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COVID-19 challenges the value systems of family firms and urges them to adapt their behaviors, affecting their identities. This study aims to explore how and why family businesses strategically respond to challenges to their identity during COVID-19. Based on a qualitative case study of six German family firms, we propose a process model of family business identity variations during COVID-19 with three propositions, highlighting the interplay between strategy and identity. Counterintuitively, we found that an exogenous shock like COVID-19 can have a positive effect on family business identity, leading to identity clarification or consolidation. We contribute to the growing stream of research investigating the impact of COVID-19 on SMEs, as well as research on family business identity heterogeneity and organizational identity literature by illustrating the interplay between strategy and identity. Plain English Summary: The silver lining of COVID-19 for family business identity: COVID-19, as one recent exogenous shock, posed a strong challenge for family businesses. However, little is known about how family businesses deal with exogenous shocks that force strategic responses and thus challenge family businesses to question "who are we as an organization". In this study, we investigated how strategic responses induced by COVID-19 affected the identity of German family firms. Counterintuitively, our study reveals that COVID-19 provided an opportunity for family business identity consolidation. It highlights how a firm's unique identity stemming from the closeness with the family can serve as a guidance for strategy-making during COVID-19. Specifically, the study unearths that, when facing the uncertainty of external challenges like COVID-19, the competing family business goal systems are challenged, providing an opportunity for family business owners to refine and re-define the identity of the family businesses. Overall, it thus shows that exogenous shocks can have a positive impact on the family businesses' identity, by leading to a consolidation of an already existing identity, as well as to a clarification of a previously unclear identity. [ABSTRACT FROM AUTHOR]

This study examines the influence of stakeholder pressures and family ownership on strategic decarbonization choices of German Mittelstand firms. It distinguishes between symbolic strategies focusing on compensating CO2-emissions and substantive strategies directed toward reducing carbon emissions. The relative pressure exerted by internal and external stakeholders on these strategic choices is examined. Data from 443 manufacturing firms reveal that overall stakeholder pressures increase the pursuit of decarbonization strategies. Internal stakeholders pressures are associated with increased reliance on substantive decarbonization strategies both in family-owned and non-family-owned firms. Pressure from external stakeholders are associated with increased reliance on both substantive and symbolic decarbonization strategies only in non-family-owned firms. No effect of external pressures was found in family-owned firms. Implications for theory, management practice, and policy makers are discussed. [ABSTRACT FROM AUTHOR]

Hidden Champions (HCs) are defined as market leaders in niche markets. They represent the success of the German Mittelstand like no other group of firms. However, little is known on how HCs contribute to regional development. Given their export strength, regional embeddedness, and strong vertical integration we expect HCs to have a profound effect on regional development. Using a German dataset of 1,645 HCs located in 401 German districts, we analyze the effect of HCs on a variety of regional development dimensions. Our results show that HCs are not equally distributed across regions and influence regional development. Regions with a higher number of HCs show strong regional economic performance in terms of median income. Moreover, HC intensity affects regional unemployment and trainee rates as well as regional innovation in terms of patents. Surprisingly, we did not find an effect of regional HC intensity on regional R&D levels and GDP. We can further conclude that the effect of HCs is not limited to the particular region in which they are located but that sizable spillover effects exist. Besides its contribution to the regional development literature, our study adds to a better understanding of the HC-phenomenon. Implications for regional policy makers are discussed. [ABSTRACT FROM AUTHOR]

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Hidden champions are world-market leaders that emulate a niche strategy. In this research, we illustrate the hidden champions' key business strategies and their evolution over space (geographical distribution) and time (technological change). While we describe their spatial distribution and argue how complementary institutional arrangements embed niche world-market leaders, our historical roadmap sketches the main milestones of how changes in technology and market structures came into existence. The emergence of niche markets is strongly tied to the evolution of technologies within both supplier and end-user markets. Tracing the evolution of niche markets, we derive three different eras of niche markets and exemplary hidden champions of their time: pre-industrial, industrial, and post-industrial. We rely on a few hidden champions that we present more in detail to illustrate their niche market emergence. Moreover, we investigate inventions and technology revolutions of the hidden champions' main industries. Building on Hermann Simon's key insights on hidden champions, we analyze how the academic discussion unfolded onwards after his first seminal contributions. We conclude through presenting fields of future research that will help to further evolve studies on hidden champions. [ABSTRACT FROM AUTHOR]

Relying on the upper-echelons perspective, this paper investigates the effect of financial managers' characteristics on the level of organizational ambidexterity reached in German Mittelstand firms. These firms are often depicted as highly innovative and able to compete on worldwide markets despite significant resource constraints. We theorize that skilled financial managers are very important in making the optimal use of Mittelstand firms' scarce resources and, in particular, for balancing exploitation and exploration, thus reaching high levels of ambidexterity. Our findings from a survey of German Mittelstand firms broadly confirm our expectations and show that financial managers' individual entrepreneurial behavior correlates positively with the firms' level of organizational ambidexterity. In addition, we find that firms with financial managers having enjoyed business education are more likely to reach high levels of ambidexterity if these financial managers are heavily involved in strategy development. Overall, these results indicate that well-suited financial managers are an important human resource for Mittelstand firms. In addition, our findings are among the first to show that financial managers not only influence finance and accounting choices, but also innovation-related outcomes such as organizational ambidexterity. [ABSTRACT FROM AUTHOR]

Hidden champions are market leaders in niche markets and are an important part of the German Mittelstand. Although the hidden champion phenomenon has received considerable interest in practice, few academic studies on this issue exist. We especially lack evidence on the financial performance of hidden champions. Our study addresses this gap and investigates the profitability of hidden champions. In analyzing a panel dataset of 4677 German manufacturing firms, of which 617 are hidden champions, we find that hidden champions have significantly higher profitability with regard to return on assets but less so regarding return on equity. The hidden champion performance effect on return on assets is valued at 1.7 percentage points. Furthermore, the hidden champion performance effect decreases with firm size. Our paper contributes to the literature on the effect of firm strategy on firm profitability and adds to a better understanding of the hidden champion phenomenon. Plain English Summary: Hidden champions are little known to the public and yet so important to national economies. Defined as (world) market leaders in niche markets, hidden champions are an important part of the German Mittelstand and are heavily associated with the success of the German economy. In analyzing a sample of 4677 German manufacturing firms for a period of 10 years, we compare the financial performance of hidden champions to that of other midsized firms. Our paper shows that hidden champions outperform nonhidden champions, especially with regard to return on assets. Interestingly, the hidden champion performance effect decreases with firm size and disappears for firms with more than 900 employees. Our paper adds to a better understanding of the hidden champion phenomenon and extends research on the strategy-performance relationship, particularly addressing the role of firm size. [ABSTRACT FROM AUTHOR]

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Copyright of Perspektiven der Wirtschaftspolitik is the property of De Gruyter and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Tanulmányunk a magyar feldolgozóipar kiválasztott részét, a hazai tulajdonú középvállalkozások csoportját vizsgálja. A feldolgozóipar erős dualitása, a válság óta tovább növekvő külföldi működőtőke (KMT)-függősége indokolttá teszi a növekedési alternatívák feltárását. Tanulmányunkban a német középvállalati szektor (Mittelstand) nemzetközi szakirodalomban bevett, részben általánosítható koncepciója alapján tekintjük át a magyar középvállalkozások vállalatdemográfiai jellemzőit, növekedését, környezeti beágyazottságát és fejlődési kihívásait. Kutatásunkat országos adatbázisra támaszkodó kvantitatív felmérésre, valamint elsősorban vállalati interjúkon alapuló kvalitatív vizsgálatokra alapoztuk. Megállapításaink szerint a középvállalati szektort hosszas zsugorodás és a válság okozta sokk után a konszolidáció és lassú növekedés jellemzi, s egyes fejlődési jegyei alapján felállítható a párhuzam hosszabb múltú német megfelelőjével. Bár a középvállalatok nem képesek a külföldi tőke helyettesítésére, a jövőben növekvő szerepet játszhatnak a minőségi termelési tényezőkön alapuló növekedés megalapozásában. A jelenleg működő középvállalkozások mellett beazonosítható a kisvállalkozások közötti „potenciális középvállalkozások” köre is, amelyek megfelelő körülmények között maguk is középvállalatokká növekedhetnek. A hazai tőkeakkumulációt elősegítő, erősödő stratégiai orientációval rendelkező, kedvező lokális és regionális beágyazódást mutató, népességarányos elhelyezkedésű (a KMT-alapú iparnál kevésbé koncentrált) középvállalkozói réteg megerősítése a hazai gazdaságpolitika érdeke is.

Franciaországban – ahol gyakran a német Mittelstand vállalatokat tekintik nemcsak példának, de versenytársnak is – a nagyvállalati fejlesztési modell megrekedése után ismételten napirenden az újraiparosítás. Ezúttal a figyelem fókuszában a középvállalatok, azoknak is egy speciális köre, az ETI-k, valamint a startup cégek kerültek. A dezindusztrializáció negatív hatásai, amit a 2008-as válság tovább súlyosbított, sok vitát generáltak részben a beavatkozás szükségességével, részben annak mikéntjével kapcsolatban. A decentralizált Németországhoz való felzárkózás, az ipari versenyképesség bázisát jelentő Mittelstand-modell sikeresebb alkalmazása komoly kihívás a centralizáltabb berendezkedésű Franciaországban. Az elemzések kimutatták, hogy az ipar relatív elmaradásának hátterében leginkább a gyengébb innovációs teljesítmény jelenik meg. Ezért az állami intézmények és támogatási rendszerek erőteljesen fókuszálnak az innovációs teljesítmény javítására. Bár a vita nem dőlt el, egyre inkább az iparpolitika szükségessége mellett érvelők kerülnek többségbe, úgy tűnik, ismét egy ipart támogató állami politika van kibontakozóban. Annak kapcsán, hogy ez hogyan, milyen eszközökkel történjen, még nagyon nem látszik konszenzus. A francia iparpolitika jelenleg oszcillál a közép- és nagyvállalatokat középpontba állító, valamint a kiemelten a startup vállalkozásokat támogató, ezeket különféle kormányzati eszközökkel támogatni szándékozó nézetek és gyakorlatok között. A két elképzelésben az innováció intenzív támogatása a közös vonás. Egyelőre annak a jelei kevésbé, vagy csak nagyon áttételesen rajzolódnak ki, hogy milyen módon segíti a francia gazdaság- és fejlesztéspolitika és intézményrendszere annak az üzleti környezetnek, infrastruktúrának a fejlesztését, amely ezt az innovációalapú iparpolitikát hatékonyan képes támogatni, illetve hogyan működik a lokális, regionális üzleti infrastruktúra, az oktatási és szakképzési rendszer, amely az innovációt és az ipari teljesítményt közvetetten, de annál eredményesebben tudja ösztönözni.

Copyright of Boletín Económico de ICE is the property of S.G.E.E.I.P.C., Secretaria de Estado de Comercio, Ministerio de Industria, Comercio y Turismo and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This paper examines the demand of German Mittelstand businesses, or small and medium-sized enterprises (SMEs) - including the Handwerk (craft sector) and retail trades - for medium- and long-term capital in the mid-1950 s, and how this demand was met by mobilizing capital from banking institutions, especially from savings banks and credit cooperatives, under the regulatory framework and policy coordination of the ministerial committee (Arbeitsausschuß). The Bundeswirtschaftsministerium established this committee with delegates from interested groups among the Mittelstand and financial institutions in West Germany. Although impressive economic growth came in the 1950 s, with high investments in many industries with public-sector assistance, Mittelstand firms suffered from a lack of capital, which changed their structure of performance, markets and ability to finance expansion of their business. The ministerial committee drafted guidelines and coordinated the interests of each Mittelstand group and banking institution to solve the problems in a competitive market economy. As individual incomes were restored and the capital market stabilized by the late 1950s, the financial support structure of the Mittelstand economy was built on regional savings banks, credit cooperatives, and credit-guarantee associations, providing them access to external capital in the early 1960s. [ABSTRACT FROM AUTHOR]

Copyright of SWS - Rundschau is the property of Verein fur interdisziplinare sozialwissenschaftliche Studien und Analysen and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)