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About this book

Hidden champions are highly successful small and medium-sized companies that are global leaders in terms of market share in their respective niches. Presenting the outcomes of an in-depth, multinational study on hidden champions in Central, Eastern, and Southeast Europe, Russia, China, Georgia, Mongolia and Turkey, this book provides essential insights into the critical drivers of success, market leadership positions, competitive advantage, and core lessons learned on the road to business prosperity. It also addresses development needs in connection with management, financing and the regulatory environment, which can in turn be used to create recommendations for various stakeholders (e.g. governments, financial institutions, management development institutions) in order to support hidden champions in their further growth and business success.

Table of Contents



The majority of studies of corporate success relate to larger, well-known companies. The main reason is that historical data are easy to collect and the success of companies such as IBM, Hewlett-Packard, Dell, and Nokia appeal to young generations of students and entrepreneurs.
Danica Purg, Alenka Braček Lalić

Research Methodology

More than two decades ago, German management professor Hermann Simon coined the term “hidden champions” to describe the outstanding enterprises in his home country as he examined their role in Germany’s economic development and innovation progress (1996). He developed his idea further and extended this research to global companies (2009). In 2011, CEEMAN and IEDC-Bled School of Management, Postgraduate Studies launched an elaborate project: 18 research teams worked with over 165 companies across Central and Eastern Europe (CEE) and Turkey to study the hidden champions of their respective countries. Published in 2013 and based on Simon’s methodology, the book Hidden Champions in CEE and Turkey: Carving out a Global Niche, edited by Peter McKiernan and Danica Purg, sought to uncover examples of hidden champions, but also to compare the new findings with Simon’s (Purg et al. 2019). An additional aim was to identify what support hidden champions needed in Central and Eastern Europe and in Turkey, as the business environment and historical background in which they were striving to succeed were (and still are) quite different from those of more mature market economies.
Alenka Braček Lalić, Denis Berberović

Hidden Champions: Leadership Success Factors

In the study on hidden champions, Walravens and Filipović (2013) indicate that the overlap between three systems—company, family, and ownership—can be either a strength or a weakness. This is because they contain a number of bivalent elements that continually interact within any structure (Flören 2002), the company’s strategy and culture, HRM, communication, ownership, finance, and the balance between company and family interests. For example, the spirit of ownership can be a binding element in a family or it could lead to reluctance to consider external financing and to blockage of the business’s expansion.
Danica Purg, Arnold Walravens

Hidden Champions: Common Lessons Learned on the Path to Success

When conducting a large-scale qualitative research project such as the one presented in this book, two major benefits for the business community arise. First, practitioners get the opportunity to peak into individual success stories and draw conclusions from separate case studies presented in country chapters (Yin 2014; Gummesson 2000). The second major benefit is general conclusions drawn from all the hidden champions involved in this research. These are the main lessons from the project: major findings offering invaluable insights into the formation of a hidden champion. Based on the methodology of meta-analysis of individual case studies, main conclusions were drawn and, according to their similarity, they were categorized into 13 themes (Patton 2015). These themes represent the general lessons of this research and sum up the project’s major findings. It is important to note that these lessons are given by successful hidden champion managers and no reference is made to academic work within the lessons. This has been done on purpose, as the authors’ intention is to let the voices of practitioners be heard. And they do have plenty to say.
Denis Berberović, Amra Kožo, Merima Činjarević

Hidden Champions: Financing and Regulatory Environment Development Needs—Context Matters

Hidden champions are characterized by the uniqueness of their products and services, which satisfy users’ needs in a unique way, and the uniqueness of their business model, which combines organizational structure, organizational culture, and operations in a unique way. In this chapter, two elements (formal institutions and finance) of an entrepreneurial ecosystem will be discussed using information from the 2019 survey of hidden champions in 22 countries, mostly from Southeast Europe.
Slavica Singer, Sunčica Oberman Peterka

Hidden Champions: Management and Leadership Development Needs

The main aim of this chapter is to introduce management and leadership development needs identified by the research conducted among Hidden Champions (HC) companies in Central Europe and South-Eastern Europe (CESEE) and the Asian market. Today’s business environment is dynamic, turbulent, and hyper-competitive. It is characterized by rapid changes, and often, business literature describes it with the trendy managerial acronym VUCA (Bennett and Lemoine 2014). As a term, VUCA is first used in 1987 (Bennis and Nanus 1985) to reflect the volatility, uncertainty, complexity, and ambiguity of general conditions. By the time it got a deeper meaning, and each element of the VUCA acronym provide insights into the strategic movement and behavior of an organization.
Amra Kožo, Alenka Braček Lalić

Hidden Champions of Albania

Albania is a small country with limited business resources. As the country has suffered during a long economic transition, doing business in it is not quite easy. Companies are not yet willing to share their successes and failures due to cultural constraints and the business environment. During the early 1990s, Albanian business focused mainly on services and commerce as an easy way to get the return on investment in a short period. However, in recent years it is breaking into new areas where innovation and creativity are becoming essential. Entrepreneurs show maturity in protecting their achievements and are conscious that they needed to deal with numerous challenges to achieve success. Nevertheless, companies in Albania are not growing enough due to cultural constraints and the business environment. It was challenging to identify hidden champions that meet the conditions of Simon’s methodology in Albania in 2018.
Vasilika Kume, Elona Garo, Anisa Kume

Hidden Champions of Belarus

The chapter continues the discussion on the history of the development of hidden champions in Belarus that was started by Golenchenko and Daneyko in 2013. Extending the taxonomy of Belarusian hidden champions, the chapter discusses the context in which Belarusian hidden champions evolved and adapted their business models to a rapidly changing global environment. Based on in-depth interviews with founders, we present the case studies of three Belarusian hidden champions that substantially differ in terms of their history, strategy, and business model. In addition, getting a glimpse of the future, we make assumptions on sectors that may give rise to new hidden champions. Implications and recommendations for the government, business schools, and financial institutions are provided.
Radzivon Marozau, Hanna Aginskaya, Pavel Daneyko, Natalia Makayeva

Hidden Champions of Bosnia and Herzegovina

The chapter on hidden champions of Bosnia and Herzegovina begins with an overview of the country’s economy in order to give the context in which hidden champions conduct business. The chapter particularly focuses on the challenges that these companies face. It proceeds with three selected case studies of hidden champions. GS-TMT ltd. from the metal industry is a company that has a seven-decade long tradition and has been through ups and downs to become one of the major suppliers to global metal-processing companies. Kristal Ltd. a family SME from the glass industry has innovated the production of glass and launched highly innovative glass products thus changed the international glass market. NSoft ltd. is a fast-growing IT company offering online betting solutions to global clients. All three hidden champions differ significantly, not only from the industry perspective but also in terms of the way they were established. However, all three companies have also several factors in common—passionate leadership, loyal human resources, continuous investments, and all-around innovations. As discussed in this chapter, these elements have helped them throughout the years to build leading positions in the international market as reliable suppliers to global clients.
Denis Berberović, Merima Činjarević, Amra Kožo, Nenad Brkić

Hidden Champions of Bulgaria

This chapter starts with a brief description of the economic and political situation in Bulgaria during its recent history, focusing on the period after the collapse of the Soviet-style socialist system. Bulgaria went through a particularly difficult transformation period, marked by economic and political turbulence, organized crime, and social unrest. By the end of the 1990s, the situation began to stabilize, both economically and politically, and Bulgaria entered a period of sustained economic growth, interrupted only in 2009. At present, the country is politically stable and has some of the best macroeconomic indicators in Europe. Nevertheless, Bulgaria has few true hidden champions. UniComs, presented here, is one of the few. It started out as a small manufacturer of medical products and has become a true multinational, albeit a small one.
Michael Minkov

Hidden Champions of China

Guided by the national strategy of “Made in China 2025,” China has established a top-down program of encouraging champions. The case studies in this chapter are devoted to three hidden champions in China, selected from a larger group. Our analysis shows how late-comers have developed and become leaders of niche markets. They teach different lessons in business specialization, innovation, and business models, and provide insights concerning company growth in the context of a developing economy.
Xiaobo Wu, Linan Lei

Hidden Champions of Croatia

Small competitive businesses with growth potential are crucial for the Croatian economy, which made a slow recovery after the 2008 crisis. Global Entrepreneurship Monitor confirms on a yearly basis that the country has a low share of businesses with growth potential, mainly because of a lack of competitiveness measured in terms of product novelty. The technological readiness of Croatian businesses is close to the EU’s average, but product innovativeness is falling behind (Singer et al. 2018, p. 34–35). This brings up the question of the entrepreneurial ecosystem which should provide better support to businesses with growth intentions and potential through education, R&D transfer supported by government programs, availability of equity capital, or business angels support. Examples of hidden champions confirm the existence of businesses strongly committed to growth, and their lessons learned are that their success is exclusively based on the strong leadership of their owners, capability to develop teams with strong commitment to innovativeness and global markets.
Slavica Singer, Sunčica Oberman Peterka

Hidden Champions of the Czech Republic

After a successful transition period, the Czech Republic aims at further transforming its economy, from being a cost-effective sub-contractor with a convenient location close to developed Western markets to increasing domestic value added in its exports. Some Czech companies have already managed to build and dominate market niches and have become local, regional, or even global leaders. This chapter contains case studies of four little known companies—Bioveta, Elko EP, Microrisc, and Phonexia—in the pharmaceutical, electronics, and IT sectors. They benefit not only from their innovative capacity, but also from their adaptability. They combine a high-level professional know-how with the ambitious vision of their leaders. Our four case studies provide evidence of gradual and ongoing structural changes in the Czech economy toward a more favorable position in the global value chain. At the same time, all four hidden champions highlight the long-term weaknesses of the Czech business environment, specifically in terms of regulation, infrastructure, and education system. These three domains need improvement for the economic transition in the Czech Republic to be successfully completed.
Jarolím Antal, Jana Vlčková, Ondřej Sankot, Pavel Hnát

Hidden Champions of Hungary

Hungarian hidden champions continue to be small, highly innovative companies with strong, centralized leadership, as they were in the previous round of research. Although some hidden champions still rely on the traditional Hungarian industries, newly emerging ones provide applied software solutions and find their competitive advantage in customized state-of-the-art solutions or technologies. Hungarian hidden champions excel in the knowledge-based niches of big industries.
After a brief economic overview, this chapter discusses Hungarian hidden champions. Capsys Ltd. is a hidden champion in the banking software industry. Cyclolab Ltd. is a world market leader in the field of cyclodextrin solutions. Energotest Ltd. is a regional market leader in the field of modular, network-integrated technical testing stations. Tran-SYS Ltd. is a technology leader, producing life-like, complex simulation systems for interlocking, and railway operations. Tresorit Ltd. is a technology leader as an enterprise cloud encryption and collaboration company, which provides end-to-end encrypted file sync and sharing for businesses. The identified hidden champions offer state-of-the-art technology to satisfy customer needs mostly with well-customized solutions.
Miklós Stocker

Hidden Champions of the Republic of Kazakhstan

This chapter is an overview of the hidden champion research in Kazakhstan. As the largest landlocked country in the world, and the fastest growing industry in Central Asia, primarily due to its natural resources, Kazakhstan represents an interesting case. The Kazakh market is of interest to neighboring Central Asian states, the Eurasian Economic Union, the CIS countries, Asia, Europe, and the USA. The entrepreneurial culture in Kazakhstan is on the rise and the country has seen the growth and development of diverse companies, from small and home grown to large franchises and joint ventures. The research revealed that the companies that could potentially be labeled as hidden champions were often supported by the government or did not hold a regional leader position. Thereby, many successful and innovative companies of research interest could not be included in the final version of this chapter as they did not satisfy the methodology requirements. Nevertheless, we were able to highlight two companies as potential hidden champions. This chapter overviews the political, economic, and socio-cultural context of the country and evaluates the issues surrounding the hidden champion research.
Christian Kahl, Aigerim Raimzhanova, Aigerim Serikbekova, Sultanbek Kaiym

Hidden Champions of Kosovo

The chapter on Kosovo’s hidden champion brings to the spotlight the historic and economic development trends and the economic potential of Kosovo. This is the latest country, with the youngest population in Europe, whose average age is 26 years. It has 1.8 million inhabitants and it is situated in South Eastern Europe. Kosovo’s economy has undergone different political developments, which has had an impact on its economic trends. The chapter discusses the tools that MOEA used to become a hidden champion and the motivation of the successful entrepreneur, who established MOEA in a completely new industry and turned it into the country’s hidden champion. MOEA is the number-one fruit-grower and natural juice producer in the Central and East European market, producing unique and healthy fruit drinks with its advanced fruit processing technology. The chapter also discusses MOEA’s development tools and challenges, and its potential for success. Finally, the chapter gives recommendations for improvement to governmental, financial, and higher education institutions.
Dafina Turkeshi Ballanca, Florentina Dushi

Hidden Champions of Lithuania

Lithuania is going through tremendous economic changes, from an agrarian country to an innovation-driven economy. Current World Bank data demonstrate the growth of high-technology exports, a small proportion of agricultural raw materials exports, and a quite high percentage of exports to high-income economies. Policy makers also demonstrate efforts to improve the business environment in Lithuania, which makes the Lithuanian economy attractive for the development of hidden champions. This chapter reviews the development of the Lithuanian economy in the context related to the success of hidden champions in Lithuania. An analysis of five cases of Lithuanian’s hidden champions reveals the financing and regulatory environment development needs in Lithuania. Also, the chapter highlights the market leadership and competitive advantages of Lithuanian hidden champions and discusses their success stories, learned lessons, and management and leadership development needs. Lithuania’s hidden champions’ case study results demonstrate that sensitivity to customer problems and high appreciation of the employees are of high importance for market leadership success.
Erika Vaiginienė, Rasa Paulienė, Laima Urbšienė

Potential Hidden Champions of Moldova

The chapter describes the main characteristics of the economic and socio-political context and business environment in which Moldova’s potential hidden champions operate. The other topic of this chapter is the way that the companies in a small country in Eastern Europe manage to expand regionally and globally, and develop a worldwide database of customers. The potential hidden champions of Moldova share some characteristics in terms of how they face challenges at the national and international levels, the core principles of their corporate cultures, the way of doing business, and the lessons learned on their path to success.
The conducted interviews emphasized the development needs of the companies and their success factors. Also, secondary sources were consulted in order to describe the stories of the potential hidden champions.
The chapter ends with a list of conclusions and recommendations for stakeholders that could help Moldova’s potential hidden champions prosper in the future.
Dumitru Slonovschi

Hidden Champions of Mongolia

Mongolia is a landlocked country, sandwiched between China and Russia. Although it is a country with a relatively young economic history, Mongolia has been in the spotlight due to its recent economic development and explosive double-digit growth in the early 2010s. It is rich in mineral resources and multinational mining giants have a keen interest in tapping into them. Although it became a free market economy only in 1990, the country has seen considerable growth since then. Though still considered a small nation in the global context, the number of SMEs is constantly growing. Out of 90 companies that were studied for this project, the four most interesting ones have been further analyzed for this chapter. The companies do not completely fulfill the hidden champion criteria, but their operations and outlook suggest that they are potential hidden champions.
Eku Bold

Hidden Champions of Montenegro

Montenegro has a small open economy, characterized by a small domestic market. Montenegro depends to a large extent on imports, which results in a negative trade balance. That negative balance is partly mitigated by the positive balance in the service sector.
We have identified two hidden champion companies in Montenegro: Marina Porto Montenegro in the tourism sector and Domen in the ICT sector.
Marina Porto Montenegro is a luxury marina for yachts, superyachts, and megayachts, located in Tivat, in the Bay of Kotor. In the market segment of superyachts and megayachts, Marina Porto Montenegro is the market leader in the Adriatic Sea region.
Domen is a joint venture that was founded in 2008 by Afilias Limited, GoDaddy.​com (foreign partners), and ME-net (a domestic partner) which does business as a “.me” registry. Domen is the market leader in the region in terms of number of registered country code top-level domains (CCTLD) and is ranked third in Europe in terms of CCTLDs registered outside of their home country.
Both companies were founded after the Montenegrin declaration of independence in 2006. In a relatively short period, they have achieved a leading position in competition with companies from other regional countries. The clear visions of both companies’ founders, operationalized through a well-chosen and implemented strategy based on a differential focus, led these companies to success. In their business success, it was of extreme importance that they identified excellent business ideas with high market potential in a timely manner.
Milorad Jovović, Bojana Femić-Radosavović, Nikola Mišnić

Hidden Champions of Poland

Poland is a country with a strong entrepreneurial spirit. The hidden champions’ performance has been closely related to political and economic changes: the fall of communism in 1989 and the transition from a centrally planned economy to a market economy. This led to the emergence of small private businesses focused on the domestic market. The accession to the European Union in 2004 created new perspectives for the hidden champions’ growth after the opening of the international markets, financial, educational, and institutional support, legal regulations, and FDI inflow with new technologies. Liberal democracy enabled the hidden champions to emerge in almost all industries. The majority of them have been taken over by large international companies. This has enabled their high performance. In the Global Competitiveness Index, Poland moved from 57th position in 2011 to 37th in 2018. Polish hidden champions build their positions using strong partnerships with suppliers and customers. Their competitive position is weaker than that of leading Western companies due to Poland’s less developed business culture and the complexity of regulations increasing the transaction costs and business risks. Hidden champions go international with their products and services and are masters in securing their access to scarce resources. They offer strongly innovative products based on their own R&D and develop their brands and new distribution channels, such as e-commerce and digital marketing. Poland is one of the world’s leaders in the business services sector and provides a friendly environment to start-ups.
Grażyna Leśniak-Łebkowska, Magdalena Popowska, Małgorzata Godlewska, Mirosław Łukasiewicz

Hidden Champions of Romania

The Romanian hidden champions were born in an economy that is catching up with the rest of the EU member states in terms of GDP per capita and productivity. The three hidden champions presented in this chapter are operating in industries with fast technological changes. They define the interconnected society that we all live in production of electronic devices with communication technologies, production of software, and provision of digital services for the marketing of companies. Their competitiveness in Romania represents a solid foundation for international expansion, all of them having proved their competitiveness on a global scale. Electra is selling electronic devices in Germany, Grapefruit is selling digital services to major global companies like Renault, Philip Morris or Pepsi and Romsoft is selling software to one of the world’s leading companies of lab medical devices. Although they have advantages in terms of labor costs, these are not the current drivers of competitiveness, as the companies rely more on the technical know-how of employees and the internal dynamics that rapidly generate new products or services, allowing the continuous expansion and growth of the business. All three hidden champions are direct beneficiaries of the simplicity of trading across borders in the EU and stand apart in the Romanian economic landscape in terms of human capital, business sophistication, and innovation.
Andrei Ștefan Neștian, Ana Iolanda Vodă

Hidden Champions of Russia

This chapter describes the evolution of the business environment in Russia since the state-controlled economy was replaced with a market-oriented economic system. It covers the political climate, industry developments, macroeconomic indicators, customer behavior, and more. It examines the general context of present business opportunities for small and medium-sized enterprises in Russia with particular reference to hidden champions. The authors revealed distinctive features inherent to Russia’s hidden champions in terms of market leadership, innovation, competitive advantage, management, and leadership style. The study concludes that, although the short horizon of the Russian economy seems to be uncertain and turbulent, the potential of the hidden champions is huge in the long run, considering their key advantages in their market niche.
Irina Skorobogatykh, Olga Saginova, Zhanna Musatova, Ekaterina Molchanova, Sofia Sedenko

Hidden Champions of Serbia

The transition of Serbia’s economy started at the beginning of this century. It has resulted in an economy that is no longer dominated by large state enterprises. The private sector is becoming the backbone of its transformation and development. The hidden champions presented in this chapter are in different industry sectors. They produce furniture and equipment, bulbs, software and hardware tools, and plastic packing. These companies are competitive because they are no longer using information technologies as support for the value chain but as an integral part of it. Apart from being IT-focused, Serbia’s hidden champions also share other characteristics—their top-tier managers have all stated that they heavily invest in employee training and professional development, but also in their work-life balance. This is also followed by a strong employee retention record. They develop products and solutions for specific customer needs on a daily basis.
Goran Pitić, Nebojša Savić, Miloš Erić, Jelisaveta Lazarević, Zoja Kukić, Ema Marinković

Hidden Champions in Dynamically Changing Societies: The Case of Slovakia

Hidden champions (HC) originally defined by Herman Simon as globally or regionally highly successful companies with specific features have been revealed and studied also in the Slovak context. Based on in-depth interviews with CEO Representatives and additional secondary data researchers provided an insight into the best practices of HC and reality-approved inspirational strategies, other companies can learn from to pursue their future global success. Authors examined the progress of hidden champions defined in 2011 and identified the new strong or potential ones in terms of nature of their market leadership and nature of competitive advantage, and formulated core lessons learned on the path to their success. These companies operate in different environment in comparison with original concept applied in German-speaking countries, resulting from the different historical, socio-political, and economic background of the country, that is briefly introduced. Currently, HC companies perceive new external business challenges that should be addressed, together with their internal management and leadership development needs. Studied companies carefully monitor and rapidly respond to new technological trends (as Industry 4.0, digitalization, automatization, IoT, virtual, or augmented reality), they face demographic problems (a lack of especially IT or technically educated qualified labor force, brain drain) or deal with new business opportunities and also threats from Asian countries. The chapter provides also more detailed case studies of selected companies from the IT and machinery sector presenting their success stories and implications for governments, financial institutions, and business schools how they could support these companies to thrive also in the near future.
Janka Táborecká-Petrovičová, Jaroslav Ďaďo, Michal Budinský

Hidden Champions of Slovenia

Slovenia has a number of globally competitive companies that lead the market in their niches, while also being widely unknown to the general public. They operate mostly in the manufacturing and IT industries and export mainly to European countries. Some of them also export to North America, Argentina, China, Japan, Korea, and Australia. Export sales revenues amount to 80% or more. The Slovenian hidden champions have some competitive advantages in common, such as flexibility, knowledge, technology, and continuous investment in research and development.
Katja Babič

Hidden Champions of Turkey

This chapter provides a qualitative analysis of five hidden champions in Turkey by taking an inclusive approach to market positions as well as management aspects. Hidden champions are highly innovative small-to-medium-sized companies with leading global market positions, mostly in their niche markets. The companies’ characteristics can be summarized as a global focus, a strong emphasis on consumers, talented and engaged employees, global and local market knowledge, participatory management, being open to change, lean thinking, compliance with ethical values, sustainability practices, quality standards, outstanding design skills and propensity for digital transformation. The analysis will shed some light on what makes these hidden champions competitive in international markets. The chapter provides five case studies by concentrating on Turkey’s emerging economy.
Dincer Atli, Nebiye Yasar

Hidden Champions of Ukraine

Finding hidden champions in Ukraine was not easy. Many business leaders have decided not to be hidden and have invested in corporate brand promotion. On the other hand, most company-related information is private. Also, the domestic market is relatively large. Therefore, many successful companies are still operating within their own range. The key advantage of the Ukrainian hidden champions is their narrow specialization that renders the domestic market too small. These companies have no other choice but to compete on a global scale. Ukrainian hidden champions produce high added value and export hi-tech products.
Iryna Tykhomyrova, Vadym Saveliev
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