An interview with Maurizio Zordan: “Sharing values fuels trust, and with trust, you can build great things.”
About Maurizio Zordan
Maurizio Zordan is CEO of Zordan and President of Woodways. After earning a Business Administration degree from the University of Padua (Verona Campus, Italy), an MBA degree from CUOA Business School (Italy), and after gaining a solid professional experience as Financial Controller at Marzotto Group (a leading Italian textile manufacturer), he joined the family company (Zordan) in 1996.
With his transformational leadership skills and a clear vision of the future, Maurizio has successfully managed to create a harmonious balance in his organization between bold business objectives, continuous improvement initiatives, and prosperity goals.
Ivo Pezzuto: Maurizio, how did you turn a carpentry workshop in Valdagno (province of Vicenza, Italy) into an emerging luxury shop-fitting player in the global markets?
Maurizio Zordan: Our company was founded in 1965 as a technical carpentry shop supplier to Marzotto Group and as a furniture maker serving the local market. In the mid-1990s, Marzotto offered Zordan the opportunity to design, build, and install the furnishings of approximately 200 stores in Italy and Europe for their informal clothing line (Marlboro Classics). That collaboration opened up the prospect for Zordan to specialize in furnishing premium stores, but it was the collaboration with Bulgari in 2001, which marked a turning point for Zordan, as it led the company to create the first flagship store for the jewelry brand in Chicago in 2004. Afterward, we developed collaborations with multiple other luxury brands.
Ivo Pezzuto: Maurizio, what are the “founding principles of mindful growth” that have led your family business to become a successful Benefit Company (BC) and to earn the B Corp Certification? What are the 3Ps (Purposes) of sustainability in your organization?
Maurizio Zordan: In 2014, after receiving the Green Design Award from Bulgari, we pursued the prestigious B Corp certification, and we realized that it was an excellent strategy for implementing a comprehensive sustainable framework at our company, but above all, that it was an easier way to communicate our commitment to sustainability through a simple score. We engaged in this journey in 2015, and we obtained the B Corp certification in 2016 together with the transformation of our firm’s legal status into a benefit company.
We have fully embraced sustainability and defined our new brand mission and goal with the 3Ps (People, Planet, Prosperity), way before other firms did. It was a paradigm shift for our company in terms of mission and corporate values. Profit, which for decades has been the primary goal in the business world and the first on the list of items to be pursued, in our corporate mission became the last item on the list (after People and Planet) and gained a broader meaning (as Prosperity), that is, both in terms of time horizon and beneficiaries. In 2020, Zordan has indeed been re-certified as a B Corp with a score of 106.5.
Ivo Pezzuto: Maurizio, what does it mean at Zordan to achieve sustainable value creation (SVC)?
Maurizio Zordan: This is part of Zordan’s identity. For us, this is the true purpose of doing business. After all, what is the benefit of generating huge profits if companies don’t improve the living standards of people and if they do not have a positive impact on society and the planet? We are a forward-looking organization focused on sustainability with deep roots in the past. We are inspired by social progress achievements and by firms and transformational leaders of the present and the past, such as the Renaissance, Olivetti, Marzotto, Cucinelli, Luxottica, and others.
Ivo Pezzuto: Maurizio, what is so special about your organizational culture, people, and values that make it possible to spread positivity, inclusion, sustainability, and beauty throughout the world?
Maurizio Zordan: Without going into operational details, I would summarize everything into the following principle: sharing values fuels trust, and with trust, you can build great things. In 2018, we embarked on an irreversible transformational change in our organization by adopting Frederic Laloux’s (Laloux, 2014) self-organized small cross-functional teams’ organizational model, also known as the TEAL framework.
We have adopted the TEAL model as a possible solution to tackle the uncertainty and complexity that pyramidal and hierarchical organizations are not capable of dealing with in an effective manner. As a BC, we have recognized the TEAL model as a tool for valuing people and their contributions. Co-creation and co-participation became fundamental ingredients for the new organizational structure and our new way of working and cooperating within and among teams. This new approach has allowed us to spread responsibility more effectively, thus increasing the resilience of our system and our ability to quickly respond to market changes and customer needs. I believe in responsible capitalism and in experimenting with unconventional solutions to deal with complexity. I believe that embracing diversity, inclusion, tolerance, transparency, and openness in an organization is critical for addressing growing complexity.
Ivo Pezzuto: Maurizio, based on the results of your firm’s latest impact report, what improvements is your company achieving regarding the governance, employees, community, customers, and the environment (climate-neutral targets)?
Maurizio Zordan: Our goal is to maintain the excellent score we have obtained in 2020, or 106.5 points. Regarding the CFP (Carbon Footprint of Product), our company, together with 400 other B Corp companies (out of a total of 6000), declared during COP25 that we would become carbon neutral by 2030. Since then, we have obtained the product and organization CFP, and we have offered our customers the measurement of the CO₂ contribution of their concepts (i.e., a verified tool for measuring the impact of the furnishings produced for the point of sale).
Together with customers, we are now working on CO₂ reduction, even through product re-engineering. We are highly committed to our sustainable business model, which is based on the benefits of renewable energies, environmentally friendly certified materials, water-conservation and water-efficient manufacturing practices, sustainable forestry, regenerative practices, biodiversity protection practices, and circular economy. Circa 95% of Zordan’s waste is recycled. We are also embracing the Double Materiality Assessments and the new CSRD framework to further improve our positive impact. The new Zordan headquarters in Valdagno, Italy, obtained the Leadership in Energy and Environmental Design (LEED) Gold certification, which is a framework that ensures that our new premises comply with the highest standards in terms of healthy, efficient, carbon and cost-saving green buildings.
Ivo Pezzuto: Maurizio, your company is focused on a process of continuous improvements to boost the firm’s value creation, innovation, and environmental and social impact. Why is it so important for firms to measure and monitor key competitive indicators such as revenues, EBITDA, EBITDA multiples, free cash flows, enterprise value (EV), net financial position (NFP), and social impact measures)?
Maurizio Zordan: We aim to keep production rolling to gain significant learning curve effects and dynamic capabilities. So, the key figures we keep an eye on are:
- Break-even point (BEP), which is set at 50% of budget volumes and obtained through the mix of fixed costs and margins.
- From the BEP, we derive an internal production capacity that does not exceed 30% of total production.
- From this figure, we understand that we cannot exercise excessive bargaining power over our suppliers since with our purchases, we cannot affect more than 30% of their turnover.
Given these conditions, we can work on improving our productivity, on the optimization of the workloads, the product margins, the orders, the customer experience, and the market-specific demand. We also developed advanced skills in benchmarking analytics. We are constantly comparing our performance, business model, and value proposition with those of our competitors. We regularly monitor our company’s position in the market in order to better understand how the company is performing, its strengths and weaknesses, and its strategic options. Without measurement, improvement cannot be achieved. In our firm’s cafeteria, our competitors’ main KPIs are displayed. These are Turnover (we call it vanity); EBITDA (we call it health status), and NFP (we call it reality). These key indicators are made available to everyone in the company, and many of our corporate customers ask for these data when they visit us. So, that means they are useful.
Our teams also work on Contribution Margin 2 (CM2) and Volumes. Difficult situations occasionally emerge from ongoing planning and replanning of sales quotas and production activities, but this is also where the best results come from. Constant review and refinement of planning activities also represent a good management practice. Our data indicates that the firms’ valuation metrics and multiples deliver better performances when they are paired with good performances in terms of SDGs.
So, to conclude, socially responsible practices have a positive impact on people, the planet, and prosperity and this is something that deserves to be remembered.
illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.
About the author
Dr. Ivo Pezzuto is a professor of Economics and Management at ISM in Paris. He is also the founder of Ivo Pezzuto Forward-Thinking Lab and an author, keynote speaker, and member of advisory boards and think tanks. Dr. Pezzuto is a regular contributor and commentator for major international broadcasting networks and financial press.