There is a saying that perfectly sums up the challenge facing every Italian manufacturing company:
‘Innovation drives growth, and growth, in turn, generates the resources needed to invest in innovation’
A cycle. A virtuous one, if you can set it in motion. A vicious one, if you stand still.
The Vicious Circle Trap
Many SMEs in the Italian manufacturing sector excel. They dominate market niches, demonstrate artisanal quality on an industrial scale, and create products that are the envy of the world. But often this excellence lasts a generation, two at most. Then it fades.
The reason is almost always the same: profits are generated, but little or nothing is reinvested in research and development. In this way, the company survives in the short term but fails to build its future. This is a classic vicious circle.
Innovation is not a luxury for large companies. It is the condition for long-term survival for any organisation, regardless of size.
Organization for Innovation
The problem is not merely cultural; it is also organisational. In manufacturing SMEs, the very people who manage day-to-day operations are often the same ones tasked with developing new products. The result is predictable: the urgency of the present always overshadows the strategy for the future.
Creating a virtuous circle requires clearly distinguishing between the two streams. The stream that maintains operations has optimisation objectives: lean processes, waste reduction, consistent quality. The stream that looks to the future has opposite objectives: exploration, prototyping, accepting error as part of the journey.
Different organisations for different objectives. Note that this refers to a different organisation of work, not necessarily a different team. It is not a question of vast resources, but of method and clarity.
Vicious circles are set in motion
A well-executed product standardisation and modularisation project simplifies procurement, reduces production times and broadens the range of products on offer. Once a lean process improvement programme is underway, it never stops and continues to generate efficiency upon efficiency.
The same logic applies in reverse: attempting to apply organisational models that are unsuitable simply because they have worked elsewhere is a vicious circle. It leads the organisation to waste energy on processes that are not its own, diverting resources and attention from what really matters.
A Temporary Manager who joins a company does not bring ready-made solutions.
They bring a method. The first step is always diagnosis: understanding which vicious circles are wearing the organisation down, where they are rooted, and why they persist. The second is to act with precision: breaking the mechanisms that drain energy without generating value, and creating the conditions for virtuous ones to take hold. The third is to step back. It is not about creating dependency, but about leaving an organisation more capable than it was at the outset, with processes that continue to function even after the mandate has ended. It is a patient, bespoke task, rooted in the specific nature of that business. There is no one-size-fits-all formula. There is a method that adapts to each individual case.
Change is never immediate. But once a virtuous cycle is set in motion, its effects are lasting.
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