Cutting it as an enterprising shirtmaker in China

When Bu Xinsheng began broadcasting the company song to his workers five years ago, some people said it smacked of capitalism. ``Working thoughtfully, blazing new trails to beautify people's lives, we devote our every thought,'' goes the song's first verse. It is sung every morning over the factory's public address system by the Haiyan Shirt Corporation's Art Troupe.

Looking back on that criticism, it is apparent that the company song was only one of a long list of controversial innovations in Mr. Bu's management of a rural shirt factory.

His innovations demonstrate the kind of entrepreneurial skill that senior leader Deng Xiaoping has been trying to coax out of his countrymen for seven years.

But Bu's success has not come without problems. The difficulties began when he conducted a frontal assault on the ``big pot'' system in which everyone had shared benefits regardless of individual productivity. Among the most serious criticisms was that he had become an industrial tyrant, setting strict rules that prohibited eating, sleeping, whistling, reading, or conducting personal business at work. Bu also used wage incentives to reward the diligent and punish the lazy.

Bu also fired six of his 1,000 employees, something unheard of since before the communist victory in 1949.

As factory manager, he received death threats from some workers, and he was attacked in the local Communist Party press. His attempts to put Peking's reforms into practice were almost blocked.

But Bu survived the controversy because he had been a careful student of government directives and he achieved quick results. He also received strong support from Peking. On more than one occasion, Bu said, Communist Party General Secretary Hu Yaobang came to his rescue and saved him from ``terrible pressure.''

Now the Haiyan Shirt Factory is a stop on the provincial tour of model enterprises, and Premier Zhao Ziyang made an inspection visit last month.

But Bu admitted recently that, after reaping a harvest of early profits and political smiles, he faces new problems. He expanded too fast last year and became financially overextended. He is looking for a foreign business partner to help him find new export markets and pay off loans from the People's Bank of China.

Meanwhile, he has lost none of his energy and outspokenness. He pointed out to Premier Zhao that his taxes were too high and that the government's tax policy on workers' bonuses was a disincentive to rural enterprises.

Bu's well-kept cutting and sewing workshops can be found in the region along the southern shore of Hangzhou Bay between the provincial capital of Hangzhou and the East China Sea. It is one of the most prosperous regions in all of rural China.

One-quarter of Zhejiang's rural work force of 19 million is employed in industry. Out of some 100,000 rural factories in the province, 1,000 are producing goods for export, officials say.

Other provinces may be equally well-endowed with bold managers and those willing to take business risks. Nearby Jiangsu, for instance, is China's wealthiest province. But as one of the smallest provinces, Zhejiang is accomplishing much that has not been achieved elsewhere. Perhaps it is the pride of craftsmanship that took root here several thousand years ago among the Hangzhou silk producers that has survived the post-1949 depredations of proletarian consciousness. Zhejiang is also adjacent to Shanghai, China's largest industrial center -- though local residents insist that Zhejiang is more of benefit to Shanghai than the other way around. Rural residents are not permitted to move to the city, but unemployed urban workers come to Zhejiang to live.

Down the road from Bu's workshops is another model rural industry, this one manufacturing high-quality pipe couplings that are exported to the United States.

The pattern of success is similar: The couplings factory started its economic take-off a few years after Peking permitted greater management flexibility in the late '70s. In this case, much of the credit goes to Lu Guanqiu, a former bicycle repairman who accepted a five-year contract to manage the township-owned business in 1983. His success has gotten front-page publicity in the national party newspaper, the People's Daily. One noteworthy problem: His bonus for the past two years was too big. At 5 percent of the company's profit, the bonus came to some $78,000 in 1985. In a meeting with the press, Mr. Lu explained why he didn't take the cash.

``I want my people to work hard. But if they see me earning a lot more than they do, they would lose their sense of being owners of the factory, and what I say as factory manager wouldn't stick,'' he said. He said he hadn't expected the bonuses to be so large when he signed the management contract.

China has moved away from being a radically egalitarian society, but there are as yet unwritten limits on income. Although factory manager Lu could legally have kept his bonus, it would have been socially and politically imprudent (or indiscreet) for him to do so.

``As I see it, if the production of a factory is expanding, and workers are satisfied, it's OK for there to be a disparity. The best paid should be about three times more than the worst paid,'' Lu said.

In his factory, he added, the ``worst paid'' worker last year received 800 yuan and the best paid 2,000 yuan.