The digitization of all areas of life has led to increasing complexity and companies find themselves in a divisive state due to this development. One example is medium-sized management consulting, which is one of the sectors that benefits excellently from digitalization. However, primarily as the one that sets up, controls and implements the multitude of projects for the digitization of companies in various industries. However, it is often hardly digitized itself. More information can be found in my article about Consulting 4.0.

The race for digital supremacy is also characterized by a high pace of change. American and Asian companies in particular are in the fast lane, pushing competitors out of the markets worldwide. But what about Germany? How is the digital transformation progressing in German SMEs?

The tradition in small and medium-sized enterprises

It is currently the task of all companies and industries to successfully implement the digital transformation. In Germany, economic growth is mainly driven by small and medium-sized enterprises. As the backbone of the German economy, traditional companies in particular are an important pillar because of their innovative capacity and technology skills. According to a study by the BMWI, 57% of economic output is provided by German SMEs.

Medium-sized companies have a long tradition and are often characterized by a long-term orientation. Thanks to a high level of value creation and a focus on the quality of their innovative products, there are many possibilities for process automation and the enhancement of products with digital or software-based modules. If you take a look at the current digital study of kfw you will find sentences such as:

  • Only one-fifth of medium-sized enterprises have started to digitally network products and services and can thus be counted as “leaders”
  • Expansion of digitalization is progressing in most companies, but mostly in small steps
  • Deficiencies in IT skills, data security and Internet speed make digitalisation difficult for Small and medium-sized enterprises
  • Focus on Industry 4.0: Projects are typical innovation projects; Qualification requirements change, business models only gradually

Jean Jaurés once coined the wonderful saying: “Tradition does not mean storing ashes, but keeping a flame burning”. Almost no traditional company would probably still exist today if they had not, in the course of their history, repeatedly orientated themselves on their own and tried and tested principles and traditions. But is the reference to the past in modern competition sufficient to remain competitive in the long term? Because, as I said in the article on digital R(evolution), when the wind blows, some build protective walls and the other windmills.

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Digitisation in small and medium-sized enterprises

Digital change affects everyone: employers and employees, students and families, young and old people. In the countryside and in the city. In the workshop next door as well as in large-scale operation. Digitalisation is also an issue for small and medium-sized enterprises. It is time for them to deliver their core values, i.e. their focus on sustainable business growth, long-term and close customer and supplier relationships, and the satisfaction of their employees, to the digital age. The conflict of objectives between the long-term strategy of traditional companies and the high speed of innovations and change processes of digitalization must be resolved. Now certainly not all areas will change fundamentally and every employee will work 100% independently, but companies should steer towards these values and at least allow a little more self-control than usual. Brandes provides an approach for such a change in values in the following figure, which I interpret in the context of digitalization in small and medium-sized enterprises.

digitization medium-sized companies
It is not important to reinvent all areas, but only to fine-tune certain adjusting screws (own representation based on the idea of Brandes)

Tradition meets digitalization

Digital transformation has reached companies. German small and medium-sized enterprises in particular are an important backbone of the German economy. Compared to startups, however, it often has a long tradition, which is not easy to change. However, not every area will change fundamentally. For this reason, it is recommended to increase agility in key core areas. In principle, therefore, traditional companies, their core values, i.e. their focus on sustainable company growth, long-term and close customer and supplier relationships as well as the satisfaction of their employees, are to be transferred promisingly into the digital age. An approach was presented here in the article. What is clear, however, is that current traditional methods of traditional companies are often no longer optimal in the context of digital transformation and should be reassessed. The following figure shows why certain basic values need to change. This is because the focus shifts from machines and planning to creativity and human focus.

medium-sized digitalisation
Whereas machines used to determine the economy, people are now becoming more and more the focus of digitalization in small and medium-sized enterprises (own presentation)
Genderhinweis: Ich habe zur leichteren Lesbarkeit die männliche Form verwendet. Sofern keine explizite Unterscheidung getroffen wird, sind daher stets sowohl Frauen, Diverse als auch Männer sowie Menschen jeder Herkunft und Nation gemeint. Lesen Sie mehr dazu.

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Verwendete Quellen anzeigen

Brandes, U., Gemmer, P., Koschek, H., & Schültken, L. (2014). Management Y. Munich: Campus Verlag.

https://www.kfw.de/PDF/Download-Center/Konzernthemen/Research/PDF-Dokumente-Studien-und-Materialien/Digitalisierung-im-Mittelstand.pdf

https://www.bmwi.de/BMWi/Redaktion/PDF/W/wirtschaftsmotor-mittelstand-zahlen-und-fakten-zu-den-deutschen-kmu,property=pdf,bereich=bmwi2012,sprache=de,rwb=true.pdf

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I blog about the impact of digitalization on our working environment. For this purpose, I present content from science in a practical way and show helpful tips from my everyday work. I am a manager in an SME myself and I wrote my doctoral thesis at the University of Erlangen-Nuremberg at the chair of IT Management.

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