Czechs Must Remove Communist Cobwebs

SURROUNDED by workers from Vietnam and North Korea, some casually sleeping on tables, Zdenek Vlasek, a top executive with the Skoda auto plant, proudly points at a fancy $7 million British machining line. ``Many people said we bought equipment that was too sophisticated. My feeling is we must go three steps forward and one step back.'' For this line, which inserts the cylinder head into the engine, that meant debugging software with untrained personnel and shutting off equipment when bad auto parts gummed the works.

The result is a highly flexible line that makes different kinds of engines - when it works.

The best and the worst that Eastern European industry has to offer is on display at Skoda Works. Modern equipment functions side by side with outdated machines 30 or 40 years old.

Before World War II, Czechoslovakia was an industrial powerhouse, making everything from cars to glassware. But much has been dimmed by years of neglect and the dusty cobwebs of the communist economic system. Czechoslovakia is marginally more sophisticated than other nations in the region. However, Michelle Siren, an East European specialist with accountants Price Waterhouse in London, says, ``In industry, they are all pretty much in the same boat in physical plant. You're stepping back 40 years.'' Most products are in dire need of improved styling and better manufacture.

Workers at Skoda's stamping shop, where steel sheet is turned into autobodies, operate presses dating back to 1964. As Skoda commemorated a new Canadian press by videotaping its startup, workers grabbed stamped parts and dumped them into a bin.

The paint shop is little better. That is where Skoda assigned 1,600 prison workers who labored under dirty conditions until they were released by the new noncommunist president, Vaclav Havel. Now employees at the paint shop - an unpleasant place - generally are Vietnamese, Cuban, or Korean.

Skoda is hungry to construct more of these lines. But like many Czech companies, it is starved for cash. So it is turning to the West for money by offering to enter into a joint venture. Skoda is demanding that the Skoda name and social system be retained even as the crush of competition filters into the country.

But is that name, or any Czech product, worth holding onto? Emil Viklicky, a Czech composer, complains that his Skoda is not a great car. ``The Lada is better,'' he says, referring to the Soviet-built auto. Even President Havel has admitted that Czechoslovakia ``produces goods of no interest to anyone while we are lacking the things we need.''

Ironically, it is precisely Czechoslovakia's dependence on the Soviet market that has stifled the creation of better products. ``Soviet gas and oil supplies pay for goods like footwear. This creates shortages in the domestic economy. Shortages in the economy means nobody improves style and marketing,'' said Thomas Bata, Czech-born chairman of the Canadian company, Bata Shoes, a visitor here. He was both dismayed and pleased by the state of the industry he helped found before the war.

``In the manufacturing side, a good proportion of the machines are over 50 years old. It's almost miraculous what they have been producing given the equipment they have,'' Bata said.

Management is one area due for a rude shakeup in a restructuring of the economy. For 40 years, Communist Party members got most managerial jobs. Now such appointments are more likely to be based on ability.