and economic aspects of the issue.

In his conclusions, the author provides the following explanation: ‘What has emerged from this analysis is that just as it is true that the future of the economy will most likely be increasingly dependent on the issues relating to corporate responsibility, it is also true that currently, public opinion and perhaps the regulations of individual states have more influence on the choice made by companies as to whether or not to adopt socially responsible models than the international framework; although the latter has deeply noble intentions, it unfortunately still lacks the binding power that stops efforts made in this direction almost all being in vain.’ This is akin to pointing to a sort of dual speed between awareness and the national and international legal instruments implemented on a subject that has in any case become a global issue.

Il dibattito sulla responsabilità d’impresa: ascesa, crisi, nuovi sviluppi (‘The debate on corporate responsibility: the rise, the crises and the new developments’)

Guglielmo Costante Salerno

Thesis, Luiss University, Department of Law, Chair of Methodology of Legal Science, 2019