Monthly Archives: December 2017

Bad Marks For Germany’s Bosses

Why re German entrepreneurs looking so desperately for skilled workers? Maybe it’s also because they drive them away. The working atmosphere in German companies is deteriorating—according to a recent study.

From Jens Kügler

“I’m not surprised about anything anymore!”. Do you know such statements? I heard it this morning on my way to an appointment in the hallways of a major corporation. It seemed familiar to me, just like those sentences from the coffee breaks: “… how bad he treated Rita again!” (emphasis on “bad” and “again”), followed by the resigned words: “… but you know what he’s like, our boss…!”.

Lumping all German bosses together would certainly be wrong. A lot of them try hard to be good leaders. But today’s employees don’t want to be command receivers anymore. They want to be involved and contribute to the company’s decisions.

Kununu is an online platform where employees can evaluate their bosses. The operator has recently analyzed over 300,000 reviews from the last twelve months. Special attention was paid to the category called “superior’s behavior”. Here the evaluators give their marks from 5 for very satisfied to 1 for very dissatisfied. While the average was still 3.19 last year, it decreased to only 3.15 in 2017, which is not a landslide crash, but it is alarming and does not really suggest a good management culture.

Incidentally, the most unsatisfied employees are in the craft trades and the textile industry. In contrast, managers received the best ratings in the business sectors of human resources, consulting and internet/multimedia. Regional differences can also be seen. While Hamburg and Berlin employees feel most comfortable with their superiors, the eastern states of Germany are the worst performers. Taillight: Saxony-Anhalt.

Another value in descending flight is recommendation. By 2016, more than 70 percent of employees would have recommended their friends and acquaintances to apply to their company. Now it’s only 67 percent. In acting like they obviously do, Germany’s superiors are doing double damage to themselves with their bad management style. Firstly, they face greater problems in staffing their vacancies as one in three employments come about through relationships and recommendations. Secondly, dissatisfied employees are poorly motivated and far more often sick. It is obvious that this will reduce the productivity of German companies.

What do employees want? They can leave that on kununu as well. They want to “openly discuss and influence” the developments in their company. In short, they want co-determination, they want to make a difference. That’s potential that lies fallow, dear bosses!

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Germany 2017: A Start-up Desert?

In terms of the economic climate, the high-tech nation Germany is more of a developing country. See recent studies.

From Jens Kügler

Everywhere we read, there is a shortage of skilled workers. Entrepreneurs are desperately looking for qualified employees. So is everything fine? Full employment, green light for growth and prosperity? Obviously, there are fantastic conditions for well-qualified people at the moment. However, non-staffed workplaces endanger companies and thus entire sectors of the economy. Orders cannot be processed, customers get lost. And that’s just one of the downsides of the sunny economy.

The recently published annual study “KfW Gründungsbarometer 2017” (Founding Barometer) of the state-run KfW business development banks reveals yet another fact that should make us sit up and take notice. In 2016, the number of business founders was in decline once again – as it has been for years. The authors see the cause for it in the boom economy, the shortage of skilled workers and the prospect of potential founders for good employee’s jobs. So why having the courage to take risks? Why giving up a fixed salary and favorable health insurance when there are sunny job prospects?

This weekend’s newsletter by the platform Franchiseportal said that also franchisors face growing problems finding franchisees—even though this type of business offers the best possible security for starting and operating an enterprise successfully. The brand under which a franchisee builds up his company is well known. The business model has already been successfully tested a hundred times over. And the head office supports the founder in many ways—from financing planning and credit procurement to purchasing or accounting in business operations.

And there is another gap in the medium-sized economy: ten thousands of family-run SMEs cannot find a successor. Germany’s too few business founders prefer to found a new company, if at all, rather than to take over control of a well running ship on a firm course. Yet, without a new captain, even the safest ship will have to sink.

If we add it all together, the number of companies is declining. With the SMEs, the backbone of the German economy dies. In the midst of the boom—or because of it—we dig our own economic pit. Sounds a bit drastic now, but it can happen. In any case, Germany needs more entrepreneurial courage. It needs a start-up culture. What it does not need are teachers or parents who advise young people to not try being self-employed and saying things like: “You better look for a safe job!“.

Whoever will rule in 2018 will have to create more business incitement. There are plenty of good examples from abroad—as only a glance into the neighboring country of Switzerland reveals. Although there are no state subsidies such as the low rated German KfW loans, the Swiss are busy founding companies. The cantons—federal states—and municipalities help them in many ways, from providing them with inexpensive plots of land to concessions on the already very low taxes. Perhaps this is one of the reasons why Switzerland has been ranked number one in the Global Competitiveness Report for years as the world’s most productive country.

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How No-Go’s Run: Success with Weird Business Ideas

“This will never work. You’re crazy”. Many a business founder have heard such statements but were lucky winners at last.

From Jens Kügler

Have you ever heard of cash desk advertising? In fact, a German company has developed a patent for an adhesive film system that can be used to cover the running tape at the supermarket checkout counter as an advertising space, just like a poster. Where do customers stand the longest time and are attentive? Right, at the till. It’s a weird idea, but not so silly when you think about it for a while.

A Danish franchise has been successfully selling rental umbrellas in pedestrian precincts for two or three years, as discussed in this blog. The umbrellas also serve as advertising space. In Munich, a company from Singapore has placed 7,000 rental bicycles. Customers find and unlock the bikes via app and GPS and can leave and lock them anywhere they went. There is a controversial debate as to whether this is ecological or whether the city is “littered” with bikes. But: Everybody talks about the “yellow bikes from China or so” (= Asia).

In his blog on LinkedIn, the author Max Wittrock recently reported on supposedly bad ideas, which are often the best. As an example, he cited an organic muesli, which users can compile themselves online and have it sent to them by mail. The good thing about the idea was that it’s inventors were the first to introduce this as an interesting topic to the PR tools. This was remembered by the network community – and since, the cereal business has been running very well. Anyone can immediately become world market leader in a niche that is small enough, says Max Wittrock.

However, the author points out that a good idea alone is not enough. Firstly, the start-up founders will have to be extremely excited to the idea. They must be so enthusiastic about it that they cannot wait to implement it. It is be better to found something that you love – even if it sounds small and crazy at first – than to pursue a supposedly great idea without enthusiasm and the necessary vigour.

Finally, the idea must be further developed into a sustainable business concept. Decisive is the surrounding environment, the working out of the flash of inspiration. The blogger speaks indirectly of details such as pricing policy and distribution. Without that, the online muesli would not have succeeded. Business professionals know what is needed: market research, demand analyses, marketing strategies, a capital requirement plan, turnover, cost and liquidity planning and—in order to obtain the capital of the banks and subsidies—a professional business plan.

Someone who sets up a company for the first time cannot know how to turn a flash of inspiration into a functioning company. But what are start-up consultants for? A real brainwave, even a crazy business idea, is worth investing a few thousand euros in start-up consulting, especially since consulting in Germany can be publicly funded. Isn’t it better to really work out an idea to a concept than to let it disappear forever in the nirvana of the never realized?

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