Having three businesses, Paolo Bussolari reasons, is like having three children.
“It’s impossible to say that one is better or more important than the other,” the CEO of Italian multi-business company Cefla tells The CEO Magazine.
Just like any group of siblings, the three business divisions that Bussolari is referring to each have their own identities.
There’s the civil and industrial plant engineering business that was founded in 1932 when a group of nine tinsmiths, plumbers and electricians came together with 100 Italian lira each – just over US$0.05 in today’s value – to establish the Cooperativa Elettricisti, Fontanieri, Lattonieri e Affini (Cooperative of Electricians, Plumbers, Tinsmiths and Related Trades, or Cefla) of Imola, a commune within the Bologna metropolitan area of Italy.
In 1964, the second division, a finishing unit for surface coatings, decorations and digital printing, was founded. The Cefla name has since become the one to trust for turnkey finishing solutions in construction, furniture, packaging, aerospace and automotive industries.
Cefla Medical Equipment, the youngest unit, came into operation in 1998 when a series of acquisitions were made in that decade in the dental and radiology space.
These three very disparate units have each carved out very different markets. “Nearly all of our engineering business comes from the Italian market,” Bussolari explains. “Whereas we are a market leader in finishing and Europe’s leading dental unit manufacturer.”
The trio are set to become a quartet as of next year, when LED manufacturer Cefla Lighting (or C-Led) becomes a standalone division within the corporate structure.
Bussolari, a qualified lawyer, joined Cefla on the medical side of the business in 2001, becoming Director of the division in 2013 on the nomination of President Gianmaria Balducci, who himself started in the business in 1995. The appointment was one of Balducci’s first moves in the role.
“Looking back, it was a great choice,” Balducci reflects. “Ours is a great collaboration. We have a lot of trust in each other.”
The figures also attest to the strength of their partnership. “The results of the past decade show us that anything is possible,” he says. “We passed from a turnover of €300 million [US$320 million] to €600 million [US$640 million] in 2022 and a net profit of €1 million [US$1.06 million] to over €50 million [US$53.4 million].”
The decision to maintain operations during the COVID-19 pandemic played an important role in this success.
“Many of our competitors decided to pursue a stop-and-wait strategy. We kept our factories open and continued to deliver products and a high level of service,” Bussolari explains.
The move has reinforced Cefla’s unique selling proposition across each of the markets it operates in.
“We keep to our promises and we’re recognized for that,” Bussolari says. “If Cefla promises a delivery, it’s fulfilled. If we promise payment, it’s made. We’re very solid.”
As they look toward an uncertain future with the energy crisis and a recession on the horizon, Balducci takes a lot of confidence from what the pair have already achieved.
“We have the right mix of experience, unstoppable energy, curiosity and commitment,” he says.
Bussolari adds that looking forward, they have sketched out a variety of potential scenarios in a flexible business plan. However, no matter how the next 12–18 months play out, the drivers remain the same.
“We will continue to improve the customer-oriented value proposition through products and process innovation, and new market and segment development to broaden the product and service range,” he reveals.
“We will also improve team organization and efficiency by investing in people and developing new efficiency tools, and partnering and networking to strengthen know-how and skills both internally and through external channels.”
On the last point in particular, Bussolari underlines the importance of involving Cefla’s supply chain in product development.
“We frequently consult with suppliers to find the best solutions and identify the best technology so as to obtain optimal performance and a balance between quality and cost,” he points out.
These supply chain partners have been the lever that has contributed decisively to overcoming production records and satisfying customers, especially in the past three years, along with a less lean philosophy and increased pragmatism, he adds.
It helps that 80 percent of all suppliers have a base within a 100-kilometer radius of the company. “We’re lucky to be in an industrial valley. It’s key to our reactiveness and responsiveness to the market,” Bussolari says.
In 2022, the company celebrated a significant milestone: its 90th anniversary. “It’s easy to feel inadequate presiding over a company that’s 50 years older than you,” Balducci says with a laughs.
“Nevertheless, if I look back at just the 10 years I’ve been President, the company has made impressive progress. We’ve strategically repositioned ourselves in highly profitable, high-tech sectors and abandoned others that we felt had less encouraging prospects. This has led to a doubling of revenues and quintupled profitability.
“These results have allowed us to celebrate a huge anniversary in the best way possible.”
Cefla’s three distinct businesses do share a common base: technology. Along with investments in AI, the company is also making a foray into clean energy.
In late 2022, it announced a partnership agreement with California’s Bloom Energy for the supply of solid oxide fuel cells.
“It’s a really interesting technology for Europe right now considering the energy shortages,” Balducci says.