Hidden Champions in rural Germany: Innovation strategies to compete in global markets

Abstract

In the field of economic geography, there is much evidence that innovation occurs more readily in cities, while rural or peripheral areas are deemed disadvantaged. However, emerging research about innovation outside of agglomerations and recent criticism of urban-biased perspectives challenge established assumptions on the relation of innovation and space and dominant formats of knowledge creation. Innovation is increasingly conceptualised as a knowledge-driven, interactive, and multi-local process connecting spatially dispersed networks of actors, workflows, and resources. Notions of slow innovation, mobility, and temporary proximity as well as regional and place-specific qualities challenge existing representations of rural or peripheral areas and are vital to understanding innovation activities outside of agglomerations and in rural economies in particular.

Building on this theoretical progress, we present empirical research on hidden champions in Germany, which are commonly described as extraordinarily innovative companies successfully competing in global markets. First, we present the spatial distribution, innovation patterns, and modes of interaction of these enterprises to argue that the occurrence of larger, highly specialised enterprises is not primarily a phenomenon of agglomerations, at least in Germany. Second, we present findings from qualitative interviews with the representatives in enterprises to explore strategic approaches towards innovation in a comparative perspective. Findings demonstrate that rural and urban firms follow similar practices and strategies to innovate. They utilise means of a global reach for knowledge sourcing, while their local context is of less importance.

Biographical Note

Lukas Vonnahme (SFB 1199 & Leibniz- Institut für Länderkunde)

Having studied Human Geography in Marburg, Lund and Frankfurt from 2008 to 2014, Vonnahme joined the Leibniz-Institute for Regional Geography Leipzig in 2014. After he worked for bwcon GmbH, a regional economic development agency in Stuttgart in 2015, Vonnahme obtained his current position as a Researcher and PhD Candidate within the project “Peripheral but Global: World Market Leaders outside of Agglomerations”, which is part of the Collaborative Research Centre (SFB) 1199: “Processes of Spatialization under the Global Condition”. His research interests include regional economic development, processes of knowledge creation in space, and innovation management.

Thilo Lang (SFB 1199 & Leibniz- Institut für Länderkunde)

Having studied spatial and environmental planning in Kaiserslauten and urban planning in Hamburg, Thilo Lang gained his PhD in Potsdam and Durham. As the head of a department at the Leibniz Institute for Regional Geography, his research interests focus on the production of space and transnational urban and regional development in the context of current processes of socio-spatial polarization and rising disparities across Europe. Further long-term research interests include urban and regional change, shrinking cities and regeneration, as well as peripheralization as a multilevel process. One current focus is on innovation outside of conurbations and alternative local and social economies.