Innovation in craft enterprises - Barriers and Success Factors

The economic structure of Germany is undergoing radical changes brought about by far-reaching alterations in the global division of labour, a weakening and modification of demand trends and by the dynamics of technological and organizational innovation. These structural changes affect the craft enterprises as well. In the past craft enterprises mastered these challenges in the competition, in the market and in the technology. Moreover, the craft enterprises are responsible for many innovative products, processes and services as well as for the preservation of jobs and the creation of a large number of new jobs. The aim of our research was to find out craft enterprises which have successfully mastered these challenges within the last years. Furthermore it is important to know something about the problems enterprises had with the adjustment to the structural changes. Discovering and analysing the weaknesses is the necessary condition to remove these weaknesses and to be successful on the markets in the future. Especially innovative enterprises are expected to have competitive advantages in opposition to enterprises that are not innovative. The paper is based on an empirical survey of 133 craft enterprises in the area of the Chamber of Handicrafts Reutlingen, a mainly rural region within Baden-Wuerttemberg. The craft enterprises in this area were examined with standardized questionnaires and interviews. The main focus in our survey was placed on variables, which describe the innovative behaviour and the information activities of the enterprises. The questionnaire included questions about process and product innovations, the product age and the three fundamental components in the strategic management of enterprises: The attitude to risk, which is proved by the choice of the growth strategy and the regional extension of sales markets. The innovative competence, i.e. the existence of activities in the areas of research and development, construction and design, business planning and staff development. The willingness to learn and the acquisition of knowledge, i.e. the employees' capability and readiness to take up know-how and to realize innovations with this know-how. The paper summarises the most significant results of the study. The examined craft enterprises were divided into two different groups: the especially successful enterprises and the less successful enterprises. Compared with the less successful enterprises, the especially successful enterprises have a stronger attitude to risk, more innovative competences and a higher willingness to learn. The differences are also emphasized by the fact that successful enterprises formulate questions - not only at the beginning of the renewal process but during all their activities. By doing so they question about themselves and their traditional way of solving problems. They organize a permanent knowledge exchange.