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In record 2nd quarter, Tech Data CEO Dutkowsky credits company staying nimble

JIM DAMASKE and CARRIE PRATT   |   Times (2007 and 2006)
In talking about his company’s record second quarter, Bob Dutkowsky, CEO of Tech Data, says having a team of competent people is a factor in its success.

JIM DAMASKE and CARRIE PRATT | Times (2007 and 2006) In talking about his company’s record second quarter, Bob Dutkowsky, CEO of Tech Data, says having a team of competent people is a factor in its success.

Bob Dutkowsky, CEO of Clearwater's Tech Data Corp., was flying high Thursday on news the giant technology distributor — one of the largest companies based in Florida — just recorded the biggest second-quarter profit in its 35 years. On quarterly sales of nearly $5.5 billion, Tech Data earned $40.9 million in an industry with cutthroat competition and thin margins. But Dutkowsky, 55, has more than company performance to beam about. He sees an improving economy. And he has a specific message to Floridians who, day to day, wrestle with a still-troubled local economy. Things will get better, says Dutkowsky, whose company ranks 109 on this year's Fortune 500 list of the largest U.S. corporations. He spoke to the Times on Thursday afternoon.

Selling $5.5 billion of technology in three months?

Yes. That's a lot of laptops, printers, servers, storage, networks and software. We did well across a broad spectrum of products.

And this success was spread across your international markets?

Both the Americas and Europe had strong quarters. More important, while sales were up 6 percent, profitability increased 22 percent. Any company that can grow profits faster than sales means you are selling more higher-profit things and less lower-profit things. You seldom see that in companies of our size.

Isn't there a rule of business that a boom in IT (information technology) spending sets the stage for an economic surge and more hiring?

When companies are on the downside, they delay IT spending. That's when tech companies spend more on R&D to create new products. When business perks up, there are more new products to buy. It's called a "technology refresh."

So what's different this time?

We have not yet seen widespread hiring. Why do companies buy technology? To make their people more productive. It's an investment a company can make to existing work forces to work better and faster. There is some job creation elsewhere. Just not in Florida yet.

What is it about the Florida economy?

Tech Data does business in 100 countries. Some of those countries are doing better than others. As I travel, I see the economy here in Florida is as slow as any place I have been to in the world. Florida's economy went deeper down and has a bigger hole to dig out of.

You still sound bullish …

Let's say I am buoyed by our results. We've had a string of good, solid quarters for two years. That's a validation that our company's strategies are correct ones.

So what makes Tech Data so successful?

Our 8,000 people (1,500 in Clearwater). I call them domain experts because they really understand this business. You can't bluff your way to success. The No. 1 skill today is competence. Tech Data is jammed with competent people who work well as a team. And that's good for the Tampa Bay environment.

Is that all?

We must stay nimble. Look at the companies that exited IT space. Sun. Compaq. Wang. Digital Equipment Corp. McAfee (bought Thursday by Intel). They were all not nimble enough.

What new tech products do you see coming down the pike that Tech Data will sell?

We used to not sell flat-screen TVs and now we sell hundreds of thousands of them, and 3-D TVs are coming on strong in time for the holidays. We're looking ahead to the Windows operating system software for cell phones — the Windows 7 for smart phones, if you will. New tablets and more competition for iPads.

You know the beauty of IT? It gets refreshed every 90 days. What we were selling a year ago is not even on our shelves now.

Robert Trigaux can be reached at trigaux@sptimes.com.

In record 2nd quarter, Tech Data CEO Dutkowsky credits company staying nimble 08/19/10 [Last modified: Friday, August 20, 2010 5:43pm]
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