The German's victories in the early years were not the result of vastly superior machines dominating the battlefield due to massive armor and huge guns, they were due to a completely different set of advantages. They devastated the Red Army in 1941 due to more previous battle experience, better training, better communications (a radio in every tank for example), better coordination of their forces due to the better training and communications, better leadership and above all better tactical doctrine. They were fighting T-26 tanks and the BT series by the thousand and they destroyed them due to the above advantages. The Soviet tanks had 45mm guns that could knock out panzers at normal combat ranges while the German 37mm and short 75mm guns in the Panzer38t, panzer3 and panzer4 tanks could knock them out at probably only slightly greater ranges. But when the Germans encountered lots of Soviet tanks they'd wipe them out by superior handling of their own forces. They’d get their panzerjaeger units into action fast while driving into the flanks of the Soviets with their own tanks. They'd use artillery pieces and anti-aircraft guns to augment the fire of the towed anti-tank guns as well. Basically anything that worked they'd do, and they’d do it fast and skilfully. When they encountered T-34 and KV-1 tanks they still used the same tactics but with more difficulty and had to work much harder. Instead of being blown up by 37mm guns while still 500 metres away like a T-26 or BT7 the T34 would keep coming closer and inflict losses with it's 76.2mm gun. 88mm guns or 105mm howitzers would have to be used to stop it. This mean’t delays for the Germans and sometimes heavier losses than they were used to. The Germans were also aided though by the T-34 tanks having many breakdowns and insufficient field repair support in 1941. In my opinion the German response to the greater difficulties presented by the T-34 of pushing on with the Tiger programme and rushing the new Panther design was disastrous. It took them away from fully providing the resources needed for the whole reason for their success in the first place, a sufficiently good tank coupled with training and tactics, and had them allocating major resources into a quest for overwhelming technical supremacy. I think they were surprised by the quality of the new Soviet tanks and wanted to show that they were not only just as good but with their engineering technology could build magnificently superior new machines. This was a big mistake driven as much by pride as anything and not by military necessity. They already had a tank, the Panzer4, which could be upgunned to destroy a T-34 at over 1000 metres. In other words it was sufficient. It could effectively fight a T-34 at the same range the T-34 could destroy the Panzer4. It wasn’t an advantage for the Panzer4 but it was parity. In fact with the three man gun turret and superior optics of the Panzer4 there probably was an advantage to the Germans. So overall this gave the now 24 ton panzer4 at least as great a capability against the T-34 as a Panzer3 with a 37mm or short 50mm gun had enjoyed against a T-26 or a BT7. So the basic condition for German success has been reestablished. A basic tank that can destroy enemy tanks at normal combat ranges operating in an all arms coordinated force that outmanouvres the enemy. Instead of blowing away T-26 and BT7 they’re blowing away the T-34, and they don’t need 50 ton monster tanks to do it. Therefore in my opinion what they needed to do in response to the T-34 was hugely increase Panzer4 production and make mass production of the pak 40 a national priority. They had also captured around 3000 Russian 76mm guns which could be rechambered to fire pak40 ammunition. So if there was a slow start to pak40 gun production for tanks they could make up the shortfall with these guns. Even with 76mm weapons going to Marders they’d still have enough to fill any gaps with the Panzer4. But basically the panzer4 had to become the main battle tank as fast as possible. All the resources going into designing machine tools to build the Tiger, training workers, setting up plant etc should have been ended at the end of 1941 in return for increased panzer4 and pak40 production. They would have been reasserting their greatest tactical strength of having large numbers of reliable and adequate tanks beating even larger numbers of enemy tanks by good training and communication. By pushing on with the Tiger and rushing the Panther programme they took resources away from this instead. In 1942 they still built the Panzer3 as the main battle tank while small numbers of panzer4 with the pak40 provided heavier anti-tank firepower. They still had to work hard to defeat the much greater numbers of T-34 tanks they now faced as the long 50mm gun in the panzer3 was barely adequate at 500 metres let alone at a 1000. The 76mm gun in a T-34 could beat the panzer3 at a 1000 metres. So in gun/armor terms the Panzer3 was insufficient as a main battle tank. In spite of this they still won the armored encounters in the summer of 42 and were able to advance but they won solely through even greater application of skill and manouvering than ever. And it was very hard work. The Germans lost 5000 tanks in the east in 1942 compared to the Soviets 15,000. This shows the extent of the skill advantage the Germans still enjoyed as their Panzer3 main battle tank was not sufficient but actually insufficient against the T-34. If instead they’d had the Panzer4 F2 already rising rapidly in production by the spring of 42, the Panzer3 rapidly disappearing from production and the Tiger programme completely cancelled the Germans could have restored operational superiority against Soviet tank forces much more powerfully and inflicted much heavier losses on them than they actually did. With no Tigers (or Elephants) stretching their resources they could have built and operated more tanks in both 1942 and 43. Not thousands more in more panzer battalions at the front as they simply couldn’t have fueled them but more tanks to be able to replace their losses and maintain their fighting strength in their battalions. Instead of panzer divisions fading to a few dozen machines due to lack of replacements they could have maintained them and kept up their numbers a lot better. All of them with pak40 armed machines as well. I think this would have translated into an awful lot more destroyed T-34 tanks. The Panther tank could then have entered service at the end of 1943 with six more months of testing and trials behind it than it actually had to catch and fix the worst problems like the engine fires. I feel the Germans panicked in their reaction to the T-34, and were wounded in their pride to. By not reacting with a simply sufficiently good tank in the panzer4 and playing to their strengths but instead reaching for huge dominance they actually weakened what the real combat power of their army could have been if they’d responded more calmly. Getting the panzer3 out, the panzer4 in and cancelling the Tiger was the most combat power efficient move I think they could have made.