The New Fabric of Success

On the floor of the brightly lit factory, Dominican salsa competes with the loud whir of sewing machines. About 200 workers, mostly women, sit at the machines in clusters assembling khaki pants. Their efforts, combined with those of a second shift, will churn out 30,000 pairs of pants today. On a wall above the women hangs a banner embroidered with the mission statement of their employer, Grupo MSA: Vestir al mundo con calidad -- puntada a puntada. To dress the world with quality -- stitch by stitch.

Strolling the wide center aisle amid this flurry of activity is Angel Lorenzo, a shift supervisor. A slight, 30-year-old man with a thin mustache, Lorenzo is effusive not just about his job, but also about his philosophy of work. "My work is my life," he says. "It's the reason that I can support my children and have a home, so I take it very seriously." He gestures toward the machine operators whom he oversees. "My job is to let them know that they are the most important people in this factory," he says. "If they don't do their jobs well, we lose clients -- and nobody prospers. But if we strive to follow the mission and the rules of the company, prosperity follows for everyone."

Lorenzo himself has prospered at Grupo M. He began as a machine operator and soon was promoted to a quality-inspection post. Now, he oversees 14 teams of machine operators, making certain that their work flow is smooth and that jobs are done on time. If his car breaks down, he can take it to the company garage, where it will be fixed for free. He bought that car with money that the company loaned him. When he gets sick, he goes to one of the company clinics for free medical treatment. His two children, now in grade school, once attended day-care facilities built and subsidized by Grupo M.

At another company, or perhaps in another country, or in another business, the benefits that Lorenzo enjoys and the loyalty that he has for his employer would not seem as startling. But consider this: Grupo M is located in the Dominican Republic, a traditionally agricultural Caribbean country where 21% of its almost 8 million people live in poverty, according to World Bank estimates (the U.S. embassy says that the figure is closer to 60%).

Moreover, Grupo M is part of an industry that is notorious for perpetuating labor abuses wherever that industry operates -- mostly in developing nations, but also in the United States. Think of children forced to work in Honduran garment factories, or Thai immigrant workers held captive in squalid conditions in El Monte, California. Since 1995, heightened consumer activism and closer scrutiny from leading apparel brands have sparked improvement, but the garment trade still remains a backwater of largely low-paying, low-skill work.

Since its beginnings in 1986, Grupo M has defied the stereotypes of both its industry and its homeland. Fernando Capellán, Grupo M's founder and president, then a 27-year-old industrial engineer and a pilot, envisioned a business that would be an innovator in the garment industry, a pillar of his hometown of Santiago, and, ultimately, an economic powerhouse for his nation. "When I make decisions, first I think of the company and the people who work for me. But then I think of Santiago," says Capellán, 41. "I'm committed to this town. These are my people; this is where I was born, where I grew up. Some people here think that I am crazy -- that I should take it easier and not invest and grow. But I say, No, that is the wrong way to do it. I think that I have the opportunity to grow this, and to put Santiago on the world map."

By many measures, he has succeeded. Grupo M now operates 26 factories in the Dominican Republic, and, with 13,000 workers, is the country's largest private employer. It is growing 10% to 20% a year, selling $200 million worth of clothing to such companies as Abercrombie & Fitch, Hugo Boss, Levi Strauss, Liz Claiborne, and Tommy Hilfiger.

More impressive is that Grupo M has earned a reputation at home and in the United States as a remarkably progressive employer whose labor practices actually strengthen its business. Last year, the U.S.-based Council on Economic Priorities (a nonprofit watchdog group at the forefront of the antisweatshop movement) gave the company a corporate-conscience award for "empowering employees," grouping the little-known Dominican company with such global multinationals as IBM, KPMG International, and Pfizer.

"We have proven that you don't have to run a factory like a sweatshop in order to be profitable and to grow," Capellán says. "In fact, we believe that we have been able to innovate, to expand, and to do what we have done because of the way that we treat our people. Everything that we give to our workers gets returned to us in terms of efficiency, quality, loyalty, and innovation. It's just smart business."