Schools and productivity: the German model is the only way

Alberto Forchielli interviewed By Simone Arminio

Originally published in Italian on Il Resto del Carlino, 2/19/15

“Excellent news: Ducati realized that the only way to keep European manufacturing alive is to follow Germany’s example.” Alberto Forchielli, economic and managing partner of Mandarin Capital Partners, reflects on the Borgo Panigale agreement from Bangkok.

Forchielli, is the legend German?

“Germany—and this is a given—is the only Western country to have conserved very high levels of industrial capacity in manufacturing sectors, like metalworking. There’s a lot to learn from this.”

And the United States?

“They stripped classical production and maintained economic dominance by focusing on innovation, companies like Apple, Google, and Tesla.”

Automakers can’t make it anymore?

“Only Germany can manage. In China, they sell both BMW produced locally as well as imported from Germany. I’ll let you imagine which cars people steal.”

Germany always wins. But how?

“With the same cards that underly the agreement at Ducati: continual development, attention to technical schools, professionalization of labor, and a very strong push toward productivity via incentive programs, new models sharing objectives, and continuous cycling. All of this well paid.”

Don’t labor costs weigh in?

“Can I say it? No.”

A world is collapsing.

“The 90s are over: labor costs have increased in Asia, too. Add to these the cost of transporting goods to Europe, the principle market for many companies. Therefore, if quality increases, and thus the value added of production, you’ll understand that the two numbers cross.”

At Ducati, does credit belong to the company or unions?

“Both. Unions finally realized that the survival of workers and companies are tied, hand-in-hand. And Italian entrepreneurship finally understood that the challenge today isn’t creativity, but professional development.”

We’re the most creative and studious. Statistics verify this.

“Look, a creative type and someone with a Harvard degree don’t make a business. Specialized employees, professional laborers, and scrupulous technicians create businesses. Germany isn’t famous for creativity or their universities. They focus everything on technical schools. And, in fact, they are the strongest.”