Istanbul, Lucca, Naples The product that the machine spits out after a good 60 meters could hardly be more analogous: toilet paper. The white colossus cuts and glues multi-layer rolls from raw material weighing tons, 1620 pieces per minute. The business in the north of Tuscany is old, classic mechanical engineering. But it has recently become highly digitized: Artificial intelligence, the Internet of Things – they are already a reality in Italy’s toilet roll production.
60 years have passed since the Italian Fabio Perini developed the first cutting machine for tissue paper here in the city of Lucca. Perini’s company, which has been part of the German Körber Group since 1993, is the market leader. Every fourth roll of toilet paper in the world is produced on machines from Körber Tissue. More than half of the 1200 employees work in Italy.
And they are experiencing a new era of digitization: “We looked at the entire value chain,” says Daniel Szabo, who heads the digital unit at Körber. Artificial intelligence can increase productivity by up to 30 percent.
The production machine analyzes itself, evaluates 400 parameters in real time – and uses them to make suggestions as to which adjustment screws need to be changed in order to improve performance. Even unskilled personnel can operate the system. “This is important because a lot of expertise in the field will soon be retiring,” says Szabo. The machine learns new things every day, also from all other devices that are running around the world.
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A look at the “Tissue Performance Center” shows how globally networked the toilet roll business is: employees sit around the clock in front of a wall with large screens. Information from more than 160 machines is received. Speed, downtime, engine temperature: everything is monitored remotely.
Instead of waiting for a customer call in case of problems, as in the past, the employees send early warnings to the operators from here. The service has been around for two years. “Before that it was a taboo to share machine data with someone over the Internet,” says Oswaldo Cruz Junior, CEO of Körber Tissue. Today, expensive failures can be avoided.
Italy and Turkey have caught up the most digitally
The transformation is not only in full swing in Lucca. All over Italy, branches of the economy are being digitized at a rapid pace. In this year’s “Digital Riser Report” by the European Center for Digital Competitiveness, Italy took a giant step forward, improving by nine places among the G20 countries. This puts Italy ahead of Germany, France and the USA.
The other big climber on the European continent is Turkey: The country has advanced from 19th to fifth among the largest industrial and emerging countries.
What are the two countries doing better than the rest of Europe? And what can Germany, which has committed itself to advancing digitization under the new traffic light government, learn from Rome and Ankara?
There is, for example, the public administration: Anyone who wants to benefit from the digital transformation in Turkey just has to look at their own smartphone. With the app “eDevlet” – in German “eStaat” – citizens in Turkey can access almost all government services, from proof of registration and tax returns to changing their names. And all this without looking for an appointment, without waiting at the office and without cash payments for a document.
Despite economic difficulties overshadowed by Ankara’s authoritarian politics, despite inflation and pandemic, the country is a long way ahead of Germany in terms of digital transformation. Digitization of public administration is not a prestige project or a political bone of contention, but simply a necessary means to an end.
The digital learning platform Eba existed in Turkey long before the beginning of the Corona crisis
Several factors make implementation easier: Turks are familiar with the Internet, and there is practically no fear of data theft. According to a study by the state statistics institute Tüik, a third of those surveyed were already using apps to buy groceries in 2019. Half of the respondents already used the smartphone to use government services such as electronic prescriptions, but also other government services. An incredibly high figure for an emerging market.
Digitization is a driving force for tech start-ups in Turkey. The local Amazon competitor Trendyol, for example, is already valued at more than ten billion dollars, although the boom in online retail since the beginning of the pandemic has also helped.
The Turkish state uses the digital affinity of its citizens, for example in education. For years, pupils have been able to access exercises and apply for tuition via the online portal Eba. The system has been tried and tested because it was already being used regularly before the Covid crisis. When the country went into corona lockdown in April 2020, nothing had to be prepared – all school children in the country with internet access could access tasks and explanatory videos via Eba.
In Italy and Turkey, the state strongly supports digitization: The government of President Recep Tayyip Erdogan is specifically promoting digitization because it wants to become independent in key technologies and align the domestic economy to future markets.
As part of the “technology-driven industry initiative” announced by the Ministry of Industry and Technology at the beginning of the year, 919 products are to be given priority: from computer chips to transport vehicles to medicines. 161 products are from the field of computer technology, 158 deal with robotics and intelligent machines.
The topic of digital transformation receives special attention. Start-ups in this field can look forward to a purchase guarantee from the government, tax rebates, help with finding offices and production facilities, and low-interest loans. Young companies that dedicate themselves to these key technologies are also to be exempt from VAT for several years.
Up to 75 percent of the expenditures for research and development could also be borne by the state. And those who hire hard-working workers also receive social security support for the employees.
“Italy already has a role model function for Germany in terms of digitization”
In Italy, too, the state is promoting digital retrofitting with tax breaks. Thanks to the EU’s Corona recovery fund, around 40 billion euros are now flowing into the digitization of the country. Change is sweeping through all industries: whether ceramics manufacturers or the fashion industry, whether agriculture or tourism. Small and large companies are currently relying on the digitization of their processes.
The start-up world also benefits from this. France and Germany are still lagging behind when it comes to setting up a business – but they are catching up. New incubators have sprung up, and there are chic hubs and start-up centers in Rome, Turin and Milan where corporations are docked.
“Many founders go abroad, but now the time has come to try it in Italy,” says Federico Marchetti, founder of luxury fashion retailer Yoox Net-a-Porter. “The moment is historic, bureaucracy is being cut, processes are being simplified.”
The digitization of the country is one of the main concerns of the government of Prime Minister Mario Draghi, which has been in office since February. It has already initiated important reforms – in the judiciary, public administration and taxes. “Italy already has a role model function for Germany in terms of digitization, especially when it comes to public administration,” says Peter Adrian, President of the German Chamber of Commerce and Industry (DIHK).
25 million Italians already have a digital identity. From mid-November, like in Turkey, most administrative procedures can be done online: birth certificate, family status, place of residence – everything can be accessed digitally. Those who use the state app IO also benefit in the corona crisis: Vaccination certificates and corona test results are loaded directly into the app, completely automatically.
Apple has put Naples as a location on the tech map – EU funds enable change
A visit to Naples shows the opportunities offered by digital change: The San Giovanni a Teduccio district did not have a good reputation for a long time. Tourists rarely got lost here in the south-east of the city, where mainly dock workers lived. But for five years now, hundreds of students have been bustling around here, cafes have sprung up and new bars and restaurants have sprung up. The neighborhood has changed since the Federico II University inaugurated its new campus on the ruins of a tomato can factory. The project was financed with funds from the EU – and with the help of Apple.
The tech giant from California founded its first developer campus in the poor south of Italy, of all places. The entire third floor is occupied by the Apple Academy, the bitten apple sticks discreetly over the doors, it is emblazoned a little larger on the touchscreens on the open-plan floor. Young people in shirts and sneakers sit in front of Macbooks and iPhones, most of them are men. It’s the beginning of the semester, and after a year of coronavirus pause, a new class is starting.
“It’s a very inspiring program, unique in the world,” says Moritz Philip Recke. He is an engineer and headed the digital division of a publishing group before joining the Academy in 2017. After graduation, he remained as one of 20 mentors.
There are no lectures, no lectures, no grades here. The students learn and decide independently which projects to tackle, supported by the mentors. They develop three apps in the ten months they spend in Naples. For this they receive a grant of up to 7,000 euros. Rent and living are cheap, so many students get by without a part-time job.
“Anyone can become a developer,” Recke is convinced. About half of the students have no previous programming knowledge. In the beginning it was a lot about conception, about the design of prototypes. Almost 2,000 young people have already completed the English-language program, more than half of them Italians. Many of them end up in Italian start-ups, but companies from Berlin, Barcelona or London also come to the final recruiting fair.
As a result, Naples has appeared on the tech map. Apple has a pull: The telecommunications company Tim, the management consultancy Accenture and the US tech company Cisco have also settled in the area. This offers the region, in which youth unemployment is even higher than the almost 30 percent nationwide, social opportunities. Naples offers real prospects again. And in the long term too: Apple has just secured the financing until 2025.
More: Digitization is not sexy, it is hard work