2 days ago
Lessons In Embracing Complexity—From Cinque Terre To Business
Andrea Pietrini | Chairman, YOURgroup | Author of "Fractional Manager".
I come from a harsh land—Liguria. The region where I was born offered few opportunities for farming or herding due to its mountainous landscape. From the beginning, the people living there decided that the sea would be their solution.
Liguria is now famous for some of the most beautiful tourist destinations in Italy, such as the Cinque Terre (a small cluster of villages nestled in the rocks overlooking the sea), Portofino and San Fruttuoso (a small monastery perched on a tiny island with a charming beach).
But tourism is a relatively recent development. For centuries, life in Liguria meant relying not just on fishing and trade, but also on cultivating the mountains. The locals carved stairs into the rocky cliffs and built terraced gardens. Over time, these terraces allowed people to complement the traditional fish-based diet with vegetables, olive oil and—last but not least—wine.
The wine produced in these conditions is rich in nutrients from the rocky soil and is known as 'heroic wine' (or 'viticoltura eroica' in Italian). And rightly so: Cultivating vineyards on steep terraces overlooking cliffs demands the courage and resilience of heroes.
In many ways, the challenges faced by Ligurian farmers mirror the ones faced by modern companies. My ancestors embraced complexity and shaped both themselves and their environment to thrive. Today, after the disruptions of Covid-19 and now under a new U.S. administration, I believe European companies must do the same: embrace complexity and adapt to a changing world.
Understanding Complexity
There are several key elements businesses must understand when dealing with complexity. The first is interconnectedness.
Like a swarm of bees, complex ecosystems involve countless interacting components. A change in one area can cause ripple effects throughout the entire system. But unlike bees, supply chains—especially those composed of small and medium-sized enterprises (SMEs)—respond in more fragmented ways.
When Covid-19 struck Wuhan, Italy and much of Europe were still 'open.' But the car industry began to suffer almost immediately. Wuhan was a hub for critical components in the automotive supply chain, and disruptions there rippled across Europe. Some companies found themselves with warehouses full of parts—but still unable to produce, because they were missing just one crucial component.
When the lockdowns ended, automakers rushed to replenish supplies, pushing their suppliers into overdrive. This led to a surge in prices and production bottlenecks. Years later, the European car market is still feeling the impact (registration required), compounded now by electric vehicle (EV) policy shifts and growing competition from Chinese automakers. These new players, benefiting from more flexible labor markets and industrial policy, are rapidly gaining ground in Europe.
This is a dynamic environment, and while large multinational companies have developed resilient strategies, many SMEs—often dependent on just a few clients—have struggled.
As the founder of a fractional management company in Italy, I learned to face these challenges head-on, just like my ancestors did with terrace farming. Helping clients embrace complexity requires a grounded, practical approach.
I recently read an analysis in Fast Company confirming that the fractional management model is growing. These professionals are like heroic farmers, drawing value from difficult terrain. They are 'plug-and-play' leaders, able to step in as SMEs quickly and effectively—often more so than traditional consultants from large firms.
Building Resilience By Embracing Complexity
When I founded YOURgroup, the first complexity I encountered was the Italian job market. Managers over 45, once out of a corporate role, often find themselves sidelined. I personally experienced this and learned—through hardship—how to manage and embrace complexity. Over the years, my associates and I have consistently shared our vision with the clients we serve.
A few key mindsets are essential:
1. Systemic Thinking: A crisis must be viewed from multiple angles. The challenges Italian companies face today stem from decades of interconnected events, making narrow, experience-based approaches inadequate. A holistic view is essential—one that considers the full system. Financially, this means owners and fractional managers must use the right tools to reinforce the company's position and drive sustainable growth.
2. Collaboration And Interdisciplinarity: When a fractional manager joins a client company, they must promote diverse perspectives and teamwork. Business owners must feel that the manager isn't working solo, but is empowering the entire organization. This is especially important in SMEs, where understanding company psychology is key.
3. Experimentation: We are entering a multipolar world—the Pax Americana era is fading, and new spheres of influence are emerging. This implies different rules and relationships. Companies must test the waters, adapt and continuously learn. Our traditional career trajectory—study, get an MBA and find a lifelong job—is obsolete. Lifelong learning and upskilling are now essential.
Many of my associates pursue master's degrees or teach in business schools, not just to share their knowledge but to gain new perspectives from younger academics.
4. Demographic Awareness: New generations are entering the workforce. Generation-X adopted digital tools; Millennials and Gen-Alpha were born into them. Their digital fluency shapes how they see and respond to challenges. In family-run businesses, younger generations often seek leadership roles. If guided well, they can introduce positive disruption.
5. Technological Development: SMEs, especially in Italy, are rapidly embracing new technologies—both in terms of advanced machinery and digital transformation. Industry 4.0 initiatives are gaining traction, often driven by former executives now working as fractional managers, who bring a strong background in innovation and automation.
The same mindset applies when the 'finance game' is in play: With the financial sector evolving just as quickly, companies can now rely on digital platforms for financial planning and on fintech startups offering fresh, external perspectives on the company's financial architecture.
Looking Ahead
We are living in a decade of immense transformation. Complexity is rising—quickly. SMEs must be prepared to turn complexity into opportunity.
Fractional management offers the vision and flexibility to help entrepreneurs and business leaders reduce risk, adapt faster and build resilient companies for the future.
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