Abstract
I joined Fiat in an absolutely unconventional manner. I did not have to undergo selection interviews, I did not discuss the position I was going to take on or what was expected of me, I signed no contract, nor did I receive a letter of appointment. I didn’t even negotiate my salary. Simply, on the morning of 2 May 1976 I presented myself at number 10, Corso Marconi, the Turin headquarters.
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Notes
- 1.
The problem of the lifts in the building on Corso Marconi was never solved because their capacity was structurally insufficient for the needs of the building. To ensure that Gianni Agnelli, or some other top manager, did not find himself mingling with clerks or visitors of low rank and having to put up with continuous stops before reaching the floor where he wished to arrive, a simple scheme was worked out: at every important arrival, the guardian at the lift gate rang a bell and an attendant would rush to reserve the use of a cabin (one ring, Gianni Agnelli; two rings, Umberto, three rings, Cesare Romiti).
- 2.
At that time Nicolò Gioia was in poor health and all that remained of his position as COO was the title. When he wasn’t at his desk reading the newspaper, he travelled the world maintaining good relations between the Group and developing countries. Towards the end of the Seventies, he died in the course of a journey and Fiat’s organization chart was left without a COO, a position that was dusted off for my benefit only in 1991.
- 3.
Equal to 5Â % of the ordinary shares.
- 4.
Translator’s note: a leading investment bank, headed by the legendary banker Enrico Cuccia.
- 5.
The top jobs in Gilardini had been subdivided between Giovanni Germano, who was responsible for the line, in other words activities involving design, production, and sales carried out on a day-to-day basis; Franco Debenedetti (Carlo’s brother), who saw to technical aspects and product, and I, who co-ordinated the staff and hence had to look after disparate things such as executive management relations, budgets and planning, communication, strategies, organization and so on. The experience I had gained in the big international groups General Electric and Honeywell proved extremely useful in the orientation of the development processes of a tiny but dynamic and diversified company like Gilardini. The harmonious relationships and efficiency of top management had allowed Carlo De Benedetti to detach himself from the company and to devote most of his time to the Chairmanship of the Unione Industriale di Torino, a post to which he was nominated in July 1974, and which became for him a showcase and a springboard towards the future.
- 6.
Like many managers with the Company, I had attended, in the mid-Sixties, the residential courses held in a training centre located in Crotonville, in New York state, on the upper reaches of the Hudson river.
- 7.
I believe that the credit for having brought Mosconi into Fiat to introduce modern and professional management methods derives from actions commenced by Umberto Agnelli in the early Seventies.
- 8.
At bottom, he had seen his first budget two years previously. It should be said to his credit that he had given me his complete support when I had introduced the new instrument to Gilardini in 1974.
- 9.
For example, in his book/interview with Giampaolo Pansa Questi anni alla Fiat (Milan and Rizzoli 1988), p. 18.
- 10.
Some years before, Nicola Tufarelli (previously with Olivetti) had been hired as direttore amministrativo (Chief Financial Officer), but later Tufarelli was to leave the position free because he had been nominated capo-settore (sector head) of the car division, as Romiti himself says in his book (op. cit.) thus implicitly admitting that sectorialization already existed before he arrived.
- 11.
Later, other non-aligned managers arrived; gradually the taboo faded away and finally there was freedom to support the club of your choice in Corso Marconi.
- 12.
Translator’s note: Gianluigi Gabetti served for a long time as amministratore delegato of IFI.
- 13.
These were profoundly reliable people who were devoted to the company. This was the case with tota Crespi, who was in charge of accounts and was one of the last of the famous “signorine” (in Piedmontese, “tota” means miss) still at work and who had been powerful in Valletta’s time; now Crespi had to deal with Antonio Mosconi’s new methods, and it was the same for Riolfo, in charge of corporate practices.
- 14.
In those first years, what I saw was genuine because there was no artificial preparation, what I was shown or heard was spontaneous. Later, in the Eighties and Nineties, my visits took on a pastoral character. I know I caused, at that time, the consumption of drums of paint for freshening up the places I was expected to visit, but I am convinced that this paintwork was useful because it gave peripheral factories tangible proof that they were being followed and controlled by the centre and, hence, that they counted for something in the economy of the immense Group. And then, a little clean-up now and then did no harm even in the workplace.
- 15.
The blitz carried out by Israeli Special Forces, in the heart of Africa, to free their fellow countrymen held prisoner in Entebbe airport had caused a great sensation in those months.
- 16.
Romiti-Pansa, op. cit., p. 39.
- 17.
As well as the car sector, the situation in Fiat Allis, the Earthmoving Machinery Sector (see Chap. 3) was also tragic; Tractors and Lorries seemed to be doing better, even though their strength was soon proved to be illusory.
- 18.
I recall, for example, the case of Cromodora, which produced chrome-plated iron bumpers: its large factories located in Venaria, near Turin, seemed an odd and cumbersome purchase precisely when chrome in waste water began to be considered a disagreeable topic and plastic was emerging victorious as a technology and attractive in design terms. Comments on the operation among the well informed in Turin did not spare the Group’s top management.
- 19.
Moreover, the map of the product/market in the heap of companies in the Sector, their technical competence, and their shareholding situation was extraordinarily varied. The range went from the torpedoes made by Whitehead of Livorno to batteries by Magneti Marelli, via compressors for domestic refrigerators by Aspera. Some of these companies had only one client, in other words Fiat Auto, such as Ages (items in rubber); others, such as Weber (carburettors), sold to car builders all over the world. Some possessed design centres and their own advanced know-how, others worked solely on licenses to third parties, such as Aspera Motors, which manufactured lawnmower motors under license from the American company Tekumseh; the ex-Fiat divisions, even when promoted to independence, limited themselves to working to customers’ design, as sous-traitantes. Some companies still had in their own equity shareholdings belonging to third parties, as happened with Cavis of Felizzano (switches and wiring), co-owned by the Codrino family; Magneti Marelli was quoted on the stock exchange, as was Gilardini, recently acquired by the De Benedetti family; instead, many other companies were owned 100 % by Fiat.
- 20.
Magneti Marelli lost 19Â billion lire, paint factories (IVI) lost eight and Aspera Motors (lawnmower motors) three. Others showing a loss were Cromodora (bumpers) and Weber (carburettors) for a billion each, Siem (headlights), Stars (plastic), Ages (rubber) for about 500Â million each.
- 21.
My plan called for the Components Sector to be organized on three levels. On the operative level there were simple entities each of which had to control its own product/market with the maximum knowledge of the facts. I reserved the name Azienda (Operating Company) for these single-product entities to underline the need for enterprise and independence they had to possess; I identified roughly thirty of them. Then came an upper level that brought together a certain number of Aziende, chosen according to criteria of operative convenience or specific common aspects. This was the birth of those entities that I called “clusters” in my letter to De Benedetti. These organizational entities, which were soon identified by the more down-to-earth name of Raggruppamenti (Groupings), had to supply the Aziende with the necessary administrative and financial support, manage the common services (personnel, information technology, etc.,), see to planning and management control and promote the development of the business around the world: their role was that of a medium-sized multi-product company. Each one of these was to be run by an important person, with a wealth of authority, experience, and professionalism. The third level, that’s to say the Sub-Holding of the Components Sector, had to be far lighter, no more than thirty persons in all, junior clerks included. Its task consisted of defining general strategies, preparing common policies and, above all, managing the dirigenti, planning the development of their experience and careers. The Fiat Holding Company came to find itself in an organizational position far distant from the operative units. This was to emerge as a great advantage: the Aziende were protected from excessive interference on the part of the Central Bodies. As I shall say later, the Central Bodies of the Holding Company, apart from Finance, were seldom able to stick their noses into the big Car and Industrial Vehicles sectors. As for the functions of Administration, Personnel, Image, the Legal offices and Staff of all sorts, how could they then justify their costly existence? That left only one hunting ground: small, isolated, run-down companies. This excessive trusteeship was oppressive and harmful, especially because it prevented the development of a modern, enterprising management at its head: a hapless unfortunate destined for such a position would have had to make compromises with at least half a dozen bureaucrats from the Central Bodies. Instead, according to my plan, the heads of the operative Aziende within the Components Sector worked under two layers of protective screens: the Raggruppamento and the Sector. Nothing guaranteed that these bodies were better than the central ones, but they spoke the same language and shared the same business interests.
- 22.
In private (but not in his book), Cesare Romiti always maintained that Umberto Agnelli had been the leader of the theorists devoid of any sense of industrial reality.
- 23.
The new structure of the Sector is described in greater detail in Document 1 of Chap. 14.
- 24.
At that time, Carlo and Franco spelled their surname in a different way. In this book I respect their personal choice.
- 25.
Translator’s note: the government of Aldo Moro, the 32nd since the foundation of the Republic, was in charge for little more than 5 months in 1976.
- 26.
Translator’s note: peones was the nickname for those Members of Parliament with no power whatsoever, who were merely forced to vote according to the party line.
- 27.
Romiti maintains in his book (op. cit., p. 38) that De Benedetti caused Tufarelli’s resignation; but the opposite is true, as I recount here.
- 28.
As I have already mentioned, an ulterior demonstration of this distortion was to come about when it was made known that Cesare Romiti and Mediobanca had negotiated the entry of the Libyans in Fiat capital unbeknownst to Carlo De Benedetti, while he was not only amministratore delegato (CEO) but also one of the major shareholders, whose personal quota was not much less than those of Gianni and Umberto Agnelli; and who was a part in some way (albeit indirectly) of that Jewish community that the new investors declared their mortal enemy.
- 29.
Even Cesare Romiti in his book (op. cit.), while he talks about the hypothesis, describes it as improbable.
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Garuzzo, G. (2014). One Hundred Days in Fiat with Carlo De Benedetti (1976). In: Fiat. Springer, Cham. https://doi.org/10.1007/978-3-319-04783-6_1
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