Sustainability in luxury fashion: An interview with Luca Sburlati, CEO of Pattern Group

In this podcast, Heidrick & Struggles’ Chiara Berlendi speaks to Luca Sburlati, the CEO of Pattern Group, which is a leading company in engineering and patternmaking for the most prestigious fashion and luxury brands. Sburlati, who started his career in HR, shares how he believes his CHRO experience prepared him for the CEO role and why HR leaders can be successful CEOs. He also discusses the leadership skills and capabilities needed to lead a sustainable industrial company, set investor expectations, and build a healthy organizational culture.

Some key questions answered in this podcast include:

• (1:09) How would you sum up what it is like to be a CEO today? In your opinion, what leadership skills are needed to succeed?
• (7:28) How do you think your CHRO experience prepared you for the CEO role you're covering today? What was the biggest stretch for you, from a CHRO to a CEO position? And also, what do CHROs, in your opinion, bring in a CEO role that other colleagues coming from other leadership functions may not?
• (12:03) And I guess one way in which you are certainly cascading this culture down the organization is also what you just shared with us: being very clear, treating everyone the same way, doing your job with passion, keep on researching, keep on being curious. Is there anything else you would like to add? 
• (13:40) What do you think are the basic characteristics of sustainable fashion design and what are the skills of sustainability-oriented leaders?
• (15:59) Looking ahead, which specific leadership skills and capabilities would you say will be the most important for your company to meet its strategic goals over the next three to five years?

Below is a full transcript of the episode, which has been edited for clarity.

Welcome to the Heidrick & Struggles Leadership Podcast. Heidrick is the premier global provider of senior-level executive search and leadership consulting services. Diversity and inclusion, leading through tumultuous times, and building thriving teams and organizations are among the core issues we talk with leaders about every day, including in our podcasts. Thank you for joining the conversation.

Chiara Berlendi: Hello, everyone. I'm Chiara Berlendi, a principal in Heidrick & Struggles’ Milan office and a member of the Consumer Markets Practice focusing on the fashion, luxury, and design industries. In today's podcast, I'm talking to Luca Sburlati, the CEO of Pattern Group, which is a leading company in engineering and patternmaking, producing collections for the most prestigious fashion and luxury brands for runway shows.

Luca joined Pattern in 2012 as their group CEO. He started his career in HR and moved to the CEO role in 2010 for the Azimut Benetti Group. Luca, welcome, and thank you for taking the time to speak with us today.

Luca Sburlati: Thank you, Chiara. 

Chiara Berlendi: How would you sum up what it is like to be a CEO today? In your opinion, what leadership skills are needed to succeed? 

Luca Sburlati: The idea is that leadership skills have been changing during the last few years. There are three main characteristics that I want to mention to you, Chiara. The first one is about geopolitics. Compared to what I might say was a pretty simple world until 2018 or 2019, the world has completely changed. The pandemic was the worst situation and put us in a very different position compared to what was business as usual before. Now the geopolitics—can you imagine the impact on the supply chain we experience today in luxury? If we produce, basically make everything in Italy, there are still a lot of suppliers from China. And both for pandemics and because the supply chain was completely disrupted, you can imagine the cost of just shipping a container from China, no? The cost in 2020 and 2021 was 10 times what it was in 2019. So, the effect of geopolitics on our business was absolutely impacting every single phase of our industry. Now, this means that if you, as a CEO, are not aware of what has happened, you are not performing your job well. Now, everybody in our field, for example, is reconsidering their supply chain. And it meant that there is a bigger showing of luxury and also in the premium lifestyle industries, from the Far East to Europe. So this is the first skill that I want to mention to you, [understanding how geopolitical situations will affect your business.]

The second point is related to what is happening in other industries. Fashion is a very old industry. Why is that? Because still, it's the last one we still use [a great deal] and [price] of the end work is still very strong, meaning that it can impact half of the bill of the material total cost, meaning that the bill of material plus the cost of labor make 50 and 50. [For a time,] everybody went east to lower labor costs. But now that they’re back, the average cost is mounting up. Now, [as it is] in other industries and particularly regarding technology, it's really important to understand how we can do better and how our industry will be strongly impacted—that is, impacted by technology—during the next 10 years, meaning not just engineering but also the production phase. 

And the third point I want to make is related to something that everybody said: “OK, we are good on that, we are perfect, that is quality. Back to basics of quality, rather than being just focused on margins.” To me, it's something absolutely important, particularly if you work on niche categories or in niche markets. Europe, Italy in particular, is full of high-potential SMEs and middle-cap companies, but they must maintain their capacity while being the best in quality. So, our idea, and I try to explain this to all our employees, is being focused on the long-term, and what we discuss, and then share with our employees, our new strategic plan we decided together is to expect the unexpected. 

Chiara Berlendi: How do you focus on quality while being a listed company that needs to keep on bringing results at a certain pace?

Luca Sburlati: First of all, we had the opportunity to choose the investor once we had our IPO. So, we choose investors that are for a long-term investing strategy. The second thing is that our company is strongly involved in ESG—real ESG, not just greenwashing. And we are probably the only one or one of the few in Italy that have an external ESG rating made by the Carbon Disclosure Project (CDP). That means that our investors want [a responsible] ESG company for a long-term strategy. So there’s a connection. And, lastly, Chiara, is in the financial meetings during the quarterly reviews with the financial institution, I'm very clear and it was really clear also during IPOs. I say, “Listen, this is an industrial company. I can perform an EBITDA, an average EBITDA between 10% and 14%. That is our good EBIT and net result, because [there is] not big capital invested. But this is our field. If you’re looking for short-term investment returns on older technology fields, move away from us.” So, I’m clear with investors. 

Chiara Berlendi: How do you think your CHRO experience prepared you for the CEO role you're covering today? What was the biggest stretch for you, from a CHRO to a CEO position? And also, what do CHROs, in your opinion, bring in a CEO role that other colleagues coming from other leadership functions may not? 

Luca Sburlati: The reality is that particularly in our industry, that is, the lifestyle industry, the human being is absolutely fundamental. As HR, I worked on selection and the staffing, I worked on trainings, I worked on careers, I worked on hiring CEOs. So, this is something you can just apply to the CEO role and work on the same principles you explained to everybody before. That’s the first topic. The second one is that you have then to work on this as a real business partner. So, be curious about the field, the shop floor, spend every day in the shop floor. The best way to do this is by working with your shop floor people, not just white collars but also blue collars and learning about them, how your products made. And once you learn about the products, you have much more interesting keys. Not just working on the shop floor but working in the retail field. So, the two phases are keys. And once you learn as HR, you can do your job as HR better, but at the same time learn about your next position as CEO. 

The other thing that I share with our employees is that you have to enjoy your job. We are in a very nice field. We manage really nice garments. I say to everybody, “Listen, the price of those garments is in between a Vespa and a motorcycle. So, imagine, for your end customer, the value of what you have in your hands. So, you have to enjoy your job.” And so being passionate, once you have those characteristics, you will perform better. 

Chiara Berlendi: Moving onto Pattern, what does it stand for as an organization, and what is the culture like?

Luca Sburlati: We are based on three main values. The first is being focused on technology. [We think of] technology as a key in every single job we do, unless the technology was not very integrated with the luxury and fashion. The second value is regarding ESG. We were the first company that certified the supply chain on social accountability, SA8000. The first one with sustainability reports, applying the GRI International Standards. In 2015, we started all this, so you can easily read it on [our website]. And the third value is the human being. We say that human knowledge is key. So, for example, to do and to have patternmakers move from a junior level to a mid-level takes eight years. And before we expose the younger patternmakers to the designers, that also takes eight years. So it's a very long-term career. So that's why, at Pattern, we say, in Italian, “artigani tecnologici,” which means trying to translate craftsmanship and technology. This will make us different. 

Chiara Berlendi: And I guess one way in which you are certainly cascading this culture down the organization is also what you just shared with us: being very clear, treating everyone the same way, doing your job with passion, continuing to researching, being curious. Is there anything else you would like to add? 

Luca Sburlati: Three simple things. We started as a very small company and today we are close to a thousand people. With all the recent acquisition, we have 13 companies integrated. Every six months, I spend time with everybody. I do a trip around Italy doing meetings with all the people together, explaining what we do or what we did well, the errors we made—because everybody, we are humans, we make errors. So it’s important to have the courage to say, “OK, we have to improve.” And then to have a vision for the next year. So, spending time with everybody at the same time is something that helps us a lot. And the other thing is that the previous owners of the companies we acquire stay with us as minority shareholders and help to [integrate] their culture together with ours so that we are stronger than before. 

Chiara Berlendi: What do you think are the basic characteristics of sustainable fashion design and what are the skills of sustainability-oriented leaders?

Luca Sburlati: There are two main characteristics. The first one is if you want to make really sustainable products, you have to start from the design. [So we must change] the minds of designers and also their skills, so that starts from schools and design schools. That's why we collaborate closely with design schools—because if you want to move from sustainability to circularity, you have to start from the design part. So, this is the first skill. 

The second characteristic is much more related to the company. We have to remember that our industry is the second-most polluting industry around. So, the second thing is to measure yourself and make an improvement plan, as we did with this program that was to be carbon-neutral, at least on our quota, by 2023, and we achieved it. Now, the company I'm seated in is completely carbon-neutral thanks to everything we did, including a very strong geothermal plant that makes us completely autonomous on gas and energy, together also with our very strong photovoltaic plant. So, we can do things, we just have to measure, build up an improvement plant, re-measure, and restart again. 

Chiara Berlendi: But often the most important things in life are simple. That doesn't make them easy. But they're simple. 

Luca Sburlati: This is an HR thing that I learned: make it simple. And sometimes you have to deal with difficult stuff, but in the end you build up a simple way, a simple vision that you share with everybody. And then you deal with bricks that are single bricks, where you simplify the single bricks and then you build up a very strong house with the simple bricks put together. 

Chiara Berlendi: Looking ahead, which specific leadership skills and capabilities would you say will be the most important for your company to meet its strategic goals over the next three to five years?

Luca Sburlati: We have to maintain and develop one of the characteristics that I mentioned to you—being human. What is changing? There are a lot of tensions with how the pandemic changed our way of working, of leading. There is a big war around being human. 

Chiara Berlendi: And, maybe in three pieces of advice, how would you say you can stay and continue being human day-to-day at work in an organization? 

Luca Sburlati: Observe and talk with everybody, continuous learning and, as I said before, stay focused on the quality of your products. 

Chiara Berlendi: Yes. Luca, thank you so much for taking the time today to speak with us at Heidrick & Struggles. 

Thanks for listening to the Heidrick & Struggles Leadership Podcast. To make sure you don’t miss more future-shaping ideas and conversations, please subscribe to our channel on the podcast app. And if you’re listening via LinkedIn, Twitter, or YouTube, why not share this with your connections? Until next time.

About the interviewer

Chiara Berlendi (cberlendi@heidrick.com) is a principal in Heidrick & Struggles’ Milan office and a member of the global Consumer Markets and Marketing, Sales & Strategy Officers practices.