Pushing through the pain
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Pushing through the pain

The Tuscan economy is hurting, and it's hurting bad. Given, these days nearly every sector and industry in every country is in pain. But Tuscany has its very own personal agony.   Why are things so bad for the region economically? The global economic crisis doesn't help, but

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Thu 08 Apr 2010 12:00 AM

The Tuscan economy is hurting, and it’s hurting bad. Given, these days nearly every sector and industry in every country is in pain. But Tuscany has its very own personal agony.

 

Why are things so bad for the region economically? The global economic crisis doesn’t help, but it certainly isn’t at the root of the Tuscan problem. The Tuscan economy has been on the brink of disaster for at least a decade, and that disaster has arrived right on time to coincide with the greatest-ever world recession; Tuscany is reeling.

 

What has made Tuscany so vulnerable in the current crisis? For one, the traditional Tuscan company structure. The vast majority of Tuscan companies are micro-companies. They’re often family run, have fewer than 10 employees and yield a turnover under 2 million euro per annum. These, the lifesavers of Tuscany in the 60s and 70s, are now often stagnant enterprises, trapped in the past, where even the young have difficulty envisioning, no less enacting, change and innovation. The successful companies that are emerging in Tuscany today tend to be from business parks or similar set-ups and are made up of individuals who have complementary skills and no blood ties. But they are too few and are emerging too slowly.

 

Next, Tuscany is suffering at a very basic level from a near total lack of investment in information and communication technologies (ICT), and whilst the actual physical hardware prices continue to fall, and is therefore easily accessible to all budgets, the mental leap required to catch up with increasingly sophisticated applications is often overly daunting for local businesses. It is common in Tuscany for a business not to have an email address, and even larger companies often prefer faxes to digital communication.

 

Finally, with perhaps the sole exception of the sports arena, culturally Italy has enormous difficulty with networking and team spirit. Petty jealousy, vicious competition and a general reluctance to see anyone else succeed in one’s particular field are sentiments generally rife in the Tuscan (and Italian) business environment. Combine this with an outdated, Masonic approach to the ?ownership’ of clients (?my client,’ ?your client,’ ?Fred’s client’) and associated extra costs (paybacks, under-the-table payments, cuts and the like) make building meaningful, fruitful and economically viable relationships with clients, suppliers and competitors nearly impossible.

 

There are some very real attempts at changing these circumstances. For example on March 29, ToscanaIN, a not-for-profit organisation of local business professionals, met to establish a set of working groups, including a group that will focus on the specific problems in the field of networking. Forums and discussions, like those undertaken on LinkedIN, provide a place to air views and exchange ideas. Local business institutions such as the Chamber of Commerce (under the guise of PromoFirenze), the CNA (a national trade union enterprise) and professional local trade associations, amongst others, are making initial attempts at underlining the importance of real, functioning networks and making the local territory a success generally, because local productivity is a major stimulus to individual company growth. However, this is a hard role to fulfill given that they have no direct positive experience of it themselves.

 

Tuscany, home to products of astounding quality and originality, is struggling to find a place in the ?new’ economy that is slowly emerging from the shattered remains of 2008 and 2009. The next few months, approaching the traditionally stagnant summer period, will give a surer sign of just how many companies will be lifting the shutters on their business after August and how many will be leaving them down permanently.

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