Keynote speech by Maltese management specialist at international conference

One of the high level topics addressed in the international conference CUNTA 2012 on contemporary challenges, held in Gela, Sicily, focused on the value of human resource management in the global economy. The conference with seven presentations and open discussions was organised by the association “daterreinmezzoalmare” with the collaboration of the Rotary Club, the Chamber of Architects, the Environment Movement and the Association of accountants and financial advisers. Its keynote guest speaker was Tonio Portughese, a Maltese expert in business leadership with vast international experience in human resource management, sustainable excellence and business leadership competences and drivers.

His presentation was delivered in Italian to an audience of industrialists, academics, journalists from specialised business publications, accountants, union leaders, environmental lobbyists from ‘Legambiente’ and the Environmental Archaeological Park, as well as leading architects.

It dealt with five main segments of analysis, research and latest international business management methodologies for excellence in performance, built on advanced strategic sustainability development and field applicable leadership models.

In the Question and Answer session from the floor, he was asked to give his evaluation of the strategies being applied by the government of technocrats led by Professor Mario Monti in Italy, as well as Malta’s development models. Mr Portughese gave a positive assessment of Prof. Monti’s mandatory actions and relentless commitment in the current reality with the implementation of tough austerity measures, fighting tax evasion with zero tolerance and an impact of taxation increases; this phase is expected to lead to new opportunities of growth in Italy’s GDP; as a result of these profound reforms the reliable indicators are that from 2013 Italy will register a slight 0.5 per cent GDP growth after a 1.2 per cent loss in 2012, targeting a five per cent growth by 2020. These strategies should re-position Italy among the leading European countries with a sustainable economy impacting positively on employment growth, which is the ultimate fundamental goal of this government.

Regarding Malta’s methodologies to face the global crisis, he explained that since political independence in 1964, successive administrations focused and built with a consensus approach on the foundations of an efficient export-oriented manufacturing industry, and in constant evolution; a diversified tourism market; and in more recent years on financial services and information technology initiatives. The major breakthrough has been the successful synergies between industry and the academic/vocational institutions supplying investors with a highly skilled and competent workforce, young candidates with the privileged credentials of qualifications in engineering, IT and science. He also underlined the benefits of the national tripartite mechanism for a sound social dialogue involving government, employers and employee unions that, notwithstanding their different perspectives, succeed in finding the basic synthesis and consensus for the common aim of social progress particularly when facing the current turbulences for a small, open and vulnerable economy.

Europe’s challenges and detractors for its competitiveness

The first segment addresses the ongoing challenges for Europe to safeguard its current level of prosperity and to slow down significantly the erosion of its global competitiveness in the parameters of technological patrimony and R&D leadership, bottom-line effectiveness and the renewed commitment for an export-oriented manufacturing.

The analysis goes deep in benchmarking the economic, financial, industrial production and unemployment indicators of leading European economies against the fast-growing Asian players with their strong GDP growths, notwithstanding the turbulent scenario of the global economic upheaval. Euro area GDP growth at +1.5 per cent in 2011 against China’s +9.2 per cent, India’s +7.1 per cent, USA’s +1.7 per cent and Japan’s -0.7 per cent.

The speaker then identified Europe’s political and socio-economic detractors that are hindering its growth, underlining the negative impact due to political fragmentation, weak governments conditioned and “blackmailed” by the spectre of losing popularity, wrong policies against preserving and promoting business and manufacturing, appearing helpless against the greed to disinvest and relocate practically to exploit cheaper labour rates; in this relocation process of manufacturing to low cost areas, Europe is also giving on a golden plate some of its high technology assets. Other major detractors limiting Europe’s socio-economic performances are the excessive bureaucracy and cost-increasing regulations while competitor countries are spared such additional cost impact derived from social protection, human rights, environment, health and safety obligations.

Re-visiting labour market

constraints

The speaker also referred to the debate on the required reforms of the labour market and the modernisation of corporate governance good practices. Questions are asked whether Europe’s economic and social model is really conducive to growth and sustainable jobs.

Mr Portughese addressed the globalisation paradox and whether globalisation has gone too far. The risks of domestic social disintegration are analysed in the framework of the world economy that faces a serious challenge in international economic integration, sources of tension between globalisation and social stability, the pressures on national governments in maintaining domestic cohesion and sustainable social welfare systems.

A new approach through

sustainable excellence

He argues in favour of the latest sustainability development strategies built on four fundamental pillars: people; products; the environment and the community.

This strategy applicable in all socio-economic realities is intended to structure and deploy energizers for business excellence that range from employee engagement to health, safety and well-being; from labour rights and social issues to integrity, ethics and governance, from waste, energy and water management to partnerships in R&D and education.

The current role of human resource management in this global recession needs to be re-engineered from a strategy perspective as a key influential player enhancing the effectiveness of its leading agents for change – improving people processes; involvement in business planning and decision-making; organisational communication; creation of innovative solutions; performance management and measurement systems. In this way people are motivated to release their best potential in their growth and development, contributing to innovation and business success.

Aligning actions to strategy to deliver improved results – a re-energised leadership model

Analysing the latest STMicroelectronics leadership model, for competencies and drivers, the speaker illustrated its fundamental pillars, namely:

· Vision that fits with the company direction, enthuses people by making them part of the vision.

· Results through the implementation of solid processes for deployment and execution.

· Entrepreneurship as an embedded climate, foster risk taking, empower people and ensure accountability, promote and recognise excellence.

· Innovation drive with a forward-sensing mindset, anticipate technological opportunities and focus to gain speed in the relentless global competition.

· People with its particular emphasis on care and commitment for people growth, development and engagement, accurate people assessment, promote professional depth.

This Leadership Model for Business Excellence aims to maximise the people value and contribution pillar, complemented by an enlightened management approach that values two-way communication, individual engagement, competencies’ enrichment, knowledge sharing, recognition.

It builds on ST’s Principles for Sustainable Excellence: Integrity, People and Excellence. Leadership is a must at all levels of the organisation to face various growing challenges.

Re-discovering flexible

manufacturing and the

re-positioned human value

for business excellence

In the final segment, Mr Portughese argues in favour of the relevant need to learn from the Japanese experience for flexible manufacturing by analysing the comprehensive consolidation of management practices from Masaaki Imai’s famous study entitled “Kaizen”, the key to Japan’s competitive success. Kaizen’s clear message is “do it better, make it better, improve it, because if we don’t, we can’t compete with those who do”. Various examinations of corporate case studies and step by step roles are explained and their proven impact on systems improvement; top management commitment; corporate culture; problem solving in challenging areas as labour-management relations; policy implementation or “deployment”; quality dissemination; increasing productivity by 30 per cent, 50 per cent, even 100 per cent without major capital investment.

Re-focusing strictly on the vision for a competitive hi-tech industry, the speaker reflected on Pasquale Pistorio, founder of STMicroelectronics, and his belief that cutting-edge manufacturing will belong only to those organisations and people who not only possess core technological competencies and knowledge, but who also have the capacity to respond to the needs of a rapidly evolving, complex environment. This mandatory condition can only be achieved through alliances with industry, with the ability to review or revitalise ourselves as part of a process of continuous improvement and adaptation, which can only be enhanced through people development and learning.

Pistorio’s vision is reinforced by Peter F. Drucker’s famous quote from his perspective as America’s management guru and social ecologist – he sets the fundamental challenge for the 21st century to increase the productivity of knowledge work and the knowledge worker together with the emergence of lifelong learning as the next frontier of management.

We can overcome the recent traumas of finance and economy failures in this unstable scenario and long-lasting negative experiences like those of the collapse of the Lehman Brothers, the stock-exchange, the “spread”, the emerging measure of Europe’s acceptance of the “golden rule”, the increasing unemployment especially in Europe, the continuous loss of competitiveness in favour of emerging economies, by re-positioning at the centre of core business the value of human resources, their development to consolidate the positive technological gap, as a real value-added energiser in what one can consider as no more a traditional military confrontation but an economic struggle currently being won by the emerging economies, whose living standards continue to rise at an even faster pace. However, Europe can still make it but only by preserving and enhancing its core assets of technology and innovation, and cutting-edge competencies in a re-structured social model, the only path out of the woods.