If, as the company's corporate advertising campaign demands, you have been watching Borg-Warner Corp., you know that the company seems to be defying the trend of the times.

If you haven't given the company a second glance, here's what you've missed: record second-quarter sales and earnings and record first-half sales and earnings, announced last week. And this despite the fact that Borg-Warner's image is as a supplier of parts to the auto industry--not the best position these days.

But look again. Although Borg-Warner still makes auto parts and other industrial equipment, over the past few years it has been moving strongly into service businesses as well. Wells Fargo armored car and alarm services and Burns security guards are part of Borg-Warner, and Borg-Warner Acceptance Corp. is the 12th largest independent finance company in the nation.

In all, service operations account for about half of the company's revenues, which totaled $2.8 billion last year, and have buoyed the company's profits at a time when earnings from Borg-Warner's automotive and industrial businesses are being hurt by the faltering economy.

"They still perceive us as an automotive supplier and wonder why we're not having trouble like the other companies," said James F. Bere, the company's chairman and architect of the move into service businesses. "But we're not really an automotive supplier."

Even to the extent that Borg-Warner still is in the auto parts and industrial equipment business, it has had the benefit of some lucky coincidence: the hot-selling Pontiac Firebird and Chevrolet Camaro just happen to feature automatic transmissions made by Borg-Warner, for instance.

"That's what I call luck, that we were on a product that the consumers wanted to buy," Bere said.

Borg-Warner's transformation into a services company has been going on for about a decade, since a management evaluation of the company's business found that "we were highly cyclical, that we would always be vulnerable," Bere recalled. What's more, the up side of the cycle in the auto parts business wasn't so hot, either. "We didn't have the luxury of a high peak in the upturn," Bere said.

In case Borg-Warner management wasn't sure it made the right decision, it got confirmation when the 1974-75 recession knocked earnings for a loop. "We had a very vivid example, a living example, of the company in that period," said James R. Deters, the company's vice president and controller.

The result was a stringent cash-management program that Borg-Warner officials credit with continuing to be a boon to the company, divestiture of a number of marginal operations, and a commitment to move into service fields. "One of the great advantages of service businesses is that they are not cyclical," Bere says.

Borg-Warner's management didn't have to look very far to find their first service company. Borg-Warner Acceptance Corp. had been founded in 1953 to provide financing to purchasers of the company's own products--which at the time included Norge appliances, which was later sold. It then gradually expanded into outside financing as well.

BWAC now provides financing for everything from television sets to band instruments to airliners, and also has diversified into insurance. Last year it earned $30.7 million, a 19.5 percent increase from 1980.

At a time when bankruptcies are on the rise and bills are being paid later than ever, BWAC is thriving, Borg-Warner officials say, because of care in selecting markets and customers. Using a philosophy it calls "niche marketing," it restricts its operations to towns and cities with populations smaller than 200,000, which gives it more control over its operations. It also imposes strict controls over retailers who offer BWAC financing to their customers. "Our delinquency has not been that high," Bere says.

Still, he says, BWAC has had to cover declines in volume and sustain growth by expanding aggressively, lately into snowmobile and marine financing. And Bere concedes that BWAC's success could be jeopardized if the economy got severely worse, putting more economic pressure on its customers. "If we had a series of large companies going bankrupt, we'd have some troubles," he said.

Borg-Warner looked outside for its other major services acquisitions. Bere acknowledged that the search for additional services companies was not based on very exacting criteria beyond financial quality. "The fact that it manifested itself in a Baker, or in a Burns, was because they were available," he says.

Baker Industries, the parent of Wells Fargo acquired five years ago, put Borg-Warner into the protective services business, which just happened to be on the verge of explosive growth, in part, ironically, because a faltering economy makes people more aware of security. As the economy goes down, the crime rate goes up--and so do profits of protective services firms.

Last year, Baker and the rest of the company's protective services group--which includes Wells Fargo alarm, guard and armored car services, Pony Express courier services, an industrial fire protection unit, and now Burns Security, enjoyed a 24 percent increase in revenues and a 51 percent rise in earnings.

Borg-Warner has diversified further in an unusual manner. It has taken minority interests in Hughes Tool Co. and Echlin Inc. that are large enough--18.4 percent and 21.9 percent of the companies' stock, respectively--that Borg-Warner can count those companies' earnings on its balance sheet, but not so large that the company has to manage them. The company has said it has no intention of taking control of either Hughes, an oil well service company, or Echlin, an auto parts firm. The investments have paid off well for Borg-Warner.

The company also has benefitted from good fortune in its traditional businesses. While the automotive parts business generally has followed the domestic auto industry into a chasm, Borg-Warner has found a couple of bright spots. In addition to the transmission for the Firebird and Camaro, for example, the company makes equipment for front-wheel-drive systems, rapidly becoming standard on domestic automobiles.

The company also has been lucky in additional sectors of some otherwise ailing businesses. While the recession has chilled its residential air conditioning operation, its commercial air conditioning business is doing well. "There's one business, but two components--one bad, but the other offsetting it," Deters said.

Borg-Warner executives also credit much of the company's success to an aggressive cash- and asset-management program at the divisional level.

"You can only have decentralization if you have a control system that can tell you where you've been and where you are now," he said.

This cash- and asset-management philosophy also grew from necessity during the 1974-75 recession, when money was tight. Over the next few years, it fueled growth that outpaced the economy, and it has minimized the company's need to look outside for funds. Bere is critical of companies that have borrowed heavily, saying it tends to lead to sloppy management with less attention to cash controls.

Borg-Warner has won high praise on Wall Street, where it has remained on many "buy" lists while brokers are putting "sell" recommendations on other auto-based conglomerates. Most analysts cite the company's management quality and diversity--particularly its service acquisitions--for the high rating.

But for all of the company's luck in acquisitions and managing its resources, perhaps the luckiest move in the past few years is the one it didn't make. Bere kids that a still-wounded ego makes him reluctant to talk about the company's abortive attempt to acquire Firestone Tire & Rubber Co. in 1978, but he will say, "I'm glad we did not make it, because we would have been in something we didn't want to be in."