An eventful June with “stories” and exhibits at which the Pirelli Foundation is presenting a number of documents from the Pirelli Historical Archives.

The exhibit “TECH STORIES. Politecnico di Milano 1863-2013” kicked off on 13 June and is an event rich with stories of architecture, design and engineering to celebrate the 150th anniversary of Politecnico di Milano, a university that is the embodiment of excellence in innovation, technology and education in Italy and throughout the world. The exhibit tells the stories of the most important people and events from the history of Politecnico, which educated some of the most prominent Italian architects, engineers and business people, including Giovanni Battista Pirelli, who was to go on to work in the rubber industry after graduating in 1869. “L’impresa della gomma” (The enterprise of rubber) is the title for the section dedicated to Pirelli, which features historical materials documenting some of the most important milestones from the history of this well-known Milan tyre manufacturer. Along side photos of the graduating class of 1869 and the hand-written letters of Professor Colombo to Giovanni Battista Pirelli, there is the photo of the first Milan factory in Via Ponte Seveso, catalogues from the period, and some of the most famous Pirelli advertisements by Bob Noorda, Alessandro Mendini and Armando Testa that are preserved in our Historical Archives. The exhibit will be running from 13 June to 10 December at the Museum of Science and Technology in Milan.

“Rinascita. Storie dell’italia che ce l’ha fatta” (Rebirth. Stories of an Italy that made it) tells another story, that of twenty years of Italian artistic and industrial production which made Italy the land of design, fashion and creativity. It is the story of the rise of original Italian products that were to become global status symbols, such as Pirelli’s Cinturato tyres, and which tell the story of the transformation of Italian industry and the Italian way of life. Stories of an Italy that made it.

Featured from our archives, there are a number of the company’s advertisements, photos of the Pirelli building (nicknamed the Pirellone for its great height), and issues of the historical Pirelli magazine, which was published from 1948 to 1972.

The exhibit will be running from 21 June to 2 November at Palazzo Mazzetti in Asti. 

“Polytechnic culture”: the ability to unite science and the humanities while constantly seeking new forms of harmony that can lead to both economic and social growth. It is also an attitude that is still best expressed, in Italy, in Milan and in the Lombardy region generally, first and foremost in the “culture of Politecnico”, the Milan university that is a synthesis of education and research, of academic and entrepreneurial innovation, so much so that it is among the world’s top 50 universities in the field of technology and engineering (source: the Times Higher Education ranking of top universities). Milestones represent decisions that have been made, and celebrating milestones keeps those decisions fresh in our minds and keeps us aware of our commitment to create our future. Celebrating the 150th anniversary of Politecnico di Milano, with all of the celebratory conferences, seminars, exhibits (such as the one currently under way at the Museum of Science and Technology), publications and other events, serves to tell the people of Milan, of Italy and of the rest of Europe both how and why, right here in Milan, such an excellent university came about and is still, after a century and a half, among the leading sources of knowledge and innovation in Europe.

History. From when it was founded with the crucial contribution of Giuseppe Colombo, a man of both science and industry (as one of the founding fathers of Edison with the construction of the first city power plant in Europe in 1883) to the studies of Enrico Forlanini and the first prototype of a helicopter (1877); from Europe’s first electronic calculator, which Luigi Dadda took to the U.S. in 1954, to the chemistry studies that helped Giulio Natta receive the Nobel Prize in 1963 (with the creation of Moplen, a revolutionary plastic that changed Italian habits and customs during the economic boom). Today, Politecnico is made up of a dense network of relationships with leading international centres of research and innovation, and out of the university’s labs come some of the best Italian high-tech start-ups.

When you think of Politecnico, you think of industry, such as the companies of the Schiapparellis and the Ucellis, or Edison, or even Pirelli, which was created in 1872 by Giovan Battista Pirelli, a Politecnico alumnus who studied throughout Europe with the help of the university. You also think of the architecture of Gio Ponti and Aldo Rossi, of Renzo Piano and Gae Aulenti, or the design work of Marco Zanuso and Vico Magistretti. You think of that special propensity to unite science, literature and the arts as seen in the work of Carlo Emilio Gadda and Fausto Melotti. It is a century and a half of history marked by countless names of engineers, entrepreneurs, scientists and other visionaries, all highly skilled at managing processes in which innovation is not only the discovery of new technologies, but is also, and above all, that typically Italian form of “incremental innovation” – an ingenious adaptation or modification of a machine that radically changes a production process, the addition of a chemical compound that makes a material stronger or lighter, or a new relationship between technology and the organisation of labour. The concept of “civiltà delle macchine” (machine civilization/civility) is no oxymoron. It is a poetic metaphor for the synthesis of man’s intelligence and the transformation of machinery, such that the machine can better obey our commands and be safer and more productive – more “civil”.

A culture of design and a culture of production, as is often said among business people, engineers, designers and other technological – or rather, “polytechnic” – circles. In an Italy that was approaching modernity, Politecnico di Milano was, 150 years ago, an incubator for robust industry. Today, as “post-modernism” has demonstrated its fragility and rushed imbalances (too much finance, too much distortion in the ephemeral culture – or, better, “sub-culture” – of superficiality), a place of education and research such as that of Politecnico can reiterate its relevance and its role in creating the future as we rediscover, “polytechnically”, the central role played by industry. It is an international role that is so typical of Milan and of Italy as a whole.

All challenges that organisations and individuals face each and every day require us to make a change in outlook, a qualitative shift or otherwise take things to the next level. It’s easy to say, but exceptionally difficult to do. And on our quest to do so, we all too often come across business gurus and other self-proclaimed experts who actually take us farther from our goal, rather than helping us to work better.

There are, however, always a few diamonds in the rough in the vast landscape of works seeking to help us “live and work better”. One such example is “Leading strategically. New thinking for entrepreneurs, organizations and personal life”, a recently published book of just over 140 pages written by Hassan Yemer, a management consultant who seeks to bring together strategies for business and strategies for life by starting with a single question: “What do I want to be, a leader or a follower?”

The result is a journey at breakneck pace through approaches to anticipating events without being overwhelmed by those events. It is a voyage of two parts: identifying a form of “strategic thinking” for modern times and analysing the conduct of organisations and their leaders before recommending a few corrections that can be made. It starts from the individual and then leads to the organisation.

Yemer’s is a work to be studied with care, to be assessed and to be verified, but it is also a stimulating, thought-provoking work and a sort of challenge – something to ponder. Take, for example, what Yemer writes on the first pages of his book: “Leadership does not depend solely on the desire to lead.” There must be more than just that. There is something extra that permeates true leaders and that, at the end of the day, also characterises the culture of enterprise that finds success in the marketplace. This is why he then asks the question, “What makes a good leader?”

Leading strategically. New thinking for entrepreneurs, organizations and personal life.

Hassan Yemer

XLibris Corporation, May 2013

Italy is still not firing on all cylinders in terms of competitiveness.  The country is lagging on international markets, is attracting declining levels of foreign investment, and is expected to remain in recession throughout 2013 and to post low levels of growth in 2014. Italy is hobbling along. Businesses are shutting their doors, and the country’s most precious asset, its manufacturing base, is dwindling away, having lost 15% in capacity and not looking good in terms of future development. In other words, despite it all, there is still a robust culture of enterprise that is holding off Italy’s collapse, but there are still no real strategies for growth, no good industrial policymaking, and not enough spending in research, innovation and education to keep pace with the other nations that are our competition. In short, and as Pirelli chairman Marco Tronchetti Provera said in an interview with Corriere della Sera (7 June), Italy doesn’t take good enough care of itself.

Figures released by the IMD World Competitiveness Centre in Lausanne show that Italy comes in at just 44th in the annual ranking of international competitiveness (behind the U.S. in first place, Switzerland in second, Hong Kong third, Sweden fourth, Germany ninth, the U.K. in 18th and France in 28th), slipping back four spots from its already low position of 2012. Spain, Portugal and Greece trail behind, but that’s no consolation. There are cyclical economic factors, i.e. the recession, as well as structural factors that haven’t helped, i.e. Italian bureaucracy, taxation, the lack of transparency, political uncertainty, and the consequent scarcity of foreign investment.

Indeed, here we have another aspect of the crisis: the lack of international investment. According to a recent study by Ernst & Young (see Il Sole24Ore of 6 June), Italy is driving away investors and losing ground on the other EU nations: Fewer projects, fewer resources, less employment, less innovation, and so less development.

Of course, there is some good news to be found if one reads the newspapers carefully.  For one, the French Alstom group is investing 34 million euros to build a premier research centre for energy transmission in Sesto San Giovanni. The U.S. multinational Valspar acquiring the Italian paints manufacturer Inver for its headquarters for European development.  And the U.S. Mohawak group, after acquiring the world-famous Ceramiche Marazzi, appointed an Italian, Mauro Vandini, to lead the business and, by investing in new technologies, develop an original alliance between multinationals and the manufacturing skills of the Sassuolo district with a keen eye on international markets. Or even the insurance giant Berkshire Hathaway, a leading shareholder of which is Warren Buffett, in the race to acquire Milano Assicurazioni. Not to mention the fact that international investors now hold 34% of Pirelli’s stock. These are all signs, in their own way, of faith in the capabilities of Italian multinationals, in the vibrant growth of small and medium enterprise here, and in the strength of our human capital (such as the engineers coming out of the polytechnic schools in Milan and Turin) in pursuing cutting-edge industrial research. So there are good investments coming into Italy, but it’s not yet enough to be truly optimistic.

There is some reason for this active, productive Italy to believe in growth, as called for by the president of Confindustria, Giorgio Squinzi, a staunch supporter of manufacturing as a cornerstone to growth and of the need for all of the EU to work to “reindustrialise Europe”. But we are still waiting for public policies and government decisions that are up to the challenge.

There are many businesses that are doing what they can, but government support measures are few and far between. No aid. No incentives. Not enough underlying policy decisions to create a favourable environment for business growth, for domestic and foreign investment, or for new and innovative start-ups. We need public investment in research and innovation, in education and the transfer of technologies, and we need to break free from the bureaucratic and fiscal shackles preventing investment. Through domestic policy and European policy. We need a true “industrial compact” that can support growth now that we have sought balance in the public accounts through the “fiscal compact”. Industrial Italy is showing that it knows how to face the crisis despite the heavy burden it has to bear. Government and policymakers have a duty to support resiliency and recovery.

The factory is life. A life full of workers and executives, battles and conquests, conflict and collaboration. The factory – manufacturing – doesn’t just produce things, but also sensations, sounds, odours, sights, experiences, memories, emotion and ingenuity, and makes men and women who they are. And it continues to do so to this day, although in somewhat different ways. Revised, more modern, more focused on social and environmental needs, more “comfortable” than it once was, the factory continues on. Although the second largest manufacturing nation behind Germany, there is still much to do in Italy, where manufacturing needs to serve as the foundation for a new season of economic development.

As such, it is important for us to understand how, and why, factories today continue to be so crucial and how they have become what they now are, especially when the input needed to understand comes not so much from cold, hard numbers and charts, but from the warmth of words and of stories.

This makes Fabbrica di carta. I libri che raccontano l’Italia industriale (published by Laterza with the support of Assolombarda, foreword by Alberto Meomartini and introduction by Antonio Calabrò; translation of title: “Paper Factories. The books that tell the tale of industrial Italy”) a book to be read over and over again. The work provides a sort of overview of what Italian literature, in just under a century, has managed to give us on the topic of industry and all that goes on in and around it. It’s nothing scientific and precise, but that’s what makes it so real and practical.

In just over 300 pages, Giorgio Bigatti (who teaches Economic History at Bocconi) and Giuseppe Lupo (an instructor of Italian Literature at Università Cattolica) have brought together the best of these “factory tales” by authors such as Volponi, Sereni, Levi, Calvino, Ottieri, Giudici, Fortini, Vittorini, Arpino, Gadda, Pratolini, and many more. The work is divided into three main parts: Panorami dell’Italia industriale (Views of Industrial Italy), Personaggi in cerca di lettori (Characters in Search of Readers), and an appendix entitled Scritture del presente (Writings from the Present). Within these sections we find abstracts and brief accounts of Italian factory life, both past and present.

The result is a highly enjoyable book to be read and reread. And even to be used in schools and universities to study a key aspect of “Italian identity”. It’s a sort of handbook to that culture of enterprise which is one of the most important parts of Italian society.

Fabbrica di carta. I libri che raccontano l’Italia industriale.

Edited by G. Bigatti & G. Lupo

Laterza, 2013

What happens when external agents, new ideas and, above all, new financial resources come to an established industrial system with a strong culture of enterprise and national identity? This is no rhetorical question, but one that points to something that can actually happen quite frequently nowadays. But to understand it well, we need more than mere theories. We need experience, empirical evidence, and the input of those who have already gone through it.

We need a work like Foreign Investors as Change Agents: The Swedish Firm Experience, a study published in May under the aegis of the Swedish Royal Institute of Technology by authors Kathy S. Fogel, Wayne Y. Lee (both researchers at the University of Arkansas), Kevin K. Lee (researcher at California State University, Fresno), and Johanna Palmberg (Research Director for the Royal Institute of Technology).

The study – conducted using both theoretical and empirical approaches – is an exploration into how foreign investors can act as agents of change in corporate governance. The system taken as an example is that of Swedish industry and the impact of the arrival of high volumes of foreign capital, which made for an ideal case study given that Sweden was, for quite some time, characterised by strong “economic nationalism”.

But beyond the history and the data, the four authors discover something that perhaps few would have expected: under the influx of foreign capital, Swedish firms made a cultural shift. In their conclusions, the authors explain, “What is remarkable in Sweden is that dominant owners of Sweden’s largest firms cooperated by conceding some control rights to foreign investors, and as a result, allowed informal reforms in corporate governance that made firms leaner, more capital intensive, and more profitable.”

What may, at first glance, have appeared to be a sort of colonisation by foreign capital turned out to be an agent of change, and not just technical and financial change, but also – and above all – a change in culture.

Foreign Investors as Change Agents: The Swedish Firm Experience 

Kathy S. Fogel, Kevin K. Lee, Wayne Y. Lee and Johanna Palmberg

The Royal Institute of technology, May 2013

Good corporate culture combines solidity of experience and a new outlook, the strength of those fully familiar with men and machines and the enterprise of those, also with a touch of rashness, try to radically overhaul consolidated processes and routines, the pride in success and the hunger for new experiences. A good corporate culture, all in all, builds original fusions of past and future. This is why the strategy of the so-called “generational handover”, as drawn up by Assolombarda and ready to be applied by large companies such as Bayer, Techint, Campari and A2A, has a basic meaning which goes beyond the albeit important expediency of employing young people. It can be expressed in a few words: employees set to retire in a few years’ time accept part-time work and the company hires a young person. The salary of the older person is cut but not his or her pension contributions (the difference is paid by Lombardy regional funds). The company saves on the cost of labour (the salary or wage of a young person is lower) yet is committed in the long term with the new employee. The part-time older worker can tutor the younger one, teaching him or her a profession. A virtuous cycle in other words. To be sustained either with national legislation (the approach taken by President Hollande in France) or with agreements between companies and trade unions, with support from the regional authorities and intelligent use of EU funds (the policy adopted by Assolombarda and the Lombardy regional authorities, which could soon be imitated by the regions of Lazio, Friuli, Piemonte, Emilia and Marche).

“New jobs are not created, only the existing pie is shared out”, say critics. This is true, but it is a very partial view of things. Because in the meantime there are incentives for turnover, the exchange of jobs. Young people are offered new opportunities: joining a firm and with the possibility of targeted vocational training on the job. For the older people the awareness of their usefulness is strengthened: feeling entrusted with the responsibility of teaching a job can give added motivation to tired-out sixty-year-olds, at the end or almost of their careers. Without counting, moreover, the strength of the original fusions of experience and innovation which we discussed at the start.

In order to restart the tired and often constricted motor of the Italian economy other measures are definitely needed: incentives for investments (also internationally), support for research and innovation, growth in size of firms, credit at favourable conditions, drastic cuts in taxes and useless bureaucracy, efficiency of the justice system (above all civil), infrastructure, quality training, etc. In other words it will take the building of an environment ultimately favourable to firms and, by the corporate world, the assuming of all the responsibilities typical of a ruling class.

In the meantime the “generational changeover”, ready to start, can make a good contribution in this very direction. With a further advantage for Italy as a system: preventing young Italians, possibly with a good diploma or a good degree in their pockets, from going off to seek out more welcoming job markets. A serious loss of human capital, damage to social capital, to be prevented. It would be better instead to keep to the good Italian tradition of making the “young and old” interact and prove once again that tradition and innovation are a trump card.

Small firms, the very small ones, so-called microenterprises, nevertheless tackle major competitors. A little like David against Goliath, there are thousands of businesses of this type which, in some way, take on the world and often succeed. Understanding how they do it is important and also fascinating. These firms have it all: Italian genius and production folly, creative flair and heedless calculation. As well as innovation and aggregation, craft production and haute design. What really happens is however often difficult to understand.

Microimpresa macrocompetizione. Innovare e aggregarsi per ripartire [“Microenterprise macro competition. Innovation and aggregation for a relaunch”] by Andrea Scalia makes an attempt by starting, as is explained, first of all from a great passion and experience with the microenterprise, that ideal place of production where humans are responsible for and play a leading role in their own working lives. A place that differs from the large factory, possibly slightly idealised, which also represents a different corporate culture. Aside form the contrasts which leave little space for anything else, the work by Scalia concentrates on the world of microenterprises in manufacturing, services, trade and agriculture which represent an organisational form which is much more widespread than is commonly thought: firms in Italy with fewer than 20 employees are approximately 98% of all those in existence.

Scalia therefore gathers together and investigates, and studies in depth, the typical features of microenterprises, eventually focusing on the increasingly strong need for aggregation also of these organisations whose basic value however remains unchanged. Starting from the special kind of innovation practised in them which, as the book says, is the keystone for Italian entrepreneurs who have always been careful to add special features and value to their work, that innovation which is often invisible, carried out day after day with an obsession for perfection, the unseen, that which is in global value chains, that which is now developed in the networks and in the connections of the global world.

Microimpresa macrocompetizione. Innovare e aggregarsi per ripartire 

by Andrea Scalia

Egea, 2013.

Globalised, yet often still influenced by the local culture where they were founded. Firms which attempt and succeed in negotiating international markets often find themselves in this situation. They think global yet still look back. They operate internationally yet are still identified by the culture which has generated them. It is important to understand the product of the union between global motivations and local emotions in order to gain a better understanding of how business is conducted today.

This is research which needs to be carried out in a team, given the number of cultures which have created different ways of understanding how to carry out business.

This is why The Effect of Cultural Infrastructure in Business Management: Comparison of Turkish and Japanese Business Cultures by Kürşat Özdaşli (professor of economics at Mehmet Akif University in Burdur, Turkey) and Oğuzhan Aytar (correspondent of Karamanoğlu Mehmetbey University in Karaman, again in Turkey) is interesting.

The study bases on a claim that the influence of globalisation, i.e. a standardised set of rules which influence production and consumer behaviour, has now been accepted. Yet while taking into consideration the principles of globalisation, the single corporate communities also reflect the features of the social culture which can integrate the technical side.

To understand this better the two authors examined and compared the way of carrying out business in Japan and Turkey. The typical cultural values and history of the two production systems and the differences and similarities in corporate management were therefore studied in greater depth and an attempt was made to establish the key points at the basis of the success of Japanese firms and the features of the “business culture” of Turkish entrepreneurs. This led to the confirmation, with proof coming from the investigation, of the uniqueness of Japanese companies and the function of “bridge” between different worlds of Turkish entrepreneurship. However Özdaşli and Aytar also arrive at a thought-provoking explanation that every firm has its own characteristic culture which touches on the beliefs, thoughts, behaviour and visions of the world. This culture feeds on the value and characteristics of the community.

The Effect of Cultural Infrastructure in Business Management: Comparison of Turkish and Japanese Business Cultures

Kürşat Özdaşli – Oğuzhan Aytar

Interdisciplinary Journal of Contemporary Research in Business, April 2013, vol. 4 no. 12

Managing a business. Making music. Creating harmony. Bringing people together. Tuning instruments. Learning to find unity amidst both consonance and, of course, dissonance. This intriguing cultural comparison is the basis of a book by Frank J. Barrett, “Yes to the Mess: Developing a Jazz Mindset for Leading in a Complex World” (Harvard Business Review Press, 2012), which is of great use to men and women in the world of enterprise. It has been published in Italy by the Bocconi University publishing house Egea, with the title Disordine armonico (translation: harmonic mess) and featuring an enjoyable foreword by Severino Salvemini. The original (English) title is even more explicit and alludes to two of Barrett’s great passions, as he both teaches management at Harvard and plays jazz piano, and the book flows naturally through the many levels that the best culture of enterprise can express. Organisation and improvisation. Teamwork and the creative flair of the soloist. Repeating a common rhythm only to escape from that rhythm to explore new landscapes. In short, research and innovation, backed by great skill and a command of the instruments at hand.

These are recurring themes on this blog, and faithful readers may remember the bold, ironic comparisons between the music of Eric Satie and the production of a tyre. Signs of a constant processing of ideas towards more creative relationships between running a business and creating a culture, and a quest for meaning amidst the many twists and turns in an “industrial metamorphosis” that calls for new and better tools for understanding how to change paradigms in production, product and use. This changing of the times in response to the Great Crisis that we are still suffering through is also evoking daring ideas concerning forms of organisation and relationships between the leading players within an organisation. Music, and in this case jazz, can be of great help.

Proof of this can be found in the discussion surrounding Barrett’s book that has been raised within Bocconi by Salvemini, as well as by Alfredo Scotti, the chairman of Aon; Francesco Micheli, a man of finance, chairman of MiTo, and highly cultured musically; Filippo Del Corno, musicologist and councilman responsible for culture for the City of Milan; and by jazz musicians Paolo Fresu, Cesare Picco, Bobo Ferra and Enrico Intra.  Various voices. Original points of view. A stimulating debate both for those who run businesses and for those who make music.

Why? In the words of Salvemini, “The new models of business management need to follow the example of a variety of contexts that are less rigid than traditional management.” This is the lesson we can learn from Miles Davis, Louis Armstrong, Charlie Parker and, more recently, the great Keith Jarrett, who all say that even the best soloist needs the backup of a steady rhythm, the efforts of an orchestra or other group (a trio, a quartet, etc.) to accompany, lead in, cue and otherwise support the voice of the soloist’s piano or trumpet. “To support the leader,” says Salvemini, “as it should also be in a company made up of a cohesive, tight-knit group of people.”