9370

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importance: parking and parking fees, cityscape, safety in the inner cities, rents. In general: soft factors are of minor relevance for energy-intensive industries.

Evaluation gaps allow better insights (Figure 2).

Figure 2. Evaluation gaps

Three groups of location factors more relevant to energy-intensive industries are: 1) Cost aspects (e.g. energy costs, water and wastewater taxes, local property and business taxes, public charges, costs of waste disposal), 2) Governmental behavior (duration of permit procedures, quality of cooperation with local authorities and administration, cost awareness of administration), 3) Some R&D-oriented aspects (R&D-facilities, technology consulting, conslting for efficient energy use).

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Groups with less relevance are inner city conditions and other soft location factors.

Last step: Change in course of time – comparison of results for energyintensive firms in 2012 and 2008 (Table 5).

Table 5. Comparison of results for energy-intensive firms in 2012 and 2008

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Gain of importance (interesting aspects): university (research), technology consulting, wage level, availability and qualification of workforce, education (comprehensive schools, vocational training schools, university), energy costs.

Loss of importance (interesting aspects): citymarketing, regional location marketing, regional Image, proximity of customers and providers, land prices and rents.

References

Berlemann, M., Tilgner, J. (2006). Determinanten der Standortwahl von Unternehmen – Ein Literaturüberblick. In: ifo Dresden berichtet, vol. 13, issue 06, pp. 14-24.

Maier, G, Tödtling, F. (2006). Regionalund Stadtökonomik 1. Standorttheorie und Raumstruktur. Regional und Stadtökonomik 2. Regionalentwicklung und

Regionalpolitik. Wien, New York: Springer.

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Hidden Champions

H. Rupsch

“World market leaders speak German”. Only one percent of the world’s population accounts for the Germans. But 48 percent of the medium sized world market leaders are from Germany – the Hidden Champions! (Simon, 2016). How does that happen? I have been interested in the subject for a long time. One main reason is that you, the students, should know about it – in such companies you can find excellent jobs and challenges. Insider tip for a successful career: forget the big names, if you are not a genius, have excessive happiness or excellent relationships you will never have a chance to achieve top positions. But you must be flexible and like country life – most of the companies are located in small villages, villages with the names you have never heard of.

Definition

Hidden Champions are defined by three criteria: 1) The company must rank among the top 3 in the world market or be the number 1 on the continent. 2) Turnover less than 5 billion €. 3) The level of awareness in the general public should be low. This definition is based on the article from Hermann Simon, he has been engaged in Hidden Champions for 25 years.

SMEs Definition: max. 249 employees, turnover less than 50 million €; importance: 99% of all companies, 2.1 trillion €, 15.7 million workers; strengts: confidence, independence, flexibility, continuity; backbone of the German economy.

Quantity

The known figures are (some selected countries):

Swiss & Austria: above average

Share in Swiss and Austria is very good in relation to market size.

Reason why

The phenomenon is the result of a complex netting, not least historical conditions.

1.The small states in Germany until 1918 forced the entrepreneurs to internationalize quickly, if they wanted to grow.

2.Old traditions such as clock making in the Black Forest with its sophisticated precision mechanical skills. Example Black Forest: during long wintertime they

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produced clocks a long time ago, e.g. Cuckoo Clocks and thus they earned a high level of technical competence.

3.Close cooperation in some regions between universities and business, e.g. mathematicians at the University of Göttingen. The mathematicians at the university of Göttingen have been for centuries leaders in the world, resulted in 39 companies for measurement technology (Measurement Valley, Metrology Mile: shows the history and presence of metrology in Göttingen in its diversity. It stresses the close connection with research and training facilities – growing here over the last 200 years, more than 40 Nobel Prize winners).

4.As a transmission belt between science and practice the FraunhoferGesellschaft plays a crucial role today. Research of practical utility is the central task of the Fraunhofer-Gesellschaft. The research organization founded in 1949, undertakes applied research for the benefit of the economy and for the benefit of society. Contractual partners and clients are the public sector as well as industrial and service companies.

5.A unique dual vocational training system. The system is called dual because education and training are provided at two places of learning: in companies and in part-time vocational schools. This is the main type of vocational training in Germany; more than 60% of an age group is involved in dual vocational training. Training in individual occupations is governed by training directives. At present there are about 350 recognized occupations for which the Federal Government has issued training directives.

6.Hidden Champions invest 50% more in the training than average in Germany.

7.Tax factors. For example the high property tax in France and the estate tax in the US, prevent the indispensable capital commitment for the development of the middle class.

8.“Globalia”. In the “mental” internationalization Germany is far ahead of other major countries. Globalia is a name for the globalized future world. Germany: language ability, international experience through exchange of students, studies, trainees, even as tourists. Countries like France, Italy, Japan or Korea are far ahead. The success in this field needs mentally open and cultural, globalized people.

Development

Looking back 25 years Hidden Champions created 1.5 million new jobs; they are 10 times as large as 25 years ago; the average annual growth rate is 10%. A quarter of the exports comes from Hidden Champions. A quarter of the GDP in Germany is based on production – largely thanks to the Hidden Champions. Even during the crises in 2008/09 nearly all have survived. The numbers speak for themselves.

Strategy and Leadership

The essential keys to success are the following:

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above all the leaders,

they identify totally with the task,

person and mission are inseparable,

they lead authoritarian in the fundamental values,

but leave to its employees great leeway in the details of execution,

women play a major role in leadership,

leaders remain an average of 20 years at the top, remain in large companies 5,2 years,

continuity is a precondition for pursuing the extremely ambitious long-term goals. The headline of my own business life: all business is people. Regard the business as your own company (principles of leadership Sony CPG).

market leadership is in no way measured only by market share,

but includes the claim to show the customer the way to the future – to the benchmark of its industry sector,

focus is the most important feature of the strategy of Hidden Champions,

Hidden Champions are today on average represented with more than 30 own subsidiaries in their target markets. They are real global players.

product and service play key balance roles. Focus: concentrate on what is best, even if it is only one product – like Flexi with a dog’s leash. The target is better than that of others. Focus reduces the market, globalization opens the market - global market share 70%. Hidden Champions have 5 times as many patents as large companies, out of the 50 largest applicants with the Patent Office 19 are Hidden Champions.

Examples

The top ranked Hidden Champions of the last two years are Herrenknecht (Schwanau, tunnel boring machines), Lürssen (Bremen, mega yachts), Wilo (Dortmund, pumping systems, air conditioning, water supply), Otto Bock (Duderstadt, wheelchairs, prosthesis), Grimme Gruppe (Damme, agricultural machinery), Duravit (Hornberg, equipment for bathrooms), Peri (Weißenhorn, concrete formwerk, staging), Kaeser (Coburg, compressor equipment), Karl Storz (Tuttlingen, medical equipment), Sto (Stühlingen, thermal insulation).

Not to forget also Adco Dixie (Ratingen, mobile toilets), Recaro (Schwäb.Hall, airplane seats), Katz (Weisenbach, beer mats), Wanzl (Leipheim, shopping trolleys), Flexi (Bargteheide, dog leashs), Pöschl (Geisenhausen, snuff). For instance Katz GmbH & Co KG is the small but mighty company. It has 248 employees, is more than 300 years old – and absolutely the world class. 7 out of 10 beer mats on the planet are produced by this company, 3.5 billion pieces per year. Revenues in 2012 was just under 50 mio. €. The profit – on respectable 11%. If you could paint a German SME’s, a company like Katz would come out: with a long tradition, rooted in the region, successful in the world with a product that could be hardly named German.

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Number ob Global Champions

Figure 1. Distribution of Global Champions in innovation by country

Source: EU-commission, Industrial R&D Scoreboard

Case Tuttlingen

Tuttlingen is a small city on the Danube in the south of Germany, “World centre of medical instruments”. Some statistics: number of inhabitants 34.369, jobless rate 3,2%, indicator for spending power 108,5 T€ (BRD: 21,5 T€), employees 23.866, in-commuter 14.734. High-Tech made in Tuttlingen: more than 400 medical

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technology companies with approximatey 8.000 employees, working in Europe’s largest medical technology cluster. In addition there are hundreds of other specialized medical suppliers and service providers, healthy competition, eternal battle for the best employees, the companies inspire each other (see Weltzentrum der Medizintechnik Tuttlingen (2017)).

Dannoritzer Medizintechnik GmbH & Co. KG is a part of the Tuttlingen medical device manufacturing industry specialized on spare parts for medical instruments. The company has existed for over four decades as a family property. It has accumulated experience, sophisticated know-how, an extraordinary feeling for customer needs, immediate deliverable surgical instruments, it allows flexibility, open mindedness for innovative ideas, offers comprehensive solutions for repairs. The company is a typical family business: father, mother, kids and partners by marriage. The boss knows everything. The young generation is working globally and an employee of the first hour is still there.

Table 1. The 20 largest Global Champions in innovations in 2013

Source: EU-commission, Industrial R&D Scoreboard