Tragedy at the House of Gucci
(Last of a series)
The house of Gucci started in Florence in the 1920s, and grew under the steady influence of founder Guccio Gucci. His son, Aldo, brought the brand to New York in the 1950s, fueling growth for two decades. But as we saw last week, the family business was wracked by internal strife.
So in the 1980s, grandson Maurizio brought in professional management. Sara Gay Forden, in her book “The House of Gucci,” described Maurizio as turning on the charm for finance house Investcorp, which took a stake in the company.
Maurizio told Investcorp, “There is a saying in Italy: The first generation creates the idea, the second develops it, the third must face the big growth questions. How can you tie a company that has 240 billion lire in sales to a closed family mentality? I believe in tradition, but as a base on which to build, not as an archaeological collection to show to tourists. The family war has paralyzed this company for years. How many competing labels have been born and reached success just because Gucci was standing still? Now it is time to turn the page!”
However, chaos already reigned. Employees were confused by contradictory messages, often from Maurizio himself.
Once, he ordered employees to throw away old but unused products, but they did not listen and found a new market for these. “On the one hand, big money would be thrown away,” a manager told Forden, “and on the other, we were instructed to save on pencils and erasers, our telephone calls were monitored, and we had to burn out all the lights by 5 p.m.”The situation was like “the Titanic sinking and [passengers] having champagne and caviar,” said a board member.
In the 1990s, in a bid to revitalize the business, Maurizio imported American designer Tom Ford. Ford, in tandem with company CEO Domenico De Sole, put Gucci back on the fashion map.
De Sole the lawyer had decades ago led second-generation Rodolfo’s fight against his brother Aldo, then Aldo’s fight against his son Paolo, followed by Maurizio’s fight against Aldo and his cousins, and later on Investcorp’s fight against Maurizio. After Maurizio’s demise, De Sole landed the top post, thereby ending Gucci leadership at the family business. De Sole and Ford would later convince French billionaire Francois Pinault to help them fend off a takeover by LVMH’s Bernard Arnault.
Maurizio tried his best to revive the family business, but childhood scars took their toll. “Maurizio had heard both his father and his uncle say over and over that he wasn’t capable of managing the company,” banker Andrea Morante told Forden. “He carried this fear around with him. He wanted to hear people say, ‘You are a genius.’ You were either for him or against him.”
Maurizio’s biggest error though was in marriage.
“When you are healthy, handsome, and have a highly visible last name and the most beautiful boat in the world, it is difficult to make real friends,” said Morante. “You find yourself surrounded by people in desperate search for the indirect limelight, for easy money, and for the glamor of being associated with a well-known name.”
Against his father’s wishes, Maurizio married Patrizia Reggiani in 1973 and the couple had two daughters. A decade later, he left her for another woman. The couple divorced in 1991. Four years later, Maurizio was gunned down in his office, and in 1998, Patrizia was found guilty of orchestrating his murder. She was released from prison in 2016.
Gucci’s longtime watch supplier Severin Wunderman said it best: “The Gucci story is the perfect example of what a family should not do.”
Queena N. Lee-Chua is on the Board of Directors of Ateneo’s Family Business Center. Get her book “All in the Family Business” at Lazada and as ebook on Amazon, Google Books, Apple Books. Contact the author at [email protected]
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