ABB stands the test of time
The Chamber of Commerce in Genoa awards ABB Italy an historic Italian business certificate for 100 years of uninterrupted business
ABB was recently awarded an historic Italian business certificate by the Chamber of Commerce in Genoa, which recognizes companies that have operated without interruption for more than 100 years. As the expected lifetime of modern corporations shrinks, being in business for more than a century has become a real achievement.
The average lifespan of a company listed on the S&P 500 index has decreased from 67 years in the 1920s to just 15 years today, according to a study by Professor Richard Foster at Yale University. By 2020, Professor Foster estimates more than three-quarters of the S&P 500 will be made up of companies that we have not heard of yet.
“Even the big, solid companies, the pillars of the society we live in, seem to hold out for not much longer than an average of 40 years,” writes Arie de Geus, a former Royal Dutch/Shell Group manager in his book about corporate survival, The Living Company.
In recent times, some former giants have vanished – car maker Saab, for instance, or financial firm Lehman Brothers, while others struggle to reinvent themselves, like former mobile phone colossus Nokia, or the iconic camera company, Kodak, now just a shadow of its former self.
And yet some companies (mostly small, family-run businesses) have survived for hundreds of years; a handful (mainly in Japan) are more than 1,000 years old. In his book, Mr. de Geus provides some core characteristics of long-lived companies, big and small.
They are sensitive to changing conditions, in business and in the societies where they do business. They have a strong sense of identity, are open to innovation and experiments by their staff, and careful about finances. They are good corporate citizens, flexible, innovative, and able to reinvent themselves – like ABB.
Nothing seems to guarantee a long corporate life more than a sound reputation as a good citizen, backed by quality products and people. ABB’s parent companies (Swedish ASEA, founded in 1883, and Swiss Brown Boveri, founded in 1891) developed those properties, as well as a practice of innovation and customer focus that made them stand out in the corporate world.
This corporate DNA is an important legacy in the context of today’s ultra-competitive business climate.
It is fitting that the Genoa Chamber of Commerce handed ABB an historical business certificate, since the company’s predecessor, Brown Boveri, acquired the oldest electromechanical Italian company in 1903, Tecnomasio Italiano, founded in 1863.
Over the years ABB has gained experience in most of Italy’s electromechanical sector, and acquired important companies that have contributed to Italy’s industrial history, such as Ansaldo Trasformatori, Elsag Bailey, Ercole Marelli, SACE, Officine Adda and IEL.
Today, ABB Italy’s 6,300 people are concentrated in the north and central parts of the country. The company invests 3.2% of its turnover in R&D activities, and Genoa is a main operational center, home to ABB engineering, R&D and automation facilities focused on the energy, industrial plant and marine sectors. This capacity was enhanced in 2010 when the new Sestri Ponente offices were inaugurated in Genoa, featuring an advanced and futuristic Demonstration Center for the Symphony Plus total plant automation system. And in 2012, ABB acquired RGM Polycontrol, a Genoa-based subsidiary of RGN S.p.A., which specializes in auxiliary power systems for rail vehicles.
ABB is a main actor in the Italian industrial sector, a role it has successfully played for more than 100 years. ABB invests, innovates and creates value in Italy, enhancing local roots even as it scours the world for new business opportunities.
ABB Italy is a part of this long-term legacy, which is helping to develop the Italian economy by supplying products, systems, solutions and services that boost to customer performance.