The German Mittelstand

German SMEs perceive opportunity in diversity

“Each and every company must shoulder a certain amount of responsibility and commitment to play an active role in settling important social issues” The chair of the “ChartaderVielfalte.V.” association left no doubt at the recent meeting of the heads of member companies in the Bundeskanzleramt. His reference to important social issues was all too obviously a reference to the flood of migrants coming to Germany who risk becoming a burden to the state, the people and the economy. It is in this sense that the call is to be understood, and to German SMEs in particular, the backbone of the country’s economy.

An ad hoc task force – called ad hoc – has been set up to piece together and recompose the mosaic of skills and expertise that members implement in their business areas, and make them available in the form of mid- to long-term projects to the organizations who provide assistance to migrants. Some details remain to be clarified but it looks increasingly probable that companies will be required to broaden their vista to include migrants when selecting employees. Taking advantage of diversity as a resource for economic success also means integrating candidates with a background of migration.

This should not be a problem for SMEs; many companies have perceived the benefits of diversity for years, with results that are unequivocal. Indeed, a survey carried out jointly by the Institut für Wirtschaftsordnung (IFM) of Bonn and GE Capital confirm the positive relationship between a functioning diversity management and a better than average growth. Top of the class in growth, companies whose turnover increased by more than 10 percent, are much more active in promoting in-house diversity than those whose turnover is static or diminishing. Diversity, however, is not only the prerogative of growth. Almost three-quarters of the companies surveyed stated that diversity had a positive impact on productivity. 68 percent spoke of an enhanced wellbeing among employees and 65 percent noted a stronger innovative drive.

In its more differentiated assessment, limited to a workforce with a migrant past, IFM awarded top marks to SMEs. Companies who see themselves as highly innovative and who have incorporated more than ten innovations into their product range and service portfolio in the last two years are seen to have a high percentage of employees who were migrants.

The idea that the lack of specialised workers and the negative demographic trend can be solved in the future by the waves of migrants presently arriving in droves in Germany is assuredly wishful thinking. The results reported by IFM and GE Capital are to be seen as an opportunity – start seeing broader horizons and opening up to what they can bring.