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Kings of the Hill
The company ranked first in this year’s Globe 100 has a Northeastern graduate at the helm. So does the company in second place. And the one ranked third.
Why does the phrase “clean sweep” come to mind?
By Karen Feldscher
All three say they goofed off in high school. But the men profiled in the pages ahead more than made up for those early days—they became chief executives at the biggest success stories in the high-stakes world of Massachusetts business.
And they all went to Northeastern.
George Chamillard, Jerald Fishman, and Roger Blethen run, respectively, Teradyne, Analog Devices, and LTX Corporation: the companies ranked one, two, and three this year in the Globe 100, the Boston Globe’s annual list of the state’s best businesses.
Not surprisingly, all three companies play a major role in the world of high tech. Analog Devices manufactures the integrated circuits, or chips, that power everything from cell phones to washing machines. Teradyne and LTX make equipment that tests those chips to make sure they work properly.
All three CEOs—and their companies—rode the crest of the high-tech wave that drove the stock market to dizzying heights last year. Now that the economic tide has turned, all three acknowledge their businesses have dipped south, thanks to an equally dizzying high-tech bust.
But they’re remarkably sanguine about their companies’ prospects. Their decades in the high-tech business have gotten them used to its wild ups and downs. They say they know things will swing the other way sooner or later, and when they do, they’ll be ready.
By the way, Northeastern’s domination of the Globe 100 doesn’t end with the top three spots: The fourth-ranked company is EMC Corporation, a company founded in 1979 by two NU grads, Richard Egan and Roger Marino. Egan, currently chairman emeritus of EMC—and recently confirmed as the new U.S. ambassador to Ireland—served as its chief executive through 1992. Marino served as president through 1991.
1. Teradyne
George Chamillard, UC’66, MBA’70
The company
Teradyne is the world’s largest supplier of automatic test systems for the semiconductor industry and a leading supplier of high-performance interconnect systems for the telecommunications and networking industries. The company’s products are used to test semiconductors, printed circuit-board assemblies, telephone lines, and broadband networks.
Last year, Teradyne employed more than 9,600 people and had sales of $3 billion. The company has manufacturing facilities in Massachusetts, California, New Hampshire, Illinois, Texas, Japan, and Ireland. Corporate headquarters are in Boston.
The CEO
Chamillard, who joined Teradyne in 1969 as an engineer, became the company’s president and chief operating officer in 1996, its chief executive officer in 1997, and its chairman in 2000. He earned a bachelor’s degree in industrial technology in 1966 and an MBA four years later. Born in Needham, Massachusetts, and raised in Norton, Chamillard, 62, lives in Cohasset with his wife, Maureen. He has four grown children—Debra, Donna, David, and Donald—and eight grandchildren.
Why do you work in a tiny cubicle?
You want to do what’s effective, and in the industry we’re in, we don’t get things done by papers and reports and charts and data—it’s by heavy interaction. And the people you interact with, who know what’s really going on, are the applications engineers, the designers, the people interfacing with the customers. So you don’t want to have any barriers to communication. One barrier would be if they didn’t have easy access to me. You want to stimulate communication and have it so the people with the real knowledge can see me easily.
Why is Teradyne so central to the high-technology industry?
If you look at technology as an industry, and information technology as a subset, it represents maybe 5 to 8 percent of the world’s GDP. And yet the industry has been responsible for something like two-thirds of the productivity gain over the last five years. Now, if you look at how the test-
equipment industry fits in, the fact is, we enable that technology to be delivered. You’ve got to design the part, build the part, and test the part. Testing is a crucial part of the process.
What’s the edge Teradyne has over its competitors?
Today, we have about a third of the world’s test-equipment business for semiconductors. That gain has come from the ability of Teradyne’s engineers to invent solutions, identify markets, align their products with the customer’s needs very well—in fact, better than our competitors. One way we do this is by having a culture that lets very creative, talented people do their jobs better than the other guys. The culture at Teradyne encourages taking risks, and tries not to wound people if the risk doesn’t work out.
Why doesn’t the current high-tech downturn bother you?
You have to look past the dips. This is a very volatile industry. You’ve got to ask yourself, what are the fundamentals? Electronics gives everybody in the world a better life. Now, where’s the world in total in terms of a better life? If you look at Boston or Newton or Wellesley, we’re in great shape. But there’s a lot of room in the rest of the world. We’re involved in a business that has such potential. If you believe in the digital revolution, then you’ve got to believe in semiconductors, and if you believe in semiconductors, you’ve got to believe in Teradyne.
What if the next big thing isn’t semiconductors?
Then we’ll test that.
What’s it like being at the top of what the Boston Globe calls “a brutally competitive and rapidly changing industry”?
It’s a lot more fun being number one than number two. But the biggest risk in staying at the top is what I think of as the “successful company disease”—starting to think that the customer’s wrong, or the competitors aren’t as good. That’s a dangerous thing. So we try to have a culture that’s continually challenging. We have a style in the company that is very open, straightforward. Everything’s on the table; everything’s challenged. If the young engineer who’s spent two years out in the field comes back in and says there’s something wrong with a product, we listen.
How do you keep morale up when business is slowing?
I don’t think morale stays up by exhortation. Of course, we do some of that. But morale comes from feeling you’re working on something that positions the company better. You’ve got to ask, what can I do? I can work on getting electronics out faster. I can work on supporting my customers. The key is to build the culture and the organization that can sustain itself for the future.
Why do you love your job?
It helps society; it has real rewards; and I work with incredibly bright people. The risk in technology companies is you wake up in the morning, the clock radio comes on, and you hear the announcement that somebody invented something that makes you obsolete. You have to thrive on that. Plus, at Teradyne over the years, I’ve had what I would think of as five distinct growth jobs, where I’ve had to re-engineer how I do work. If the environment can offer you that, why would you leave?
Do you ever hate your job?
Look, thirty years with a company, you do have a love–hate relationship with it. There were periods when I hated the people, I hated the problems. But, on balance, it’s been wonderful.
Why do you call yourself a late bloomer?
I was not very focused in high school. My father, who was a chemical engineer, badgered me to do something, so I signed up for Wentworth and got an associate’s degree in industrial electronics. After two years in the Coast Guard, I was married and had one child; and I saw I was undereducated, and started what ended up being eight years of night school at Northeastern. I was a mediocre student in high school and Wentworth, but I was way up there at Northeastern—I was getting 3.8s and 3.9s. I found graduate school incredibly stimulating. I just loved it.
What did you drive when you were at Northeastern?
A ten-year-old Ford station wagon.
What do you drive now?
My favorite is a 1965 Corvette, emerald green. I bought it fifteen years ago and was going to restore it, but it’s sitting idle in my garage. I also have a large pickup truck, a big bright- yellow Dodge Ram, that I go to the dump with. And I have a four-door Mercedes. I trade my cars in about every two years, so I can have that great experience of buying a new car.
2. Analog Devices
Jerald Fishman, ME’70
The company
Analog Devices is one of the world’s leading manufacturers of high-performance integrated circuits for signal-processing applications. The Norwood-based company’s chips are the technology that turns voice and visual signals—which are analog, or continuous in nature—into the digital packets needed for Internet, satellite, and DSL transmission. Analog’s chips can be found in a wide range of electronic products, from personal digital assistants, laptops, and DVD players to refrigerators and washing machines.
In 2000, Analog earned $2.6 billion in revenues, up 78 percent from fiscal 1999. The company, with manufacturing facilities in Massachusetts, California, North Carolina, Ireland, the Philippines, and Taiwan, employs nearly 10,000 people.
The CEO
Fishman has been president of Analog Devices since 1991 and its chief executive since 1996. He began his career at Analog in 1971, in product marketing. The 55-year-old Fishman and his wife, Dale, live in Weston and have two children—Elizabeth, 23, and Andrew, 21. Born and raised in Queens, Fishman earned a bachelor’s in electrical engineering from the City College of New York (1967), a master’s in electrical engineering from Northeastern, an MBA from Boston University (1972), and a law degree from Suffolk University (1976).
Why is Analog Devices a great company?
The semiconductor industry is a $200 billion industry and a very diverse industry, and we’ve picked a place to be in that industry where, one, it grows very quickly, and two, people pay for your technology. It used to be, in the early days, technology was used mostly in military/industrial applications. But now it’s made its way to the consumer sector, the computer sector, the communications sector—all the high-growth applications—so it’s a great business.
Why do you think Fortune magazine called Analog one of the most admired companies in the United States?
People admire technology. One reason is, if you have the right products and the right customers, you make profits. But I think equal to that, we’ve always understood it was important to get the very best people and move them in the right direction. We work with our people enormously to develop them, to build bridges between us and them. Our turnover, as a result, is extremely low. It’s important to keep people and invest in them, and keep them focused on working for you.
What’s it like running such a fast-growing company?
It’s exhilarating some days, and other days you’re scared to death. It’s a very, very cyclical business. Last year, we grew 80 percent in one year; we increased sales by $1 billion in a single year. And this year, we’ll do less than last year. This year’s a terrible year in all the technology industries. It’s a business of highs and lows, but as long as the highs are higher than the lows are low, you keep doing it. Also, it’s an awesome responsibility, to be responsible for 10,000 people, knowing that some of the actions you take affect real people, their lives and their families, and their aspirations.
How do you deal with the tumultuous ups and downs of the technology industry?
We have to respond to the short term in some ways, but we have tended to keep focused not just on the next three months, but the next three to five years. To really win in new technologies, you can’t respond to every cycle up and down. You just keep working. Having some historical perspective does help—knowing that when you have a great year, the next year is going to be lousy; and that when you have a lousy year, the next year is going to be good. You’ve got to decide what you’re going to do, and then, with some modulation, keep doing it. Some people think that takes a lot of courage. But I think what it really takes is experience.
What’s your favorite pastime?
About five years ago, my wife made me buy this beach house down the Cape. I argued like hell not to do it, because I thought it was going to be a big pain. But she said we’d never find a spot like this again. So I finally bought it, and it’s the best thing I ever did. I bought a boat, go on the ocean, smell the salt air. I just love it.
Where did you live when you were a Northeastern student?
Some hole in Brighton, with a bunch of other guys.
What did you drive when you went to Northeastern?
An Oldsmobile Cutlass convertible.
What do you drive now?
A red Jaguar.
How did Northeastern prepare you for the rigors of being a CEO?
Certainly working full time and going to school at night is hard. It really teaches you a lot about doing the important stuff. Given that I’m one of the world’s greatest procrastinators, it teaches you how to balance your time, because you have to. I think it really was like boot camp. I remember trudging down there after work—just trying to get there sometimes was a challenge. But I stayed with it. I had three roommates—all four of us had gone to engineering school in New York, and all four of us started in the evening program at Northeastern; and after a year the three of them quit. I was the only one who stayed with it—and the only one who’s still married to the same woman, the only one who’s had the same job for thirty years. I don’t know what it says, but it says something—I guess that I don’t quit very easily.
What would you have said if someone had told you, back in your Northeastern days, that you’d become a CEO of a major company?
“What are you smoking?” When I was 21, I was not very directed. I have friends I knew from that age, and they’re staggered when they see me now; they say, “That couldn’t be him.” I have a good friend, Millard Drexler, CEO of the Gap, who’s very successful. We went to the Bronx High School of Science together. We laugh now, because I think we had the two lowest averages in the class.
What’s your advice to young people trying to get ahead?
I’ve seen too many examples of people with life plans—but you just can’t plan. My advice is, chill out. You can do some things to prepare yourself to take advantage of things, like get a good education, but to figure you can plan your way from thing to thing, to me, is an extraordinary waste of time. Just follow your instincts, and be prepared to take risks and jump on opportunities harder than the next guy. And stay with it, because it’s so easy to give up and get discouraged. And realize that half of it is luck.
3. LTX Corporation
Roger Blethen, E'74
The company
LTX Corporation makes machines that test the world’s most advanced integrated circuits—the chips that go into everything from cell phones, to computers, to automobiles. Nine of the top twelve producers of integrated circuits buy LTX’s machines. LTX clients include heavyweights like IBM, Intel, Texas Instruments, Motorola, and Lucent Technologies.
In fiscal 2000, LTX’s revenues were about $306 million, a nearly 100 percent increase over the previous year. Based in Westwood, LTX also has office and manufacturing facilities in San Jose, California; London; Singapore; Japan; Korea; Taiwan; and the Philippines, and employs about 800 people.
The CEO
Blethen, who helped cofound LTX in 1976, when he was 25, became the company’s president and chief executive officer twenty years later, in 1996. He received a bachelor’s degree in electrical engineering from Northeastern. Blethen lives in Dover with his wife, Pamela, and 12-year-old son, Zack. He also has two daughters, Christine, 25, and Andrea, 23. He was born and raised in Medway, Massachusetts.
What advantages does LTX Corporation have going for it?
Three things. First, we recognized three years ahead of everybody else—including our archrival, Teradyne—that all electronics were going to be boiled down to single types of circuits. And we developed testing equipment for that new technology. And we had a very successful rebirth of the company. Second, we have a very efficient business model, which is flexible enough to ride the ups and downs, so we can always invest in research and development—good times and bad—and continue to build our technical lead. The structure also allows us to make money in the bad times, or not lose too much like others do, and to make good profits when conditions are good. Third, LTX has been able to recruit a brilliant leadership and operating team.
How did you become chief executive?
It was an inside takeover and turnaround job. LTX always had an immense core of technology—we were a major player in the marketplace—but we lacked the ability to make industry-leading profits, which are required to keep funding the technical growth. So in 1996, I petitioned the board of directors, by myself, to become chief executive officer and to put the company on a new mission. And they took me up on it.
What have your nearly thirty years at LTX been like?
It’s been hard and exciting. It’s exciting now because we’ve rebuilt the company in a good way, a way that will allow us to move forward for several years and succeed. And the first ten years we started the company was a really exciting time. We started with no customers, no products, and no money, and we built a company that we took public and that ultimately grew to $200 million in revenues and was a major player in our part of the market by 1990. The period just before I took over was a very frustrating period because, as hard as we tried, factors that needed to be corrected within our business were getting in the way of our success. We needed to adapt to the industry conditions—to consolidate, be more efficient, and develop a real profit-making mentality.
Why is making money so important?
Making profits sounds very capitalistic and not very people-oriented, but you can’t pay people, you can’t reward them, and you can’t retain them if you don’t make money.
What was it like to retool the company and lose nearly $80 million in 1998?
You know, it’s easier to start a company than it is to stop one and restart it, because you can’t really stop it. You have to keep it going while you’re stopping it. It was an enormously difficult and enormously rewarding challenge. And the $80 million was a cashless write-off. So while the write-off was $80 million, the loss was really nearer $20 million. It wasn’t as bad as it looked.
What do you love about your work?
The technology itself is interesting; and it also changes the way people work and live, and I think that’s terrific. I also like the ability to develop the organization and the people we have. And I just love the competition.
What do you dislike?
If there’s anything, it’s the time it takes away from my family. I take about fifty business trips a year.
Why do you think it’s important to reserve time with the family?
I’ve learned that you need to be as aggressive with managing your personal life as your professional life, or it gets away from you. I’m a commercial pilot, and I used to be a nine-handicap golfer; but I put the flying and the golf aside when I became CEO. They’re just too time-consuming. Now I either work or spend time with my family—that’s it. We do things outdoors: walking, biking, boating, fishing.
How did you get to campus when you were a Northeastern student?
For the first year, I hitchhiked, and took a bus when I felt like spending the money. Then I bought a used car—a 1967 blue Dodge Coronet, which I drove until 1977, when it stopped operating.
What do you drive now?
A BMW 740iL.
Where did you work on co-op?
Teradyne—now LTX’s main competitor.
How did you pay your way through college?
I worked on a dairy farm for five years, from junior high school through high school, every weekend and all summer.
Did you like working on a farm?
Farms are places that you have really great memories from, but they’re really lousy to work on. It’s tedious and repetitious. I milked cows, baled hay, cut wood.
What did co-op do for you?
I wasn’t highly focused academically in high school. I went to Northeastern because my dad said, “I want you to get an education.” So that was it. The opportunity to work at several different firms really gave me an idea of what the business world was about—what it meant to be an engineer beyond the theory, and what it meant to be successful in business.
What if someone had told you, while you were at Northeastern, that you’d become a CEO?
I was pretty cocky. I think I would have said something like, “Yeah, maybe.” My view was, I was just going to plain outwork everybody.
The company ranked first in this year’s Globe 100 has a Northeastern graduate at the helm. So does the company in second place. And the one ranked third.
Why does the phrase “clean sweep” come to mind?
By Karen Feldscher
All three say they goofed off in high school. But the men profiled in the pages ahead more than made up for those early days—they became chief executives at the biggest success stories in the high-stakes world of Massachusetts business.
And they all went to Northeastern.
George Chamillard, Jerald Fishman, and Roger Blethen run, respectively, Teradyne, Analog Devices, and LTX Corporation: the companies ranked one, two, and three this year in the Globe 100, the Boston Globe’s annual list of the state’s best businesses.
Not surprisingly, all three companies play a major role in the world of high tech. Analog Devices manufactures the integrated circuits, or chips, that power everything from cell phones to washing machines. Teradyne and LTX make equipment that tests those chips to make sure they work properly.
All three CEOs—and their companies—rode the crest of the high-tech wave that drove the stock market to dizzying heights last year. Now that the economic tide has turned, all three acknowledge their businesses have dipped south, thanks to an equally dizzying high-tech bust.
But they’re remarkably sanguine about their companies’ prospects. Their decades in the high-tech business have gotten them used to its wild ups and downs. They say they know things will swing the other way sooner or later, and when they do, they’ll be ready.
By the way, Northeastern’s domination of the Globe 100 doesn’t end with the top three spots: The fourth-ranked company is EMC Corporation, a company founded in 1979 by two NU grads, Richard Egan and Roger Marino. Egan, currently chairman emeritus of EMC—and recently confirmed as the new U.S. ambassador to Ireland—served as its chief executive through 1992. Marino served as president through 1991.
1. Teradyne
George Chamillard, UC’66, MBA’70
The company
Teradyne is the world’s largest supplier of automatic test systems for the semiconductor industry and a leading supplier of high-performance interconnect systems for the telecommunications and networking industries. The company’s products are used to test semiconductors, printed circuit-board assemblies, telephone lines, and broadband networks.
Last year, Teradyne employed more than 9,600 people and had sales of $3 billion. The company has manufacturing facilities in Massachusetts, California, New Hampshire, Illinois, Texas, Japan, and Ireland. Corporate headquarters are in Boston.
The CEO
Chamillard, who joined Teradyne in 1969 as an engineer, became the company’s president and chief operating officer in 1996, its chief executive officer in 1997, and its chairman in 2000. He earned a bachelor’s degree in industrial technology in 1966 and an MBA four years later. Born in Needham, Massachusetts, and raised in Norton, Chamillard, 62, lives in Cohasset with his wife, Maureen. He has four grown children—Debra, Donna, David, and Donald—and eight grandchildren.Why do you work in a tiny cubicle?
You want to do what’s effective, and in the industry we’re in, we don’t get things done by papers and reports and charts and data—it’s by heavy interaction. And the people you interact with, who know what’s really going on, are the applications engineers, the designers, the people interfacing with the customers. So you don’t want to have any barriers to communication. One barrier would be if they didn’t have easy access to me. You want to stimulate communication and have it so the people with the real knowledge can see me easily.
Why is Teradyne so central to the high-technology industry?
If you look at technology as an industry, and information technology as a subset, it represents maybe 5 to 8 percent of the world’s GDP. And yet the industry has been responsible for something like two-thirds of the productivity gain over the last five years. Now, if you look at how the test-
equipment industry fits in, the fact is, we enable that technology to be delivered. You’ve got to design the part, build the part, and test the part. Testing is a crucial part of the process.
What’s the edge Teradyne has over its competitors?
Today, we have about a third of the world’s test-equipment business for semiconductors. That gain has come from the ability of Teradyne’s engineers to invent solutions, identify markets, align their products with the customer’s needs very well—in fact, better than our competitors. One way we do this is by having a culture that lets very creative, talented people do their jobs better than the other guys. The culture at Teradyne encourages taking risks, and tries not to wound people if the risk doesn’t work out.
Why doesn’t the current high-tech downturn bother you?
You have to look past the dips. This is a very volatile industry. You’ve got to ask yourself, what are the fundamentals? Electronics gives everybody in the world a better life. Now, where’s the world in total in terms of a better life? If you look at Boston or Newton or Wellesley, we’re in great shape. But there’s a lot of room in the rest of the world. We’re involved in a business that has such potential. If you believe in the digital revolution, then you’ve got to believe in semiconductors, and if you believe in semiconductors, you’ve got to believe in Teradyne.
What if the next big thing isn’t semiconductors?
Then we’ll test that.
What’s it like being at the top of what the Boston Globe calls “a brutally competitive and rapidly changing industry”?
It’s a lot more fun being number one than number two. But the biggest risk in staying at the top is what I think of as the “successful company disease”—starting to think that the customer’s wrong, or the competitors aren’t as good. That’s a dangerous thing. So we try to have a culture that’s continually challenging. We have a style in the company that is very open, straightforward. Everything’s on the table; everything’s challenged. If the young engineer who’s spent two years out in the field comes back in and says there’s something wrong with a product, we listen.
How do you keep morale up when business is slowing?
I don’t think morale stays up by exhortation. Of course, we do some of that. But morale comes from feeling you’re working on something that positions the company better. You’ve got to ask, what can I do? I can work on getting electronics out faster. I can work on supporting my customers. The key is to build the culture and the organization that can sustain itself for the future.
Why do you love your job?
It helps society; it has real rewards; and I work with incredibly bright people. The risk in technology companies is you wake up in the morning, the clock radio comes on, and you hear the announcement that somebody invented something that makes you obsolete. You have to thrive on that. Plus, at Teradyne over the years, I’ve had what I would think of as five distinct growth jobs, where I’ve had to re-engineer how I do work. If the environment can offer you that, why would you leave?
Do you ever hate your job?
Look, thirty years with a company, you do have a love–hate relationship with it. There were periods when I hated the people, I hated the problems. But, on balance, it’s been wonderful.
Why do you call yourself a late bloomer?
I was not very focused in high school. My father, who was a chemical engineer, badgered me to do something, so I signed up for Wentworth and got an associate’s degree in industrial electronics. After two years in the Coast Guard, I was married and had one child; and I saw I was undereducated, and started what ended up being eight years of night school at Northeastern. I was a mediocre student in high school and Wentworth, but I was way up there at Northeastern—I was getting 3.8s and 3.9s. I found graduate school incredibly stimulating. I just loved it.
What did you drive when you were at Northeastern?
A ten-year-old Ford station wagon.
What do you drive now?
My favorite is a 1965 Corvette, emerald green. I bought it fifteen years ago and was going to restore it, but it’s sitting idle in my garage. I also have a large pickup truck, a big bright- yellow Dodge Ram, that I go to the dump with. And I have a four-door Mercedes. I trade my cars in about every two years, so I can have that great experience of buying a new car.
2. Analog Devices
Jerald Fishman, ME’70
The company
Analog Devices is one of the world’s leading manufacturers of high-performance integrated circuits for signal-processing applications. The Norwood-based company’s chips are the technology that turns voice and visual signals—which are analog, or continuous in nature—into the digital packets needed for Internet, satellite, and DSL transmission. Analog’s chips can be found in a wide range of electronic products, from personal digital assistants, laptops, and DVD players to refrigerators and washing machines.
In 2000, Analog earned $2.6 billion in revenues, up 78 percent from fiscal 1999. The company, with manufacturing facilities in Massachusetts, California, North Carolina, Ireland, the Philippines, and Taiwan, employs nearly 10,000 people.
The CEO
Fishman has been president of Analog Devices since 1991 and its chief executive since 1996. He began his career at Analog in 1971, in product marketing. The 55-year-old Fishman and his wife, Dale, live in Weston and have two children—Elizabeth, 23, and Andrew, 21. Born and raised in Queens, Fishman earned a bachelor’s in electrical engineering from the City College of New York (1967), a master’s in electrical engineering from Northeastern, an MBA from Boston University (1972), and a law degree from Suffolk University (1976).Why is Analog Devices a great company?
The semiconductor industry is a $200 billion industry and a very diverse industry, and we’ve picked a place to be in that industry where, one, it grows very quickly, and two, people pay for your technology. It used to be, in the early days, technology was used mostly in military/industrial applications. But now it’s made its way to the consumer sector, the computer sector, the communications sector—all the high-growth applications—so it’s a great business.
Why do you think Fortune magazine called Analog one of the most admired companies in the United States?
People admire technology. One reason is, if you have the right products and the right customers, you make profits. But I think equal to that, we’ve always understood it was important to get the very best people and move them in the right direction. We work with our people enormously to develop them, to build bridges between us and them. Our turnover, as a result, is extremely low. It’s important to keep people and invest in them, and keep them focused on working for you.
What’s it like running such a fast-growing company?
It’s exhilarating some days, and other days you’re scared to death. It’s a very, very cyclical business. Last year, we grew 80 percent in one year; we increased sales by $1 billion in a single year. And this year, we’ll do less than last year. This year’s a terrible year in all the technology industries. It’s a business of highs and lows, but as long as the highs are higher than the lows are low, you keep doing it. Also, it’s an awesome responsibility, to be responsible for 10,000 people, knowing that some of the actions you take affect real people, their lives and their families, and their aspirations.
How do you deal with the tumultuous ups and downs of the technology industry?
We have to respond to the short term in some ways, but we have tended to keep focused not just on the next three months, but the next three to five years. To really win in new technologies, you can’t respond to every cycle up and down. You just keep working. Having some historical perspective does help—knowing that when you have a great year, the next year is going to be lousy; and that when you have a lousy year, the next year is going to be good. You’ve got to decide what you’re going to do, and then, with some modulation, keep doing it. Some people think that takes a lot of courage. But I think what it really takes is experience.
What’s your favorite pastime?
About five years ago, my wife made me buy this beach house down the Cape. I argued like hell not to do it, because I thought it was going to be a big pain. But she said we’d never find a spot like this again. So I finally bought it, and it’s the best thing I ever did. I bought a boat, go on the ocean, smell the salt air. I just love it.
Where did you live when you were a Northeastern student?
Some hole in Brighton, with a bunch of other guys.
What did you drive when you went to Northeastern?
An Oldsmobile Cutlass convertible.
What do you drive now?
A red Jaguar.
How did Northeastern prepare you for the rigors of being a CEO?
Certainly working full time and going to school at night is hard. It really teaches you a lot about doing the important stuff. Given that I’m one of the world’s greatest procrastinators, it teaches you how to balance your time, because you have to. I think it really was like boot camp. I remember trudging down there after work—just trying to get there sometimes was a challenge. But I stayed with it. I had three roommates—all four of us had gone to engineering school in New York, and all four of us started in the evening program at Northeastern; and after a year the three of them quit. I was the only one who stayed with it—and the only one who’s still married to the same woman, the only one who’s had the same job for thirty years. I don’t know what it says, but it says something—I guess that I don’t quit very easily.
What would you have said if someone had told you, back in your Northeastern days, that you’d become a CEO of a major company?
“What are you smoking?” When I was 21, I was not very directed. I have friends I knew from that age, and they’re staggered when they see me now; they say, “That couldn’t be him.” I have a good friend, Millard Drexler, CEO of the Gap, who’s very successful. We went to the Bronx High School of Science together. We laugh now, because I think we had the two lowest averages in the class.
What’s your advice to young people trying to get ahead?
I’ve seen too many examples of people with life plans—but you just can’t plan. My advice is, chill out. You can do some things to prepare yourself to take advantage of things, like get a good education, but to figure you can plan your way from thing to thing, to me, is an extraordinary waste of time. Just follow your instincts, and be prepared to take risks and jump on opportunities harder than the next guy. And stay with it, because it’s so easy to give up and get discouraged. And realize that half of it is luck.
3. LTX Corporation
Roger Blethen, E'74
The company
LTX Corporation makes machines that test the world’s most advanced integrated circuits—the chips that go into everything from cell phones, to computers, to automobiles. Nine of the top twelve producers of integrated circuits buy LTX’s machines. LTX clients include heavyweights like IBM, Intel, Texas Instruments, Motorola, and Lucent Technologies.
In fiscal 2000, LTX’s revenues were about $306 million, a nearly 100 percent increase over the previous year. Based in Westwood, LTX also has office and manufacturing facilities in San Jose, California; London; Singapore; Japan; Korea; Taiwan; and the Philippines, and employs about 800 people.
The CEO
Blethen, who helped cofound LTX in 1976, when he was 25, became the company’s president and chief executive officer twenty years later, in 1996. He received a bachelor’s degree in electrical engineering from Northeastern. Blethen lives in Dover with his wife, Pamela, and 12-year-old son, Zack. He also has two daughters, Christine, 25, and Andrea, 23. He was born and raised in Medway, Massachusetts.What advantages does LTX Corporation have going for it?
Three things. First, we recognized three years ahead of everybody else—including our archrival, Teradyne—that all electronics were going to be boiled down to single types of circuits. And we developed testing equipment for that new technology. And we had a very successful rebirth of the company. Second, we have a very efficient business model, which is flexible enough to ride the ups and downs, so we can always invest in research and development—good times and bad—and continue to build our technical lead. The structure also allows us to make money in the bad times, or not lose too much like others do, and to make good profits when conditions are good. Third, LTX has been able to recruit a brilliant leadership and operating team.
How did you become chief executive?
It was an inside takeover and turnaround job. LTX always had an immense core of technology—we were a major player in the marketplace—but we lacked the ability to make industry-leading profits, which are required to keep funding the technical growth. So in 1996, I petitioned the board of directors, by myself, to become chief executive officer and to put the company on a new mission. And they took me up on it.
What have your nearly thirty years at LTX been like?
It’s been hard and exciting. It’s exciting now because we’ve rebuilt the company in a good way, a way that will allow us to move forward for several years and succeed. And the first ten years we started the company was a really exciting time. We started with no customers, no products, and no money, and we built a company that we took public and that ultimately grew to $200 million in revenues and was a major player in our part of the market by 1990. The period just before I took over was a very frustrating period because, as hard as we tried, factors that needed to be corrected within our business were getting in the way of our success. We needed to adapt to the industry conditions—to consolidate, be more efficient, and develop a real profit-making mentality.
Why is making money so important?
Making profits sounds very capitalistic and not very people-oriented, but you can’t pay people, you can’t reward them, and you can’t retain them if you don’t make money.
What was it like to retool the company and lose nearly $80 million in 1998?
You know, it’s easier to start a company than it is to stop one and restart it, because you can’t really stop it. You have to keep it going while you’re stopping it. It was an enormously difficult and enormously rewarding challenge. And the $80 million was a cashless write-off. So while the write-off was $80 million, the loss was really nearer $20 million. It wasn’t as bad as it looked.
What do you love about your work?
The technology itself is interesting; and it also changes the way people work and live, and I think that’s terrific. I also like the ability to develop the organization and the people we have. And I just love the competition.
What do you dislike?
If there’s anything, it’s the time it takes away from my family. I take about fifty business trips a year.
Why do you think it’s important to reserve time with the family?
I’ve learned that you need to be as aggressive with managing your personal life as your professional life, or it gets away from you. I’m a commercial pilot, and I used to be a nine-handicap golfer; but I put the flying and the golf aside when I became CEO. They’re just too time-consuming. Now I either work or spend time with my family—that’s it. We do things outdoors: walking, biking, boating, fishing.
How did you get to campus when you were a Northeastern student?
For the first year, I hitchhiked, and took a bus when I felt like spending the money. Then I bought a used car—a 1967 blue Dodge Coronet, which I drove until 1977, when it stopped operating.
What do you drive now?
A BMW 740iL.
Where did you work on co-op?
Teradyne—now LTX’s main competitor.
How did you pay your way through college?
I worked on a dairy farm for five years, from junior high school through high school, every weekend and all summer.
Did you like working on a farm?
Farms are places that you have really great memories from, but they’re really lousy to work on. It’s tedious and repetitious. I milked cows, baled hay, cut wood.
What did co-op do for you?
I wasn’t highly focused academically in high school. I went to Northeastern because my dad said, “I want you to get an education.” So that was it. The opportunity to work at several different firms really gave me an idea of what the business world was about—what it meant to be an engineer beyond the theory, and what it meant to be successful in business.
What if someone had told you, while you were at Northeastern, that you’d become a CEO?
I was pretty cocky. I think I would have said something like, “Yeah, maybe.” My view was, I was just going to plain outwork everybody.