Q. Management systems of Germany?

Ans: Modern Germany is the biggest industrial nation in Europe and the second only to the USA
on earth. As regards GDP the position of unified Germany moves between the second and the
third in the world. It enjoys the sixth position among the industrialized countries regarding per
capita income. Moreover, this country has been enjoying a very strong balance of payment
position during the last three decades. Unemployment problem is also the lowest, while the
German companies have excess capital awaiting investment to the extent of over 700 billion
Marks. Price level has also been the most satisfactory during the last few decades.
The unique features of Germany’s management system are:

(1) Ensures participation and cordial industrial relations: Germany’s management system
ensures workers' participation in management to the extent which is unparallel in the whole of
Europe. Workers feel themselves an integral part of management and put to their best in the
workplace. This has helped reduce the age-old authoritarian attitude of managers and has turned
German industrial relation to be one of the best in the world. The occurrences of industrial
conflict is almost at its lowest level and the loss of man-days on account of strike is almost nil.
Research studies indicate that within the 16 West European countries, during the eighties, the
loss of production due to industrial dispute has been the lowest.

(2) Product quality and productivity at a high level: German industrial productivity has been
the highest in the world during the last few decades. It has been possible due to whole-hearted
co-operation of workers, who feel themselves as active partners in a system, often referred to as
"productivity qualition" among share-holders, managers and workers. This qualition has not only
ensured quantity but also quality and it is well known that quality and German products go
together.

(3) Bigger span of supervision due to technical efficiency of workers and managers:
Technical efficiency is the yardstick of promotion of German workers. They are trained and
evaluated regularly and therefore, are competent to work with little supervision from managers
who consider themselves not as boss but as guide to fellow workers. Such managers are mostly
engineers and/or economists and receive extensive work-related training before they are assigned
with the job as managers.

(4) German managers think about the functionally specific rather than the managerially
general: The management courses offered by German business schools are more work related
than those of American business schools. Moreover, apprenticeship for potential executives is
essential which makes managers technically efficient and competent to lead the work team and
help the workers in their work related problems.
(5) Industrial jobs are considered most prestigious and respectable: In modern Germany,
industrial jobs are much more prestigious than the jobs in either civil or military bureaucracy.
Before World War-II, the young generation in Germany preferred jobs in defense services but
the situation has changed after the war. Management positions in industries have been considered
doubly rewarded by university graduates since such jobs allowed them to work for national
reconstruction on one hand and also to ensure bright career prospects for themselves.

(6) Emphasis on production management: Co-determination emphasizes upon production. The

managers consider themselves as production managers. The most of workers are also engaged in
production. The industrialists think that the marketing of products would be automatic if the
wheels of production run well. Thus unlike American, British or French emphasis on marketing
management, German emphasis is on production management. In any factory, production
manager is the most respectable man and often earns much more than anyone else in the factory.

(7) No separate engineering division: German workers are technical experts and can take care
of their machinery well. Each and every worker can be called an engineer and the result is the
non-existence of any separate engineering division within the factory.