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Normally these days, clever acquisitions are mostly talked about when made by the Internet giants. It feels that the regular world of market competition has been hijacked by the dominance of scale. Equally we talk interminably that innovation is only about utterly new product whereas today it is a complex subject often encompassing the old, updated and adapted for modern times. We talk of waterproof, perspiration and abrasion resistance but forget that it is in the nuances that often the greatest impact is achieved; and that it is as often about process as it is product, with the marketplace today requiring both as a routine.
Consequently, it was exciting to see a twenty-year old tanning business buying a 75-year-old one with innovation as the motive. As their notice of the event stated, the international tanning Group ISA TanTec has acquired a major stake in Scamosceria del Brenta Srl (Scabrenta), an Italian tannery with over 75 years of tradition in tanning and even longer in leather trading.
I particularly liked the next sentence: “Scabrenta, using its proprietary technology and deep knowledge of Italian leather making, will be an important R&D hub for various kinds of leather solutions within the ISA Group. Importantly, ISA will be able to deliver Italian developed leather to the Asian market, broadening the range and quality of solutions for its customers.”
Just last week, I attended the annual installation of a new Master for the Worshipful Company of Glovers of London. It is an ancient Livery Company first established in the city of London in 1346. The new Master chose “heritage” as his theme for his year, and noted that this was to not only to do with gloves themselves but also the industry and, of course, the Company. With over 650 years of history, he has a lot of “heritage” to play with, and a lot if it based around leather as the central material.
Knowledge and labour that stretch across national and political boundaries
One thing the Master will soon discover is that from the earliest days three countries had to combine to make the best gloves. “Spain to dress the leather, France to cut it, and England to sew it” was the oft repeated proverb for centuries. The best gloves took a variety of materials, knowledge and labour that stretched across national and political boundaries, as Holly Dugan said when she chronicled the perfume industry in 1975. Since, yes, perfume was another technology intricately linked to leather. Leather has been a globalised business for millennia.
ISA TanTec was founded in 1995 and is very much a modern business living in the new global world. Its move into the U.S. was a progressive step showing understanding of the way supply chains were moving as costs rise in Asia, and the value of short supply chains become apparent.
The development with Italy is different. It recognises that Italy has been special in its approach to leather. Often this is ascribed to its locally networked industrial structure, but we must not forget that this very flexible mix of what were originally all quite small tanneries, and bits of tanneries, lies embedded in a nation that is a world leader in fashion and style. This has created an understanding of what will and will not work in terms of converting hides and skins of all sorts into leather fit for purpose. Just a few days ago I was looking at a leather I made when I worked in Santa Croce in the 1970s. It was a soft grained, tumbled, polished semi-aniline kip skin which we called Snobby; and I remain proud of it. We were given the raw material and asked to make something worthwhile out of it, and Snobby took a while, but worked perfectly.
While the technical and production aspects are carried out well in Italy there is a tacit element that makes Italian leather more than merely good. As I see it ISA TanTec realises this and is prepared to try and see if it can bring this sort of thinking into the organisation. Making tacit knowledge into organisational knowledge is exceptionally difficult.
Knowledge is not data or information. There are two types of knowledge, explicit and tacit. Explicit knowledge is the type of knowledge that is easy to disseminate. The knowledge of how to print a side at a given temperature and pressure is an example of explicit knowledge. It can be turned into explicit information by codifying it on a process sheet. Tacit knowledge is not easily articulated. This type of knowledge exists within a person’s mind and can be seen in his actions, but is usually difficult to codify.
This is what ISA TanTec hopes to be able to capture and bring into its organisation in the coming years. It will be difficult, but if it works to even a small degree it will be worth every penny paid in the acquisition.
Dr Mike Redwood
14th November 2017
Follow Dr Mike Redwood on twitter: @michaelredwood
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