A Generation of Leaders Born in the Trenches of the Great War

ITALY ENTERED WWI AS A BACKWARD COUNTRY AND CAME OUT AS AN INDUSTRIAL ECONOMY. STUDENTS THAT CAME BACK FROM THE FRONT WENT ON TO BECOME MANAGERS AND ENTREPRENEURS. THEIR CONTRIBUTION TO SUBSEQUENT EXPANSION AND GROWTH IS THE CONFLICT'S MOST ENDURING ECONOMIC LEGACY

by Andrea Colli, Dept. of Policy Analysis and Public Management, Bocconi
Translated by Alex Foti

The 24th of May 2015 was the hundredth anniversary of Italy’s entrance in World War I, the large-scale carnage that opened three decades of European civil war, before Europe’s nations understood the need, in spite of the difficulties, of political union to achieve durable peace.

Italy lost 651,000 men under arms (about half of French and British military losses, a third of German losses, half of Austrian and Hungarian ones) plus more than 590,000 civilians, a blood tribute second only to Serbia’s. Thus, the country gave a significant contribution to the horrific casualties caused by the first world conflict, with all the deadly efficiency afforded by modern industrial technology.

➜ the companies that made Italy great

The price paid by Italy seemed huge by those who started talking of a “Mutilated Victory” right after the end of the war. The economic and business historian must however underline how that historic massacre left durable effects in terms of radical economic transformation and industrialization of the country. Italy had only started to abandon its peripheral position in Europe at the start of the 1900s, thereby reverting long-term historical decline, caused by the centuries of political fragmentation and misgovernment following the Renaissance.

Italy entered war a year late (luckily, one might say, as the number of casualties could have been larger), but went to war with what Luigi Einaudi defined an adequate effort in terms of «materiel and industry». Italy entered WWI at the margins of industrial capitalism, and ended the war as full member of the club of advanced countries. Some of its firms, thanks to the war, became leaders in their respective industries, becoming quasi-monopolists at home but acquiring international standing in world markets. Some companies went on to dominate their industries for many decades, holding positions at the summit of Italian capitalism (FIAT, Montecatini, Ansaldo, Edison, Falck, only to mention some), finding in the military effort the strategic push, and especially the resources to expand their scale and deepen their horizontal, and especially vertical, integration. By necessity, mass production techniques entered the business arsenal of Italian entrepreneurs.

War devastated a whole generation, by burying a good part of it and traumatizing survivors for their whole lives. However, in the trenches manned by peasants and workers a sort of national identity was for the first time forged (cemented by the necessity to communicate in the national language, instead of the countless local dialects), as well as a national managerial class.

➜ a generation of leaders

University students were natural recruits of the army as military officers and cadres. These twentysomethings were sent to the front as lieutenants and captains, and given the command of soldiers to be led to their likely deaths in no man’s land. They graduated at the front, so they said, and were exposed to constant stress and risk of death while having to take tough decisions. Whoever had the luck to come back from the trenches used the experience of leadership and command in combat to join business enterprises and government administrations, thereby creating the human capital foundations on which subsequent economic development was built on.

Many did not come back alive, though. Bocconi, which had been founded just at the start of the century but was already a leading academic institution, lost many of its students. In fact, in relative terms, Bocconi saw more students killed in war than any other Milanese university. Their names are engraved in the memorial monument standing in the square next to the Velodrome Building, where most of us Bocconians usually walk by without giving it a thought.