The true Talent of Complexity is being able to imagine possible scenarios better and before others…

Fewer and fewer Italian economists and politicians dare to disregard the negative economic outlook.

The impact will be on all market sectors, and even more on previously “doped” real estate market, deeeply reconfiguring the importance of MAINTENANCE & CARE rather than ACQUISITION & YIELD.

What may happen?

Triggered by a possible real estate deflation and further stressed by seriously jeopardized industrial systems, Italy will be forced to a new management culture stressing the Value Optimization of any asset, activity, service... - not simply the Selling Opportunities.

CHART #1 (at article end) depicts how much management costs impact the initial construction cost during a 50-year life-time of a commercial building: 5 times ! [O.Tronconi: La complessità evolutiva del Facility e del Property Management: verso il Capital Asset Management].

What to do in the Italian Facility Management sector? Simple: understand Italian market!

CHART #2 (at article end) shows Service markets in major European countries:

1) the potential outsourced services value [b€];

2) the actually outsourced services;

3) the integrated service market.

 In a nutshell:

-  Italy is a major player with 43b€ of services potentially to be outsourced (two thirds of biggest French market);

-  Italy in a “giant” in terms of outsourced service (62% of total, just slightly lower than Germany and Netherlands);

-  Italy is a “dwarf” in terms of outsourced integrated service (just 11% of total)!

Italian companies love to outsource at single-service providers, often “mamas&papas” companies easier to “squeeze”…

Latin motto divide et impera (separate and better command…) seems still in Italian DNA.

Cultural issues (control vs empowerment), together with structural ones (small companies vs complex and structured ones) and social ones (family ownership and management vs professional management), all resonate together to require a significant and urgent evolution.

Economic crisis, with resulting opportunities for culturally and financially more advanced business models, may result in a profitable harvest of several market sectors for Integrated Facility Management providers.

Yet, Italian companies already experienced an Integrated Facility Management upsurge during 2007 – 2012 period, resulting in disappointments due to a lack of advanced complexity and partnership culture in Italian FM management as clearily depicted by Andrea Ciaramella (Real Estate & Facility Management Department - Politecnico di Milano) in this VIDEO (in italian):

As Mariantonietta Lisena (IFMA – Italy Chapter) replied to Nicola Antonucci’s ARTICLE (in italian): Italy is wasting huge market potentials.  The fault is on both sides: Clients and Providers, since it’s a cultural problem, and only new and/or external players may change it.

An FM Cultural & Connection change

The solution, as well as huge opportunities, stems from:

-  New FM Management Culture based on deep knowledge of Complexity principles, in order to see, understand and effectively make decisions in more and more complex situations with their continuous, frequent and, especially, unpredictable changes;

-  New FM Players, to effectively introduce in Italy both new Management and new Financial Cultures, all blended inside an effective Governance culture;

-  New FM Value Propositions which better focuses on, as per Andrea Ciaramella's inteview (in above link, Management, Technology and Human Skills innovation. This becomes even very urgent with Artificial Intelligence availability.

Conclusion:

-  Italy, as well as other Countries, is facing a structural deflationary process which creates excellent financial and economic opportunities for New Players;

-  Italian FM market needs New Players with modern and scientific Management Culture, understanding, coping with and making effective decisions in very complex scenarios;

-  Italian FM companies, both Clients and Providers, need New Players with true Partnership way of working;

-  Italy needs New Players with strong embedded Governance and Corporate Social Responsibility principles and best practices.

And remind:  Chaos helps well prepared minds! – L. Pasteur’s  (paraphrase).

Significant Danger Risk opens significant Opportunities – as per Chinese “Crisis” kanji word: Wei-ji = Danger + Opportunity

If you wish to either understand more of share your interest about Italian FM Market, contact us at [email protected]