The attitude of the German Army towards what happened on the Somme might best be summed up by an oft-quoted remark made by a German officer on the Somme; that it was:
[The Somme] was the muddy grave of the German Army.
This may come as a surprise to those more familiar with the popular Anglo memory of the Somme - which in turn is arguably defined more by the First Day then the entire (titanic) campaign - but the Somme, whilst it wasn't able to inflict a decisive defeat and breakthrough against the German Army in France, was nonetheless acknowledged by German officers and soldiers as a severe setback, and every bit as much a human tragedy for them as it was for their opponents. The Somme cost the Germans somewhere between 465,000 and 600,000 casualties - compared to 370,000 at their other titanic struggle in 1916 in the West, Verdun. Those losses could also not be easily replaced - although manpower issues would effect all armies, the British and French had their dominions to recruit from. The Germans also lost a high number of experienced officers, NCOs and other ranks, whose skill and experience could also not be easily replaced, with Crown Prince Rupprecht of Bavaria commentating:
What remained of the old first-class peace-trained German infantry had been expended on the battlefield.
The conclusion drawn by Ludendorff was that the German High Command had to
bear in mind that the enemy's great superiority in men and material would be even more painfully felt in 1917 than in 1916. They had to face the danger the 'Somme fighting' would soon break out at various points on our fronts, and that even our troops would not be able to withstand such attacks indefinitely, especially if the enemy gave us no time to rest and for the accumulation of material
Apart from leading to Ludendorff to back unrestricted submarine warfare, the Somme was also an impetus for the Germans to began the withdrawal towards the Hindenburg Line.
Sources
Sheffield, Gary - Forgotten Victory - The First World War: Myths and Realities
Sheffield, Gary - The Somme
Philpott, William - Bloody Victory: The Sacrifice on the Somme