“Italian Icons of China”, Sisme S.p.A.
This article was originally published in Italian in Panorama on 26th November 2024.
Please note that this is a courtesy translation of the Italian language article originally published in the Panorama Magazine Issue at: https://www.panorama.it/economia/italian-icons-of-china-sisme-spa
Discovering how Italian companies excel in international markets, particularly in China, is a fascinating journey of ambition and innovation. With the “Italian Icons of China” series, we share success stories through exclusive interviews with the protagonists of Italy's most influential companies, offering valuable insights and inspiration for entrepreneurs and companies of all sizes. A unique opportunity to learn from real experiences and discover the secrets of innovation.
In this appointment, we are excited to present an exclusive interview with Ms. Serena Costantini, President of Sisme S.p.A since 2022.Founded in 1957, Sisme S.p.A. is an Italian leader in the manufacturing of roto-stators and electric motors. With production sites in Italy, Slovakia, and China, the company combines innovation, sustainability, and a focus on human capital, standing out for its customized solutions and strong environmental commitment.
Serena Costantini embodies the perfect blend of tradition and innovation. Born in Switzerland to a Swiss mother and an Italian father, she built a solid career starting with a degree in Economics and Business from the University of Pavia and an initial experience as an auditor at PricewaterhouseCoopers S.p.A.
Today, Serena promotes an ongoing commitment to sustainability and gender equality. Active in important entities such as Confindustria and Federmeccanica, she represents a leadership that combines strategic vision and social responsibility, ensuring sustainable and inclusive growth for the company.
1. We know that Sisme entered the Chinese market in 2004 in Tianjin. What have been the most significant moments in the development of your business in the country?
Once the initial barrier was overcome in 2005 with the establishment of a plant of about 2,000 square meters of production capacity to follow our largest customer, the Danfoss Group, Sisme worked on:
a. Primarily expanding its services to other global clients, such as the Emerson Group (now Copeland) and the Bitzer Group, to supply electric motors while ensuring the same quality and efficiency as the corresponding models provided by Europe.
b. In 2008, moving to a new facility of about 8,000 square meters in order to manage a continuously growing business volume.
c. Starting from 2010, expanding its customer portfolio to new global players such as the Ingersoll Rand Group (now Trane Technologies) and the Gea Bock Group (now part of Danfoss for the compressor division).
d. Finally, from 2020, beginning an expansion towards global customers controlled by Chinese ownership, such as the Snowman Group.
2. The Chinese market offers great potential. What opportunities do you see for the future of Sisme in China, especially in terms of expansion and collaboration with local partners?
The Chinese market offers significant opportunities, but at the same time is characterized by intense price competitiveness. Therefore, Sisme intends to seize the opportunities of the Chinese market and to do so, as mentioned, it has begun to extend its reach to Chinese customers with the common denominator of the global projection of its business which would allow it to properly highlight the characteristics of its products and services, by overcoming mere price competition.
3. Operating in China also involves several challenges, both economic and cultural. What are the main difficulties you have encountered and how have you addressed them?
The main economic difficulties we have encountered, and continue to encounter, in the development of the Chinese market specifically, relate to competition with local competitors who exert significant and constant pressure on the sales price. This, for the time being, limits Sisme’s portfolio to a few large international clients. From a cultural standpoint, we have undertaken a mutual approach project based on the commitment of both European and Chinese colleagues. After almost 20 years of presence in China, this process is still ongoing, but the collaboration and understanding with our Asian colleagues has definitely improved. Our local general manager, Alessandro Moalli, who has been with Sisme China since its founding, fully embodies this approach: professionally committed and a co-author of the development of Sisme products, he has also managed to integrate personally (he is happily the father of an Italo-Chinese child). All of this has led him to become a recognized point of reference for both Chinese and European colleagues and business partners.
4. The topic of sustainability is becoming increasingly relevant. How does Sisme S.p.A. integrate sustainability principles into its operations? Could you tell us about the most important initiatives you have implemented in this area?
Sustainability is an integral and essential part of Sisme's products, which, by their very nature, play a key role in the fight against reducing CO2 emissions into the environment. Always attentive to environmental issues, Sisme's production has always been characterized by low emission levels. Nevertheless, the company has continuously invested in improving its production processes, recently introducing LED lighting in all the Group’s facilities, replacing aluminum melting furnaces with new "smart" furnaces (which can also be controlled remotely), and significantly reducing gas consumption (more than halved). Economic evaluations are underway for possible installation of solar panels in various Group facilities to further reduce the environmental footprint. Additionally, in 2020, we launched an initiative to promote sustainability within the Group, starting with the Italian facility, focusing on both economic and social sustainability in the broadest sense. Today, we are in the fourth edition of the Sustainability Report, and we have begun to address the challenges posed by "Scope 3," which concerns our products and services from the "cradle" to the gates of Sisme. This involves considering not only the impact of our processes and services within the company but also the impact of our suppliers. We are also extending Scope 1 & 2 analyses to our Chinese facility and plan to conduct a product lifecycle assessment in Sisme China to compare it with those of a comparable European product.
5. How do you plan to adapt to economic changes and the needs of Chinese consumers?
Sisme’s mission is to serve global partners by addressing the specific needs of the Chinese market through targeted actions and by driving cost-reduction projects in partnership/co-design that continue to combine quality and efficiency with sustainability. Ongoing investments in research and development are essential to adapt to market changes and the needs of Chinese consumers. In fact, Sisme invests each year about 2% of its revenue in R&D, ensuring a constant value proposition that is well represented, for example, by the offering of brushless motors that do not use rare earth permanent magnets, but rather ferrite magnets, or motors without magnets (synchronous reluctance).
6. What advice would you give to those considering investing in China, and what key aspects do you believe are essential for success in the Chinese market?
Our advice is to have a clear understanding of one's mission and characteristics in order to focus on providing original solutions, even in a highly competitive market like China. It is therefore advisable to avoid losing one's essence and history, as they are the true assets of any successful company.
By: Attorney Carlo Diego D’Andrea, Vice President of the European Union Chamber of Commerce in China
