Successful global market leaders in Germany owe their standing in no small part to their corporate culture. 75% of leading companies with above-average profits see it as a crucial success factor. Global market leaders with only average profits draw upon this asset on a far less frequent basis: corporate culture plays a decisive role in only 56% of these companies. And in companies which perform below average, 47% prioritize corporate culture, according to the findings of the current study entitled “Best Strategy 2018.” Staufen, the corporate consultant, surveyed a total of 210 German companies that are global market leaders either in their industry or in their segment.
As a whole, leading German companies are doing quite well in terms of their profits. Four in ten perform above the average of their respective industry. That said, over half of these companies cannot monetize their outstanding market positions into attaining above-average profits. Corporate culture is a key variable here. “Many mid-sized enterprises in particular have their roots in traditional kinds of entrepreneurship: a benign patriarch founds a company and regards it as a kind of family of which he is clearly the leader. And when this visionary figure disappears, the hierarchical organization often lingers on as an empty shell,” according to Wilhelm Goschy, COO at Staufen. “In companies like that, an inflexible command & control system is often predominant, and employees’ motivation and confidence suffer — and by extension, so does their performance.”
As a matter of fact, however, the current Staufen study shows that more than a third of German global market leaders still follow strict hierarchical structures. Even within the foreseeable future, this interpretation of management is going to reach its limits. Innovation and technology cycles are accelerating at a breathtaking speed. And the solitary figures at the helm who define their management position based on having an information monopoly will soon be unable to keep up with this pace.
“Managers who work behind closed doors and focus more on figures than on the people in their companies are growing increasingly obsolete. Managers need to be near the value chain. They have to see themselves as mentors who work jointly with their employees to improve processes, structures and qualifications,” as Goschy advises. More and more, these tried-and-true lean principles include agile methods as well. “The main issue for managers is to relinquish power. Managers will only be able to motivate their employees and leverage their potential if they can empower them properly to make their own decisions,” Goschy continues.
Staufen “Best Strategy 2018” study shows that companies have come to realize that times are changing. 91% regard changes in management conduct as a key component in their ability to prepare for the future. This attitude creates a foundation. And corporate culture had already become a priority in two-thirds of the companies surveyed where significant changes had taken place within the past three years.
Best Strategy 2018: What global market leaders in Germany do better
For its study “Best Strategy 2018: What global market leaders in Germany do better,” the corporate consultant Staufen conducted a survey of a total of 210 German companies in early 2018 that were global market leaders either in their industry or in their segment. 40% of these companies are global players with annual sales of over €500 million. Of those who responded to the survey, 42% were owners, members of the executive board or CEOs, and another 38% were division heads. The companies predominantly represented the automotive industry, mechanical and plant engineering, and the electrical industry. A copy of the study is available by contacting Kathrin Kurz, k.kurz@staufen.ag
BestPractice Day 2018 – Europe’s leading lean management conference
The rules of the game have changed. Those who want to stay or be at the head of the pack have to keep moving. That is why this year’s BestPractice Day from July 3-4, 2018 in Darmstadt has as its motto, “Learn. Lead. Design the change.” You can look forward to presentations held by management luminaries who actively and decisively design the way their companies are changing. With over 350 participants a year, BestPractice Day has established itself as a place for decision makers from the industry and academia to come together.
Further information about the event is available at
www.best-practice-day.com
