Gain­ing trac­tion

China Daily European Weekly - - BUSINESS -

Chi­nese own­er­ship has given new mo­men­tum to Ital­ian tire maker Pirelli

Michael Wen­deroth, an as­so­ci­ate pro­fes­sor of mar­ket­ing at Spain’s IE Busi­ness School, agrees, although he says it’s still too early to de­ter­mine mar­ket suc­cess.

“It’s quite early in the smart tire mar­ket to de­clare any­one the vic­tor,” Wen­deroth says, not­ing that Pirelli’s ri­val, tire com­pany Con­ti­nen­tal, also has sim­i­lar smart tire tech­nol­ogy.

Wen­deroth adds that the key chal­lenge fac­ing Pirelli go­ing for­ward is the need to quickly push fur­ther into China’s pre­mium tire mar­ket. “If they show solid growth there, that will prove the ac­qui­si­tion by ChemChina made sense,” he says.

Pre­mium usu­ally means tires for the likes of BMW Mini, Mercedes, Audi, Jaguar and Land Rover, among oth­ers. Although no of­fi­cial mar­ket share rank­ing ex­ists, Pirelli es­ti­mates that, in China, it has a share for the pre­mium tire re­place­ment mar­ket in the “high teens”.

Look­ing back, what gave Provera faith in the ac­qui­si­tion was a per­sonal bond he de­vel­oped with Ren Jianxin, founder of ChemChina, whom he first met 10 years ago.

ChemChina, founded in 1984, is a huge Chi­nese State-owned en­ter­prise that be­gan as a small sol­vents fac­tory founded by Ren with a 10,000 yuan loan.

Ren cre­ated the ChemChina em­pire by tak­ing con­trol of more than 100 trou­bled State-owned chem­i­cal fac­to­ries across China, with the gov­ern­ment re­tain­ing own­er­ship.

Today, ChemChina is China’s largest chem­i­cal com­pany and a Global For­tune 500 en­ter­prise. It has 160,000 em­ploy­ees, of whom 83,000 are over­seas.

Provera im­me­di­ately no­ticed Ren’s deep un­der­stand­ing of tech­nol­ogy and ap­pre­ci­a­tion for the skills of the huge cor­po­ra­tion’s front­line em­ploy­ees.

“He un­der­stands that strate­gies are im­por­tant, tech­nol­ogy is key, but it is the skills of the peo­ple that re­ally make projects suc­cess­ful,” Provera says.

Provera adds that he has a lot in com­mon with Ren. He also is a leader who deeply ap­pre­ci­ates the ex­per­tise of work­ers, in fac­to­ries, in re­search labs and else­where.

“I of­ten meet with our front-line work­ers to ex­change views, which is im­por­tant in de­liv­er­ing re­sults that are con­sis­tent over the long term,” he says.

In Provera’s view, pas­sion is the key ingredient to suc­cess­ful lead­er­ship. At the age of 70, he is full of energy. He wakes up early, works long hours and trav­els fre­quently to over­see Pirelli’s in­ter­na­tional op­er­a­tions. “The air­plane for me is a part of my daily life. I don’t re­mem­ber a week in which I didn’t take a plane,” he says.

Provera, due to re­tire in 2020, is in the process of se­lect­ing a suc­ces­sor. Asked how he would like his legacy to be seen, Provera says tech­nol­ogy and tra­di­tion are the key. “We have a re­spon­si­bil­ity to run a brand steeped in tra­di­tion, (which) is lead­ing on tech­nol­ogy and has peo­ple at its heart.”

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