From The Independent
Sir Austin Bide: Industrialist who transformed Glaxo into a world force and then clashed with Thatcher at British Leyland
Sir Austin Bide was the man principally responsible for the transformation of Glaxo from a company best known for its baby foods into a world force in the pharmaceutical industry. During a 40-year career at Glaxo, he created a coherent group from a disorganised collection of companies and, vitally, doubled its expenditure on research. Then, in his late sixties, he was involved as director and later chairman of British Leyland, where he was prevented by an uncharacteristic loss of nerve by Margaret Thatcher from selling the whole group to General Motors, a move which would have saved the British taxpayer uncounted millions of pounds.
Bide’s route to the top was neither easy nor straightforward. He was born in 1915, the son of an artillery officer who was killed at Passchendaele two years later. The family lived in Kensington where regular trips to the Science Museum kindled in the young Bide an early interest in science. As the child of a relatively humble background, university was not an option, and at the age of 17 he went to work as a government scientist. But he spent his evenings and weekends studying for a degree in chemistry at Birkbeck College and Chelsea Polytechnic, and in 1939 he was awarded first-class honours – an unusual achievement for a part-time student. In 1940 he tried to join the Royal Air Force, but was seconded to work for Glaxo as a research chemist at its laboratories in Greenford, west London, where he worked on the synthesis of vitamin B1 and then on the development of penicillin
By 1947, at the age of 32 he had risen to be head of technical research. Four years later, he was entrusted with supervising the construction of a new factory at Montrose in Fife to produce penicillin – where he showed foresight in acquiring an additional 33 acres of land to cope with future extensions. His career took a curious turn when he was appointed first deputy company secretary and then, in 1959, company secretary, in what would normally have been a peaceful corporate backwater. But in that post Bide saw the company’s activities from a head office that was lacking in any coherent control.
His reputation was greatly enhanced by being one of a small group that successfully fought a takeover bid by Beecham, then best known for its pills and products such as Brylcreem, but which also had a flourishing penicillin business. By that time, Glaxo’s chairman was Sir Alan Wilson, a former director of Courtaulds, who had helped fend off an unwelcome bid by ICI. Unfortunately Wilson simply could not cope with the situation and had a nervous breakdown, so the defence was left to a small group of younger executives, among whom Bide played a prominent role.
Fortunately for Glaxo, in 1972 the Monopolies Commission ruled that the takeover would damage Britain’s research efforts into new drugs (though Bide lived long enough to see his company merged not only with Beecham, but also with the American firm Smith Klein). The Commission also ruled against a proposed merger with Boots – at the time Glaxo had a substantial wholesale drugs business that it could have brought to the joint group.
As deputy chairman (from 1971), Bide had already started planning the transformation of the group. His first step had been to merge the group’s numerous wholesalers into a single company and he planned to sell some of Glaxo’s unprofitable subsidiaries.
Bide was the natural candidate for the chairmanship when Wilson retired in 1973. He had worked for the company for more than 30 years, and had wide experience as a research chemist, factory manager and company secretary. He also took over as chief executive, serving in the post until 1980, and as chairman until 1985.
Bide believed in sound administration and disliked the general corporate disorder of Glaxo’s UK subsidiaries, chaos which Wilson had done nothing to sort out. He had already started a process of structural reform by rationalising Glaxo’s technical divisions which followed on from the creation of Glaxo Holdings the previous year.
He then implemented the so-called “Orange Book” in which he had set out his plans, and transformed the structure of a group that had expanded rather haphazardly over several decades into that of a normal business, involving a Group Management Committee with directors responsible for different parts of the group. But he was tactful enough to ensure that the process of centralisation and the instillation of a group culture was not overly brutal so that the goodwill of such well-known subsidiaries as Allen & Hanbury was not dissipated.
Bide could be ruthless, but he was also one of the rare British executives to practise “management by wandering”, notably by informal visits to laboratories to meet the young researchers who were following in his footsteps.
The year before Bide took over as chairman, Glaxo had opened a new pharmacology laboratory which led to the discovery of its most profitable drug, the anti-ulcer treatment Zantac. But during his chairmanship he greatly expanded Glaxo’s research activities – in the 10 years to 1982 they went from 3.8 to 5.8 per cent of the group’s turnover, and produced a steady flow of new drugs.
Bide’s other major contribution lay in instigating Glaxo’s expansion in the United States, where it had previously had only a small sales and marketing organisation. In early 1978, Glaxo took over Meyer’s, a modest family-owned pharmaceutical company based in Florida, at a cost of just £18m. This modest purchase was greeted in the British financial press “with a a sigh of disappointment”, but Bide revealed his strategy – and indeed his whole attitude to business – in a rare interview with The Times: “We thought it sensible to start with a business that was viable ab initio. We did not have the right to be over-venturesome. The US market can be a dangerous place for the unwary.” And indeed, the purchase led to an unimagined expansion in the years following Bide’s chairmanship – largely due to the success of Zantac.
Even before Bide retired as chief executive he had started to take on some outside roles. The first was rather unfortunate, as a director of J Lyons, formerly Britain’s leading caterer, which was in freefall after taking out a disastrous loan in Swiss francs in the early 1970s just as sterling was starting its precipitate descent.
But he was best known as a director and then, from 1984 to 1986, chairman, of Britain’s most expensive industrial casualty, the massive, partially nationalised car manufacturer British Leyland (BL). He arrived in 1977 as part of the clean sweep that brought in Michael Edwardes to try to rescue a group on the verge of meltdown.
Following his success at Glaxo, by then one of Britain’s most successful industrial concerns, Bide was justified – though unwise – in claiming that “my expertise in management is total”. It wasn’t. He was totally unused to coping with the tangled mess of competing trade unions which were such a feature of life at BL. Indeed, at Glaxo, Bide had tried to avoid recognising unions by giving the existing “advisory committees” negotiating rights.
A private, generally unobtrusive personality, he was also unused to the unrelenting glare of publicity which accompanied anyone involved with British Leyland. Edwardes himself was unstinting in his praise of Bide, writing that he “proved to be a tower of strength as we hit problem after problem”, particularly in providing support during Edwardes’ early confrontations with the unions and shop stewards like “Red Robbo”. By the time Edwardes left in 1982, he had greatly improved the situation, albeit at the cost of substantial government support. Even Mrs Thatcher admitted in her memoirs that “there had certainly been improvements. Productivity was up, days lost by strikes were down, losses were down” – though she thought that the management “was still poor”.
Bide believed that his role was “getting BL to the point where someone may want to buy it”. At the end of 1985 he succeeded in persuading General Motors, which really only wanted Jaguar and Land Rover, to take the whole group off the hands of the British taxpayer. But the timing proved fatal. In early 1986 Thatcher was battered by the resignation of Michael Heseltine over selling Westland to the Americans and was unprepared to allow a much larger British group to be sold. Bide was naturally furious and left BL, but before he went he forced Paul Channon, the then Secretary of State for Industry, to admit the true story in the House of Commons
Until his late eighties, Bide was involved in a wide variety of activities: he was a member of the Adam Smith Institute and had an active role at the National Aids Trust. He was also a staunch early supporter of the Open University. His other major concern was the restoration of Salisbury Cathedral – a cause dear to the heart of his friend Edward Heath.
At its zenith, the British Leyland truck and tractor plant in Bathgate, West Lothian, was the biggest single concentration of machine tools in Europe, providing employment for 7,000 men, writes Tam Dalyell. Faced with the horrendous prospect of its closure in the early 1980s, I asked, in my capacity as the constituency MP who had been immersed in the problems of the motor industry for 20 years, to have a private meeting with the BL chairman, Sir Austin Bide.
A quietly spoken man who always chose his words carefully, he was inflexible, absolutely straight and briefed so well that he produced a minute of a meeting that I had had in Longbridge two decades earlier with the crusty boss of Austin, Sir George Harriman. He had told me: “You are a young man and I am an old man. Before you cease to be MP for West Lothian, I tell you that Bathgate will end in tears. We never wanted to move out of the Midlands. We were forced to go by the Cabinet.”
Bide simply said it was economic folly even to imagine that the ancillary industries would move to Scotland, and in an increasingly competitive market, there was now no option but to close the plant. But, unlike some others, Bide did not wash his proverbial hands of the problem. He used his multitudinous contacts to encourage other industries to come to West Lothian, and ensured better redundancy terms than most of us expected. He was a humane capitalist boss.
In later years, I saw a lot of him when he was a regular attender at the Foundation for Science and Technology, which met in the Royal Society premises at Carlton House Terrace, for formal speeches, dinner and discussion on a particular topic. Bide’s contributions were heavyweight, pertinent and always commanded attention. He used to give me a lift back to my Horseferry Road flat in his chauffeur-driven car, and on one late-night occasion told me that the closure of Bathgate had been agonising but necessary. “In the long run, facing reality as soon as possible causes the least hurt.”
Austin Ernest Bide, chemist and industrialist: born 11 September 1915; joined Glaxo 1940, head, Chemical Development and Intellectual Property 1944-54, deputy secretary 1954-59, secretary 1959-65, director 1963-71, deputy chairman 1971-73; chief executive 1973-80,chairman 1973-85, honorary president 1985-95; director, British Leyland 1977-86, deputy chairman 1980-82, non-executive chairman 1982-86; Kt 1980; married 1941 Irene Ward (three daughters); died 11 May 2008.