Innovation Patterns in Wine Firms: The Case of Three Wine Producing Systems in Northeastern Italian Regions

The innovation and creativity in wine sector play a key role for the development and competitiveness of wine firms (Pilati 2006; Pomarici 2006). Actually, innovation follows a bumpy and very uncertain pattern where human capital ensures from time to time flexibility, efficiency and creativity. This intangible asset may be evaluated through two components. An intangible component associated with knowledge embodied in machines, products, procedures and which is produced by humans but it acquires its own life spreading and multiplying the starting value (Amabile, 1996). A second component associated with human capital in the strict sense, i.e., the knowledge of working people (Heberden, 2006) which features ranges from multi-socialization aspects (attitudes, skills, professional culture) to learning processes (experience), from education to training, research and vocational qualification, from experimental and innovating experiences (learning by doing) to learning and innovation patterns in creative, design, communicative and design skills (Barney, 1991; Lipparini 2002; Rullani, 2004; Rullani 2008). This paper analyzes wine-producing firms located in three Italian areas, namely Prosecco of Valdobbiadene, Trentino and Friuli Collio, showing a high propensity for innovation, with the aim to figure out innovation patterns and the role of creativity in wine industry. In the first phase of research, we discuss the principles and the theoretical models applied to innovation, starting from the neoclassical theory up to contemporary evolutionary models. In the second step, we analyze the most significant factors affecting innovations, through a survey where information has been gathered by giving a questionnaire to a sample of wine firms. Data about 89 firms have been collected and information about structural elements, process and product innovations, marketing and managerial aspects as well as the technologies employed have been explored. We have also gathered information about difficulties encountered by wine firms in implementing innovations, factors needed to be competitive, strengths and weaknesses of three territories, factors originating creativity and strategies adopted by the companies to be innovative. As methodology of analysis we have followed traditional statistical tests of variance and the discriminant analysis for the three territories, in order to highlight the main differences in innovation models among the three areas. Next, a logit regression has been carried out to evaluate factors affecting innovations and creativity. The results show significant vivacity in term of innovation within the three groups of wineries, which is also confirmed by the considerable average yearly investment, given that it reaches 17% of the turnover, in the period 2006-2008. Investments in production processed are also growing, especially in activities considered strategic for the three territories. In particular, producers in the Conegliano-Valdobbiadene area are focused on sparkling wine making and bottling processes, those operating in Trentino pay attention especially on aging and wine quality, while wine makers in Collio area are investing mainly in grape reception and fermentation technologies. Many wineries invest also in the wine typology: for instance, many companies are looking for new types of wine in order to meet the changes in the consumers’ tastes. The innovation is also important in the field of information technologies that speed up actions and bring significant cost reductions. Attention is also paid to the customers and to marketing innovations. Most of companies make remarkable efforts to improve the staff training, given that they recognize that knowledge and information are important for creativity while the human capital is the hinge for getting best results. About the difficulties that companies face in introducing new investments, research, extension and cooperation are the fields where many deficiencies have emerged. Another critical point regards the high level of bureaucracy, which the wineries consider a notable hindrance to the business management, involving cost increases and time losses. These aspects are felt to be hampering in the global competition that wineries are facing; therefore they react by investing more in communication in order to promote their own brand. Moreover, they have focused on excellence and specialization, to avoid a lowering price strategy, as it happens for standard wines. The discriminant analysis allows us to estimate the companies behaviors in relation to the surrounding territories. A first analysis, performed by using only “objective variables”, shows more than 80% of cross validated correctly classified cases. Companies belonging to the Conegliano-Valdobbiadene District show a strict connection with their own territory, and only 18% have adopted the Trentino or Collio models of innovation. The Trentino companies instead depart from the model of their own territory: 14% of them emulate the Conegliano-Valdobbiadene model and 9% towards the Collio one. Among those belonging to the latter area, 16% are more similar to the Trentino ones. Among variables that mostly contributes to the differentiation in the three territorial innovation models we find: sparkling wine as process innovation, the cork as product innovation, the broadband and the data management as information technology, the professional training and the finance availability as obstacles to adopt innovations, and the average investments for the last three years. A second analysis, performed by means of “subjective variables” shows 77,4% of cross validated correctly classified cases: almost 82% in the Collio and Conegliano Valdobbiadene areas and only 66,7% in the Trentino. The comparison of wineries belonging to the two types of classification gives further support the hypothesis of three locally differentiated innovation models in the northeastern part of Italy.