Life has changed for Debra Paget in the year and a half since she transferred from the Massachusetts headquarters of Digital Equipment Corp. to the company's computer plant in what people here call Silicon Glen.
"I love the contrast," she says, "between our plant where everything is real advanced, and the little villages all around where life is simple and natural and down to earth. I mean, it's hard to explain to people back home that you may be late driving to work because there were sheep crossing at the roundabout and you have to stop and wait for them to get out of the way."
Paget is one of a relative handful of Americans working in Scotland for Digital Equipment, but the company -- known to Scots and Americans alike as DEC -- is notonly the third-largest computer company in the United States, but also a major employer in the Scottish highlands.
Since IBM set up shop in 1951 in Greenock on the West Coast of Scotland, the country has become populated with American computer companies, which now account for almost three fourths of Scotland's booming computer industry. Once synonymous with heavy industry, Scotland today is in the midst of an economic regeneration, which is making it a world center of the computer industry.
Like the rest of Britain, Scotland suffers from severe problems of unemployment and recession in its traditional industries; only last month, the closing of two more shipyards was announced.
But at the same time Scotland's computer industry is booming. Output has quadrupled since 1980. This rugged and rain-drenched country, once looked on as a poor relation by the English, is today admired throughout Europe for its success in nurturing high-technology industry.
IBM was lured here 35 years ago mainly by financial inducements from the British government and a plentiful supply of skilled labor. The firms that arrived after IBM cite Scotland's education system as the single most important factor in their decision.
"Scotland moved very quickly to recognize the importance of good universities to high technology industries," says Jim Rigby, financial controller of Hewlett-Packard's plant at South Queensferry, near Edinburgh, which opened in 1965.
Scotland, with a population of only 5 million, has five universities, all of them taking a special interest in electronics. It produces more college graduates per capita than any other nation in Western Europe. Its work in advanced high-tech areas such as artificial intelligence is considered to be among the best in the world.
The education-propelled growth dynamic, begun in the 1950s, continues today. "It became a self-fulfilling prophecy," says Llew Avis, human relations manager at National Semiconductor Corp., who came to Greenock in 1970. "The universities were famed for high-tech expertise and highly competent people. Companies arrived, and they began supporting projects at the universities. The universities added more courses, and more students. So there was an even better supply of skilled people."
Today, Silicon Glen -- the 70-mile-wide belt between Ayr and Dundee -- boasts more than 300 electronics companies. With three airports in the belt, it has excellent transportation links to the population centers of Europe and elsewhere. When Shinetsu completes its plant for producing raw silicon, Scotland will have a role in every stage of information-system production, from silicon to microprocessors to components to complete computer systems.
American companies play a crucial role in Silicon Glen. The British government's Scottish Development Agency estimates that 60-odd American companies account for 72 percent of Scotland's electronics revenue. It is as if American industry is repaying a century-old debt it owes to Scotland for the contribution great Scotsmen such as Andrew Carnegie, Thomas Edison and Alexander Graham Bell made to the American industrial revolution.
In the opinion of executives here, the success of the American firms is attributable to good management and, in particular, good industrial relations. IBM Greenock produces personal computers and workstations for export throughout Europe, the Middle East and Africa. Sam MacEwen, communications director at Greenock, says productivity there is as good as at any IBM facility anywhere.
"The competition for workstations produced here," he says, "is from the Far East, and we compare favorably with that."
From the so-called "Red Clyde" labor activism of 1919 to the coal miners strike of 1984-85, Scotland has had a reputation as a hotbed of union militancy. The president of the Scottish Union of Mineworkers, the fiercely eloquent Mick McGahey, remains Britain's most influential Communist. But the experience of the American electronics giants suggests that union militancy is the product of bad management, and not vice versa.
"In 35 years, we've not lost a day in industrial disputes," says MacEwen. IBM has operated a nonunion shop here since 1951. Ten years ago, local union officials demanded a ballot of IBM workers. More than 90 percent voted to maintain the nonunion arrangement.
George Doak assembles computer keyboards at IBM Greenock. Before coming to IBM, he worked at the shipyards and on Chrysler's assembly line. He blames Chrysler management for the appalling state of industrial relations there.
"At Chrysler," he says, "the union was essential. You had to do whatever the foreman told you. If you complained about anything, they'd haul you before a management committee, and you were suspended. Then the union'd meet and you were out on the street i.e., on strike . You spent more time on the street than in the works."
"Here," he says of IBM, "it's on a man-to-man basis. If you get a disagreement, you sort it out with your owm manager. If you want to, you can take it higher. It's what IBM calls the open-door system."
The performance of the electronics firms has done a lot to improve the image of American multinationals in Britain. Jim Manderson, formerly with Hewlett-Packard, has been personnel manager at Digital Equipment's Ayr plant for nine years.
"Both companies' values and philosophies are very similar," he says. "It's provided me, and our people generally, with security and opportunity, and a sense of recognition and caring. All of that is contrary to the traditional American reputation. Before the war, American companies had a reputation of hire and fire."
In a June 3 parliamentary debate on unemployment, Norman Godman, who represents Greenock, made a speech bemoaning the effects of the shipbuilding slump on Greenock. He concluded by telling the House of Commons: "There are one or two bright spots in our area. IBM employs 2,900 people. Every day, I say thank God for that."
"That may sound strange coming from a socialist member of Parliament," Godman explained in an interview, "but in Greenock, where we've got a male unemployment rate of 26 percent and great problems of poverty, IBM is an enormous creator of wealth and jobs. Their attitude towards unions, which I don't agree with, is really the least of my worries."
Electronics executives say the American spirit of individual entrepreneurship is not as easily transplanted as the American style of corporate management.
"Silicon Glen is not Silicon Valley," says Sam MacEwen. "We won't have people setting up in business in their own garages like you do. Americans see risk-taking as a part of life. We Scots tend to be 'canny,' by which we mean careful and cautious. We don't like taking risks."
Llew Avis at National Semiconductor has high praise for Scottish technical innovation. "We invented the Dolby C chip which reduces noise in tape recordings at this plant, and we now export it to Japan," he says proudly. But he notes that in 16 years in Greenock, not one employe has left this 1,000-employe facility to set up his own business. Nevertheless, a network of small companies servicing the multinationals has grown up, auguring well for the future of Silicon Glen.
"When we came here 20 years ago," says Rigby of Hewlett-Packard, "we couldn't get supplier support locally. Now there are toolrooms, printed circuit manufacturers, coil manufacturers and others. It is moving towards becoming a fully integrated industry."
One of the ironies of Silicon Glen is that although it represents just the sort of high-tech industrial regeneration Margaret Thatcher's Conservative government believes in, its success is attributable to state intervention as much as to free enterprise. The three factors most often cited by business executives in their decision to come to Silicon Glen are education, the airports and capital grants -- all government-subsidized.
The grants are administered by the Scottish Development Agency, with a budget of $180 million a year, offices all over Scotland and the world (including four in the United States and one in Tokyo). Equipped with wide powers to expedite local procedures such as planning permission and road construction, the SDA is the closest Britain has to Japan's MITI (Ministry of International Trade and Industry), a state agency with enormous power to influence and direct private sector firms.
"The first breakthrough was the most difficult," says Secretary of State for Scotland Malcolm Rifkind of the computer industry, "and I would certainly accept that the public sector has a key role to play in attracting overseas companies."
Rifkind says special measures have been taken to shield Silicon Glen from the cuts his government has made in education, research and regional budgets. He says the government took steps last year to ensure that all three airports in the region stay open even after their upcoming privatization.
Businessmen foresee the computer boom continuing, but stress that computers alone are not the answer to Scotland's unemployment problem.
"Computers are a tool," says MacEwen, "for use in other industries. We've only just realized that our traditional industries are dead. We're starting now to look elsewhere for opportunities. Other industries, especially the service industries, will have to grow too."