Abstract
The outstanding importance of the “Mittelstand” for the German economy is frequently emphasized inside Germany and abroad. Even on an international scale, the term “Mittelstand” has become a synonym for the success of the German business model and has often entered the local vocabulary, especially in the Anglo-Saxon world. In an era of a fast changing globalised economy and of stock-market oriented multinational corporations, the enterprise owner, strongly tied to his Mittelstand company and its stakeholders, represents a firm anchor with long-term orientation but also shows the necessary flexibility to react quickly to constantly changing economic framework and market conditions.
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- 1.
In Germany, a broader SME definition has been chosen because the German enterprise population is marked by a relatively large share of larger Mittelstand companies (in the range from 250–500 employees) which feature the typical characteristics, advantages and resource limitations of family owned enterprises and which are thus markedly different from large (shareholder-owned) corporations.
- 2.
There is no single compelling/logical way of how to define a family enterprise in practice (i.e. with regard to required ownership and management structures). In its studies, IfM Bonn defines a family enterprise as an enterprise where up to two natural persons or their family members have at least 50% ownership of the company and where these natural persons are also involved in the management of the company.
- 3.
Since 2007, the newly established German enterprise register contains comprehensive data on the ownership links between companies (with reference to the reporting year 2005). In November 2011, a pilot project of the Federal Statistical Office applied the independence criterion to its SME-statistics (according to the EU-definition) for the first time. The criterion classifies an enterprise as independent if the majority of its capital or voting rights is held by one or several other enterprises. By considering the additional independence criterion, the share of SMEs in the total number of enterprises decreases by 8.8%-points, the share in employment and turnover by 16.9 and 14.2%-points respectively (cp. Söllner 2011, p. 1.095f.).
- 4.
The latest analysis of IfM Bonn (cp. Haunschild/Wolter 2010, p. 26) shows that in 2006, some 95.3% of all enterprises classified as family enterprises which employed 61.2% of all employees and generated 41.1% of total turnover.
- 5.
Bundesministerium für Wirtschaft und Technologie (BMWi) and Kompetenznetzwerke Deutschland (2011) present some 102 specially certified and successful technology and innovation networks in Germany which are marked a.o. by a close co-operation between enterprises, universities and research institutions.
- 6.
An analysis by IfM Bonn showed that in 2009, large German family enterprises with an annual turnover of more than 50 million EUR showed an average equity capital rate of 33.5%. Almost one quarter (23.0%) had a rate of over 50% (cp. Lamsfuß and Wallau 2011, pp. 16–17).
- 7.
In view of the key importance of skilled employees for the competitiveness of Mittelstand enterprises and the German economy as a whole and in view of possible future shortages due to the increasing demographic change, the availability of skilled personnel is the central topic of many media reports, policy discussions, analyses and studies involving all economic actors (enterprises, business associations, policy makers, trade unions, the media, etc.). In fact, the topic is so widely debated that the German term “Fachkäfte” almost carries “mythical” connotations.
- 8.
This is also illustrated by the low number of strike days and lost working hours in German enterprises. Although international comparisons are difficult to undertake due to non-harmonised statistical coverage, among 20 OECD countries only Japan, Poland and Switzerland reported fewer strike days than Germany (cp. Lesch 2009, p. 17).
- 9.
The Chinese management style, by contrast, seems to be characterised more strongly by the basic principles of seniority and hierarchy. Both seem to strongly determine the way of thinking, the social behaviour and business life in China. Western enterprises which entertain own production facilities in China often report that these principles are so deeply embedded in the Chinese mentality that independent and creative thinking is less widespread among the Chinese staff, even among the future management leaders (cp. Waldkirch 2009).
- 10.
In general, smaller countries with smaller domestic markets and a less diversified industrial structure tend to show higher export rates ceteris paribus. In order to make use of economies of scale and fully exploit the potential market demand, domestic enterprises are often forced to sell on foreign markets as demand on the domestic market is rather limited. Furthermore, due to the limited number of industries in a small country, the entire demand for goods and services usually cannot be satisfied by domestic companies alone.
- 11.
Comparable data for (qualitatively defined) family enterprises are not available.
- 12.
The strong export performance of the German economy is also favoured by the specific German specialisation pattern. Due to the rapid economic development of large emerging economies and the growing purchasing power of their upper and middle classes, investment/capital goods with a high-medium technology intensity and cars produced by German companies are strongly demanded on international markets. Within the manufacturing sector, German companies have also successfully developed new products and services, especially in the “green technology”-sector (e.g. energy efficiency, waste management/ recycling, renewable energies, water and air pollution control) and have often become world market leaders as well (cp. Bundesministerium für Umwelt, Naturschutz und Reaktorsicherheit (BMU), Umweltbundesamt 2011, pp. 17–19).
- 13.
Unemployment figures have decreased from a maximum of 5.3 million in 2005 to a minimum of 2.7 million in 2011. At the same time, the total number of paid employees and the number of employees liable to social security contributions are steadily increasing and have reached all time highs in 2011.
- 14.
Again vehicles construction (31.4%), mechanical engineering (11.1%) and chemicals (7.3%) have the highest shares, though less equally distributed than the sectors’ shares in total exports.
- 15.
The Fraunhofer Gesellschaft takes its name from Joseph von Fraunhofer (1787–1826), an illustrious Munich researcher, inventor and entrepreneur. The organisation was founded in Munich in 1949 with the initial vocation to raise funds for industrial research. In 1952, it still had only three employees. But the demand for external research services grew rapidly in the early years of economic recovery. Soon after, the first Fraunhofer institutes were established.
- 16.
Their purpose is to co-ordinate work on related research fields within the Fraunhofer Gesellschaft, to pool essential resources in core disciplines and to present a unified image in the marketplace.
- 17.
This included project revenues from industry (463 million EUR), Federal and Länder governments (406 million EUR), the European Commission (65 million EUR) and other institutions (96 million EUR) (cp. Fraunhofer 2011, pp. 16–18).
- 18.
Approx. 150,000 professional experts from enterprises and trade unions work on an honorary basis at the examination boards for apprentices’ intermediate and final exams.
- 19.
Of crucial importance for the organisation of in-company vocational training is the Vocational Training Act (“Berufsbildungsgesetz”, BBiG). This federal law lays down, among others, the requirements and conditions for companies to engage in vocational training.
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Holz, M. (2013). Strategies and policies to support the competitiveness of German Mittelstand companies. In: Coltorti, F., Resciniti, R., Tunisini, A., Varaldo, R. (eds) Mid-sized Manufacturing Companies: The New Driver of Italian Competitiveness. Sxi — Springer per l’Innovazione / Sxi — Springer for Innovation. Springer, Milano. https://doi.org/10.1007/978-88-470-2589-9_6
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