New study: Innovation bottlenecks arise within companies themselves
The restructuring of German industry is proceeding inconsistently in many companies and often falls short of their own goals. This is the finding of a new study by the Institute for Social Science Research (ISF Munich), which is based on a representative survey of more than 4,000 employees and in-depth case studies in key industries. The study examined transformation processes from the perspective of employees and was funded by the Hans Böckler Foundation.
A new phase of digitalisation and restructuring processes to decarbonise production structures are presenting companies with the challenge of a major transformation. The results of the ISF study show that the transition to a new industrial production method is no longer a marginal phenomenon. Around half of employees report a high or very high level of change in their work. These experiences are particularly pronounced in the automotive industry, the information and communications sector, financial services and energy supply.
At the same time, the findings contradict the widespread assumption that employees are fundamentally averse to change. Of those who are experiencing transformation in concrete terms, only 15 per cent associate it primarily with risks. The vast majority view change ambivalently or see it as an opportunity for personal advancement. ‘Employees perceive transformation realistically – neither uncritically nor fundamentally negatively,’ says Thomas Lühr from ISF Munich.
The analysis suggests that the causes of the currently much-discussed crisis phenomena lie less at the individual level than in the operational implementation of transformation strategies. The study identifies three key mechanisms of organisational innovation stagnation. First, the development of new digital business models often fails due to internal power conflicts, political dependence on established business areas and a lack of resources. Second, new forms of work such as agile organisational approaches are being introduced, but they conflict with existing bureaucratic management logic. Thirdly, many companies lack a clear strategic orientation that offers employees reliable prospects for qualification and professional development.
Against this background, the study concludes that common explanations for the industrial crisis – such as reference to location costs or supposed acceptance problems among employees – do not adequately capture the empirically relevant causes. Instead, the findings point to deficits in the management and coordination of operational transformation processes. ‘Many companies are still approaching the transition to a new industrial production method with management approaches from the old world,’ explains Andreas Boes. ‘This leads to contradictory experiences, friction losses and blocks innovation potential.’
The authors therefore consider a change of perspective to be necessary: the analysis widely held in companies and the public sphere, according to which the transformation is failing due to a ‘German fear’ and a lack of willingness to change on the part of employees, is misguided. The research results indicate that there is a widespread willingness among the workforce to break new ground. Companies can build on this with a ‘forward strategy’.
