Another Boat in the Water

Electronic News, August 13, 2001 by Heidi Elliott

Avnet Inc. last week unveiled the second spin-off business unit in its Electronics Marketing group with the formation of Avnet RF & Microwave.

Avnet (nyse: AVT) unveiled its "speed boat" reorganization plan in June. The plan calls for the Phoenix-based company to reorganize its Electronics Marketing operating group into smaller, specialized, product-focused business units, which it calls speedboats: semiconductors, interconnect, passive & electromechanical (IP&E) devices; RF/microwave (wireless) components; and supply-chain services. The company has already moved to organize its European and Asian operations in this manner.

The speedboats will operate independently with their own sales force, field-applications engineers, asset management and profit and loss statements--similar to the structure of the former VEBA companies. They can even make their own acquisitions.

This move comes after Avnet in 1998 announced it would reorganize along customer-centric lines. The company had commissioned a yearlong study of its customers' needs, and customers indicated they wanted a single point of contact with Avnet versus being called on by representatives of then-divisions Hamilton-Hallmark (semiconductors), Time (passive components) and Penstock (RF/microwave).

However, Avnet's growth since then--primarily through acquisition--called for a new plan. "The scope and size of the business has just boomed," Brian Hilton, president of Avnet Electronics Marketing/Global, said of this latest reorganization.

That's certainly true for Avnet's RF and microwave business, which has tripled in size over the course of the last three years, gaining customers and entering new markets.

"We've really grown," said Joel Levine, president of Avnet RF & Microwave. The new business unit includes 44 product lines, a technical sales group, value-added services, including parametric testing, hybrid assembly and design, thin-film assembly services and wireless design services performed by Design Services' Bluetooth lab in Singapore.

Levine has big plans for the unit. "We get to be a specialty distributor with all the resources of a Fortune 500 company behind us," he told Electronic News last week.