Berlin Flexible working hours, remote work, modern management culture: Many companies like to advertise their progressive working conditions. But how far along are we in this country when it comes to the future of work? This question was also asked at the Boston Consulting Group (BCG), one of the world’s largest strategy consultancies.
“We wanted to carry out a kind of pulse check on employers,” says Sebastian Ullrich, partner at BCG and co-author of a still unpublished study that is available exclusively to the Handelsblatt. Ullrich and his team surveyed almost 350 top managers from the C-level of international companies. About ten percent of them were German managers – from Dax companies and medium-sized companies.
In this way, BCG not only determined the status quo in German corporations, but was also able to draw international comparisons: Where can Germany learn from which other nations when it comes to New Work? Where is it itself a role model?
One of the main results: Germany stands out in six areas. These are the top and flop areas.
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1. Customer friendliness: flop
It is remarkable how self-critical the surveyed German top managers were in this area: 60 percent of the other countries – managers from 47 nations took part in the study – rated themselves better than the Germans in terms of customer friendliness.
“Compared to other countries, Germany is extremely poorly positioned when it comes to customer care in virtual rooms,” confirms BCG partner and study author Sebastian Ullrich. Today, the relationships with one’s own customers must be maintained digitally above all – somewhere else one is further. “In terms of digitization, Germany is only mediocre overall in an EU comparison.”
During the pandemic, for example, he observed the telecommunications industry closely, says Ullrich. “In Great Britain, for example, the providers reacted quickly to the lockdown, closed branches and switched everything to online.” In Germany, on the other hand, most shops remained open – bypassing the needs of customers.
According to Ullrich, German companies will have to deal more with new questions in the future: How high is the proportion of customers who only see us online? How do we personalize your online shopping experience? How do we bind customers to us digitally?
His conclusion: “Establishing New Work means not only changing things internally – but also working differently with customers.”
2. Employer image: flop
In this respect, Germany lags far behind the other countries: 68 percent of the participants gave themselves better grades than the German managers.
Sebastian Ullrich is not surprised. “The Dax companies in particular have to rethink this area.” There is often a misunderstanding of what makes an attractive employer. He is amazed at what comes to mind for many managers when it comes to polishing their own employer image: “Many companies continue to believe that individual factors such as discounts in the gym or in online shops are enough to convince today’s talents.”
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Studies, also by BCG, have shown that randomly selected benefits are no longer enough to keep your company positive. “Today’s employees value above all a good relationship with managers and colleagues, the values of the company, the purpose and especially the opportunities for advancement.”
In many companies, a lack of opportunities for advancement is a reason for talent to leave. “We often see a transport backlog. Many managers have been in their positions for ten or 15 years and not much has changed. As a result, there is often no room for ‘young guns’,” says Sebastian Ullrich.
Many companies have little idea of the needs of their employees. “The graduate who has just come out of university gets the same package as the father of three who has been with the company for ten years.” Instead, working models and times would have to be individually adjusted in order to retain good employees.
3. Social Impact: Flop
In this area, the strongest countries are those that have very binding ESG criteria – i.e. high demands on ecology (environmental), social (social) and good corporate governance (governance). Sweden and Canada are two of these model countries. In the BCG study, Germany does worse on this point than 57 percent of the other participating nations.
In the study, the term “social impact” also includes the ESG criteria, explains Sebastian Ullrich. “It’s about questions like: How clearly are companies positioned on certain social issues? How sustainable is our supply chain? Or also: How do we protect the mental health of our employees?”
In Germany, according to Ullrich, it is difficult to set big goals that also send strong signals to the outside world. At BCG, for example, an LGBTIQ+ recruitment target of five percent should be achieved by 2025. “Instead of praise, I always hear critical questions first: ‘How is that supposed to work, how do you want to measure it’? The attitude here is still very German-conservative,” says Ullrich.
4. Opportunities for further training for employees: Top
One area in which Germany is a pioneer, according to the BCG study, is training opportunities in companies. “My experience also shows that a lot is invested in keeping employees fit for work.” The focus is on employees learning during their working hours, i.e. optimizing processes “on the job” or learning how to use new technologies.
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“In Germany, employees are very direct and strong, for example when it comes to making processes more efficient,” says Sebastian Ullrich. He noticed this again and again, especially in technical fields such as the automotive sector. “What can we do better?” is a question that many employees there have internalized. “This attitude is certainly also due to the fact that we are such an engineer-oriented country.”
5. New technologies: Top
In the field of technology, two sectors in particular are ahead in Germany, according to the BCG study: tourism and finance. According to the authors, this is due to the fact that the travel industry in particular was hit hard by the pandemic – and was therefore forced to change quickly. With success: According to BCG, the proportion of online bookings in Germany is around 45 percent.
But even beyond these sectors, people in Germany know how to use technologies for good cooperation – at least compared to other countries. Sebastian Ullrich: “Especially during the pandemic, we quickly got on really well. Many companies have managed the transition to hybrid working well. Tools like Zoom or Teams were quickly established.”
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Other studies, such as the Digital Office Index 2022 by the digital association Bitkom, also confirm this perception – albeit less euphorically. Here, 1,100 German companies in Germany were asked about which digital tools they use, what role paper plays in their everyday office life and what their willingness to invest in digital office processes is.
The result: On a scale from zero (“not at all digitized”) to 100 (“completely digitized”), German companies still achieve 59 points. Large companies do better overall with 68 points, while small companies average 58 points. Overall, however, according to Bitkom, almost 40 percent of German companies can count themselves among “pioneers of digitization”.
6. Management culture: Top
When it comes to leadership, the top managers surveyed said they were self-confident: 62 percent of those surveyed see themselves as industry leaders or at least well advanced in terms of leadership culture.
Sebastian Ullrich sees this critically. “Many companies think they now have a great remote work culture – but don’t understand what is involved,” says the BCG partner. “They think they’ve found the leadership model where everyone can happily work hybrid, but that’s rarely the case.”
Switching to hybrid leadership is a mammoth task. How much control does it take? How do you design hybrid teams so that everyone can work well? What kind of leadership can employees most identify with today? Questions that most companies would not have answered conclusively by a long shot. “Here, the self-assessment of employers is rather wishful thinking,” says Ullrich.
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