The picture that emerged from the work of the 2014 Focus on Industry session of the Aspen Seminars for Leaders was of an Italian industrial system that was holding up well, even through the crisis, and particularly so in those sectors exposed to international competition. This year’s session saw the participants aiming higher, with a view to putting forward an agenda for Italian industry growth, the goal being not merely to ensure resilience, but rather to provide the underpinnings for a veritable industrial renaissance. With this in mind, a research study undertaken by Aspen Institute Italia into the drivers of Italian industrial competitiveness was presented at the seminar. Drawing on the experiences and perceptions of Aspen members exposed to the vicissitudes of business and production challenges, the study identifies new sources of growth, in the medium and long term, for Italian industry.
During the debate that ensued, Italy was likened to an athlete attempting a 100-meter dash while carrying a 66-pound backpack, the latter being a metaphor for the burdens of low productivity, high labor costs, stunted business growth, heavy taxation, stifling bureaucracy, and a North-South divide. This image was seen as starkly evoking the fundamental need – in order to make the country attractive for Italian and foreign firms – to lighten the load of that metaphoric backpack. Reducing complexity at all levels thus becomes the watchword.
It was stressed, however, that simplification will not suffice alone. To withstand increasingly faster-paced and complex global competition, it is chiefly innovation that is needed – the most important driver in a digital world. If within a few years all firms, regardless of the sector they operate in, will be in a position to call themselves dotcoms, Industry 4.0 will mark the real turning point. But this will require huge investment: not just in research and development, although this continues to be important (as do the rights protections that underpin it), but also in revolutionizing the way business is done, and in rethinking business processes and products. In all this, it will be essential to acknowledge the importance of any given firm’s local roots, which, even for global and digital companies, remain a fundamental building block for forging a competitive advantage.
Also viewed as making a crucial contribution in this progress towards the future was the education system, understood as including not just universities, but running the entire gamut from schools to vocational training and lifelong learning, and which is currently riven with dichotomies. It was felt that the goal should not be solely to produce and supply the labor market with human resources that are more responsive to the changing and increasingly sophisticated needs of an ever-evolving production system, nor just to promote greater access to training in the fields of Science, Technology, Engineering, and Mathematics (STEM). Rather, it is also to instill new skills, particularly those soft skills that are little taught or valued in Italy today. It was argued that only by modernizing the training system will it be possible to succeed in shaking up the managerial class, and to overcome the heavy mismatch of skills that sees a country and an entire continent having to contend with double-digit unemployment, while too many jobs remain unfilled.
The banking system was also seen as having a key role to play. There was a perceived need, on the one hand, to devise mechanisms that will enable the benefits stemming from the post-crisis strengthening of the European banking system to filter through to firms, and on the other, to channel funds increasingly through capital markets.
In conclusion, the participants submitted that it will be crucial for any strategy which seeks to revitalize Italian industry to pursue a shared European path to development, and to acknowledge the pivotal role that storytelling can play – in the face of an often heedless political class and sometimes hostile public opinion – in finally instilling a renewed appreciation of the concept and importance of doing business today in Italy and in Europe.