This case study focuses on the HR problems faced by Bata India. The management's inability to deal with labor strife had resulted in huge losses for the company. After a brief turnaround of four years (1996-1999), Bata was once again moving towards a decline. The case highlights various HR issues, which Bata has to immediately deal with in order to have productive workforce.

For right or wrong reasons, Bata India Limited (Bata) always made headlines in the financial dailies and business magazines during the late 1990s. The company was headed by the 60-year old Managing Director William Keith Weston (Weston). He was popularly known as a `turnaround specialist' and had successfully turned around many sick companies within the Bata Shoe Organization (BSO) group.

By the end of the financial year 1999, Bata managed to report rising profits for four consecutive years after incurring its first ever loss of Rs. 420 mn in 1995. However, by the third quarter ended September 30, 2000, Weston was a worried man. Bata was once again on the downward path. The company's nine months' net profits of Rs. 105.5 mn in 2000 was substantially lower than the Rs. 209.8 mn recorded in 1999. Its staff costs of Rs. 1.29 mn (23 percent of net sales) was also higher as compared to Rs. 1.18 mn incurred in the previous year. In September 2000, Bata was heading towards a major labor dispute as Bata Mazdoor Union (BMU) had requested West Bengal Government to intervene in what it considered to be a major downsizing exercise.

With net revenues of Rs. 7.27 bn and net profit of Rs. 304.6 mn for the financial year ending December 31, 1999, Bata was India's largest manufacturer and marketer of footwear products. As on February 08, 2001, the company had a market valuation of Rs. 3.7 bn. For years, Bata's reasonably priced, sturdy footwear had made it one of India's best known brands.

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