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Tech Data thinks small to regain passion

Chairman Steve Raymund is working to create an environment that makes the vast company act like an upstart.

By HELEN HUNTLEY
Published April 13, 2006

Tampa Bay's biggest company has "lost the passion" and needs to overhaul its corporate culture, Tech Data Corp. chairman Steve Raymund said Wednesday.

"As we've gotten bigger and a little more bureaucratic, we've lost some of that winning spirit," Raymund said. "We've lost the passion for being the best and having accountability."

With more than $20-billion in revenue, the computer products distributor is by far the largest company headquartered in the Tampa Bay area. The company is No. 107 on the Fortune 500 list and has nearly 8,000 employees. But Raymund said being big isn't enough.

"We believe the best companies have a distinctive culture without which they wouldn't be as successful," he said, citing Southwest Airlines and Jabil Circuit Inc. as examples. Raymund is a director of Jabil Circuit, a St. Petersburg electronics manufacturer with $7.5-billion in revenue last year.

Raymund said Tech Data is embarking on a campaign to build what he calls a distinctive "winning culture."

He said the campaign will be modeled after the lean principles that guide Toyota's production systems. A major goal is improving areas of waste and inefficiency, he said.

"We are undertaking a complete renovation of our culture," he said in a speech to business community supporters of the YMCA of Greater St. Petersburg.

Raymund said the culture he hopes the company can create will emphasize integrity, respect, teamwork, honoring commitments, forming partnerships with customers and suppliers, coming up with solutions instead of making excuses, and creating an environment of continuous improvement.

How will it be done? Raymund said communication will be the first step. Important principles will be stressed in posters and printed on employee identification badges. Managers will get coaching in the principles, which will become a basis for employee evaluations, he said.

Tech Data's financial performance could use a spark. Although revenues rose 3.8 percent last fiscal year, net income was down 83.6 percent, in large part because of restructuring costs for European operations. The company operates on a gross profit margin of about 5 percent, so even a small percentage improvement has the potential to create a big effect.

Raymund, 50, has effectively led the company founded by his father since 1982. Although chairman and chief executive, he has said he plans to give up the CEO role when a successor is chosen.

"I want to stay involved in the company. But I'm getting fatigued, and I want to do other things with my life," he said last month.

Helen Huntley can be reached at hhuntley@sptimes.com or 727 893-8230.

[Last modified April 13, 2006, 00:52:17]