Why and how to implement strategic competence management in manufacturing SMEs?

To become and remain competitive, manufacturing companies need to be highly flexible and offer a high quality/price ratio. One of the crucial prerequisites for achieving this goal is the adoption and effective usage of advanced technologies in manufacturing processes. This calls for strategic competence management, which characterizes the company's capability to adjust organizational and employees' competences to new requirements. However, only very few German small and medium-sized enterprises (SMEs) in the manufacturing sector currently use systematic and strategic competence management in their processes. Our paper addresses this issue by providing empirical evidence on the awareness and current usage of strategic competence management tools in German manufacturing SMEs based on recent data from the German Manufacturing Survey, which is conducted by the Fraunhofer Institute for Systems and Innovation Research ISI. Following this, we introduce a conceptual, process-based approach for managing competencies in manufacturing SMEs strategically and systematically. This approach was developed and tested over the course of a three-year research project. In addition, we present a case study of a company that successfully implemented this approach.