The Czech shoemaker, Tomas Bat'a, was once one of the brightest stars in the European business firmament. A classic entrepreneur, he anticipated many modern management movements by decades. Yet until a few years ago, very little was known of Bat'a Bat'a, the successful libera! capitalist, was hated by fascists and communists alike, and both his enterprise and his management system were dismantled under the totalitarian regimes that ruled his native Czechoslovakia for more than 40 years.
Today, his management methods are the subject of increasing scholarly interest. As an innovator and an example of the best that European capitalism can do, he deserves to be remembered. His methods can still inspire managers today.
Life and times
Bat'a was born on March 3,1876 in the town of Zli'n in Moravia, then a province of the Austro-Hungarian empire, now in the Czech Republic. His family had been shoemakers for many generations, and Bat'a himself apprenticed as a cobbler. He moved to Vienna in 1891 to start his own business, which quickly failed. Returning to Zli'n, he founded another business in partnership with his half-brother, Jan. This business, too, ran into difficulties and the Bat'as were threatened with bankruptcy. Bat'a later claimed this event changed the course of his life. He applied himself to his work, introduced some innovative new products and turned the company around. He had paid off his debts by 1900 and began to move into volume production, establishing his first factory in Zli'n with 50 employees. Upon the outbreak of World War I in 1914, Bat'a won an order for 50,000 pairs of shoes for the army. Unable to handle the full production himself, he set up a co-operative arrangement with other shoemakers in Zli'n to ensure that the order was filled on time. By the end of the war, the Bat'a company was employing 5,000 people.
During the mid-twenties, Bat'a introduced many of the organisational reforms that would go on to make up the Bat'a system. The company also continued to expand internationally. When exports to the US were hurt by the introduction of import tariffs following the crash of 1929, Bat'a switched his attention to other markets. He had ventures in China and India as well as in several European countries by 1930 and began opening his own retail outlets. Bat'a factories were now producing 100,000 pairs of shoes a day. By 1932, there were over 650 retail outlets selling Bat'a shoes in 37 countries.
Bat'a was killed tragically in a plane crash in July 1932. He was only 56 at the time. His half-brother, Jan Bat'a, took over as managing director. A talented manager in his own right, he led the company's dramatic global expansion in the mid-thirties. By 1937, the company was making nearly 60 million pairs of shoes a year, and had 65,000 employees in 63 countries.
Czechoslovakia was annexed to Nazi Germany in 1939. Jan Bat'a tried (unsuccessfully) to prevent the company from being taken over by the German army, and then went into exile in the US. Because he had negotiated with the Nazis in order to try to save the company, he was then blacklisted by the Allied powers. He went into further exile in Brazil in 1941. Worse was in store for the company headquarters in Zlin. Bombed and badly damaged by the US Army Air Force in 1941, it was taken over by the Soviet army in 1945 and nationalised by the communist Czech government in 1946.
The Bat'a system of management was progressively dismantled by first the Nazis and then the communists, and Bat'a's legacy was all but forgotten in his native land. But his memory was not entirely forgotten. Another member of the family, Tomik Bat'a, fled to Canada in 1939, later refounding the Bat'a company in Ontario. Today, Bata International has a worldwide presence in shoemaking and shoe retailing.
The Bat'a system
The fundamental foundation of the Bat'a system of management was an ability to analyse, understand and learn. …