America should take careful note of what's happening in the old Locke insulator plant at the foot of the Hanover street bridge here.

Founded in 1893, Locke was the world's first manufacturer of electrical insulators -- ceramic plates used to separate power lines from non-energized metallic parts in electric power plants and substations.

In 1920, General Electric bought out Locke and built a major new plant on the Baltimore waterfront. Continuing to use the Locke name, G.E. was now the world's largest producer of electric insulators.

But a major challenge was al- ready in making, far away and unobserved, in Japan.

The challenge began around the turn of the century when a Japanese electrical engineer visited the United States and took home a sample of a Locke insulator.

The engineer showed the ceramic device to officials of Noritake, a Japanese manufacturer of fine porcelain tableware. Noritake agreed to try making a few copies of the American product.

The copies were so successful Noritake created a subsidiary called Nippon Gaishi Kaishya (Japan Insulator Company), of N.G.K., for short. 

N.G.K. is now the world's largest manufacturer of porcelain insulators, employing 5,000 people in Japan and many more around the world. 

Meanwhile, Lock's fortunes gradually declined. By 1974 the Baltimore plant was losing money, and General Electric was threatening to shut it down for good.

Instead, G.E. sold N.G.K. a controlling 60 percent interest in Locke.

"Locke was our teacher, our ancestor. It was the company that taught us the business," and N.G.K. official said the other day. "So we had a strong feeling about the company, and the idea of rescuing it seemed to make sense."

But the rescue was not to be easily accomplished at a time when worldwide recession was causing a decline in the demand for energy and a corresponding drop in the demand for power plant components.

At first N.G.K. sent over a lone Japanese executive who maintained a relatively low profile here, over-seeing what was still essentially an American-run factory. Locke continued to lose money. 

Then, in 1981, N.G.K. decided on a bolder strategy. To increase productivity and decrease costs, it would try to rebuild Locke from top to bottom according to the Japanese model.

To remake Locke in its own image, N.G.K. sent a new team of aggressive, young Japanese managers, advisers and technicians. They were given three years to succeed. One year remains.

"It is a final bet," Mike Shibata, the new president of Locke Insulators, said the other day. "If we fail, we surrender, close up shop and go home."

Two years after Shibata's arrival, the company is still operating in the red and still fighting for its life in a highly competitive industry in a still-sluggish market.

But there are hopeful signs for Lock's 450 local employees and their foreign managers.

The Japanese have introduced new product lines, brought in some modern Japanese equipment, and aggressively sought and won new contracts.

But they say the biggest and most important challenge lies in increasing the productivity of the American work force.

How are they doing this?

"Our philosophy is the family concept," Shibata says. "The company is like a dad, and the employees are the kids. If the company is growing, then all the kids have a better time. If the company is in trouble, then all the kids pitch in.

"When we came here, the feeling among the workers was us against them, the workers against the company. We have tried to show them that we are all on the same side. We are not enemies."

The practical results of benevolent paternalism have been mixed. On the one hand, the United Electrical Workers have managed to negotiate a new contract with no salary cuts or benefit concessions at a time when union workers elsewhere have not always been so lucky.

And the new philosophy has also led to a reduction in blue-collar layoffs. Layoffs were commonplace before the Japanese took over.

When they have had to cut jobs, the Japanese have trimmed sharply from the top instead, firing or giving early retirement incentives to nearly 70 white-collar employees.

The trade-off for the blue-collar workers has come in the work load.

According to management and union officials and a number of workers interviewed at the plant and elsewhere, almost everyone at Locke is now working harder and, most say, more efficiently.

On the factory floor, for example, workers who have slack time at their specialized tasks are given other jobs to do until they are needed back at their basic posts. Before they were allowed to sit around and wait.

Janitorial work has also been cut by asking workers to help keep their own work areas clean. This request has been dramatically underscored by the Japanese chairman of the board who makes daily rounds picking up cigarette butts from the factory floor.

"The Japanese are out on the floor all the time, so they really know what's going on," said Jim Johnson, president of the union local and a 19-year veteran at Locke. "The G.E. managers would walk through in a three-piece suit maybe once a week. These guys are out here picking up cigarette butts a couple of times a day. And their doors are always open upstairs. Communication is wide open."

I asked Johnson and others if there weren't some workers who are not happy about the extra work load or the foreign managers.

"There are always some problems," the union official said, "but most of us realize that if the Japanese hadn't taken over, we'd all be out of jobs by now. That's the bottom line."

Later, I asked Shibata how he would sum up the Japanese management formula.

"There's no secret formula," he said. "It's all common sense: motivation, loyalty, pride. We learned it all from you."

BPA lets contracts 

Helena (AP) - Bonneville Power Administration says it has awarded contracts totaling almost $26 million for its 157-mile Colstrip transmission lines project between Garrison and Taft (Idaho border). 

The largest contract, for more than $21.1 million, went to Alcoa for aluminum wire. The contract is for two-thirds of the wire -- which the BPA calls "conductor" -- for the project. Reynolds Metals Co. will supply the rest.

The second contract, for more that $3.7 million, was to NGK-Locke for 141,000 insulators -- about 80 percent of those needed for the line. 

The other contract, for $1.1 million, went to Italiasolitori for 31,800 other insulators of another type -- 20 percent of those needed for the line. Earlier, a contract for the other 80 percent of that type of insulator was awarded to another firm.