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In contrast to the predictions from the family business and the small- and medium-sized enterprise internationalization literatures, Hidden Champions are world-market leaders exhibiting a high share of exports. The purpose of this study is to analyze their strategy of internationalization of Hidden Champions in Germany and find that the international success and strong, sustained performance emanates from their product type, enabling to successfully pursue a niche strategy for differentiated premium products.

The authors first conceptually explore how Hidden Champions pursue strategic internationalization, and then analyze a sample of N = 2,690 Hidden Champions to examine why Germany has been able to generate the highest per capita share of Hidden Champions in the world.

The study finds that on both a micro and macro level, the strong and sustained performance of Hidden Champions is driven by product type and quality strategies. Niche strategies for a knowledge-intensive, technological product enable the firm to lock-in customers. However, to safeguard the internalization of highly specific quasi-rents, Hidden Champions enter foreign markets through fully owned subsidiaries, retaining control and residual property rights. The second finding of this paper is that Germany has succeeded in deploying its high level of human capital into the Mittelstand through highly skilled workers.

Unfortunately, no micro-level panel data are available. Still macro-level data beginning in the nineteenth century provide strong empirical support for the hypothesized causality.

This is the first paper to link the strong and sustained export performance of Germany to the Hidden Champions by examining the origins of the German Mittelstand model, dating back to the social, political and economic developments of nineteenth century.

This paper aims to study whether international niche market leaders (INMLs) gained their leading position as early mover or diligent follower, and assess whether they leveraged hard or soft forms of technological, supply pre-emption and customer lock-in advantage mechanisms.

Empirical material stems from qualitative and quantitative data on a sample of 20 niche companies from the Basque Country (Spain) that operate in business to business markets.

The sample predominantly followed an early entrant strategy and applied soft measures to reach niche market leadership.

Findings imply that early entering fosters conquering leadership in niche markets, that pioneer advantage is easier to sustain in niches than in mainstream markets, and that soft measures are more effective in niche markets than in larger markets. A limitation to our findings is that they follow from explorative research on a sample of firms from a reduced geographic setting.

Hidden champions and INMLs can be important sources of technological progress and economic value for the localities that host them. Therefore, despite their traditional low profile and the fact that they are not always the largest firms around, policymakers may want to pay more attention to this type of companies.

Tot he best of the authors’ knowledge, this is the first paper to research entry timing and its outcome for market leadership with regard to niche players or hidden champions-type of firms. It introduces an original taxonomy to operationalize and distinguish between hard and soft measures to leverage advantage mechanisms related to market entry timing.

The purpose of this article is to illustrate the management policies behind the success of Swiss product‐manufacturing companies in international competition.

The study included a few multinational corporations as well as a large number of “hidden champions”.

The study has led to three management policies that are currently driven by their top management. The three management policies were: extension of the service business; entering the medium market; and optimising the global footprint.

The paper provides effective guidance for managers seeking to extend the service business and to enter the medium market segment. The management policies are complementary perspectives to many existing ideas advocated by practitioners.

Shifting management attention towards the service business and the medium market segment is not easy. There are several barriers limiting management attention.

This paper contributes to the theory of the relationship between human resource management (HRM) and innovation at small- to medium-sized enterprises (SMEs) by conducting a conceptual analysis of the question why Germany boasts by far the highest number of “Hidden Champion” SMEs. This is done by case studies from the army and public financial management of aid disbursal in developing countries. Implications for HRM at SMEs are discussed.

Conceptual analysis using case studies.

Contributing towards filling the gap concerning theoretical underpinnings of the link between HRM and innovation, we suggest that interdisciplinary work from relevant organisational case studies indicates that the concept of institutional design to provide motivational incentives may be relevant, especially concerning high performance systems with bundles of HRM practices. Specifically, the fundamental principle of subsidiarity is found to be important.

The research is broadly applicable to organisations of all kinds, as the diverse case studies indicate. We point towards tentative implications for the firms that account for the majority of the work force, namely SMEs, and among them the most successful ones, the so-called “Hidden Champions”.

HR managers can improve motivation, performance and innovation by decentralising decision-making as far as possible, while ensuring the overall organisational goals are well understood and shared, and resources are dedicated to train and educate staff. Additionally, the conception of rank-order competitions complements the institutional design.

Greater productivity and material performance as well as greater job satisfaction via larger autonomy and decision-making power on the local level can be achieved by the application of subsidiarity as key HRM configuration. This can be employed at SMEs, as discussed, but also other organisations. Further, the principle of subsidiarity and the greater emphasis on staff training and education may help reduce inequality.

Our paper contributes towards filling the gap in the literature on the link between HRM and innovation, by identifying the role of subsidiarity. We introduce an interdisciplinary perspective, with contributions from economics and psychology, among others. We also contribute to the history of HRM.

The purpose of this paper is to analyze the extent to which different patterns of cross-functional integration and the operations strategy (OS) process may be explained by national cultures differences.

Perceptual survey data from 105 manufacturing plants in four countries were used to validate the constructs and to test the hypotheses. The plants are located in two Western and two Eastern countries with different industrialization and development backgrounds (Brazil, China, Germany and South Korea). CFA validated the constructs, and ANOVA and t-tests evaluated the differences between levels of four Hofstede’s elements (i.e. power distance, individualism vs collectivism, uncertainty avoidance and long-term vs short-term orientation) on the OS process enablers (i.e. leadership for cross-functional integration and functional integration) and elements (i.e. manufacturing strategy linkage to corporate strategy and formulation of manufacturing strategy).

Results suggest that different OS and OM processes are present in different national cultures. Leadership for cross-functional integration and manufacturing strategy linkage to corporate strategy differ between levels of power distance, individualism vs collectivism and uncertainty avoidance. Functional integration and formulation of manufacturing strategy also present differences according to the degree of individualism vs collectivism and long-term orientation.

Results indicate that national culture is a key aspect for the OS process. Prior studies usually do not consider cultural aspects. Therefore, the OS process varies in different countries and contexts. Managers need to adjust their OS process when they are developing a global OS.

This paper aims to review the factors in Germany’s economic growth and attributes these to the Mittelstand model driven by Hidden Champions.

This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context.

Germany’s economic growth can be attributed to the “Mittelstand” model combined with the core strategies of the “Hidden Champions” – manufacturing high quality premium products to dominate market niches, creating and sustaining a highly-skilled labor force and investing in science and technology to maintain a sustained competitive advantage.

The briefing saves busy executives, strategists and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

There is a research gap in strategic management regarding the complement from managerial cognition literature to the behavioral theory of firm, as well as linkage between cognitive structure and cognitive process of strategy formulation in the field of managerial cognition, which also calls for further exploration. The purpose of this paper is to construct a model from an integrated view for explaining the process of cognitive reconstruction under incremental changes.

Qualitative research is conducted in the form of 17 semi-structured interviews in four hidden champions operating in China. Based on the model generated from the literature review, this paper adopts the abductive logic for data analysis.

This paper draws the following conclusions. The cognitive structure is shaped by the changing environment and the performance feedback, the variance in structural attributes will affect whether the changing environment destructs the effectiveness of original cognitive structure or not, the centrality of cognitive structure will promote the efficiency of tried-and-true organizational adaptations to incremental changes, and cognitive structure reconstruction is the result of the recursive process of trial-and-error learning.

This paper proposes the model explaining the interaction mechanisms between cognitive structure and strategy formulation process. It also presents the iterative sense-making process for reconstructing cognitive structure in strategy formulation. Both of them extend the understanding on managerial cognition in organizational adaptations to incremental environmental changes.

The purpose of this paper is to arrive at a general definition of an HPO and a (practical) way to measure an HPO. Managers are looking for techniques to strengthen their organizations in a way that they cannot only cope with threats but could also quickly take advantage of opportunities, and thus, grow and thrive. The academic and especially the practitioner fields reacted on this “thirst for high performance knowledge” with a plethora of books and articles on the topic of high performance organizations (HPOs). These publications each came with their own description and measurement of HPOs, which created a lot of confusion among practitioners.

In this study the following reserach question is answered: how can an HPO be defined and its performance measured? So that with the answer, this paper can take away the aforementioned confusion. This paper does this by conducting an extensive systematic review of the literature on HPO, after which this paper synthesizes the findings into a proposal on how to define and measure the HPO.

This paper was able to obtain from the literature a list of definitions and measurements for an HPO. The common denominator in these definitions and measurements turned out to be respondents given their opinion on the effects of the organizational practices they apply on organizational performance vis-à-vis that of competitors. This paper concluded therefore that an HPO should be defined and measured relative to competitors and should be based on the perception of managers and employees of the organization: An HPO is an organization that achieves results that are better than those of its peer group over a longer period of time.

With the answer on the research question, this paper fills the current gap in the definition and measurement literature on HPOs, and thus, has moved the research into HPOs forward, as researchers can use these research results in their future studies on high performance and HPOs.

Although there is a plethora of literature on high performance and HPOs no univocal definition and measurement of the HPO can be found. This study provides for the first time an academically well-founded definition and measurement method.

Much has been written concerning the value and validity of the bottom of the pyramid (BOP) model, as a strategy for multi‐national corporation (MNC) growth. The model presented in this paper adds to the discussion of strategic possibilities to tap the potential of emerging markets. This paper seeks to address these issues.

The paper first discusses trends in economic growth in emerging markets, global strategies, and the BOP market, then analyzes the blue ocean strategy (BOS) of value innovation.

The paper develops the Value Flame at the Base of the Pyramid (VFBOP) model by combining BOP and BOS strategies to potentially offer opportunities for MNC market entry as well as market supply, to drive revenues and expand global market share.

As a concept, the model must be validated by empirical and case research to ascertain the shape and dynamics of the model. Future research can establish the parameters of the flame.

It is believed that the VFBOP model is the first to address some of the limitations of BOP strategy while profiting from the BOS model, in order to fully benefit from sourcing and selling to emerging markets.