no. 60 · no. 60 — july 2011 1 focus innovation 2 imind – the real source of innovation 4...

No. 60JULY 2011

Worldwide quarterly magazine of the Pirelli Group

C h a l l e n g e, v e l o C i t y, t e C h n o l o g y, C r e a t i v i t y, i d e a s, i n n o v a t i o n, o r g a n i z a t i o n, C o o r d i n a t i o n, t e a m w o r k, P a s s i o n.

1No. 60 — July 2011

Focus InnovatIon

2 iMind – The real source of innovation

4 Innovation in Innovation

6 A centre of excellence

Contents

Published byPirelli & C. SpACorporate Communications and Media Relations

Editorial CoordinatorMaurizio AbetDirectorBarbara LightwoodEditor-in-ChiefSimona Gelpi

Editorial officeViale P. e A. Pirelli, 25 - Milano [email protected]

English text editorRobert NewmanGraphicsLeftloft — www.leftloft.comPrintingGraphicscalve S.p.a.

Worldwide quarterly magazine of the Pirelli Group

Registrazione Tribunale di Milanon. 494 del 24.9.1994

Printed on GardaPat 13 Kiara paper

No. 60 — July 2011

www.pirelli.com

CQ-COC-000018

8 12 Pirelli F1 activation – Beyond the track

16 Green performance – Cinturato: an eco-friendly family

20 scorpion trail – Blazing a trail

24 truck – Tyres with no fear

26 Information technology – Digital Innovation

28 Europe’s new strategy – From European Union to Innovation Union

29 Governance of risks – Turning risk into a choice

30 corporate culture – Rubber Soul

34 Pirelli PZero – From tyres to fashion the move is technological

36 2011 awards – Leaders worldwide

10F1 – adrian newey Winning innovation

Renzo Piano The masterpiece factory

Each day, innovation is the essence of the work of us all. It is the frontier between those who go ahead and those who stay behind. It is a challenge to make ideas win, to transform intuitions into reality and involve creativity, genius, passion, but also technology, organi-sation and managerial ability. Conquering challenge means contributing to the success of the company, it means interpreting the needs of the market, verify-ing that others have not yet been able to satisfy those needs, understanding how to generate value and striv-ing to be the first and the best. This is the concept of challenge seen through Pirelli’s eyes. A concept that has motivated the people of research and develop-ment for a long time, but not R&D alone. It is also the concept of placing oneself in a niche concentrated on high performance, where technological innovation plays a key role not only in relation to the products, but in all its areas of competence: from raw materials to methods of calculus and simulation, right through to the production process. For us, creating value by inno-vating means transferring our knowledge and ability to a product as fast as possible, and making that prod-uct available to the market quickly. Speed is a funda-mental element in this quest and the company must have a coherent internal speed. In fact, innovation must not only be born in the R&D department, it must also originate from the flow of many company contri-butions. It is, therefore, fundamental to have a business culture within the group that is oriented to change. The whole company must be fired up, motivated and fast. And it is a system that must move in a coordinated man-ner. That is our culture. And our daily commitment. Maurizio Boiocchi, Pirelli’s R&D director

Without innova-tion we would be at a standstill. We wouldn’t live, we

wouldn’t grow, we wouldn’t evolve, we would be unable to manage change. We spoke of innovation with chairman of Pirelli, Marco Tronchetti Provera.

If you had to define what innova-tion is to Pirelli with a message on Twitter, what would you write?Marco Tronchetti Provera LIFE. The life of a company is based on innovation. There is no future for a company or an organisation unable to innovate.

What is the most innovative instru-ment or application that you use most in your daily life?M.T.P. My head. That is the true mechanism that I seek to ‘re-set’ like new each day. I think it is fundamental to try to begin every day with a free mind, to start again with new ideas, but without ignoring the previous day and the experiences of the past.

What is innovation to Pirelli today?M.T.P. It’s people. People who make their competence and enthusiasm available to the company. Innovation is the ability to fuel change induced by shar-ing knowledge and is, therefore, a process that has the human ele-ment at its centre.

With which instruments and actions is innovation carried out at Pirelli?M.T.P. It is fundamental to con-stantly fuel the competences of the various company areas and functions, not only through the ex-change of information and inter-nal comparison, but also through constant contact with the external network represented by universi-ties, research centres, areas that constitute benchmarks of excel-

lence in innovation. Innovation cannot exist without comparison or without the ability to follow the evolution of the world through a network of relationships able to provide visibility of the outside. For a company, this translates into having a solid research structure, able to activate a network that ab-sorbs existing excellence outside the company itself.

Innovation means being prepared to modify rules and habits. What is the relationship between Pirelli and change?M.T.P. Here, change is constantly in operation, because we want and must adapt our speed to the speed of the world that surrounds us. To do that, it is important to share the need to not remain behind but to accelerate at all levels, and on the basis of the responsibility of everyone. Discontinuity is in itself an engine of evolution and innova-tion. For example, the economic crisis is an extraordinary accel-erator of change. It brought back greater attention to the funda-mentals, returning products and services to centre stage and rein-

stating finance to its due role: not a leading role, but one of support to the development of the busi-nesses. A change in the concept of the production of wealth, which was well summarised by Zygmunt Baumann with a passage from the equation ‘money-time-money’ to one that is ‘money-products-serv-ices-money’.

Innovation is not only that of the process or product, but also the introduction of new information technologies and forms of com-munication. How is Pirelli confront-ing this challenge?M.T.P. Innovation can certainly not disregard technologies, such as informatics or the evolution of forms of communication. That is why we are looking with a dif-ferent eye at all the information systems with the objective of exploiting opportunities which, even from the social network point of view, permit the organi-sation of information in a new way to increase competitiveness and to attempt to understand in real time a world that is going forever faster.

imind The real source of innovation

Quality and readiness to innovate are the characteristics of the School of High Training for Management, promoted by the Giovanni Agnelli Foundation, the Pirelli Foundation and the Edoardo Garrone Foundation, together with the Association du Col-lège des Ingénieurs of Paris – one of the most authoritative European institutions in the field of manage-ment training – and the Collège des Ingénieurs of Italy programme.The school directs itself to 40 young graduates in engineering, scientific and economic areas, selected on the basis of merit and preparation, of-fering them a full time masters’

degree in business administration. It is based on four months of train-ing in the lecture hall in the English language and six months of ‘action learning’ in a company. This takes place in part together with their lec-turers and the students of the Collège des Ingénieurs at their premises in Paris, Stuttgart and San Gallo, and in part in the Turin centre with lectur-ers from Italian polytechnics and universities as well as the world of business. The masters’ degree is free to those on the course, who are also paid as a result of employment with a forward contract for their entire pe-riod of training.

Innovation and training

An interview with Marco Tronchetti Provera

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3No. 60 — July 2011

Innovation is at the base of the competitiveness of firms and the growth of countries. But innova-tion at the beginning of

the third millennium is different from what it was at the end of the second millennium. Innovation has changed the innovation para-digm. But what are the features of this new paradigm?One is the pervasive role of scien-tific knowledge. Science nowa-days is a major input in inventive ideas and in the innovation pro-cess of almost every major sec-tor, from new materials, to ICT, health, biotechnology, energy, environment and many other sec-tors. This means that companies that want to be innovative in a va-riety of fast growing sectors must understand and absorb new sci-entific developments and trans-form them into new products and improved processes like never before. A second major feature is the increasing role of consum-ers and users in innovation. Over the past decades, companies have gone from creating preferences, to seeking in-depth contextual knowledge about consumer and user needs, to sharing knowledge bases with their customers, to ac-cepting their direct participation in innovation. The demand side is more directly and more deeply in-volved in the development of new

ideas and new product solutions. A third change is the shift to open innovation processes in which firms collaborate with outside organisations such as suppliers, universities and research centres, and leading consultants and ex-perts to create innovation. Com-

panies are looking outside of their own laboratories for new and useful knowledge bases. In the new millennium, the innovation process is widely distributed and firms need to get access to a vari-ety of complementary competen-cies. Finally, the geographic loca-tion of innovation has expanded. From three poles of excellence – the United States, Europe and Japan – we are moving to a situ-ation with multiple hubs in new and emerging countries such as Korea, Taiwan, China, India and, more recently, Brazil. As a result, companies will increasingly face

the challenges of reverse innova-tion and of new product develop-ment for large and growing mar-kets where the characteristics of demand are quite different from those in the advanced economies. What are the main messages for companies that emerge from

these developments? First, companies will need to continuously update their innova-tive capabilities by exploring the new opportunities that science and global economic develop-ment will offer. They will need a scientific viewpoint with global scanning capabilities. Second, companies

will need to open up to collabo-ration with external sources in order to access necessary comple-mentary knowledge, and they will need to do this without losing the distinctive capabilities that re-main the base of their long term competitive advantage. Third, companies will need to be able to integrate new knowledge and ideas effectively into their organi-sations as well as to manage their own knowledge bases.

Franco Malerba, Professor of Applied Economics, KITeS, Bocconi University

innovation in innovation

Companies will need to continuously update their innovative capabilities by exploring the new opportunities that science and global economic development will offer

The openness of the innovation process pos-es the challenge of recombining creatively physical components and knowledge ele-

ments developed within the company, but also out-side of it. How can individuals become aware of, and then select from, a widening range of potentially useful sources of ideas? An ongoing project –funded in part by the Silvio Tronchetti Provera Foundation and jointly run by Bocconi University and San Raf-faele University- has identified the neurological foundations of such abilities. They are linked to two key neurological circuits. First, those circuits relat-ed to the ability of shifting our attention span from few things to many, and back. Individuals who can switch efficiently, in response to changing environ-mental feedback, exhibit high ‘cognitive flexibility’. Second, the circuits related to our ability of devel-oping simple rules to face uncertain situations. In other words, our ability to flexibly shift our atten-tion is related to our ability to rapidly develop sim-ple problem-solving rules. In turn, such rules help us select relevant information and use it to quickly solve complex problems.

Stefano Brusoni, Associate Professor of Applied Economics, KITeS, Bocconi University

Given the increasingly open, interactive and distributed nature of innovative activities, firms need to develop skills in leveraging ex-

isting knowledge and competences and in developing new ones, both internally and with external partners (see matrix). Yet each of these strategies involves its own challenges. Internal development strategies, es-pecially if based on leveraging existing market and technological knowledge, may hamper search into dis-tant and unrelated areas. So-called ‘competency traps’ and managerial myopia often constrain experimenta-tion along existing knowledge dimensions, prevent-ing the adoption of radically innovative technologies or the implementation of new business models. The external sourcing of new capabilities through acquisi-tions, alliances or agreements helps firms to get access to a broad range of technological and market opportu-nities, but also requires strong integration skills and appropriate transfer mechanisms. How major corpo-rations have overcome these challenges is the object of ongoing research at Bocconi University, funded in part by the Silvio Tronchetti Provera foundation.

Pamela Adams, Professor of International Management, Franklin College Switzerland and KITeS, Bocconi University

Neurological Circuitry and Innovation

Leveraging Knowledge for Innovation

Internal Orientation External Orientation

Exploit Leverage current competences to enter new areas and add new competences

Leverage your competences to enter new areas:

− Harvesting, leverage and recombine technological resources to enter a new market − Leverage market knowledge to apply existing technologies in new domains

Leverage your competences to enter new areas through external alliances, M&A or partnerships:

− Leverage your technological competences for entering new areas by sourcing market competences externally − Leverage markets competences by sourcing technological competences externally

Explore Development of new competences/knowledge bases

Develop internally new competences that depart from the firm’s main technology and market competences in order to align organisational resources with environmental opportunities

Acquire capabilities that depart from the firm’s main technology and market competences in order to align organisational resources with environmental opportunities

Knowledge-leveraging strategies in open-innovation environments

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5No. 60 — July 2011

InternatIonalIsatIon

sumption. It uses the most modern Pirelli research technologies for the production of ecological, high and ultra-high performance tyres. Some of gems of technological excellence at the new centre include an evo-lution of the robotised system for tyre production called Next MIRS, the CCM precision system that pro-

duces tread compounds and a sen-sor Cyber Tyre, bringing to life the intelligent cover which will have a means of transmitting useful infor-mation for driving and controlling a vehicle. More than 1,100 people work at the Settimo Torinese cen-tre, which has a production capac-ity of over 3.5 million tyres a year, all exclusively for the he premium market segment. The innovations and excellence intrinsic in Pire-lli’s new technological centre are already considered a study case in the world of Italian industry due to the new unit’s ability to constantly innovate its production processes, while maintaining its fundamental characteristic of being industrially sustainable. So much so that it con-sumes 33% less energy, reduces CO2 emissions by 36% and produces 20% renewable energy. The organisa-tional processes of human resourc-es and work space are also a major break with tradition. They include community space, for socialisation not imposed by the company but desired by the employees, the estab-lishment of recreation areas like a small football pitch, Internet point and other advances.

A highly advanced and efficient technological installation. Reduced environmental impact. For high and ultra-high performance tyres. Among the jewels in its crown, are Next MIRS, Cyber Tyre and an evolved system of compound production

Started at University of Cali-fornia in Berkeley, U.S.A. in 2001, the objective of the

Cyber Tyre challenge is the acqui-sition of information from a tyre on the move that can better influ-ence the safety and dynamics of the vehicle.In about 10 years of development, a device has been created which, when inserted inside a tyre, trans-mits important data on its perfor-mance that the tyre “reads” while in motion directly to the car’s electronic management system.In practice, the Cyber Tyre en-sures the transformation of the driving experience, improving a number of performance factors and providing information on ap-plications which, to some people, may seem unthinkable.A mix of hardware, software, elec-tronics, dynamic models, math-

ematics and physics comprise the sensor, the result of a highly advanced project developed by Pirelli with American and Italian universities and completely man-aged by the Group’s research and development engineers.Performance and safety are the two elements that will benefit most from the Cyber Tyre, but they will not be the only aspects that will profit from the intelli-gence of the tyre in motion. One is the environment, but the influ-ence will probably not be so direct and immediate. However the per-formance that it will be possible to obtain from the Cyber Tyre will also permit the improvement of the cover’s rolling resistance by optimising the management of how the tyre works.

Giorgio Audisio

Its UHP (handling) is tops, its quality level constant, pro-duction is integrated and au-

tomatic, the technological and logistical flexibility are in no doubt, while the fast develop-ment of new sizes is certainly a fundamental plus; then there is the simultaneous production of 14 different sizes in four differ-ent diameters – between 18 and 24 inches – and with section widths ranging from 225 to 375 mm.In that list are the characteristics of Settimo Torinese’s Next MIRS mini-tyre factory, an evolution of the Modular Integrated Robotised System of tyre production. It has been entirely designed and de-

veloped by Pirelli and the Group’s research and development tech-nicians and is based on 45 patents which have already been granted and another 73 for which patents have been requested.Next MIRS is one of the four mini-factories at the Settimo Torinese centre and it is a robotised system for the production of the world’s most advanced tyres. It builds ultra-high performance tyres for car ranges like those of Ferrari, Maserati, Porsche, McLaren and Lamborghini and its production capacity has a flexibility of up to 50 unit batches per size.

Gianni Mancini

cyber tyre: the intelligence of sensors

next MIRs: the factory of patentsP

irelli’s new technologi-cal centre at Settimo Torinese, Turin, Italy has been created by in-tegrating two existing

factories into one single plant. Its production equipment is the most technologically advanced and effi-cient in the Group, and the new in-stallation will be inaugurated this year. On 19 March, President of the Republic of Italy Giorgio Napoli-tano visited the new facility which stands in an area where Pirelli has been manufacturing for over 60 years, accompanied by chair-man Marco Tronchetti Provera and managing director of Pirelli Tyre, Francesco Gori.Representing an investment of more than 150 million euros, the new technological industrial cen-tre has been designed to limit to the maximum its impact on the environment and its energy con-

a centre of excellence

Giovanni Pomati

Over 1,100 people work at the Settimo Torinese centre, which has a production capacity more than 3.5 million tyre a year

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7No. 60 — July 2011

8 Pirelli world 9No. 60 — July 2011

The new Settimo Torinese centre designed by Renzo PianoStefano Missaglia

The masterpiece factory

At the Settimo Torinese centre, produc-tion excellence marries with that of architecture, thanks to the hand of one of the best known Italian architects, Genoese Renzo Piano.

Work began at the building site in June, 2009 and was aimed at strengthening and joining the existing structure with new production units of high architec-tural and planning quality through the re-design and the improvement of general services and of internal distribution logic. Coherent with Pirelli’s strategies of sustainable development, particular attention was paid to the project’s eco-sustainability. That is clear from the adoption of ideal measures with which to ful-ly limit the new units’ environmental impact and en-ergy consumption and to favour moments of contact and meeting between the various company functions.Despite the diversity of the end products – tyres for heavy vehicles in the existing factory and those for

high performance cars in the new unit – this indus-trial centre provides both units with common servic-es. They include the centralised production of energy and some parts of the production process, as well as the initial phase of rubber compounding and the fi-nal stage of finished product storage as activities that have become common factors to both product lines, expanding the general benefits of such synergies.The characterising and key theme of the project is its “central spine”: all the common activities and ser-vices for blue and white collar workers are located in a barycentric manner between the two factories. They include a company restaurant, the technical and administration offices, changing rooms, recre-ational and cultural areas, library, Internet space and the infirmary. It is a highly innovative element from the sociological point of view, even more so than the architectural aspect, specifically to optimise and fa-cilitate socialising among employees. The decision to

Born in Genoa in 1937 to a family of builders, Renzo Piano developed strong cultural and expressive roots with the Genoa city centre, its port and the profession of his father.At the Milan Polytechnic he worked in the studio of Fran-co Albini and graduated in 1964, after which he began to experiment with light, mobile and temporary structures.Between 1965 and 1970 he undertook numerous jour-neys of research and discovery in Great Britain and the United States.In 1971, he founded the Piano & Rogers office in London in collaboration with Richard Rogers, with whom he won the contest for the creation of the Pompidou Cen-tre in Paris, the city to which he transferred.From the early Seventies until the Nineties, Piano worked with engineer Peter Rice, establishing the Ate-lier Piano & Rice, which was active from 1977 – 1981.In 1981, the Renzo Piano Building Workshop was founded, an organisation that brings together about 150 people and has offices in Paris, Genoa and New York.Piano has received numerous awards and other forms of recognition for his work including: The Premio Com-passo D’Oro in Milan (1981), he was made Chevalier of the Legion of Honour in Paris (1985), won the Royal Gold Medal of the RIBA, London (1989), was made a Cavaliere di Gran Croce by the Italian government in Rome (1989), won the Kyoto Prize (1990), the Neutra Prize at Pomona, California (1991), was made a UNESCO goodwill ambas-sador (1994), the Praemium Imperiale in Tokyo (1995), the Erasmus Prize in Amsterdam (1995), the Pritzker Architecture Prize at the White House in Washington (1998), a career Leone d’Oro in Venice (2000), the Ital-ian Medaglia d’Oro all’Architettura in Milan (2003), the AIA Gold Medal in Washington (2008) and the Sonning Prize, Copenhagen (2009).He has been committed to the Renzo Piano Founda-tion since 2004, a non-profit making organisation de-voted to the promotion of the profession of architecture through educational and didactic programmes. The Foundation’s new offices were inaugurated in Punta Nave, Genoa, in June 2008. Simona Gelpi

Renzo Piano

locate the car parks in the same central space – not the norm for an industrial installation – complies with, and strengthens, the basic idea of facilitating and improving the conditions of access of the em-ployees to their places of work.This central axis looks like a large avenue generously planted with over 400 flowering cherry trees, organ-ised with two parallel one-way lanes with car parks for about 550 vehicles. At the end of the “spine” there is the Pirelli hall, which can be transformed into var-ious configurations, ready for meetings and outside events; the opposite end is counterbalanced by a cor-responding seven a side football pitch.All of which has been designed with great attention in terms of eco-sustainability and optimisation of energy resources. The project has availed itself of a cogeneration plant, a system that recycles rain water, which is conveyed into a tailor-made hydro-reservoir, a sec-ond skin of external protection, above the covering that will have the task of controlling the irradiation of the sun, increase the performance of the thermal insulation and accommodate 10,000 square metres of photovoltaic panels alternating with simple bris-esoleil permeable to water in the zone directly above the treed area … in short, a real masterpiece of an eco-sustainable factory.

architecture

Settimo Torinese

Settimo Torinese’s project disegned by Renzo Piano


I f any confirmation was needed of Adrian Newey’s contribution to how a Formula 1 team goes about its

business, last year’s stunning double championship win with Red Bull Racing is all the illustration needed.Having taken both Williams and McLaren to the heady heights of multiple title wins in the 1990s, New-ey’s challenge, when he joined Red Bull Racing for the 2006 season, was to do the same for a young team determined to challenge the status quo at every opportunity.Six short seasons into the team’s F1 adventure and Newey has de-livered. Seizing on major regula-tion changes for the 2009 season, the designer penned a spectacu-lar car that took six wins on its way to second in the champion-ship. That radical design paved the way for last year’s RB6 and after nine wins, 15 pole positions and 11 other podium finishes, the mission was complete – the constructors’ and drivers’ titles were secured. After early stints with the Fittipaldi and March F1 teams, he first tasted success in American racing. His March sports car design won IMSA’s GTP class in 1983 and 1984, and his IndyCar project, the March 85C, took the championship and the Indy 500. The follow-up model won the championship in 1986 and the Indy 500 in both ’86 and ’87, but F1 was calling, and after a brief venture with March, Newey was, by 1990, at Williams.There, in partnership with Patrick Head, he brought

home five constructors’ titles between 1991 and ’97 and made champions of Nigel Mansell, Damon Hill, Jacques Villeneuve and Alain Prost. When Newey de-parted Williams for fresh challenges at McLaren, he confirmed his prowess with three further champion-ships, rounding off the decade with the 1998 construc-tors’ title and two world championships for Mika Hak-kinen. New challenges were needed, however, and, in 2006, Newey jumped at the chance to help take new team Red Bull Racing from F1 fledglings to soaring champions. For Newey, though, the realisation of that

dream it is still not enough.“The motivation to compete and win is still as strong as ever simply because I really enjoy this team,” he says. “We’ve got a great outfit and we have a good atmosphere here. We don’t pretend to be any-thing we’re not. We’re a Formula 1 team that goes about its business of trying to make the best possible car it can.” All of which means that building a car to meet the challenges of the 2011 season has been an exciting process. “Prepar-ing for the new season has been an interesting challenge for all of us,” he says. “There have been a number of changes to the regu-lations and while they are not as comprehensive as the changes for 2009, the major differences – such

a the re-introduction of the KERS system and the ar-rival of a moveable rear wing to aid overtaking – have meant that RB7 is quite different to last year’s car. “However, what we have done is taken the philosophy of continuing evolution. We have evolved RB6, which itself was an evolution of 2009’s RB5, and this is, if you like, the third generation of a successful lineage.”

...about Adrian

He is called the rebellious genius of Formula 1. Or perhaps it is better to say

the man of the last two decades, given that Adrian Newey, chief technical officer of Red Bull Rac-ing, has by now been designing winning cars for that number of years. Despite the fact that he was born in Shakespeare’s home town of Stratford-upon-Avon, Newey is considered the Leonardo Da Vinci of Formula 1, and has challenged himself by trying to do things that were impossible for others. In the duplicity of his designer-engineer role, there are also the characteris-tics that have made him great and legendary: imagination and con-creteness, ingenuity and a sense

of limit, a passion for perfection and ease of use. He doesn’t give much away to the press and tele-vision. But when he does, Newey always reveals interesting matters and opinions. In this interview, he explains his personal innovative vision and where his stimulation resides, able to fire up the engine of innovation.

Based on your experience in Formula 1, how would you define the concept of innovation? Is it one of continuity or is it a continu-ous process? In that sense, is it possible to say which were the determinating moments of your experience in F1 and what is your vision of F1 of the future? Adrian Newey A Formula 1 car is very complex and is actually a phe-nomenally messy vehicle. If you set off on a certain route, you will most likely get stuck and reach a dead end. I am most satisfied when a design is capable of evolving and the battle between design and de-velopment is constant. Regulations

are the main obstacle; inspiration depends on understanding the re-strictions of the regulations and going from there. My F1 vision for the future is difficult to determine, let’s just say the limits are not es-tablished and that the drivers can physically stand to go more quickly.

What is the push, the motivation towards continuous innovation and how much do cultural and personal human experiences count? A.N. Continuous innovation re-flects a lot of your surroundings and experiences. I have learnt that ideas will come from noth-ing and it’s almost as if things are evolving in your mind even when you are not aware of them. There is always trial and error when it comes to design; I have learnt that if you change the shape by a small amount, it will have a big effect on performance. The push for me is that design is constantly chang-ing, so there is always something to adapt and improve.

Formula 1

Newey’s vision

An interview with Adrian Newey, chief technical officer of Red Bull Racing

Simona Gelpi

Winning innovation

If any confirmation was needed of Adrian Newey’s contribution to how a Formula 1 team goes about its business, last year’s stunning double championship win with Red Bull Racing is all the illustration needed

Sebastian Vettel, the current world champion having won in the 2010


Our Formula 1 ad-venture officially began on 24 June in Milan, when Pirelli announced

it would compete in the 2011-2013 world championships as the sole tyre supplier. An extremely im-portant challenge for us, which re-quired a major effort by the whole company. The result: in just a few months, we were able to produce tyres that brought spectacle and excitement to the Grand Prix mo-tor racing.In parallel with work by other company functions like research and development and logistics, from the end of last year it be-came necessary to orient all our marketing activities worldwide to Formula 1. For various countries, this became a strategic and opera-tional priority.That is why F1 activation was cre-ated, as an operational platform developed to maximise the impact of Formula 1 on the Group’s busi-ness through all the main stake-holders – the media, tyre trade, consumers, institutions, from an-alysts to the most representative institutional individuals in the various countries in which Grands Prix take place, as well as our em-ployees.Marketing and communications activities before, during and after

each GP allow us to increase Pire-lli brand exposure and measure it during the live TV transmissions of Saturday qualifying and the Sunday race on all channels and in all markets. The data that became available to us after the first few races confirmed a return of signif-icant value, due to the exposure of our brand name through the prin-cipal ‘properties’ available – at the circuits, on the cars and pictures of the drivers who wear our brand at each GP during trophy presen-tations. Most important of all, it confirmed the ability of Pirelli to fully exploit Formula 1, especially in emerging markets, where the

company is investing a great deal. The strategic role of Formula 1 is, in particular, reflected in the in-creased sales of the P Zero family of tyres and greater customer pen-etration we are achieving, the two most relevant key performance indicators which already show an improvement against 2010.So Formula 1 can and must be a powerful image builder. Especially one of business through the di-rect and selected involvement of our dealers and the activation of the end user as both members of the public attending the GPs and our distribution network, as well as through targeted digital chan-

Beyond the trackThere are not only innovative Pirelli tyres in Formula 1. Marketing and communications also speak the language of innovation. Marco Maria Tronchetti, head of Pirelli F1 activation, tells the story

Pirelli F1 activation

A powerful image builder

At the GP of Australia in Melbourne, the first round of the 2011 world championship, Pirelli supported a solidarity initiative promoted by the foundation of Red Bull’s local driver Mark Webber. The Mark Webber Challenge helps fight leukaemia and since 2006 the foundation has raised over a million Australian dollars to help combat this serious illness. From this year, Pirelli Tyre Australia will take on a leading role by contrib-uting to the support of the Challenge with financial and logistical help. “We’re really pleased to support the

foundation’s Mark Webber Challenge as the official sponsor in the year of Pirelli’s return to Formula 1. The part-nership for us is a duty”, said Ales-sandro Marchi, managing director of Pirelli Tyre Australia, who with Mark Webber displayed a cheque for 80,000 Australian dollars (€57,000) made out to the foundation.“It’s really fantastic to have Pirelli as the official sponsor of my founda-tion”, replied the Red Bull driver. “It will, without doubt, elevate the pro-file of the organisation and will help us to raise more money from other companies”.

Innovation and social responsibility

F1 activation was created as an operational platform developed to maximise the impact of Formula 1 on the Group’s business through all the main stakeholders


The social media is an integral part of Pirelli’s communications strategy. Several months ago, an official Face-book fan page was inaugurated and as a result of continual user interac-

tion, the page has so far registered over 15,000 fans and attracted a total of over three million visits since the start of the season in March. And the graph confirms that the numbers

are growing fast. As well as Facebook, Pirelli has activated a Twitter profile that communicates real time updates to users during the races and replies to their questions.

Among the initiatives that we have taken to promote Pirelli and the world of

Grand Prix motor racing is the Formula 1 Village. This travelling promotion set out from Genoa on a tour of Italy on Saturday 28 May and is devoted to Pirelli and the maximum formula. It will tour for five months, calling in at 10 major Italian cities to promote a series of events linked to Pirelli technology and the world of F1. After Genoa, the Pirelli Formula 1 Village is to visit Bologna, Flor-ence, Rome, Rimini, Turin, Monza, Padua, Naples and Bari.The heart of the project is the Pirelli Formula 1 Village itself, a 400 square metre area in which a show car and drive simulator will enable F1 enthusiasts to make

virtual fast runs and challenge each other by racing the last lap on an electric track. Key players in this initiative are the children, for whom an area has been set aside where they can challenge each other by driving a mini car on the electric track wearing costumes of foam rubber that recall the single-seaters. During each event, the city centre is transformed into a paddock, giving young visitors the chance of feeling like champions for a day. Guests can take part in a special test that will verify their knowledge of Formu-la 1 and test their driver reflexes.To involve people who cannot take part in these events, the ex-perience can still be enjoyed by accessing web site www.pirelli.it/f1 emotion.

Pirelli Formula 1 in the social media

Travelling with Formula 1

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GP MONACOPROMO KEN BLOCK

Among the marketing ini-tiatives designed to in-volve end users are two

Pirelli simulators, which have been used during events organ-ised to coincide with each Grand Prix, starting with Barcelona on 22 May. One of them is modelled on the Toyota TF109 with which Pirelli carried out its private pre-season test sessions. The livery of the second simulator was the subject of an international com-petition called PITLINE – made up from the words pit lane and line – which took place from 1-21 March. Accessing the www.BootB.com address, the research engine for creative races, F1 enthusiasts, journalists, bloggers and oth-

ers were able to let their minds run free by interpreting and giv-ing shape to Pirelli values. Per-formance, research, innovation and safety all became the basis for the new F1 car’s livery, and so became an instrument by which to communicate Pirelli’s values. Participants sent their entries to the special blog http://www.pitline.Pirelli.com, where they were able to enjoy tremendous visibility and have their designs voted on, with the opportunity of sharing their creation on the major social networks.

Entrants from 15 different coun-tries sent 195 projects through BootB.com, so it was not easy for Pirelli to decide on the win-ner from such a large number of creative proposals. But in the end, French designer Bruno Maugery won the $4,750 prize. The initia-tive is certainly a ‘best case’, not only due to its success of having attracted over 13,500 visitors to the PITLINE blog – an average of 530 per day from a total of 97 coun-tries – but also for the promotion of creative young minds through such an innovative project.

a creative FormulaLucio Vesentini

nels across the world. Our clients throughout the world – most of all our dealers – have begun to be involved in a series of on-track ac-tivities. These include exclusive in-vitations to the paddock club and access to that restricted area and

the pit lane, plus off-track projects, such as planning promotional and branding activities by the shops, inspired by our Formula 1 pres-ence. We also have agreements and continuously network with the 12 F1 teams so that it is possible to use a number of exclusive proper-ties, like the participation of some drivers in Pirelli events, or visits to a team’s headquarters by our deal-ers. Ours is a 360° approach: for example, at the time of the Grand Prix of Turkey we invited journal-ists, analysts, local and foreign dealers from all over the world – in-cluding Russia and Brazil – to the Pirelli factory at Izmit, where we make our entire motor sport range, including the P Zeroes for F1.Among the various initiatives we have run since the start of the 2011 Formula 1 World Championship is the organisation of media events at Shanghai, Istanbul and Barcelo-na. Our objective is to take advan-tage of the Grand Prix week to talk to all the local media – TV, newspa-pers, magazines, radio and the web – about Pirelli’s strategic presence in every market, our products and assets. We always involve the lo-cal CEOs in the presentations and press conferences. Where it has been possible, the company has made contributions to the support of local communities through tar-geted projects and initiatives. Let’s look at some examples.

Our Clients have begun to be involved in a series of on-track-activities

Marco Maria Tronchetti Provera


Cinturato is a historic Pirelli tyre brand that has returned to the marketplace with new character-

istics oriented towards green per-formance. A family of ‘green’ tyres, which has now been enlarged by the arrival of the Cinturato P1. The modern Cinturato range was inaugurated in 2008 with the in-troduction of the P4 and P6 for cars of small and medium cubic capacities and were given a fa-vourable reception by the market and specialists. It was the turn of the Cinturato P7 in 2009, the first green tyre range for cars of medium and high cubic capaci-ties, which achieved maximum recognition in Europe’s most se-vere press tests. The Cinturato tyre range has been designed and developed by the Pirelli Group’s laboratories to meet new market needs and contribute to sustain-able mobility. Due to their inno-vative compounds, structures and tread patterns, Cinturatos deliver lower fuel consumption and car-bon dioxide emissions as well as more mileage and safety in both the wet and dry. The Cinturato P1, which made its debut this year, is a tyre designed to respond to the new European regulations sched-uled to come into effect in 2012 and is for premium city and com-pact cars. Right from the first of-ficial tests, the new Pirelli topped its competitors in terms of fuel saving and lower noise levels, two fundamental parameters that en-sure a high environmental grad-ing. As a result of a 15% reduction in its weight and the selection of innovative technologies, the Cin-turato P1 also reduces rolling re-sistance by up to 25%.And in line with its green perfor-mance pedigree, the Cinturato P1 cuts external acoustic pollution by 1.5 decibels and internal noise lev-els by 1 decibel, providing greater driving comfort and pleasure.

The ecology of the Cinturato P1 blends with its high technologi-cal content and is even available in run flat form in some sizes, en-suring continuous mobility.The new addition to the Cinturato family further reinforces the con-solidated Pirelli green performance strategy, the tyres of which ac-counted for 36% of the company’s sales in 2010. With 27% of total Pire-lli sales throughout the world com-ing from green tyres, the ecological

Cinturato is already the Group’s most important range. It is destined to expand even further, in line with further planned reinforcement of Pirelli’s green performance strat-egy. Four different qualities dis-tinguish the Cinturato P1: safety, driving pleasure, respect for the en-vironment and versatility.

As far as safety is concerned, the Cinturato P1 was developed to op-timise the tyre’s performance on both wet and dry surfaces. Hybrid materials, which control and sta-bilise the tyre’s deformation, en-sure an optimum contact patch with the ground in all conditions and significantly reduce braking distances, while also producing greater cornering power.The P1’s environmental impact depends on whether it is used in cities or on long journeys, but it does contribute up to a 4% re-duction in a vehicle’s CO2 emis-sions. Rolling resistance, the force with which a tyre opposes the vehicle’s forward movement, de-pends on factors beyond the tyre itself – speed and weight of the vehicle, type of asphalt, ambient temperature and the tyre’s infla-tion pressure – as well as internal factors such as the cover’s struc-ture, tread compound and pattern. When designing the Cinturato P1, Pirelli introduced innovative new materials and compounds for those components. The tyre reduces rolling resistance by up to 25%, which translates into lower fuel consumption and emissions. The lower rolling resistance is also

A family of tyres that respects the environment, without losing any of its safety or versatility qualities, has been extended by the arrival of a new product: it is the Cinturato P1, a range of green performance tyres for premium modern compact and city cars

Cristina Pontiggia

Cinturato: an eco-friendly family

green performance

Car Tyre for sustainable mobility

From the first official tests, the new Pirelli topped its competitors in term of fuel saving and lower noise levels

Cinturato P1The latest of the green tyre range to have been launched, which has been developed for city and compact cars and is also available in run flat form.

Cinturato P6For compact and medium cubic ca-pacity cars, this tyre has optimum handling qualities in the wet and un-der braking, and a high mileage tread combined with ride comfort.

Cinturato P4Stability and drive precision. Power-ful grip when cornering under full load. Safety in the wet and low noise

rotation to the advantage of on-board silence.

Cinturato P7For cars of medium/high cubic capaci-ty, this tyre combines high performance with respect for the environment.

Scorpion VerdeInnovative, an ecological performer and the first green performance tyre specifically for SUVs and crossovers.

Winter Snowcontrol Serie IIFor city and compact cars, safe in any wintry situation: city, motorway, mountains.

Green performance tyre family


Green performance conceptsReduced environmental impact during its production and lifetime, both principal objectives of Pire-lli’s green performance strategy. One achieved with a tyre range that exploits new materials and compounds and innovative car-cass structures to the point at which safety and driving pleasure are unchanged in both the wet and dry, while at the same time the tyre generates a low environmen-tal impact.Nano-technologies were used by Pirelli’s research and development laboratories to create the com-pany’s family of green tyre com-pounds that produce greater ther-mal stability, lower friction levels and, as a consequence, reduced fuel consumption and CO2 emissions. The elimination of aromatic oils, which are potentially damaging to

both the environment and human beings, has made the production process even safer as well as di-minishing the tyre’s environmen-tal impact. To be born of a global green performance environmental approach demanded the use of new

materials not derived from petro-leum, integrated solutions for the motor industry and even produc-tion processes that are ever more eco-friendly. Green performance gives tyres a longer life and quieter running.

Energy efficientReduction in the tyres’ fuel consumption, CO2 emissions, up to 20% in

rolling resistance and fuel savings of up to 4%.

Clean airThe tyres are made of eco-compatible ma-terials that minimise

environmental impact during both their production and lifetime. Pirelli tyres already respect the European regulations on the emission of highly aromatic oils (HAOF) into the envi-ronment, due to come into force in January 2012.

High mileageLonger life of the tyre and parity of safety. Compared with equiva-

lent products of previous genera-tions, the green performance tyre’s life is 30% longer while still maintain-ing its safety and performance char-acteristics: that is sufficient to delay replacement by about a year.

Low noiseThey precede the 2012 regulations on noise reduction. Compared to

earlier generations’ equivalent prod-ucts, green performance tyres are up to 30% less noisy.

Green performance

P1 ensures a high degree of driving pleasure and versatility

due to the tyre weighing 15% less, the use of full-silica compounds, the optimised curvature of its pro-file to produce a uniform contact patch, less energy dissipation and more aerodynamic sidewalls for reduced friction with the air as it rolls across the road’s surface.The Cinturato P1’s internal struc-ture and tread pattern ensure a high degree of driving pleasure and versatility. One of the basic qualities that single out Pire-lli tyres has always been perfor-mance, linked to reliability and safety. The new tyre is a synthesis of those characteristics, its versatil-ity making it suitable for all regu-lar uses when driving in the city and on motorways. It is produced in sizes ranging from 14” to 16” and is T to V speed rated.The new member of the Cintura-to family will be available on the European market from the end of 2011, having already been selected as original equipment by BMW.


scorpion trail

Innovation that marries technology, research, quality and human capital

Innovation is at home at the Motorcycle Business Unit, which always creates original products of value. Innovation that marries technology, re-search, quality and, most of all, human capital. From all of that comes the Scorpion Trail.

Introduced in 2008 as ideal for enduro road bikes, the tyre has been successively improved to respond to the needs of the sport touring categoryPirelli’s experience in off-roading with the Scor-pion series, which first saw the light of day in 1980, brought about the renewal of the enduro segment with the new Pirelli Scorpion Trail. A product which is a true turnaround, as shown by Pirelli’s ability to foresee the future demands of a sector in continu-ous evolution, transforming it into a winner. The tyre tells a versatile success story and is just as at home at the North Pole as it is in the African climate of Cape Town: it is a global performance product.Designed for 2-cylinder all-round enduro bikes, Scor-pion Trail has a road going vocation combined with a decidedly sporting spirit, meeting a fistful of needs: grip in all riding conditions, tyre life, comfort, off-road traction and adherence, speed and good handling.The natural heir to the MT90 S/T, the new Scorpion is an important stratagem. The pitch of the basic tread pattern started with a completely innovative and revo-lutionary concept. It was purposely lengthened so that it repeats itself just four times around its circumfer-ence, integrating the typical enduro tread blocks with those of the supersport type. The tyre does recuperate some of the winning elements of the Scorpion MX world championship product. Like its structure block in a V-shape to provide maximum traction, and two large tread blocks at the centre that improve stability as well as offering a more aggressive performance.

Blazing a trail

The Motorcycle BU comes up with the Scorpion TrailKevin Allen


Another innovative element is the availability of two different structures for broader use. There is the conventional type for less powerful bikes that has more of an aptitude for off-road work. Then there is the radial, ideal to take the power output of the modern enduro tourers. The Scorpion Trail also has an all-new compound. The rear is made up of 70% silica for good wet grip, longer life and adaptabil-ity on all kinds of roads. While being a linear tyre, the new product gives of its best when leaning. It is much lighter and the front holds the road perfectly even with a passenger aboard. It allows the rider to understand the right level of inclination when go-ing into a corner, so that he can accelerate with de-termination on the way out without losing grip.In a word (or two) the Pirelli Scorpion Trail has per-fect grip, inspires maximum confidence, stability and agility.

Innovation also means a combination of resources in which social learning and interaction play a central role in increasing the validity of company

potential. It is important to the Motorcycle Business Unit to work closely with bike manufacturers, shar-ing information and meeting each other’s needs to-gether and in the shortest time possible. A collabora-tion that permits the development of a harmonious product – a tangible and effective result, especially for the end user. And Pirelli is pleased to accept the chal-lenge. For the Scorpion Trail, the company worked in partnership with the key motorcycle manufacturers until the tyre shod their bikes perfectly, generating an ample range of the tyre’s offers and uses.Being an original equipment supplier to the world’s biggest-selling constructors is important recogni-tion of Pirelli’s credibility and reliability.The modifications made were for the Ducati Multi-strada 1200, the Triumph Tiger 800 and the Honda Crossrunner. Tyre sizes of the Triumph Tiger off-roader were unchanged. It was necessary to create special sizes for Ducati and Honda, as their machines are often used for racing and never produced for the enduro road or adventure segments.Pirelli worked closely with Ducati for three years and achieved 100% OE supply. That meant the creation of prototypes through a continuous exchange and shared know how as well as a total cooperative effort, especially during outdoor testing. The result for the Multistrada was a Pirelli Scorpion Trail in 120/70-17 and 190/55-17 sizes to satisfy the freedom an enduro gives, with the sporty performance of a superbike, the rear slightly rounder to increase off-road traction and stability under load. As Ducati’s technical partner, Pirelli and its Scorpion Trail were able to take part in the fantastic adventure of Ducatista Paolo Pirozzi, who lapped the world on two wheels. A project that lasted a year and which was important in testing the real life potential of the new tyres.Another testimonial of value and reliability comes from the United States. Racer Mark Cernicky will fit Scorpion Trail to his Ducati Multistrada for the 2011 Pike’s Peak International Hillclimb, the renowned

event in which the track winds its way along the slopes of the Rocky Mountains in the State of Colo-rado. The renewed collaboration with Honda has opened the door to great opportunities of growth, expansion and visibility, given the effort in terms of research and investment that the Japanese construc-tor makes in the world, always requiring a precise but especially efficient product.So Pirelli also made special sizes for the Honda Cross-over, the Japanese-made multi-purpose motorcycle. They were in 120/70-17 and 180/55-17 and produce plenty of grip, increase the riding pleasure, the fun where the limits are raised.

Pirelli puts innovation into gear

Innovation also means a combination of resources in which social learning and interaction play a central role in increasing the validity of company potential

Carlo Saponaro


No more ‘slaloms’ on snow and ice covered roads. To help keep heavy trucks from skid-

ding, leading to accidents that cause chain reaction traffic jams with the knock-on effect of seri-ous economic damage, Pirelli has developed its new range of W:01 tyres, able to take on road surface snow and ice. Tyres that have no fear of the winter and that have been conceived and designed us-ing the most advanced technolo-gies. Bolstered by a blend of latest generation compounds and in-novative tread patterns, the new tyres offer an extremely high level of safety.The secret is in the tread de-signs. The deep grooving, pitch sequence and geometry of the tread blocks all work together to achieve an exceptional com-promise between traction per-formance and controllability on snow, braking in the wet, acoustic comfort and mileage. In particu-lar, the FW:01 pattern for steering axles is composed of dense trans-verse grooving and robust dimen-sions that ensure a high degree of

truck

Innovative new winter truck tyres

Tyres with no fearStefano Loy

directional stability on snow and wet surfaces, yet at the same time maximise mileage and acoustic comfort. The TW:01 created for drive wheels is packed with innovative features by Pirelli’s research and develop-ment division. One is the tread pat-tern, which comprises a substan-tial transverse grooving to capture and trap large amounts of snow to fully exploit the natural adhesion phenomenon of snow-to-snow, en-suring traction and controllability of the rear tyres and, therefore, the whole vehicle.The reduced mobility of the tread blocks, together with the use of compounds with high silica con-tent, also means lower rolling resis-tance, with a consequent fuel sav-ing. And that’s not all. The tyre has also been designed to guarantee acoustic comfort, especially on dry surfaces, and ensure a reduction in fuel consumption compared to previous product lines. The secret of this advantage lies in the se-quence and disposition of the tread blocks, which limit the noise creat-ed as the tyre rolls across the road.So these are tyres developed by Pirelli especially to reinforce the company’s commitment to road safety. Often, serious delays in traffic circulation are due to ar-ticulated trucks slewed across the road because their tyres are not up to the conditions in which they are being used, even if they are le-

gal. Current European regulations say that heavy vehicles must have M+S marked tyres with which to take on the winter or alternatively snow chains solely on the drive wheels. But in some conditions, this is no guarantee of optimum performance. That is why the new range of W:01 tyres has been developed and exhaustively test driven by Pirelli in its constant commitment to road safety, being one of the signatories to the Euro-pean Road Safety Paper in October 2010. The results are brought out by the facts: much more traction and more vehicle controllability on snow covered and wet surfaces than conventional M+S products.The strong point of the new Pire-lli tyres is the composition of the tread pattern, which is of two dif-ferent kinds of compound. One is the external strata, which is in contact with the road and de-

signed to optimise mileage and road holding in low temperatures. The other is internal, which mini-mises heat generation, improves its duration characteristics and carcass remoulding capability.So the new ace up Pirelli’s sleeve is ready to face the problems of asphalt covered with snow and ice. And it is much needed, if we consider that on one single day in Great Britain last year – 29 Novem-ber – the Automobile Association received no fewer than 200,000 calls for help. And in Germany, many vehicles were trapped in the country’s main autobahn net-work. It was not much better in Italy, where a bitterly cold snap last December blocked the main A1 artery, stranding 6,000 motor-ists and truck drivers for 22 hours. Now, the battle against the big freeze on the roads has begun and is already bearing fruit.

Pirelli has developed a new range of W:01 tyres, able to take on road surface snow and ice

The secret is in the tread designs


Companies are now having to deal with the cultural revolu-tion in communi-cations imposed by

new technologies. At this point, the essential question is: ‘What to do?’ For that reason, marketing offices the world over are taxing their minds, seeking ever more innovative means of bringing the consumer closer to their products

in order to incenti-vate sales. Pirelli is right there at the heart of things. The company’s staff is at the cutting edge the digital world and is continually updating

the path taken recently after the choice of SAP made in the Nine-ties. Now, the Group has launched a new initiative called ‘Digital In-novation’, a project that exalts the role that information technology can play as an enabler of change and innovation, processes or prod-ucts. The new route seems to be obligatory, a sort of business one way street without the chance of making a U-turn and retracing one’s steps. The new Pirelli project has been placed in the hands of a directive committee, a kind of dig-ital trail blazer, which has already elaborated a precise strategy com-prising four fundamental central ‘pillars’. They are digital marketing, the event driven company, knowl-edge management and private cloud computing. In particular, the philosophy of the digital inno-vation project is based on certain basic considerations. Today, con-sumers are faced with an incred-ible galaxy of information, which is continually up-dated by computer. The PC’s screen is the new market-place in which to go shopping. The

Internet’s offer of goods is legion, varied and, more than anything else, competitive. In this globalised market, the con-

sumer is now the whole world. Using a mouse, he can move from one point of sale to another, choos-ing the products he likes most, combined with the best price-quality ratio. And within that informative galaxy, as he leafs through the data, he can verify the transparency of the product he wants to buy, the services on offer and the prices shown. So how do you ‘capture’ the buyer and convince him to click on your company’s page: that’s the challenge that faces the project and Pirelli’s management. Other data being considered by the directive committee is of network traffic. Fifty percent of the world’s population is under 30 years old and in 2010 96% of the under 30s were

registered with a social network. On top of that, around 600 million people use Facebook. A vast number to which over 200 million new us-

ers were added last year alone. Numbers to make your head spin, which are destined to increase in the years to come, and there is no way that can be ignored by com-panies. So the objective is to gain as much as possible from the net-work.In the light of that data and these analyses, Pirelli has put to-gether a digital market-ing project. There will be a single core team for the management and an increase of new digital initiatives.

These are its strong points: ‒ Site management and analysis, the objective of which will be the development of Pirelli’s web

site, keeping its content updated and ensuring the daily evolution of the web structure through the coordination with the various countries, the analysis of consumers’ at-titudes and conduct.

‒ Content management, where it is proposed to develop, produce and manage multi-media contents for all existing multi-channel and multi-device platforms, like iPhone, iPad and others. ‒ Social media management and anal-ysis, the main task of which will be to develop Pirelli’s presence in the structured social media, such as Facebook and Twitter, ensuring daily updating and management of the consumer’s ‘sentiment analysis’ by monitor-ing structural media like blogs, forums, communities et al. ‒ Corporate digital management will develop and manage web contents in respect of investor relations, governance, sustainability, media, careers, PZero and the calendar. ‒ E-commerce management will con-

trol Pirelli’s presence in e-commerce web sites through the implementa-tion of strategic guidelines and an activity plan for the main areas of business.

The second ‘pillar’ on which the digital innovation project is built is called the event driven com-pany, which has in mind the im-plementation of IT solutions that permit a proactive development; for example, managing events within the supplier-client ‘chain’. With end-to-end supply chain initiatives, one of the key factors in this sense is business process management (BPM). The third ‘pillar’ is knowledge management and that will have three pilot areas in which to start its activities: the Group’s intranet, called :pnet, will be ex-tended to provide new functions in-cluding collabora-tion and workplace. They will be located next to areas of in-stitutional commu-nications, a project specific to the finance depart-ment, mainly oriented towards the creation of a basic area of knowledge within the depart-ment for the support of decision-al activities and, lastly, tyre R&D. Private cloud computing, the fourth ‘pillar’, will affect the nor-mal day-to-day activities of all IT service users. So in Pirelli’s future, the customer will always be the centre of atten-tion and, thanks to technology, will be closer wherever he might be in the world. Alessandra Banfi

digital innovation

information technology

Enabling cultural change

How Pirelli is organising itself to extract as much as possible from the net and stay close to the consumer

In this globalised market, the consumer is now the whole world


How do we innovate within the organi-sation? By being attentive and reac-tive. To do so, Pirelli has instituted a new system of protection from risks, which enables it to make timely iden-

tification of them and adopt adequate measures with which to manage them in anticipatory and proactive terms. The crisis that hit the world economy, the insta-bility of financial markets, the complexity of manage-ment processes and the continual evolution of norms swung the spotlight onto the need for a revision of the company’s risk concept and, more in general terms, of the governance of risks. As American Warren Buffet, the world’s third richest man, says, “Risk comes from not knowing what you’re doing”.A fundamental precondition for the success of this process is the gradual diffusion of the values of risk management within a business organisation.At Pirelli, that translates into a value driven approach. In other words the identification and management of all those risks that could prejudice the company achieving the strategic objectives of its industrial plan and/or damage critical company assets, and top down, which is mapping the area at risk. That func-tion is carried out by the managerial risk committee,

which recognises and measures areas of priority cor-related to the identified risks. And those can be sub-divided into the strategic and the transversal. The for-mer have been definied, starting with the objectives of the industrial plan; in that area, there are risks con-nected with the evolution of the external context in which the group operates and a number of derivatives from internal factors, like financial risks, those linked to processes characteristic of the business and others associated with organisational and human resources.The family of transversal risks concern all the poten-tially damaging events, which can always affect op-erational activities, apart from strategies in operation, such as risks to normative conformity, business conti-nuity and information technology.The map of risks is periodically subjected to careful analysis by the heads of the business units, central functions and regions/countries. They have the fun-damental responsibility of evaluating the potential impact of each risk, the probability of its occurrence and the adequacy of the management system. The results of these analyses are then evaluated and sub-mitted to the managerial risk committee to create a continuous loop of information between top manage-ment and the operating unit. So an effective infra-structure of enterprise risk management becomes a critical success factor for companies like Pirelli that want to excel, as well as an instrument by which to create value, improving the anticipatory capability and response to change of context. That reduces the volatility of the expected results, optimising the allo-cation of resources and increasing the confidence of analysts and investors. We innovate by transforming risks into opportunities.

Pirelli has instituted a new system of protection from risks with which to manage them in anticipatory and proactive terms

Turning risk into a choice

governance of risks

System and approach

Alessia Carnevale

Last October, the ‘Union of Innovation’ Eu-ropean strategy was presented. It defines the political orienta-

tion and action that the European Union member states have been asked to develop in research and innovation to be able to respond with effectiveness to the economic, social and environmental chal-lenges of the next decade. Europe’s political authorities are convinced that the EU needs to invest in re-search and innovation if it wants to generate a meaningful economic

recovery. The European commis-sioner for Research, Innovation

and Science, Máire Geoghegan- Quinn, and the vice-president

of the European Commis-sion, Antonio Tajani, who is responsible for industry, have agreed to support “a

profound change in Europe’s abil-ity to innovate, which is the only way to create stable and well-paid jobs that can resist the pressure of globalisation”.Innovation is not only an EU pri-ority policy, it is a matter of some urgency to be undertaken in mea-sured fashion across the board. The action strategy promoted by the Commission envisages the al-

location of 3% of the Union’s pub-lic expenditure to research and innovation by the end of 2020. The intention is to favour the creation of 3.7 million new jobs and a gross domestic product increase of 795 billion euros in the EU by Decem-ber 2025. The investment increase will combine with the promotion of measures of effective standar-disation, greater integration of the internal market and better regulation of intellectual property rights through public tenders and other financial initiatives to sup-port companies that promote in-novative projects. The objective is to help businesses, recognised as the essential growth factor in the European economy, to translate in-novation in products and services for the market. In particular, there will be the creation of a single Eu-ropean patent at competitive cost on the international market as one of the priorities to be achieved by the end of 2011. Real innovation is only possible if a cohesive Euro-pean-level research system is cre-ated. One that favours the mobility of researchers, coherence between national and European research programmes and collaboration among companies and research institutes and with in-ternational partners. The

participation of European research companies – the so-called outline programme of which the seventh programming is under way for the period 2007-2013 (7th PQ) – is strongly supported by the Europe-an Commission, which is involved in an attempt to simplify and har-monise the procedure to facilitate companies’ access to finance for re-search projects. With this purpose in mind, the common strategic management policy for research and finance will be launched in 2014 with the task of improving the scientific and economic impact of the research activity sustained by PQ, the programme for competi-tiveness and innovation and the European institute of innovation and technology. This will apply, in particular to the energy, transport, health, nano-technology, environ-mental, agricultural, safety and communications technology sec-tors. Among the proposed measures is the creation of a single window of information to support partici-pants in research projects – called a one stop shop – and the possibil-ity of putting oneself forward as a candidate for various projects at the same time without the need

of presenting relative company documentation for every announcement.

From European Union to Innovation UnionResearch and innovation: the paths identified by Europe’s political authorities to slow the economic crisis

Petronilla Cifarelli

europe’s new strategy

Political orientation and action


There cannot be technological de-velopment and innovation if the terrain that sur-

rounds the company is not fer-tile”. With those words Marco Tronchetti Provera, chairman of Pirelli and the Pirelli Foundation, presented the exhibition Rubber Soul (Anima di gomma). Aesthet-ics and techniques in step with fashion, staged by the Foundation and inaugurated on 20 June at the temple of Italian design, Milan’s Triennale. The exhibition encap-sulates the history and future of Pirelli in the world of fashion, with an eye constantly turned to-wards innovation and technology, which are at the bases of the Pire-lli PZero industrial design project. And all of this through innovative languages in tune with the evolu-tion of the words and signs of con-temporaneousness. The star of the show is rubber, a material of ancient origin discov-ered in 500 BC by the Maya people, who extracted natural rubber from trees, calling them the ‘trees that cry’. The tears were, in fact, an elastic substance they used to make balls with which to play. And it is a virtual rubber ball that greets and accompanies visitors through the entire exhibition, il-

lustrating the properties of a ma-terial as ancient as it is innova-tive which, gradually processed, became anything from a piece of elastic to material and objects. The exhibition is spread through four halls, each one devoted to a par-ticular item of clothing: heels and soles, overcoats and raincoats, cos-tumes and bathing caps and, lastly, Pirelli PZero fashion. And in each one of them, the rubber ball kicks off events that reflect on the walls, floors and ceilings. So it is possible to walk through a labyrinth of

Bruno Munari, who comes to life under our feet; observe sketches of waterproof clothing while the ball literally bounces to good and bad weather, playing with photo-graphic images from the Pirelli Foundation’s historic archive; or bring the sea to life as if we were under the waves, and watch bath-ers of times gone by swim and dive above us. Not far away is a very young Marilyn Monroe in a pink Pirelli Lastex costume, smil-ing from the blow-up of a 1952 ad-vertisement that was found while

Corporate Culture

Pirelli Foundation

Rubber SoulTechnology does not grow if it does not find an adequate cultural environmentMaura Corinaldesi

Bruno Munari, advertisement for the Coria sole, 1953

Anonymous, Sketch for rubber heel ad, circa 1950-1960


searching through the Pirelli ar-chives.Lastex, which was also called ‘the yarn of marvels’, was a great inno-vation after the Second World War. It enabled women to abandon the whalebones and laces that caged their bodies and finally wear practi-cal swimming costumes that were more elegant and comfortable.The last room is devoted to the present and, therefore, Pirelli PZe-ro offers a visual and innovative reading of fashion which is not represented in a physical manner, but in an ethereal way. The prod-ucts disappear and leave space for desires and visions. The images that meet the visitor tell of an ap-parently bi-dimensional world in which people and objects stay in the background. So the rubber ball, the guide and soul, becomes a protagonist of the set, giving the leading characters of this dream properties that allow them to do seemingly impossible things. The last room is reserved for the con-sultation of an important patri-mony of images, catalogues, post-ers, magazines and videos that have contributed to the story of Pirelli communications in Italy and the world. A consultation both analogical and digital, as a result of the multi-media installation ‘turning handle archive’ created by the Nuova Accademia Belle Arti of Milan.“What has been created in the Triennale is not to be considered a work of patronage, but an idea of the growth of the company to-gether with the cultural institu-tions. Technology does not grow if it does not find an adequate cul-tural environment”. With those words, Marco Tronchetti Provera closed the exhibition’s press con-ference, during which was shown a video interview by Antonio Cal-abrò, director of the Pirelli Foun-dation, with Professor Umberto Eco, who said, “In this completely

ethereal exhibition, constructed of images, history and revision, what comes out is not a portrait of fash-ion, but a portrait of the image of fashion. And the actuality of the representation is exactly there. (…) As we have already said, there are no objects but representations of them to try to move attention to the aspect of fashion at a dream level. Fashion stimulates and pro-duces dreams, especially today”.Over 2,000 people attended the event, which has underlined once more how much Pirelli’s history is strongly linked with culture, art and the Italian society. And, obvi-ously, with technology which, in its most innovative form, creates materials and shapes.

Ermanno Scopinich, advertisement for shoe soles, 1948

Mario Brunati, Sandro Mendini, Ferruccio Villa, Sketch for ad for snorkeling articles, 1958

The star of the show is rubber, a material as ancient as it is innovative


Research, innovative materials, inspiration and original solutions in PZero collections

Fiorella Poppi

From tyres to fashion the move is technolog-ical, the result of con-tinual search for ever more innovative ma-

terials, inspiration and original so-lutions to problems. It is also fash-ionable to be in step with scientific research and PZero doesn’t let an opportunity like that slip through its fingers. For instance, the PZero patch garments of the autumn/winter 2011/2012 have married su-per engineering with artisan emo-tions: the patch garments recall the little squares of rubber with which bicycle tubes were repaired in the Sixties, and inside them are tapes with the legend “Pirelli 1872”, the year our company was established. But “lightness” is in the wings for spring-summer with light gum, a new rubberised ma-terial for coats and field jackets weighing just 350 grams, while the knitwear is also ultra-light in a material called light fleece, dyed with “faded” colours.To understand what PZero means to research and where an inces-sant curiosity leads to when look-ing for something new, it is inter-esting to analyse one of the most original materials as far as total look sports clothing goes: Kevlar.Kevlar is the protagonist of the lat-est Pirelli PZero collection, but it is also the material from which Bat-man’s costume is made, both for the comics and the films Batman Begins and Dark Knight. Always in the lead as far as research and innovation are concerned, PZero snapped up the chance of using this extraordinary material in fashion.

Pirelli Pzero

Collections and new initiativesIf we want to cover the history of Kevlar, we need to go back to 1965, the year in which the scien-tist Stephanie Kwolek discovered this synthetic aramid fibre when searching for an elastic and partic-ularly strong material. Its principal characteristic is great mechanical resistance to traction, so much so that at equal weight Kevlar lasts five times as long as steel and is highly resistant to heat, as it decomposes at around 500°C without ever melt-ing. Its sealing c h a r a c t e r i s t i c s mean it is used as a reinforcement fi-bre for the produc-tion of bullet proof vests, extreme sports equipment, for aircraft compo-nents, in tyres from the Seventies onwards and, more re-cently, for the sails of racing yachts. Kevlar’s mechanical resistance has been improved over the years and that is why it is being used increas-ingly for protection against impact, given its resistance to perforation. But the advance that really made Kevlar pliable is the one in which it was lightened, also making it suit-able for sportswear.

However, Kevlar is not the only ma-terial under the PZero microscope in the search for lightness with-out loss of resistance: triple strata nylon+laminate for quilted jackets is another, then there is the quilted neoprene nylon windstopper for the Bike Gum winter collection, breathability and impermeabil-ity for the spring-summer collec-tion: light gum, light fleece, nylon, technical stretch cloth, waterproof

double cotton. And for footwear there is, once more, rub-ber, calf, suede ma-terials with pixil-lated techniques. But PZero’s search for ever more in-novative solutions does not stop at the choice of materials from which their

wares are made. The project evolves one by one, with garments adapt-able to physical conformation: “the cut” items will make their ap-pearance for the spring-summer of 2011, a major new exclusive for this season. Using rubber and scis-sors, people will be able to calibrate and cut hems and sleeves to regu-late their length and create trench coats and trousers so that they

become increasingly self-tailored. The innovation is the luxury to be able to choose a “tailor made” gar-ment, the ability to invent oneself a look that corresponds as much as possible with one’s perceived image. All due to a rubberised film that impedes fraying and broken lines. Just follow the instructions and invent garments that seem to have been made specifically for the wearer.“Trendy image+technical innova-tion”: that is the PZero formula, a strategic duo to create a look which, on the one hand, respects the technological vocation of the company, and on the other of-fers solutions in fashion, without having to give up practicality and sportiness.

From tyres to fashion the move is technological

PZero garments can be found in the most prestigious boutiques throughout Italy, as well as in the traditional online store www.pzeroweb.com, where it is possible to see the entire collection with assorted colour variants.Meanwhile, PZero is readying it-self to make its official debut in the heart of Milan’s most presti-gious shopping area: the centre of Milanese fashion. Preparations are in full swing for the opening of the first PZero single-brand store in Milan, which will be inau-gurated in September. It will cover 1,500 square metres between Cor-so Venezia and Piazza San Babila, in a key area of fashion and style.The PZero shop will carry com-plete collections of the company’s range and there will also be a sec-tion devoted to Winter Sottozero skis and Pirelli PZero rubber boats, built as a result of an agreement with the Scandinavian company Tecnorip.The PZero brand has also won over sports and show business person-alities including Giovanni Soldini, Esteban Cambiasso, Diego Milito, Alessandro Gassman, Simona Ven-tura and Belén Rodriguez.

PZero locations

PZero patch garments have married super engineering with artisan emotion

The sneaker rubber racer


The Big Green promotes Pire-lli. At Moline, Illinois, home of the John Deere headquarters, Pirelli Agro Brazil won the world excellence award as the best supplier for the fifth consecutive year. The Hall of Fame is the top level recogni-tion in the sector, made each

year by John Deere, one of the world’s biggest manufacturers of agricultural and construction machines. Only suppliers who have confirmed their excellence of products and services over a five year period are admitted to the JD Hall of Fame.

2011 awards

From public institutions, private companies and consumers

Leaders worldwideJUNE

As with every year, Pirelli celebrated its ability to invent with an Invention Awards ceremony and the traditional presentation of gold and silver plaques to the Group’s inventors. With seven patents already granted and 39 requested in 2009, the 17 inven-tors received their plaques from Pirelli chairman, Marco Tronchetti Provera. In addition, the 2011 Science and Company annual compiled by Observa Science in Society (published by Mulino) confirms the central role of innovation at Pirelli, the Group

having taken first place among the most innovative Italian companies for the number of patents it has been granted.

Pirelli enjoys an excellent reputation and appears in the 2011 Global RepTrak 100, the most authoritative annual study of the reputations of the world’s businesses, conducted by the Reputa-tion Institute. The Group placed 31st among the 100 companies world-wide, coming second of the Italian firms. The classification is the result of a survey of 48,000 consumers in 15 countries, who in April 2011 were asked to express their opinions on 100 principal companies at a global level.

Italy 2011 national Innovation awards Prestigious company recognition for research and Pirelli’s enterprise ability comes from the 2011 National Innovation Awards, which were presented at the Quirinale Palace by President of the Italian Republic Giorgio Napolitano and Minister for Public Administration and Innovation, Renato Brunetta. The Pirelli MIRS processes won the innovation award in the industries and services sector for large industrial groups of international importance. This is the declaration on which basis the award was made: For the invention of a new tyre production process, starting with thin strips of rubber placed on a drum, which permits the maximum control of the deposited rubber’s geometry and of the vulcanisation phase. The award’s principal objective is to enhance and support the best, most innovative and creative ability of companies, universities, public administrations, bodies and individual designers with a view to favouring the growth of the innovation culture in Italy.

London, on the occasion of the World Finance Awards, the London Stock Exchange presented the Best Corporate Governance Award for Italy to Pirelli. This recognition underlines the importance of corporate governance and the management of financial activities to Pirelli, essential instruments in creating long term sustainable value. A real cultural undertaking carried out by the company’s employees at all levels, which is fundamental to its good management.

USA | Pirelli in the John Deere Hall of Fame

MAR

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England | Best corporate Governance award

APR.

Reputation silver medal

JUN

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Italy | Pirelli presents awards to its inventors

JAN.

sustainability: Pirelli confirmed in the Ft indices

APR.

For the 10th consecutive year, Pirelli has been confirmed as part of the Financial Times share index for socially responsible investments, the FTSE4GOOD – FTSE GLOBAL and the FTSE4Good Europe and is the only Italian company in the Automobile&Parts sector in the revised indices. In addition, the FTSE Group put together an overall rating of the 2,400 companies in the index, giving Pirelli 97 points out of 100.

38 Pirelli world

no. 60 · no. 60 — july 2011 1 focus innovation 2 imind – the real source of innovation 4...

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