The visible hand in Tempo Doeloe: the culture of management and the organization of business in Java's colonial sugar industry

Abstract

This article develops an argument about the business culture and managerial organization of the colonial Indonesian sugar industry. It argues that developments in both spheres during the third quarter of the nineteenth century — largely ignored in the relevant research literature — played an appreciable role in assuring the industry's survival in the crisis conditions of the 1880s, when the world price of sugar fell dramatically. An important explanation of such changes, it will be suggested, is to be found in the technological progress which took place in some sectors of the industry from the 1840s onward. This development, delineated here in terms of a “colonization” of the sugar factory or fabriek, began to set the industry apart from the dominant colonial socio-cultural environment in which it was situated, and to prefigure an ethos more commonly associated with the final decades of Dutch colonial rule in the Indies. A nascent business culture was paralleled, moreover, by changes to the ways in which both the fabriek itself and the industry in general were run — changes which pointed to the early growth of a specifically managerial type of enterprise within an industry where such developments have usually been allocated to the closing decades rather than the third quarter of the nineteenth century. Taken together, as will be argued, the two developments — however embryonic — formed one of the foundations which enabled the colonial sugar industry to survive a perìod of severe crisis in the mid-1880s and resume a vigorous expansion by the century's end.