What is a Hidden Champion?
A Hidden Champion is a company that
- belongs to the top three in its global market or is number 1 on its continent
- has less than $ 5 billion in revenue
- and is little known to the general public.
Some examples: Delo makes special adhesives for electronic applications. 80% of all smart cards in the world and more than 50% of all mobile phones including the iPhone are held together by adhesives made by Delo. Tetra is the world leader in food for ornamental fish with a 60% global market share. Belfor, an industrial service company, is a world leader in the removal of water, fire and storm damages. It is the only company that provides these services around the world.
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Seven lessons for other companies
So what can other companies learn from the Hidden Champions? What are they doing differently from large corporations? The answer: Almost everything! Here are the seven most important lessons.
- Extremely ambitious targets – The targets of Hidden Champions are aimed at growth and market leadership.
- Focus and depth – Hidden Champions define their markets narrowly and work deep into the value chain.
- Globalization – Focus makes a market small, globalization makes it large.
- Innovation – The effectiveness of the Hidden Champions’ innovation and R&D activities beats that of large corporations by a factor of 5.
- Closeness to customer and competitive advantages – Closeness to customer is the biggest strength of the Hidden Champions, even ahead of technology.
- Loyalty and highly qualified employees – The Hidden Champions have “more work than heads” and high performance cultures.
- Strong leadership – The leadership is authoritarian in the principles, but flexible in the details.