A sensorineural hearing loss can be described by an attenuation component and a distortion component (Plomp, 1978). The attenuation component causes certain frequency regions of a signal to be below the hearing threshold thus reducing the amount of information available to the hearing impaired. In the term distortion component effects like reduced temporal or spectral resolution can be summarised. This effect causes speech to be unintelligible even when audibility is ensured. To obtain highest possible benefit for the hearing impaired, both factors have to be addressed in hearing instruments. While the attenuation component can be compensated for by adequate level and frequency specific amplification, reducing the detrimental effects of the distortion component requires the combination of different technological approaches. This includes algorithms to reduce unwanted background signals and enhance the speech signal as well as directional microphone technology to improve the signal-to-noise ratio. The presentation will focus on the solutions offered in recent SIEMENS digital hearing technology and give an overview of the underlying audiological and technical principles.