The Harvard Business Review says that the amazing resilience of the German
economy is often attributed to its reliance on Mittelstand companies, small to
medium sized enterprises. These typically family-run businesses employ more than
70% of all German employees in the private sector, and are export-oriented,
making Germany the second-largest exporter in the world. There is a wonderful
account of these companies in the book 'Hidden Champions' by Hermann Simon,
former INSEAD professor and now Chairman of Simon, Kucher & Partners.
Germany's more than 1,300 'Hidden Champions'
The Washington Post
said in 2010:
"Buy a bottle of champagne and it puts money in the pocket of
Schneider and Co., a family-owned manufacturer that from a remote perch in the
German countryside has created a global monopoly on the wire cages that secure
the corks on sparkling wine. Obscure in a country of marquee exporters such as
Mercedes-Benz and Siemens, the company's international focus is common among
small and often family-owned firms in Germany.
Schneider's highly automated plants (in Germany) and
in Italy, Spain and Brazil churn out 2bn of the devices a year. Its dominant
market share -- amassed over 30 years -- helps explain Germany's complex and
controversial role in the European economy."
2008 presentation: How
Germany's mid-size companies get ahead and stay ahead in the global economy [pdf]