Tag Archives: avnet inc

The Circuit Tempe will feature indoor and outdoor spaces designed for efficiency, density and collaboration.

Designated Drivers: Design Guides Corporate Real Estate

Americans between the ages of 25 and 54 spend nearly nine hours a day at work or on related activities, according to the most recent Bureau of Labor Statistics’ “American Time Use Survey.” With 260 potential work days (or 2,340 hours) in a year, that’s a lot of time spent in the office. Leisure activities, on the other hand, clock in around 912 annual hours. Even with the amount of telecommuting in the corporate world, the functionality and appeal of corporate headquarters or satellite offices still matter.

This is where corporate real estate professionals — and CoreNet Global — come into play. Michelle Anderson, director of planning and development for Avnet Inc.’s corporate real estate, which includes about 400KSF of office space in Arizona, has tracked technology’s influence on Avnet’s offices. Like many other planners in corporate real estate, she is tasked with finding the balance between the financial pressures coming from the CFO and modern demands of a changing workforce and workplace. The types of buildings and upgrades necessary for labor- and cost-effective offices are not always the cheapest, though there is some consensus among the types of changes that yield the highest returns on investment.

“I would say the entire package of technology, furniture and finishes can be a good investment in the long run, depending on the type of efficiencies you are trying to achieve, space, environmental, or updating functionality,” says Anderson. “The focus should be to think flexible and keep in touch with what will come.”

New workspaces mean a new workplace mentality. The key is alignment, says Anderson.

“The workers’ demands and Avnet strategic goals can be at odds at times,” she says. “The most efficient way to navigate through those waters is through gaining trust and aligning with leadership directive and continually providing quality spaces that influence employees in a positive way.

“People understand the goal of cost savings with more efficient design. However, coupled with added amenities, vibrant spaces and more choices of working adds the energy and buzz required for success.”

There isn’t one formula for success.

“It depends on the company culture and what they want out of the real estate,” says John Pierson, JLL managing director for corporate office users. Pierson says, some tenants, like Aetna at Cotton Center, move into a space that isn’t known for its amenities, but for the lower cost option. Many clients he has toured are more concerned about the age of mechanical systems, maintenance costs and healthy work environments, than creating the live, work, play environment.

“The most humbling experience for me has been ‘if you build it, they may not come,’” says Anderson. “In terms of  designing and developing touch down and collaboration spaces this has been a work in progress. All of the furniture case studies, human physiology studies around space design and thoughtful evaluation of workspace strategies does not always equal success. What we have learned is that understanding the organizational culture even within each location can vary significantly, creative engagement and very well thought out space organizational planning and feedback from users has led us to a much higher success rate in these important spaces.”

Avnet, Anderson says, tracks revenue generation per employee as a key metric at each site. She says this allows the company to see individual performance increase with new space delivery.

In 2003, Avnet had a 29KSF office space designed with large individual workstations, 250SF to 300SF private executive offices at the exterior windows and small conference and break areas with the ratio of occupied space around 263SF per person, according to Anderson. Nine years later, that same space has benching workstations, relocated and reduced private offices that were about 100SF smaller. Additional changes included open and closed conference areas, mobile furniture, high-end audio-visual equipment, vibrant color schemes and company-provided snacks.

“The result was a space for ‘heads down’ work that also included many spaces conducive to break out and collaborating or individual privacy zones as well as achieving our real estate goal for reducing occupancy cost by 48.4 percent,” says Anderson. “By reducing the square footage per person number from 263 to 163 eliminated the need to add space to Avnet’s portfolio.”


Centrica delivers an excess of 100KSF of class-A office expandable to 140KSF.

Centrica delivers an excess of 100KSF of class-A office expandable to 140KSF.

Productive State of Mind

Companies have differing opinions on investments’ returns.

“Investing in features that improve employee well-being is money well spent,” Anderson says. “I would also add that updated finishes will add that wow factor to even to the most skeptical worker. There is not one person who is not influenced in some small way by their surroundings. We at Avnet look at total occupancy cost to drive performance improvement and lower real estate cost.”

Springing for a LEED building has been linked to a spike in productivity and fewer sick days, Pierson says. That’s one reason, Pierson says, older building constructed in the ‘80s are having a harder time getting tenants, in addition to parking ratios and outdated mechanical systems.


“Every time Phoenix builds a new building, it leases up in a heartbeat. As long as it’s cost effective, they’ll make that run,” he says.

This has led to more retrofits, particularly in the hot East Valley submarkets. In Mesa, Centrica is getting speculatively converted to a LEED standard.

“If I was a landlord,” says Pierson, “I’d gut [an old building] and open it up and makes sure it feels open. A lot of [landlords] don’t have the vision.”

This vision is a growing asset for attracting many corporate tenants who want to retain employees and save money on training as well as development of a corporate culture. It comes down to a balance between the CFO and human resources team, says Pierson. The CFO wants to lower costs and the HR team wants an environment that retains employees.

“It’s very individual for each company,” he says. “Infusionsoft in Chandler decided to buy a two-story building, cut out an 8KSF center and put in a football field but still pay for the 8KSF they removed. It’s something an Aetna would say ‘no’ to. It’s a cultural decision.”

“A lot of the big corporate users like Aetna are very involved with the CoreNets of the world and are up to date…the reality is you’re a public company and even a GoDaddy doesn’t go in and go to the extreme of an InfusionSoft,” says Pierson. “They don’t just do things that make everyone feels part of the dot com era. People got nervous when they feel like you’re wasting money.”

The tighter the workforce gets, the more competition it will bring out of employers, says Pierson.

“You’ll either pay them more or provide an environment they’ll appreciate more,” he says, citing that Silicon Valley Bank moved into Hayden Ferry Lakeside but is paying higher wages in a class-A environment. He said companies in the market are also offering perks such as aggressive stock purchase plans, which has caused retention rates to increase. Sometimes it has nothing to do with the facilities, he says. It’s about work environment.

Corporate campus

Wells Fargo is doubling its campus footprint in Chandler and initiating Workplace 2020 for its new buildings. The program is a partnership between Corporate Properties Group and Technology Operations Group that focuses on keeping workplaces efficient and effective through “enhanced experience, innovative space and right place.”

“Ultimately, we want to deliver space and technology solutions to meet team members’ needs and enable them to be even more successful,” says Leo Bauman, Wells Fargo vice president and manager of Corporate Properties Group. “Unlike the traditional office environment, Workplace 2020 stresses the importance of flexibility and choice, allowing you to seek out the environment that fits the type of work you need to do – from collaboration and meetings to head-down work and confidential conversations.”

Technology is changing the furniture landscape, says Jennifer Callahan, sales representative at KnollStudio.

“It is critical that [corporate end users’] investment in office furniture is able to support the ever evolving and changing technology,” says Callahan. “A simple example is having USB power accessible in workstation panels and ensuring that furniture is not too dedicated and inflexible to allow for the technology changes that we may not know about today.  The space needs to be able to evolve as technology morphs.”

Wells Fargo, as well as the new 2MSF State Farm campus to be located at Tempe’s Marina Heights, are among a minority of companies taking on the corporate campus model in Phoenix.

“While the Phoenix market is not made up of many headquarter locations that take space in a traditional corporate campus, we are finding end users seeking the types of amenities offered by a campus environment,” says Gensler Principal Beth Harmon-Vaughan. “The repositioning of properties such as The Circuit and 1665 W. Alameda, both in Tempe, are embracing this trend to provide creative, amenity-rich environments focused on the priorities of end users.”

This is also affected by a shift in distributed team work, adds Callahan.

“People are collaborating across geographies,” says Callahan. “We are all not in the same office. Even if we are, it doesn’t mean that we are always working in the physical office space. As employees become more mobile and teams are more distributed, it becomes important for the furniture to be flexible enough to allow distributed teams to come together.”

Office inefficiencies, such as inflexible workspaces, can cost corporate end users the most in the long run, says Callahan. This is particularly important for companies looking to reduce corporate travel costs through the use of technology.

“(GoTo meeting and Skype) are innovative ways that companies are working to drive out costs yet support their employees’ needs. It is imperative that employees have a physical space that gives them the ability to use these technologies,” says Callahan. “Collaboration fosters innovation, so having all these tools available not only reduces costs, but it can drive to innovation and breakthroughs that will be the life blood of the company,” adds Callahan.

For corporate end users looking for creative office, Harmon-Vaughan says the “most effective office environments are those which focus on the spaces with the greatest meaning to the organization’s culture and specific employee group.”

“The demands of new generations of workers are continuing to change the paradigm of planning for corporate real estate,” says Harmon-Vaughan. “The quantitative space requirements for employees, which often drive lease decisions, are only one piece of the puzzle. For a project budget to best align with a tenant’s design goals, starting with thorough programming and due diligence proves invaluable. The qualitative project drivers discovered through in-depth visioning account for implications of mobility, work/life realities and the collective amenity spaces that the changing workforce is seeking. Pressures between design goals and budgets are alleviated when stakeholders – tenants, landlords, brokers, and designers – reach an early consensus on the priorities motivating real estate decisions. We are seeing a trend of these decisions based on the design solutions which best support end users in employee attraction and retention while allowing for flexibility in their office spaces to accommodate changes in the future.”

In addition to amenities, natural light and focus/collaboration areas, Harmon-Vaughan, like Pierson, has noted emphases on health.

“Research has shown an estimated 65 percent of a company’s health related costs can be attributed to absenteeism and ‘presenteeism’ – the act of attending work while sick,” says Harmon-Vaughan. “The intersection of workplace design and well-being can reduce both.”

Pierson_John-Color compressed

John Pierson


Beth Harmon-Vaughan

Beth Harmon-Vaughan


Jennifer Callahan

Jennifer Callahan


Leo Bauman

Leo Bauman



Michelle Anderson


nexicore services electronic repair

Avnet, Inc. Acquires The Assets Of Nexicore Services

Avnet, Inc. announced that it has completed its acquisition of substantially all of the operating assets of Hartford Computer Group, Inc. and its subsidiary Nexicore Services LLC (“Nexicore”) through a Section 363 sale process in the U.S. Bankruptcy Court in Chicago. Nexicore Services, which generated revenue of approximately US$85 million in the 2011 calendar year, was one of the leading providers of repair and installation services in North America for consumer electronics and computers, operating in three complementary business lines, including depot repair, onsite repair and installation, and spare parts management. The acquisition is expected to be immediately accretive to earnings and supports Avnet’s return on capital goals for acquisitions.

“This acquisition adds another significant building block in our strategy to offer a new aftermarket services business focused on repair, refurbishment, recycling and responsible disposition of electronic products and equipment”

“This acquisition adds another significant building block in our strategy to offer a new aftermarket services business focused on repair, refurbishment, recycling and responsible disposition of electronic products and equipment,” said Steve Church, President, Avnet Integrated Resources. “Nexicore brings a broad range of services, most notably a technical call center, onsite and depot repair of electronic devices and equipment and parts management, to complement our service offerings,” Church added.

The assets acquired from Nexicore Services will be deployed in Avnet Integrated Resources, which provides reverse logistics and after-market services to the global technology industry.

For more information on Avnet, Inc., visit their website at avnet.com.

Avnet's Roy Vallee On Leadership

Avnet’s Roy Vallee On Leadership

Thirty-seven years ago Roy Vallee was stocking shelves at a small electronics distribution company in Los Angeles. That small firm has grown up to become Avnet, Inc., a Fortune 500 firm located in Phoenix, Arizona. Avnet is one of the largest distributors of electronic parts, enterprise computing and storage products, and embedded subsystems in the world. And Roy Vallee is the CEO and chairman of the board. One morning recently, marketing professor  Antony Peloso sat down with Mr. Vallee to talk about Avnet, his leadership style, and how to motivate employees — even in a far-flung global operation. Professor Peloso leads the Marketing Professional Sales and Relationship Management Initiative, which fosters strong relationships between students who are headed for careers in sales, marketing faculty members and corporate partners. The goal is to build professional sales capabilities and advance the profile and status of the sales function. And now let’s hear what Mr. Vallee has to say about one the toughest jobs of leadership: motivating employees. (26:42)

The podcast no longer works, please check the wpcarey website for the transcript.

First Job: Roy Vallee, Avnet Inc.

First Job: Roy Vallee, Avnet Inc.

Roy Vallee
Chairman and CEO
Avnet Inc.

Describe your very first job and what lessons you learned from it.
I was 13 years old when I landed my first job selling cosmetics and household products door-to-door. As a salesman, my earnings were based entirely on what I sold. That meant that if I sold nothing, I got paid nothing. While my first job was many years ago, being a door-to-door salesman taught me several valuable lessons that have helped me throughout my career, especially when I began working in technology sales. It taught me to focus on the customer and their needs, how to deal with rejection and use it as a learning experience, and how to motivate myself to keep making calls knowing that the more calls I made the better my odds of making a sale.

Describe your first job in your industry and what you learned from it.
I began my career in technology distribution in 1971 as part of a work-study program where I earned school credits. The job involved stocking shelves in the warehouse of a small electronics distributor in California. This gave me an opportunity to learn and experience first hand how a warehouse operates. Early on, I learned the importance of quality practices around inventory management and processing an order.

What were your salaries at both of these jobs?
As a door-to-door salesman in 1966, I was paid completely on commission and earned 35 percent of what I sold. When I worked at the warehouse stocking shelves, I was paid $2.25 an hour, plus I received school credit. While the money was important at the time, the experience that I gained from these jobs has been invaluable throughout my career.

Who is your biggest mentor and what role did they play?
My most influential mentor was Leon Machiz, the chairman and CEO of Avnet from 1988 to 1998. In 1989, I was a mid-level Avnet manager when he first noticed me during a presentation at one of our top suppliers. He called me into his office a few days later to promote me to president of Avnet’s computing business, a division that had $300 million in annual revenues at the time. This was a significant and unexpected promotion. However, Leon had been impressed by how well I understood our suppliers’ needs, their business challenges, and how Avnet could help them overcome those challenges. As I took on this new role, Leon spent hours with me talking about the business and helping me understand what it would take to be successful. His mentorship helped me understand one of the greatest lessons of my career — my job is not to run the company, but rather to lead it.

What advice would you give to a person just entering your industry?
I am a true believer in doing the right things consistently over time. My observation is that the most successful people in business are relentless about their focus on delivering the highest value to their customers and other partners — and that’s true if you are just starting out or if you are heading a big corporation. If you have your customers’ best interests at heart and approach that with an uncompromising single mindedness, they will reward you with their business.

I also believe that meritocracy is vital to attracting and engaging the best employees. And acting with honesty and integrity is always the right thing to do. Do it even though it might not be what everyone else is doing or it feels uncomfortable at the time. This will give you a solid reputation as an employee, business partner, employer and investment for shareholders.

If you weren’t doing this, what would you be doing instead?
I would probably start my own company or buy into a smaller business and get involved in the strategy and people development. Alternatively, I might work in venture capital or private equity investing.

Baby Boomer Bust

Baby Boomers Bust

Companies get ready as boomers start leaving the work force

The catchy term many are using to describe the impending exodus of baby boomers from the work force sounds like the title of a science-fiction film: “The Brain Drain.

But there’s nothing fictional about it. The oldest baby boomers, a group that includes more than 78 million Americans born between 1946 and 1964, began qualifying for early Social Security benefits this year. Some may choose to work beyond the traditional retirement age and others could stay on for financial reasons, but the eventual departure of baby boomers will have a serious impact on corporate America.
This might be a particular concern in upper-management ranks, where positions are most likely manned by older, more experienced personnel and a talent pool of capable replacements is thin.

“The issue is simply that our population is getting older and the birth rates aren’t equal to the aging of the population,” says Angelo Kinicki, an Arizona State University management professor, author and consultant. “You’re going to have more people exiting than you will have entering (the work force).”

Despite this demographic shift, recent surveys from Ernst & Young and Monster Worldwide agree that few corporations are properly prepared for the challenges ahead.

“What’s going to happen here is as baby boomers retire, you’re going to have a lot of people who have knowledge that are leaving the work force,” Kinicki adds.

Kinicki says it’s vital to create systems for transferring knowledge from seasoned employees and senior executives down to lower levels through the organization.
“I’d say the more progressive companies are engaging in what we call knowledge-management programs,” Kinicki says.

But, according to a 2007 Monster study titled “Building and Securing an Organizational Brain Trust in an Age of Brain Drain,” few companies have taken such steps.

While trying to determine the level of awareness companies have of the coming brain drain and what they’re doing to prepare for it, Monster found that only 20 percent of firms had a formal strategy in place to manage and preserve organizational knowledge.

Monster concludes that “the absence of such planning leaves a valuable asset exposed to a competitive market. Firms must not only recognize the value of knowledge but actively manage and protect it.”

Kinicki says several companies in Arizona, such as Intel, APS and Honeywell, have taken a proactive approach.

One corporation that has been especially innovative is Avnet Inc., a Phoenix-based Fortune 500 company that is one of the world’s largest distributors of electronic components, computer products and technology services.

Lynn Monkelien, vice president of learning and development, says Avnet is very cognizant of the imminent retirement of baby boomers.

“(We) have started looking at all kinds of ways that we can start to manage this transition period,” she says.

Among those is a multiple-tiered program that uses top-level management to teach classes for those viewed as future leaders.

Consider the Global Organizational Leadership Development, or GOLD, program. It does more than just cover particular subjects. Managers are able to expose students to their own experiences, while studentsget a chance to build relationships with senior leaders, paving the way for future coaching and mentoring.

“I think the real benefit is going to come as we start to replace some of the oldguard with the new guard,” Monkelien says.

The company also places great importance on succession planning, according to Linda Biddle, Avnet’s vice president for talent development. Avnet’s goal is to create a steady flow of people at all levels of the organization ready to take on new roles.

“Avnet is always thinking ahead, trying to predict what things are going to impact our business from a technology standpoint, from a process standpoint and, also, from a people standpoint,” Biddle says. “What we’re trying to do is not be reactionary — we’re trying to be proactive.”

Arizona Business Magazine February 2008