Once a company embarks on a pro-cess of continuous improvement, there is no telling where it will lead. Like a ship that changes course by one degree, it can over time and distance find itself a huge way from where it might have been.

That has major implications for recruitment and training if the company is to have the right skills to hand when it needs them. Two prime examples of such dramatic transformations have occurred in what began as conventional Scottish printing companies - one established in 1860 and the other in only 1983.

Yet neither is recognisable as the business it once was. The one founded 137 years ago has be-come Europe's leading supplier of instrument graphics for car dashboards, moving away from simple printing to high-value printing on new, specialised materials.

Founded by the grandfather of Jack McGavigan who retired only three years ago, it originally produced mainly advertising mat-erial such as posters and show- cards. Now John McGavigan Holdings has a 30% market share in the European automotive industry in Europe and its products are fitted in one in ten of the car types produced around the world (see separate story).

The other has taken the simple label to the limits of hi-tech, producing labels that survive hot-metal soldering - ''invisible labels'' - and is even working on labels with radio frequencies.

Labelgraphics (Glasgow) Ltd, which uses increasingly sophis-ticated filmic-type materials, is now in the middle of a #1.5m expansion which could see its staff numbers increase by al- most 50% by the end of the programme next year.

''What we are looking to is added-value labels, using non-paper filmic materials that are now being developed,'' says managing director Alex Mulvenny. ''We see ourselves moving away from standard paper labels, which will become less and less important.''

The company has expanded its factory space at Clydebank from 18,000sq.ft to 26,000sq.ft to meet increased production and to accommodate developments in leading-edge technology.

These include smart labels, developed by the company, which are invisible to the naked eye. It is also looking at the idea of sec-urity labels the size of a shirt stud, which will have implications for industries like electronics.

It is the company's programme of technological improvements which has taken it from being a two-man business in 1983, with a first month's turnover of only #118, to becoming an increasingly significant employer in Clydebank, whose staff are recruited locally.

Alex Mulvenny has a fierce commitment to the local area and to giving young people opportunities. Six staff who were recruited as 16-year-old school-leavers are now managers with the company, and the average age of the workforce is 25.

''We have decided that we want to be part of the community,'' he says, ''and for people to think of Labelgraphics as a Clydebank company trading on an international basis.''

Continuing technological im-provement has involved continuous staff training. Its workforce is currently 66 - which is 10 more than last year and 20 more than the year before. The number is expected to reach 80 by the time the present expansion programme is complete.

The company handles orders from as little as 500 labels to 50m labels a year for customers which include major electronics, food, drink, catering and pharmaceutical companies. It operates round-the-clock shifts with all the pro- cesses carried out in-house to cut lead times and assure quality. It measures its advantage over competitors in weeks rather than days.

Labelgraphics believes it is essential to have high-calibre staff and to keep them. ''We would certainly hope that the development means we can re-cruit extra staff through generating extra sales,'' says Mr Mulvenny.

Intensive in-house training is carried out on technical and service areas. Every employee is given a copy of the business expansion plan and asked for comments.

''We spend more time on training than any other company I know of a similar size,'' he says. ''With this latest development we asked staff to identify what training they themselves felt they needed as well as what we said they would need. This was done in one-to-one meetings.

''Training is a key thing. We have just been awarded Investor in People status. It is on-going - we train staff on a regular basis.''

Labelgraphics' expansion was funded from company profits with assistance from the Scottish Office, Bank of Scotland and Dun- bartonshire Enterprise, which has also helped to provide grants for management and staff training.

In the near future labels could also act as valuable tracking devices for manufacturers - by listing all source suppliers for different parts of manufacture. Eventually, labels could carry a radio frequency so that the arrival of components or products could be signalled electronically, or set other machinery in motion.

Labelgraphics already supplies bar-code labels capable of withstanding the high temperatures needed for wave soldering used in assembling printed circuit boards. These innovative labels were developed by the international manufacturer 3M, with which Labelgraphics has associate company status.

''We are looking to develop new materials in partnership with 3M, with which we do a lot of work,'' says Mr Mulvenny. ''If we have customers looking for special materials, we often take 3M with us to advise such customers.''

The labels allow the manufacturer to identify individual PCBs throughout the production pro-cess, and the bar-code system allows details of the boards and their components to be stored. They open up the possibility of identifying boards and smaller components in production pro-cesses through to installation.

''We are in the middle of our expansion at the moment,'' he says. ''It is bringing us the latest technology, keeping us at the forefront of the label market. We want to be a company that leads rather than is led. That has always been our philosophy.''