Fifty is Fantastic

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From the kitchen table to the stratosphere, TTI’s first half-century has been one incredible ride

When Paul Andrews was an electronic components buyer for General Dynamics in Fort Worth, resistors were the toughest item for him to source. When the economic downturn of 1971 bounced him out of the job, he sat in the kitchen he shared with his wife, Judy. He sat with his Rolodex, an invoice book, and $500 worth of inventory, and he cold-called buyers in desperate need of components.

His knowledge and rapport brought business in quickly. His belief that keeping a broad and deep inventory was the best way to support his customers meant the Andrews’ kitchen and dining room became a resistor warehouse for his new company, Tex-Tronics, Inc.

In 1973, he bought an 8,000-square-foot space and launched an enterprise that would redefine the electronic components distribution industry. Today, TTI is the world's leading authorized distributor specialist of passive, connector, electromechanical and discrete components, and an industry intelligence firebrand.

Sadly, Andrews passed away last February, before he could fully celebrate his company’s half-century of success. His legacy lives on in the TTI group of companies: TTI, Inc., online semiconductor catalog pioneer Mouser Electronics, semiconductor supplier Sager Electronics, and recently formed specialty semiconductor services provider Exponential Technology Group.

TTI reached the billion-dollar mark in 2000, and in 2006 caught the eye of Warren Buffett. At the time, Buffett was still wary of tech stocks, but Andrews and the TTI leadership impressed him with their desire to make TTI the best — not the biggest — interconnect, passive, and electromechanical components (IP&E) distributor in the universe. The universe is expanding, and so is TTI.

Today, the Berkshire Hathaway portfolio company employs over 7,300 specialists in 133 locations across five continents: North America, South America, Europe, Asia, and Africa. A leading authorized distributor specialist offering passive, connector, electromechanical and discrete components, their product line includes resistors, capacitors, connectors, discretes, potentiometers, trimmers, magnetic and circuit protection components, wire and cable, wire management, identification products, application tools, and electromechanical devices.

That extensive product line and their innovative supply chain solutions have made TTI the distributor of choice for industrial, military, aerospace, and consumer electronics manufacturers worldwide.

Additionally, TTI is a leading global resource in IP&E technology and market information through their online MarketEYE Research Center. “MarketEYE supplies the most accurate, up-to-date information in the IP&E industry,” said Ashish Bhuskute, TTI’s Senior Vice President and CFO.

From free component-specific articles to technical webcasts and in-depth research reports on passive connectors and electromechanical products from industry experts, MarketEYE offers an unprecedented array of on-demand IP&E market information. In addition, the firm is developing more capabilities in design, connectivity, and R&D.

Their new 45-acre state-of-the-art America’s Distribution Center in Fort Worth features over 600,000 square feet of built space, and capacity exceeding 800,000 square feet of inventory space. Every day, a workforce of more than 500 TTI team members ships more than 800,000 lines of products every day from this facility, which boasts a ceiling height of 32 feet. “We’ve leveraged that vertical space to maximize our inventory storage,” Bhuskute said.

The three levels of carousels in the mezzanine are computer-controlled to bring exactly the right components to the operator. These are placed in bar-coded totes which travel to the correct shipping location over 1.7 miles of conveyors which connect all the various picking order processing consolidation packing and shipping areas. “The Americas distribution center is very well integrated with our distribution centers around the world,” he added.

Adapt, advance, and achieve

TTI’s success isn't limited to being a best-in-class distributor of passive, interconnect, electromechanical, and discrete components, but they have extended their offerings to provide several value-added services. As Bhuskute explained, “TTI, Inc. is registered to ISO 9001:2000 standards and offers a wide range of value-added services such as Packaging, Labelling, Marking, documentation, etc., to our commercial and military customers. All assembly is performed in our state-of-the-art 55,000-square-foot dedicated facility. Our assembly operation has achieved Six Sigma quality performance and maintains lead-times well below the industry average. It is important to note that all of our value-added services are manufacturer authorized.”

TTI doesn’t consider inventory a necessary evil; rather, it’s an enviable advantage that has been central to their 50-year track record of excellence. “We don't just offer our customers the top movers, as some of the competition would,” he added. “Ours is a complete range of inventory, much like a one-stop shop.”

Another reason for their success is the relentless attention to detail, quality, and on-time performance. “We don't chase dollars,” he said. “We chase execution. We go after being the best as opposed to being the biggest. We differentiate ourselves through responsiveness and our aggressiveness in addressing our customers’ needs.”

That drive and conscientiousness has kept TTI an OEM darling over the years. From providing information technology to keeping products they need in stock and creating customized supply chain solutions, TTI is a partner dedicated to relieving their complex pain points and making their work easier.

As a CFO of TTI, Bhuskute relies on several service providers for smooth functioning of Finance, accounting & IT functions. “M&A activity as an instance is supported by our key services providers such as Grant Thornton (M&A/system advisory services), JP Morgan Chase Bank (Supporting US and Asian treasury function), Devensoft (M&A deal management), Avalara (tax) and Credit Risk Monitor (credit services). General ledger is on Oracle and PwC for tax advisory services. Besides this, Susan S, Sr VP of IT relies on technology vendors such as ZILLIANT INCORPORATED for predictive analytics and customer insights, WHITEHAT VIRTUAL TECHNOLOGIES for Citrix managed services to deliver virtual desktops and 8X8 INC for reliable cloud voice services from anywhere and any device.

The View Ahead

Prior to joining TTI, Bhuskute spent 26 years in global manufacturing leadership roles, so we asked him to share some of his insights on the role of CFO during the pandemic. He explained that most CFOs in manufacturing companies were really focused on optimizing inventory levels/freeing up cash in initial stages but now as we are coming out of the pandemic, the CFO role is getting expanded to drive several strategic initiatives such as footprint rationalization/supply chain network optimization, and accelerating M&A activities. Most CFOs are also investing in predictive analytical to enhance their forecast capabilities.

In his view, there is an opportunity to use onshoring and offshoring as a response to continuing disruption. Rather than performing all activities in a single geographic area, he suggests a more even-handed approach. “Companies need to pick their battles. They need to consider leveraging low-cost regions to perform low-value/high-volume subassemblies while retaining the high-value assemblies/manufacturing with high IP risk in their local country,” he said.

“By manufacturing low-value/high-volume subassemblies in low-cost regions, companies can maximize their profits and optimize their supply chain network. They can be more nimble, react fast, and be more dependent on their suppliers rather than trying to manage their local capacity for everything. It’s the perfect way to manage supply chain risk.”

Bhuskute stressed that TTI was a great company prior to its change in ownership, and that event has made it even greater by enhancing how the company operates. “Berkshire Hathaway has one of the world’s highest ethical standards in the way they do business,” he said. “Ours was a union of common mindsets and that's why it made so much sense. They give us a lot of freedom to operate, which is just one reason why we've had such a great success story since they acquired us.”

TTI strives to be considered the world’s preferred IP&E player by customers and suppliers alike, as well as being a home to dedicated, ethical, and hardworking employees who believe in the TTI way of doing things.

The TTI corporate culture is bolted to the core values of teamwork, unity, honesty, integrity, ingenuity, trust, respect, kindness, and compassion. “Because our values are so very people-centric, our culture is as well. We provide opportunities for our people to grow along with the company. I've been amazed and surprised that most times if a person is leaving it’s because they are retiring from TTI.”

Unlike other companies that went through massive restructuring in 2020 due to the pandemic, TTI was able to retain most of their people. “Our employees are people first, employees second, and all our employees regardless of title deserve the same level of respect,” Bhuskute said. Some of his finance department colleagues have evolved along with the company for as many as 30 years and see TTI as a second home as well as a work environment.

“It’s not that great companies make great employees. Great people and employees make companies great, and that is true for TTI,” he added. “Being people-centric and focused on being the best has made us successful.”

We also pay lot of attention to groom our leaders. Mike Morton, CEO of TTI who just completed 43 years with TTI, said, “Our founder, Paul Andrews, made it clear from the beginning that our company’s future leaders would be those who are hard-working and ethical, and who believe in our company. Now it’s my turn to find people with those attributes and develop the leaders of tomorrow, just as he did.”

Bhuskute stated, “Whether you are a first-time job seeker or an experienced professional seeking career opportunity with a growing company in a growing industry, you will likely find an opportunity at TTI that excites you.”