“Whenever there is a major change, companies are faced with a difficult process because they have to adapt the business models used previously. This creates a discontinuity that can result in an impasse. I am referring to the leap from the great cycle of development of SMEs in the Northeast, until the 1990s linked to a local district logic, to the next cycle, the one that began in 2000, which is organized around the two key variables of market globalization and knowledge digitization. This is a new situation for our districts. There are those who ride the change and those who suffer it. Some of our SMEs have learned to use digitized knowledge and have become pocket-sized multinationals, working globally with long networks. But there are so many service providers and producers who, in the districts, have remained isolated, remaining local and not global. This transformation changes the world in which businesses and people live and therefore also redefines sustainability. For better or worse.”
In what sense does it redefine sustainability? Have we reached a point where the old model has become unsustainable?
“Unsustainability is an inevitable outcome, sooner or later, of all processes that are unable, or do not care to reconstitute their premises. Hence, they reach a certain point in their development cycle and come to a halt, having ‘consumed’ some of the premises (economic, social, environmental, etc.) that had incubated their inception. The first source of unsustainability we have to deal with is modernization itself. It is two and a half centuries that modernity has fielded a series of automatisms (science, technology, the market, economic calculation) that optimize certain variables placed at the center of their field of control, pouring their dissipative force on everything that, remaining outside that field, is not visible to them and has no value. For example, the automatism of the market ensures the efficiency of means but does not care about the side effects that result, including damage to the natural and social environment, and to people’s health. From the very beginning, modernization has had dissipative consequences on social life and the natural balance, going so far in the century of Fordism as to build a totally artificial industrial economy (the big factory, standards, labor reduced to time-labor, products for mass consumption). This economy, as seen in the vicinity of the great industrial concentrations of the past, overburdened the environment and the social system, giving rise to more than one factor of unsustainability. Until the explosion of the crisis of large industrial concentrations in the 1970s. As a remedy, in the 1970-2000 period, a growth away from the previous industrial concentrations took shape, and driven, instead, by the hundreds of micro-enterprises scattered across the countryside, with thickening around the various “bell towers” that identify the various industrial districts. Development thus rediscovers the resources that the unsustainability of the Fordist model had consumed: in rural areas the land is abundant and absorbs processing residues (fumes, waste) better. Agriculture that frees up an important part of the employed provides abundant labor. Entrepreneurship arises from below, from a society that has become more mobile and horizontal. But it is a temporary remedy to the unsustainability of Fordism. Thirty years of industrial district growth, from 1970 to 2000, in fact generate a new, and different, unsustainability. By increasing the number and dispersion of factories, eventually the land becomes diffusely polluted and the availability of new land ends. Hydrogeological risk also increases due to the alterations brought to the natural balances of areas invested by district growth. At some point, then, the work, which was initially abundant, becomes scarce, because agriculture now has a limited reserve of surplus, outgoing labor. Even the formation of neo-entrepreneurship is losing steam, because it has become more difficult to set up a factory with innovations and investments that make it competitive with its predecessors. It is not easy to come out of it, because unsustainability is inherent in the operating logic of modernity. To reduce costs and increase productivity, modernity has taught us to use automatisms that preside over efficiency while dissipating the rest. Unsustainability is thus not a disease that came later, but a congenital defect of modernity, associated with reproducible knowledge and its multipliers. In the Northeast it is diluted through the unconscious growth of dissipative effects. A bit like what happens to Giacomo Becattini’s bumblebee (ed. Il calabrone Italia, Il Mulino, 2007), which could not fly if we applied the laws of physics, Northeastern small businesses have gone ahead without giving themselves to the factors of unsustainability they activate. Today, the old district model has become unsustainable and requires a new production model. A model, however, that must come to terms with the globalization of markets and new digital networks.”
How to get out of it?
“If the unsustainability is not due to an external factor or error in operation, the solution is to get the “engine” of modern production moving again by guiding it with a social intelligence that makes it run at a good speed, but remedying or preventing the dissipative effects it creates. This social intelligence must give weight not only to the products obtained, but also to the side effects that accompany them: the value of the former must be corrected by the disvalue of the latter. Or rather: people and communities must give meaning and value to sustainability by incentivizing producers to meet its requirements. This is usually a task that is delegated to the state, without considering that, in the modern world, politics is the product of a system governed by rules, that is, it is the product of an automatism (the state machine is entrusted to whoever gets the most votes). We need to create collective intelligence in communities of meaning, to guide, with the value they place on sustainability, dissipative automatisms. The conditions are now in place for this new synthesis of modernity to take shape: we see it, for example, in the current districts of ecological wood, sustainable building, slow food, healthy food, etc. The capacities to create collective intelligence and sense-related value are there: we must learn to spread and use them.”
Could a new alliance between industrial efficiency and environmental sustainability make our businesses more competitive toward higher levels of quality and value, bringing us closer to a conscious entrepreneurial society, just to quote another book of yours?
“The trajectory shows us a shift in the real economy toward the affirmation of value driven by meaning and collective intelligence. Product quality is now paid for according to the meaning the product has for the user. And that meaning includes governing the factors of unsustainability. The trouble is that the people involved often move toward this new rule, but are not fully aware of it. However, they will soon become so, because the creation of conscious collective intelligence is the only way to manage the increasing risk we will face in the near future. Managing one’s future at risk is now a matter for everyone: the individual entrepreneur or worker, the saver, and ultimately society as a whole. In our century, the world is and will remain structurally unstable: due, certainly, to the unsustainability that characterizes growth and the automatisms that promote it. But also because of other causes. Indeed, ungoverned globalization produces a structurally unstable world. The same effect is produced by the growth of intangible investments (in knowledge and relationships) to which values are attributed today (in the stock market, for example) on the basis of ungrounded and unfounded future expectations. The result is that the risks today are such that they can no longer be borne by companies that are unable to bear them and tend to reduce them drastically, even stopping investing, hiring (employee contracts create fixed costs). So they prefer outside suppliers, and do not grow to remain flexible. The problem cannot be deferred to the state, because today it is itself subjected to risks that must be reduced, so as not to become incompatible with high level of debt. The only way not to be paralyzed by risks is to share them, each taking responsibility for a segment of a growth process.”
What steps in terms of sustainability will companies increasingly need to take in the future to launch new strategies?
“The company no longer has to sell furniture but ‘the idea’ of furniture or the home. A product concept that also includes its relationship with the environment, with the territory. Today with the new sensibility born in the communities of meaning, enterprises do not only sell products but also meanings. For example, for a product made without exploiting child labor or without destroying forests, the customer is willing to pay more. Today the green apple is uglier, but it sells more. This is a sense-related value. Vegans, for example, are a sense-making community. The focus on sustainability corresponds to a new communal ethic, and it feeds the collective intelligence that assigns non-marginal value to sustainability.”
Which sectors should our industries look to most?
“Our industries from the point of view of possible development are conditioned by a two-sided past. On the one hand, it benefits us because it brings into play the intelligence of many thousands of entrepreneurs, each of whom contributes to the outcome with his or her ideas and energy. On another, we register major shortcomings when confronted with today’s new global/digital competitive environment. Our shortcomings are well known. We do not know English, we do not move in the world, we stay at home with our parents until we are 25. There is a perceived disadvantage in global relationships, and we are not capable of codifying knowledge so that we can re-use it with digital media and in global networks. In short, we are anarchic (more than others). To make up for the discrete chaos that dominates our daily lives, every day we invent new solutions, while in other countries, in Northern Europe for example, there is a habit of living in a more planned and codified way: everyone follows the rules and the resulting order simplifies everyone’s life. The first areas to look to in order to regain competitiveness in the future are those that require us to overcome the digitalization and globalization deficit. Our entrepreneurs live by ‘genius and unruliness,’ inventing the day. It is a national culture; there is a lot of personal resourcefulness that others do not have. This can become an advantage as long as we overcome individualism and invest in human capital. To live and work in today’s global/digital world, we need more engineers, more computer scientists, apprenticeships, worker training. The first step is to overcome divisions in risk management, to be able to handle formal languages to codify knowledge, to be more international and more global. Paradoxically, Italy has the highest rate of cell phones relative to the population and the lowest rate of computers than the rest of the world. We have the creativity, the desire to communicate and be in relationship: we lack the investments that can make these capabilities compatible with global networks and digital knowledge. But we can do it, following the “pioneers” who have already explored the field. Successfully.”