Financial Crisis and Bata Management System: Macro- and Micro-reaction to Crisis Environment
Bata Management System; crisis of the 30s; added value; free market; market regulation; state intervention; creative destruction
Tomas and Jan Bata both had to manage their global enterprises under the conditions of local, European and world crises of the 20s and 30s. Yet, they prospered and during the worldwide depression of the 30s they achieved unprecedented global growth and flourish. In this essay we identify the main reasons why a firm can prosper in the environment of general crisis.
We summarize economic results of Bata concern, compare its key statistics, and emphasize the fundamental albeit personally different ideas and values of Tomas and Jan Bata. The main key was the existence of a striking and fully integrated Bata management system (BMS)which clearly defined interests and conditions of cooperation among employees, managers and owners. Every company faces a choice in its reactions to a crisis: 1. Passive macro-reaction, e.g., waiting for decisions, rules or financial bailouts from the government, lobbying politicians, nurturing “survival”, or 2. Active micro-reaction, i.e. adjusting its business organization and management to the prevailing crisis conditions, exploiting the passivity and waiting “tactics” of competitors, creating new competitive advantage. The issue is: do they choose the “party and government” or the “free-market” private enterprise as the base of their economic performance and social prosperity?
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