There must be very few people around the world who at some time or place have not savored the delectable chocolate confection known as “Rocher.” Michele Ferrero, the Italian entrepreneur and the creator of this ubiquitous delicacy died on Valentine’s Day when many people were enjoying his sweet creation in a special way.
Michele Ferrero left behind a rich legacy as entrepreneur and innovator who lived an exemplary life. He developed his parents’ small confectionery shop into a renowned multinational corporation, that today has manufacturing facilities in 20 countries, sales in 53 countries, revenues of 8.1 billion euros in the fiscal year ending August 2013 and about 25,000 employees. Mr. Ferrero, who started his career helping his parents in their shop, eventually became Italy’s richest person with a net wealth of over $26 billion, ranking 22nd in the Forbes 2014 compilation of the world’s top 50 billionaires. The Ferrero Company, which is family-owned, is the second largest confectionery company in Europe and fourth in the world (after Mondelez, Mars and Nestlé).
Pietro Ferrero, Michele’s father, started his confectionery shop in 1942 in the small town of Alba (population today: 32,000) in the North Western region of Piedmont, about 50 kilometers south of Turin, while Italy and Europe were in the midst of a devastating war. Since chocolate was expensive and difficult to obtain, the elder Ferrero found a process to mix chocolate with a paste processed from the hazelnuts that grew in abundance in the surrounding countryside. His combination resulted in a confection that found favour with a great many people such that he did not even have to market the product. It sold itself. The business grew and became incorporated in May 1946.
Pietro died in 1949. His son Michele, only 23 at the time, eventually took over the business and soon refined his father’s invention into a nutritious, delectable product he named Nutella. All Italian children have eaten slices and slices of bread covered with Nutella, whose flavour and fame soon “spread” throughout the world. Today the company buys 25% of the global output of hazelnuts and produces 350,000 tons of Nutella per year.
In the early postwar period, as Michele Ferrero sold his confections in the war-torn countries of Europe, he provided quality products at a moderate price. His pricing policy allowed many more people to purchase and enjoy sweets while growing his market, sales and profits.
He was also a shrewd businessman. Michele Ferrero invented a method whereby a liquid could be placed in a chocolate confection without the chocolate absorbing that liquid. To protect his invention from possible theft, he had his patent translated into Arabic and registered in Egypt. It was his way of assuring that no corrupt official could divulge his formula to a competitor.
Ferrero also was a “hands on” entrepreneur when it came to test marketing new products. He personally went out to specific places where his sweet creations were presented to consumers to try out. He was there to observe and record their impressions and comments and would not be satisfied with his new products until he felt assured consumers would buy and enjoy them.
Besides Nutella, a number of other easily recognized brands also were created by Ferrero: Tic-Tac mints; Pocket Coffee; Kinder surprise, small milk chocolate eggs containing a tiny toy favoured by little children but also approved by mothers because they contained milk; Mon Cheri, a special type of chocolate creation containing a cherry, specially patented; and eventually Rocher which was another confection of chocolate and hazelnuts, conceived in 1982. Rocher met with extraordinary success that helped drive the company’s expansion beyond Italy’s confines.
The story has it that the inspiration for Rocher came from the rock formations (Rocher de Massabielle) in Lourdes, a shrine that Michele Ferrero visited every year. Statues of Our Lady of Lourdes are present in every Ferrero establishment by order of Michele, and the same statue was placed near his casket at Mr. Ferrero’s wake.
Ferrero died at age 89 without ever abandoning the creative work he undertook at an early age. After his death long lines formed to pay their last respects including hundreds of retired employees, just about everyone from Alba and a large number of prominent Italian businessmen. Among others, the funeral was attended by the Italian Prime Minister, Matteo Renzi, and the President of the Piedmont Region, Sergio Chiamparino. The shops in the town of Alba paid homage to their illustrious citizen by displaying his picture with the caption: “Thank you Michele. We are proud of you.” The entire town shut down the day of his funeral in the Cathedral of Alba.
Despite his immense wealth and fame, Mr. Ferrero never sought the limelight. He led an exemplary life as details about him are emerging. According to the Bishop of Alba, Giacomo Lanzetti, who presided at his funeral, Michele Ferrero was a faith-filled, kind and generous man who shared his good fortune with his employees, the local community and well beyond Italy’s borders by investing in several social enterprises in poor countries. These investments promote businesses that provide a product or service, create employment and make a profit without which they cannot survive.
According to Bishop Lanzetti, around the immense manufacturing facilities in Alba, Ferrero was known simply as “Signor Michele” among the employees. Signor Michele cared for his workers as though they were family and workers in the Alba plant respected, admired and – dare I say it – loved him back. In the nearly 70 years the company has been in business there has never been a strike, there were never any layoffs or reduced work time – a miracle in Italy where labour strife is rampant.
Ferrero provided dedicated bus service for employees who lived in outlying areas and an on-site crèche for mothers of very small children. Through his Foundation, established with his wife Maria Franca, Ferrero also built a center for retired employees where they could gather socially and engage in various activities of their choice and never feel marginalized by society.
If an employee needed to get medicines from a pharmacy, all he or she had to do was leave the prescription at the front desk when coming to work and on the way out would find the medicines waiting at the same desk, paid for by Ferrero. When an employee happened to die from injury or illness, Ferrero continued paying the deceased employee’s salary to his grieving family for three years.
One of Michele’s two sons, Pietro died of a heart attack in 2011 while on a trip to South Africa, one of several countries where Ferrero has engaged in corporate social endeavors for many years. His only other son, Giovanni remains to carry on the fame, fortune and legacy of a truly magnificent family enterprise.
In a rare interview with the Italian newspaper “La Stampa,” Michele Ferrero revealed the source of his success: “Everything that I have accomplished I owe to Our Lady (la Madonna), to Mary. I have always placed myself in her hands and I thank her. I pray to her every morning and this gives me strength.” His business motto was: “Work, create, donate.”
Other billionaires who flaunt their wealth and fame could learn much from what inspired Michele Ferrero to uphold profound human values. Ferrero not only was a great innovator and entrepreneur – a capitalist in the true sense of the word – but he had a keen sense of genuine economic, social and human development.
Ferrero is synonymous with loyalty – a banished word in the English-speaking world – which represents a strong reciprocal bond between employer and employee that enable both to prosper in fat and lean years. An American reading all this might say Ferrero was paternalistic. But that word has a negative tinge to it. Perhaps the Italian Minister of Economic Development, Federica Guidi, in a letter to the Ferrero family, said it best: “Michele Ferrero was a champion of the Made in Italy brand and an example for future generations of entrepreneurs.” In this day and age when corporate social responsibility and impact investing are all the rage, Michele Ferrero’s legacy should be a worthy example.
Vincenzina Santoro is an international economist. She represents the American Family Association of New York at the United Nations.