Roy Vallee

It's possible that Roy Vallee has spent more time creating value in the technology distribution space than anyone in history. The chairman and CEO of Avnet just celebrated his 30th year with the Phoenix-based company and is in his 36th year in distribution. He's grown Avnet into a $15 billion channel behemoth, leading it through the dot-com bubble to become the most valuable distributor on Wall Street. He's also served as chairman of the Global Technology Distribution Council and, as a longtime member of the GTDC's executive committee, he's championed the channel to manufacturers and set the vision for the IT supply chain around the world.

All this from a 20-something kid who only planned to stay at Avnet for five years.

Vallee began his career in 1971 stocking shelves for an electronics distributor. A few years later, he joined Avnet, but always planned to leave to start his own business. But over the last 30 years, he really has made Avnet his own business.

"We have evolved from a relatively immature wholesaler to a company that is literally vital to the technology supply chain, one that's known for an ability to manage the complexity within the global technology supply chain," Vallee said.

Vallee, as well as many friends and colleagues, point to a single moment in the late 1980s as the beginning of his career. It was a meeting of more than 200 Motorola and Avnet employees soon after then-Motorola-CEO Leon Machiz took over Avnet. Both companies were looking to improve a floundering relationship.

Vallee and his Motorola counterpart made presentations. After Vallee was finished, Machiz leaned over to ex-Motorola executive Chuck Thompson and said he wished he had more employees like Vallee.

"I said, 'He is your guy. He's your area manager in Orange County,' " Thompson recalled.. "Within a few months, Leon promoted Roy to head up Avnet's computer products unit. His recommendations [for Motorola] were implemented and we never looked back. Timing's everything," said Thompson, who retired in 1996.

"I've told that story 1,000 times over the years," laughed Thompson recently, when asked to tell it for the 1,001st time. "It's been fun watching his career. Two things you can't teach people are to be smart and honest. He's both of those things."

An hour before his induction into the CRN Industry Hall of Fame at the Mandalay Bay hotel in Las Vegas May 22, Vallee smiled when he recalled the meeting. "After that, I got called into a meeting with Leon. I thought he might promote me within the components business. After an hour, he said, 'How'd you like to run the computer business?' It was a huge shock to me. It was like three levels of promotion," Vallee said. "My knee-jerk reaction was the business was struggling, have you thought of hiring someone from the computer industry? His response was, 'You can hire someone.' "

But Vallee's success at Avnet is measured by more than stories. The distributor has grown more than 150 percent since he became CEO in 1998. "Take a look at what he's done for the employees, for the customers, and for the shareholders. I give him an 'A' in all those areas," said Harvey Najim, president and CEO of Sirius Computer Solutions, a San Antonio-based solution provider. "The CEO is instrumental in articulating what the core values are of any company, then walking the talk."

Avnet's market capitalization now is nearly $6.5 billion, the highest among IT distributors, and up from $1.2 billion when Vallee took over. The market cap and stock price recently hit all-time highs. Avnet's performance over the past several years, considering its market, has been remarkable, said Jeff Weiss, director and founder of the Center of Corporate Innovation, a Los Angeles-based services and consultancy for CEOs and senior executives.

"Computer and component distribution is probably the toughest industry there is. The market hasn't valued it highly. If you look at what he's done at Avnet, all the acquisitions, the research says most don't work. Almost all of his do brilliantly. He's ridden out two industry recessions that have shaken up the management of most firms. I can't think of another company that has gone through all the transactions, the ups and downs of the market, and really not missed a beat. He's been an execution machine all the way through."

Vallee is respectfully referred to as "The Senator" among distribution's elite executives and is painted by friends and colleagues as a genuine, well-spoken CEO who fosters great loyalty through his ability to both devise and execute complex plans.

"Roy is the consummate pro as far as I'm concerned. He reflects a level of professionalism to a degree that any company and any board of directors would want in an executive," said Greg Spierkel, chairman and CEO of distributor Ingram Micro and fellow member of the GTDC.

Next: Avnet's Distribution Growth

"There's some real genuineness about Roy. I've only been with the company about 14 weeks, but I have yet to see a negative ego. I see a man that's willing to have a dialogue. He'll debate with you, but he genuinely asks for input," said John Paget, global president of Avnet Technology Solutions. A former distributor CEO himself at Access Distribution, Paget knows how difficult it is to balance business strategy with economic feasibility, all while getting suppliers, customers and employees to buy into your vision. Vallee has excelled in that regard, Paget said.

Vallee's corporate accomplishments belie humble beginnings. His grandfather moved from Canada to operate a farm in Sturbridge, Mass., until the the Massachusetts Turnpike was built over it. Vallee was born in nearby Southbridge, Mass., a small, blue-collar French-Canadian enclave, but the family moved to Southern California when he was very young. On the West Coast, his father worked in a Sears-Roebuck warehouse and Roy enrolled in a trade school to study electronics technology. During a recruiting fair his senior year, Vallee met a salesman from Radio Products Sales, and took an immediate interest. "After four years of studying technology, I was not sure I wanted to become an engineer. This sales thing sounded better than engineering," he said.

Now after 30 years, it's no surprise that Vallee is preparing the company for a future after him.

"I feel like being the CEO of a public company is like a relay race. I took the baton from somebody and I will hand it off as well. The thing I have to ask is, are we further ahead or behind by the time I finish my length? I feel good about the culture and the momentum in the marketplace," he said. "It's healthy for corporations to have some amount of turnover at the CEO level. I don't believe it's healthy in two- or even five-year segments. When someone walks into a multibillion and global company, it takes a while to get things oriented the way you want. Too short is not good, but too long is in danger of becoming parochial.You get married to past ideas because we started them."

Vallee's leg of the relay race took the company global. His successor should go for intergalactic, Vallee joked.

"I look at projects we're involved in, I look at the global market for those products, I see an industry that has crossed over the $1 trillion mark last year," he said. "The growth rate has slowed, granted, but it still looks like an industry growing 7 percent a year. The vision I have is to continue expanding our share of that market. I don't think of it as only the distributor market, but expanding our share of the total market. There's geography, services, customer dimensions we're expanding."

It's enough to keep somebody busy for another 30 years.