ROME — As Leonardo's next CEO gets ready to take over the Italian firm amid questions about his lack of experience, two of Italy's leading defense analysts have offered up a list of ways to keep the company on track.

Alessandro Profumo was named by the Italian government on March 18 as its candidate to take over state-controlled Leonardo from Mauro Moretti, whose three-year mandate has expired.

Profumo, 60, a former banker, will need to be approved by the firm's shareholders when they meet May 16, with the board of directors then formerly appointing him, probably on the same day — both procedures that are considered a formality.

Although the Italian treasury minister, Pier Carlo Padoan, officially has the last word on appointments at Leonardo, commentators in Italy have claimed Profumo was picked by former Prime Minister Matteo Renzi, who resigned last December but is still believed to have influence over government decisions.

Addressing the Italian Parliament this month about the choice of Profumo, Padoan said consultancy firms were employed to help make the decision.

"Considering the particular nature of the (defense) sector and the lack of similar companies in Italy, as well as the international nature of the business, it was decided to go for experience in international development and the ability to handle complex corporate setups," Padoan said.

Profumo has previously run the Italian bank UniCredit, which had a strong global presence. But critics have pointed out that he lacks any aerospace or defense industry experience.

By way of pointers, two analysts from Italy’s IAI think tank, Jean Pierre Darnis and Michele Nones, published an article on March 28 about how the company should tackle the future.

The pair first noted that the European Union is working on a €3.5 billion (U.S. $3.8 billion) investment plan to nurture Europe’s defense industry and spur integration among European firms.

"In one way or another, the defense sector will emerge from the confines of intergovernmental activity and extend to the EU sphere," they wrote.

Turning to Brexit — the pending exit of the U.K. from the EU — they added: "At the same time, the EU will be losing an important element, the UK, which is relevant to Italy with regard to aeronautical, electronics and missile programs, and for Leonardo, given its strong industrial presence there."

At the same time, the U.S. is limiting access to its defense market, while global markets are becoming ever more "ferocious," they wrote.

The analysts noted that under Mauro Moretti, Leonardo had focused over the last three years on reorganization and cost-cutting. "Inevitably, the energies absorbed by this internal campaign have reduced the effort made in getting into international markets, as well as work on innovation."

To get back into global markets, the company must now build its order book by investing in marketing, "sending staff out into the field and finding partners there," they wrote.

"Government to government accords are useful but cannot resolve everything," they added, citing the recent deals to sell Eurofighters to Kuwait and naval vessels to Qatar.

The comments follow three years in which Moretti slimmed down his management team, losing veteran staffers with long experience overseas.

The second point, Nones and Darnis wrote, was to boost the efficiency of Leonardo’s after-sales logistic support. "Long and uncertain waits, a export authorisation system which is complicated and sometimes incomprehensible, disattention and high costs reduce the availability of systems in service and risk creating poor publicity for the group."

The analysts also argued Leonardo should focus on fewer products, a point already raised by outgoing CEO Moretti, and look to bring on board a new generation of young managers.

Another Italian analyst, who declined to be named, warned that Profumo would need to quickly learn the ropes at Leonardo. "In this job, you either need lots of experience or lots of time," he said. "Profumo may only have one three-year mandate, and decisions are needed very fast."

Looking back over his banking career, Italian newspaper Il Giornale pointed out how Profumo, while running UniCredit, took the decision to avoid investing in the defense sector for ethical reasons.

Tom Kington is the Italy correspondent for Defense News.

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