1

Research project:“Common good and responsible behavior in firms and institutions”

Department of communication and economics (UNIMORE)Institute of Firm Values - Istituto dei Valori d’Impresa (ISVI)

The Municipality of Reggio Emilia

Mario Minoja & Elisa Mori(University of Modena and Reggio Emilia)

2

Reggio Emilia demographic and socio-economic structure

• 172.525 inhabitants (end of 2013): +15,3% than in 2002 (533.860 in the entire province territory)

• 18,2% immigrants in 2013 (6,6% in 2002) vs. 7,4% in Italy• Per capita income (2013): € 26.833 (Italy 19.660)‐• Employment rate 65,8% (Emilia-Romagna 66,3%, Italy 55,6%,

UE27 64,2%): 15° position in Italy as a province (2014)• Unemployment rate 6,6% (Emilia-Romagna 8,3%, Italy

12,7%, UE27 10,1%): 5° position in Italy as a province (2014)• 56.041 firms in the province territory in 2014 (1 for 9,5

inhabitants)• Seventh in Italy in terms of number of young (under 30

years) entrepreneurs• Continuous increase in foreign entrepreneurship (4.734 in

2013) against a drop in the number of Italian entrepreneurs (31.796 in 2013)

3

Reggio Emilia economic structure

• A strong manufacturing industry– 37,1% of value added of the province– Mechanical and “mechatronics”; textile-clothing and fashion; food

(“Parmigiano-Reggiano” cheese); wine (Lambrusco); ceramic tiles• A system of small and medium-sized enterprises

– 76,5% with less than 50 employees– organized in industrial districts, networks and value-chains: mechanical and

“mechatronics”, ceramic tiles; textile and knitwear.• Top export performance

– 8.963 million euro in 2014 (import: 3.600 million)– An upward trend from 2000– 59% of value added of the province from export (vs. an average of 25% in Italy)

• Strong cooperative system in industries such as construction, food, consumer retail, services, etc.

Composition of value added

Reggio nell'Emilia Emilia-Romagna Italia2.1% 2.1% 1.8%

37.1%31.0%

25.0%

60.7%66.9%

73.1%

ServiziIndustriaAgricoltura

The higher share of manufacturing value added (37,1%) in province of Reggio Emilia than in Italy (25%) and even in the Emilia-Romagna region (31%) reflects a strong manufacturing tradition and culture.

5

Export from Reggio Emilia (province) 2000-2014

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20143,000,000,000

4,000,000,000

5,000,000,000

6,000,000,000

7,000,000,000

8,000,000,000

9,000,000,000

10,000,000,000

4,987,533,400

5,267,216,9365,396,478,899

5,159,869,291

5,822,937,652

6,426,173,987

7,390,615,731

8,100,230,294

8,433,505,681

6,445,803,298

7,330,607,480

8,341,578,1138,450,622,657

8,617,395,054

8,962,551,518

6

Public-Private Partnerships (1)

• During her three electoral mandates (1991-2004) as mayor, Antonella Spaggiari launched public-private partnerships as a way to realize some valuable and ambitious (expensive, long-lasting and far reaching) projects for the city:• requalification of the city center (recovery of abandoned old buildings)• restoration of historical buildings (Basilica of Ghiara, Reggio Emilia’s

Cathedral, San Prospero’s Church)• a new campus of the University of Modena and Reggio Emilia• high-speed train station (inaugurated in 2013) of “Reggio Emilia AV

Mediopadana” (designed by Calatrava, a Spanish “archistar”)

7

Public-Private Partnerships (2)

• The partnership framework and logic …• Entrepreneurial role of the Mayor (project launch; involvement of local

associations of firms and cooperatives; of banks and foundations; activation of political contacts and networks inside and outside Reggio, at regional or national level; fund raising at multiple levels)

• Ad hoc organizational structures (companies or committees) led (following efficiency and transparency criteria) by private people (well-know local entrepreneurs and/or professionals) with several, intertwined goals: project communication, consensus building, local fund raising

• Financial multi-year contributions of firm associations and individual firms

• … and values• Consistency with overarching vision and projects going beyond local views and

interests: the new Italian high speed rail system, etc.• Leverage on cultural and aesthetic (not only economic) value of the projects• Emulative dynamics• Strong cohesion of public powers, associations of firms, individual

entrepreneurs, individual citizens.

8

The new administration: the identification of “distinctive competencies” driving the Reggio Emilia

strategy

• Graziano Delrio became Mayor of the Municipality of Reggio Emilia in 2004• The first Delrio’s electoral mandate (2004-2009) was oriented to move from a direct delivery of public

services (government) to a more stakeholder-centered logic way of identifying and satisfying citizens’ needs (governance)

• January 31, 2009 start of the second Delrio’s electoral mandate and presentation of the "Stati Generali” of the City: a set of local stakeholders’ meetings aimed at building and sharing a vision and a strategy for the city. Three major challenges were identified:

Based on “distinctive competencies” as development drivers

A high quality, relationships promoting, sustainable

territory

A strong community

ensuring Knowledge,

participation, autonomous and

safe life

A strong and competitive

economy, ensuring widespread wealth

and stable jobs

9

Citizen's engagement in public services production

• Historical orientation to public production of welfare services. However:– increasing financial constraints imposed by the national government (“Stability

Pact”)– a large number of voluntary organisations– widespread civic sense and on voluntary organizations’ vitality

• Hence, involvement of citizens in public welfare service production through two initiatives aimed at strengthening the "community welfare" and endorsing and coordinating individual, voluntary contributions:

“I reggiani, per esempio” collect, sustain and endorse good practices of active citizenship (as individuals or in associations) 97 projects were financed in 2012

“Anche tu per esempio” (1° edition in 2010) Municipality and Third Sector Forum co-organizers of a public call to volunteering.About 375 people have started to carry out stable volunteering in local associations or for the Municipality

10

Communication strategy

• Creation of the brand “Reggio città delle persone” • Dispersed communication offices unified in the

“Communication, External Relations and Marketing” Service, which employs about 50 people (in charge of printing, press, website’s editing, public relations, call center, graphics, video production, social media) to ensure coordination and communication effectiveness.

• Creation of more informal and friendly communication formats for each policy (e.g. of public transportation: “Urban Mobility Plan” “New ideas in circulation”.

11

A new organizational structure

• Since 2005, the Municipality of Reggio Emilia had been undertaking an internal organization restructuring

• Integration between the services production’s functions (vertical dimension - line), and the areas of policies, responsible for the analysis, planning and evaluation of public policies (horizontal dimension - staff), to ensure the integration of services management and the strategic choices made by the Administration.– Five functional areas: “Services to people”; “Services to the city”; “Engineering

and infrastructure management”; “Strategic planning”; “General Management”

– Three policy areas : "The city of solidarity and social capital"; "The Sustainable City"; "The city of university, knowledge and economic development”.

A new organizational structure

12

General Management

Legal Office Institutional Office Financial OfficePlanning and

controlling OfficeHuman Resources

Office

Information systems and

technologies Office

Communication, External Relations

and Marketing” Office

Strategic planning Services to people Services to the cityEngineering and

infrastructure management

The city of solidarity and social

capital

The Sustainable City

The city of university,

knowledge and economic

development

13

Planning and control systems: «zero-based budget»

• Creation of the “Planning and Control” Service;• Review of the strategic planning phase and of the budget

construction phase: – From an historical orientation to an analysis of the needs (zero-

based budget);– From the Executive Management Plan (Piano Esecutivo di

Gestione) to the Budget.• Creation of the Observatory of public policies;• Review of programming and control systems in order to

include subsidiaries and participated organizations (service contracts, consolidated financial statement, segment reporting).

14

Human Resources Management revision

It makes professional roles consistent with the organization…• Revision of the professional categories;• Development of professional profiles through a training plan to

fulfill skills gap;• Development of multi-functionality, flexibility and specialization of

the professional profiles; • Introduction of a new methodology for assessing managers and

other personnel. Assessment is functional to the allocation of performance-related compensation and career advancement and is linked to results and skills/knowledge.

15

Financial information of the Municipality of Reggio Emilia

• “Stability Pact” always respected;• Current revenues showed an increasing trend from 113 million in

2004 to 168.5 in 2013 (+ 49%);• Similarly, current expenses increased from 111.7 million in 2004 to

152.5 (+ 36.6%) in 2013;• Investments gradually dropped from 73 million in 2004 to 22.7 in

2013 (-69%);• Revenues from sales of assets, capital transfers and loans

decreased from 74.5 to 17.2 million (-77%);• The amount of debts of the Municipality decreased by 40.3% in the

period 2005-2013 (97.5 million at the end of 2014).

16

Results (1)

• Innovation and territory– the «Area Nord Project»;– requalification of the city center and financial support to commercial activities (2009-

2010);• Welfare

– In 2010 a new organizational and governance model for social services delivery has been created (from 1,900 accesses to the community centers in 2009 to 2,382 in 2013);

– strengthening of home care services for elderly, disabled and young people (in the period 2009-2013 residential care for the elderly people has been maintained, meals delivered to elderly people rise up to 52,000 and 4,000 minors in difficulty were taken into care);

– increasing of social housing (3.028 houses available in 2013; +18% from 2005);• Education

– pre-school education is one of the distinctive competencies of Reggio Emilia– the maintenance of the 0-3 years hold schooling rate to more than 40% and

kindergarten schooling rate (3-6 years) to 86% are two of the results achieved in this field (period 2004-2013);

17

Results (2)

• Social cohesion– establishment of a network of associations that deal with Italian language and culture teaching

for foreign people (from 40 students in 2007 to 3,000 in 2013);– creation of the “Immigration booth» and of some network to promote intercultural dialogue in

2010;

• Sport and culture– restructuring of historical buildings (San Pellegrino library and others, Cloister of San Pietro,

Padiglione Lombroso and City Museums);– Since 2008, rationalization and consolidation of volunteering initiatives through the project «I

reggiani, per esempio» (97 projects were financed in 2012);– 6 new sport facilities and 18 sport facilities restructured (period 2004-2013);

• Environment, urban quality and mobility– enhancement of sustainable mobility and road maintenance;– - 9,7% CO2 emissions from 2009 to 2011;– 196 km of cycle paths in 2014 (87 km in 2004)– increase of green spaces (57.32 square meters/per capita in 2013);– strengthening of recycling and other eco-friendly practices (eg. district heating);

• Administrative simplification– simplification of the access to online services for citizens and companies (in 2013, the 7,49% of

the population required documents and certificates by the web).