Carrefour and beyond, what happens at the top of large-scale distribution in Italy
Mario Sassi's post
Carrefour Italia CEO Gerard Lavinay leaves the helm to Cristophe Rabatel from Poland where he obtained the best performance for the Group and a debate immediately broke out online on the choice to entrust the subsidiary of the French multinational in crisis of results to another Frenchman.
Given that Carrefour can choose whoever it likes, it remains interesting to broaden the discussion to the reasons that prevent Italian management (middle and top) from growing and establishing itself at the highest levels of the national and continental large-scale retail trade.
It is of little use to talk about choices that are as obvious as they are wrong or to be scandalized because a French who has not achieved the results expected by the parent company is followed by another French. Nor make unnecessary parallels with Auchan who remains a completely different reality that has decided, unlike Carrefour, to leave our country.
I reiterate that in all of Europe (therefore including Italy) managers of the highest level able to occupy that position at this stage, considered suitable for the CEO Alexandre Bompard and ready to risk their career, I don't see any.
In secondly, those who confuse the culture of a subsidiary company in terms of management and organization that are part of a multinational present in 30 countries with 490,000 employees and a turnover of about 90 billion continue to amaze me with that of an important local company that lives entirely other issues. Impossible to make comparisons. They are different worlds, different cultures and absolutely different decision-making methods. For better or for worse.
Few they seem interested in the type of CV sought by a multinational in the sector and to the complexity of a realignment operation which, if it were not to be carried out in the foreseen time and manner, would lead to a disengagement or to the sale of another very important GDO company with heavy employment consequences.
It is true that in Italy the best Italian GDO companies are more performing. And this is undoubtedly due to the short decision-making chain, to a capacity for symbiosis with the different territory, to the presence of a fabric of large and (above all) small entrepreneurs who have "maniacal" control of their business with a propensity to expand where it is still possible and the ability of a local middle management to keep the pressure on individual points of sale high. Just as it has been true for some time now multinationals not being able to question their organizational and managerial model prefer to abandon direct management by focusing on franchising especially where the competition is more exasperated. Furthermore, it goes without saying that it is often forgotten that part of the crisis of this transalpine reality was further accentuated just when an Italian manager was directing it.
It is therefore not a problem of the CEO's nationality but of interaction with local management, of leadership recognized or not, of organization, territorial sensitivity and harmony with the consumer. And whether or not the parent company wishes to grant the necessary time to reverse the trend.
The Italian large-scale retail trade as we know it today is a product of the entrepreneurial culture that built it in the last century. Whether small or large, those exceptional entrepreneurs have managed their businesses in their own way, governing them and bringing them to the highest possible level of business of the 20th century. Almost all of them, either they are gone, or they are now on the avenue of sunset. None of them have ever faced the problem of the internationalization of their company.
In the meantime, a "new" generation of entrepreneurs and managers took to the track who, except for a few but important cases, they have yet to prove that they are able to improve the results of those who preceded them and to guide the change of their realities. Turnover, costs and margins (much more than the culture of innovation) continue to be the obsession of the majority of brands. The race to the bottom triggered in the sector and which has produced four national contracts plus a few dozen pirate contracts is there to prove it.
Throughout the large-scale retail trade (including the Coop world) there are now around 700 executives (not to mention the managers who in many situations replace them with the same professionalism and commitment). The specialized selection companies confirm that, outside the sector itself, there is very little demand for managers from large-scale distribution. Especially at high levels. Italian top managers from banks and large-scale distribution have no market outside the sector. And this should make us think. Managers do they essentially move within the sector.
The hours of managerial training remain the lowest in the entire service sector of the market. Even insignificant compared to the rest of Europe. The Italian top managers with a heavy CV and internal to the sector corroborated by managed projects and personal results obtained can be counted on the fingers of one hand.
Apart from Coop (but even in that context there are signs of change), almost all the CEOs of the most important brands have a past in industry, in consulting or an international path behind them.
Fortunately, as I said, there is a high quality middle management. So there is an invisible bottleneck that precludes the growth of very good second lines at the higher levels. Other than wrong choices of multinationals! Here is the point.
Certainly in Italy, companies rooted in the territories regardless of size remain more performing than multinationals. Franchises and small local entrepreneurs have enviable results. But they do not allow that leap in quality to their companies or the CVs required of multinational managers. It is the dog that bites its own tail.
Not being able to measure with increasing complexity in international contexts, it is difficult for even a good manager to grow beyond a certain level. And so the multinationals look elsewhere. And, unfortunately, instead of identifying causes and remedies to reverse the course in terms of the growth of the managerial culture and of our companies, we are content to give vent to an inconclusive rhetoric that does not build the conditions to change the situation.
(Extract from an article taken from the Sassi blog; here the full version )
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/carrefour-e-non-solo-cosa-succede-ai-vertici-della-gdo-in-italia/ on Tue, 25 Aug 2020 04:30:56 +0000.