12.01.2012 -
by Michele Scozzai
One percent. Now, it's just a memory. Irritating, difficult to
shake off. At the time it was all that the owner of the company,
where I worked as Head of Administration, was prepared to offer me
in return for all my years of hard work and sacrifice. It was 1980
when I first started working there as a humble accountant, company
turnover was 420 million lire. Not long after that, I found myself
in charge of the company accounts.
Those were financially important years: the European Community
budget was introduced along with the Tax Consolidation Act. The
company had 27 agents in various places around the world, and in
1994 the value of production hit the 18 billion lire mark. I felt
that I had played a significant role in achieving this success for
the company, and so I went to the owner and asked for a stake in
the company. We talked for three hours and at the end of the
meeting he offered me a 1% stake. Nothing more, nothing less.
I told him that I'd think about it. That night, at home, I sat
down with a notepad and the only thing that I managed to write was
a big, fat "1", I pressed down so hard that you could see the
imprint on the last page of the pad. My last pay check had been for
3,650,000 lire. The next morning I resigned and the same evening,
together with my foreman, we took a gamble and founded
Legnotecnica. It was 1994 and I was 34 years old, my daughter Marta
was born the same day. I don't know if walking away was a mistake
but I do know that it was the right thing for me. Following your
heart is never easy: indecision, uncertainty and hesitation are
easy.
The greatest gift I've been blessed with is the people who work
with me. People are everything, alone we're nothing. They are who I
feel most responsible for (after my family, of course). At
Legnotecnica we've learnt to put quality at the forefront. That's
how we've gained the respect of our customers and suppliers. In
2005, one of our most important customers asked us to produce an
extending knockdown table with complete stability.
There was just one solution: fix the table top to the legs using
a threaded rod which goes straight through the legs. That way we
would have a product similar to a solid single piece. The problem
was that no one in the world, until then, had ever managed to
create a bore in wood longer than a metre (the length of the legs).
But this wasn't a challenge we could lose: if we didn't meet the
customer's demands, we would lose an order worth €750,000 and we
would be forced to get rid of 15 employees. They gave us six
months. After that, for reasons of cost, production would be moved
to Croatia.
AREA's intervention
The first attempt was disheartening: we bought an €800 drill bit
and, with a normal drill, we tried to bore a piece of wood. Just 10
centimetres in we realised that the bore had gone off to the right
and had come out of the body, damaging the bit. I was already
starting to think about how I would break the news to my team that
they would soon have to start looking for new jobs. Next, we asked
a university department for help but they wanted more than €25,000
just to do a feasibility study and there was no guarantee of
success.
I told them thanks but no thanks. Then, one day, I met with AREA
Science Park, my last hope. The impact was positive. We decided to
give it a go and work together to find the best solution. AREA
checked to see if somebody else had tried to bore a similar hole in
the past. We found out that, in the 80s, there had been tests done
in Japan and Canada but with very poor results. We were going into
battle without a weapon, but we couldn't surrender.
We analysed patents and techniques for wood boring systems. Wood
isn't always just wood: its density, elasticity, hardness and
resistance are all variables which can dramatically complicate
things. We ran various tests and slowly we started to see the first
results. With the help of Catas, and working with another company
AREA told us about, we were able to adapt technology which was
already used in different sectors to our needs. We discovered that
the secret lies in the bit: we built a prototype and got
encouraging results. We hadn't won the battle but we were getting
there.
The first patents
A few weeks later, we developed a machine which allowed us to
make a 120 cm through- bore. We'd achieved something nobody had
ever managed to do before. We could bore any wooden part with an
almost negligible tolerance. Our jobs were safe and so was the
company. Our new tables had certified 100/100 resistance. Unlike
normal knockdown tables, where the legs are fixed to the top using
four brackets, our products didn't wobble or flex.
We patented the technology and made an agreement with the
customer not to sell our through-bore to anyone else for three
years. We haven't stopped growing since. In 2004, turnover was 3.4
million, it peaked at 4.2 million, before being hit by the global
economic crisis. In the wood sector we are still one of the top
companies in the Triveneto area: today we have 45 employees (not
including subcontractors), we hold five patents, produce 2.5
million pieces of a year, we've invested 8 million into the factory
and we are more or less debt free. The exclusivity rights of our
customer expired and now our through-bore is used by four
companies.
Innovation
Innovation means changing manufacturing processes, creating
products which can't be copied and have a competitive quality-price
ratio. To understand innovation, true innovation, you need to live
in the factory, understand the day to day problems, and deal with
the issues of balancing the books and minimal profits. It is
unlikely that a politician or university professor who calls for
innovation really knows what they're saying.
What I feel most today is that there is a need for innovation in
the sales network: I need someone who will tell me if there are
market opportunities for my products or not. I need experts to tell
me how and where to sell my products. I need consultants who can
truly assess the commercial value of my patents. This is where we
need both national and local governments to intervene. This is the
real key to saving our jobs and promoting Italy on the
international market.
Hidden opportunities
In 2009 it occurred to me that the through-bore could be used in
different applications. I do wonder why it took me four years to
think of it. The opportunity was right there, I just couldn't see
it. Using the technology that we created with AREA, we produced a
cot which when no longer needed could easily be turned into a
storage unit, a sofa or an infant bed. The most exciting new
product though, is a 90x90 cm table which can be extended to 180cm
with a top that can be completely dismantled, and is made up of 18
interchangeable and fully personalisable parts.
Packaged, it takes up just 0.037 cubic metres, against the 0.137
of a normal table. Just in terms of transport costs, the savings
involved are enormous. If we are able to fully realise the
potential, we'll conquer the world with this product: distributors
are lining up to stock it both in Italy and Europe. The strategy we
choose to use for its sale will be an important step for
Legnotecnica.