The district goes cyber
Plans/ My provider friend rationalizes supplies. Super savings.
The year is 2003. The companies of any industrial district, let's say the marble area of Carrara in Tuscany, have almost emptied their warehouses of supplies, raw materials and goods. Some do not hold any at all: all it takes is one click and the virtual district provider supplies them from the virtual warehouse supplies, measuring the virtual needs of (real) companies through software that uses complex mathematical algorithms. In three years, companies in the area have achieved a surge in turnover, especially in exports, thanks to the greater competitiveness of the virtual district: reduction in management costs (training and technical aspects) of the warehouse, better use of employee manpower, significant scale price reductions in the purchase of supplies guaranteed by a provider that buys for 400 companies instead of for a drastic reduction in the share of capital tied up in the warehouse. Each transaction on supplies takes place with the district's Intranet and does not produce paper documentation, other than a periodic cumulative invoice.
The simulation can be valid for every district and every product, from the knives of Maniago in Friuli to the districts of Sicily. By applying the external trust of corporate functions to warehouse management in an original way, and transforming it into an Internet service, the idea promises "to recover efficiency margins in the Italian economy of several tens of billions".
The surprising estimate comes from Vincenzo Marino, 43 years old, a Neapolitan who moved to Germany, inventor of the first outsourced data management and transmission system for all company supplies. Its Unitec (www.unitec.it). founded 12 years ago as a purchasing agent in the automotive robotics sector, today it operates with around twenty employees between the center of Augsburg near Munich and the web centers of Sabaudia, where it also acts as an Internet provider. It boasts customers and contacts such as Piaggio, Iveco, Michelin, Man and Whirlpool. And from the ten billion turnover of 1999 he sees 2000 as the boom year. The embryo of the future virtual district developed in the early nineties. “We noticed – says Marino – that the business processes contained enormous hidden waste, due to the management of supplies and related office activities, which are never efficient”.
Then what is the main specialization of the small Italian-German group was born. Unitec takes over the management of 80% of its suppliers from the partner company: the non-strategic ones, which are numerous, and therefore expensive to manage, account for no more than 20% of supplies. The external manager takes care of all the relationships, issuing the partner a single invoice and therefore reducing costs.
From here to the virtual district, thanks to the Internet, it is a short step. The principle is to (virtually) connect competing companies. Ten companies in the same sector have similar warehouses; each will have, say, ten spare bulbs. But no one will ever need more than one light bulb at a time. Here's the solution: each company keeps only two bulbs in stock, and whenever it needs them, a provider supplies them, if necessary sourcing it from one of the other nine.
The system works on two conditions: that the companies in the district cede their complete "sovereignty" over the warehouse to the provider, and that each is incentivized to maintain a minimum stock. This occurs by instituting the payment of a price by the company that obtained a spare part to the one that sold it to them (the provider naturally takes care of this). Thus everyone's warehouse is not only reduced to the essentials, but does not remain idle, also operating as a supply warehouse for competitors. The entire district, in turn, behaves like a single factory, without knowing it. It goes without saying that since the warehouse flows are computerized and managed with a click, the provider of the Friulian district could also reside in Tanzania.
Will it work? It certainly seems tailor-made for over two hundred districts and the myriad of small Italian companies. In the end, everything comes back to Vincenzo Marino's Italian-German mix: "In the Internet age - he says - we are obliged to make the Italian imagination more efficient".
