Pugh named CEO at Applied Industrial Technologies
By Industrial Distribution Staff -- Industrial Distribution, 3/1/2000
Cleveland--Applied Industrial Technologies is starting the century with a new CEO at the helm and a new operating structure that focuses on three key areas of growth: e-commerce, fluid power, and industrial products.David L. Pugh stepped into the role of chief executive in late January, replacing 61-year-old John C. Dannemiller, who remains as chairman. Pugh, 51, will retain his position as president.
Pugh joined Applied little more than a year ago, bringing to the presidency experience in marketing, operations and management. Pugh was unavailable at press time, but company spokesman Rick Shaw said that Pugh will assume more leadership of the company's day-to-day operations and Dannemiller will focus more on board and investor relations.
In early February, Pugh announced a new operating structure that will focus on three key areas of growth: e-commerce, fluid power and industrial products.
"Our e-commerce channel development is a key support area for both the Fluid Power and Industrial Products business units and represents a substantial growth channel in its own right,'' Pugh said in a written statement.
"As customers begin to explore the Internet as a cost-effective, convenient purchasing option," he said, "it is extremely critical that Applied has the expertise in place to meet that need.''
James T. Hopper has been promoted to vice president-chief information officer and will oversee both the company's total information technology group and e-commerce group. Hopper was instrumental in developing AppliedACCESS®, Applied's inaugural Internet purchasing site that debuted in July 1999.
Hopper reports a slow growth rate in Applied's e-commerce business, but expects that pace to pick up.
"We're seeing e-commerce being adopted at the rate of EDI when it first came out. There's a cautious attitude among our customers, often related to inadequate hardware and bandwidth at individual work sites," Hopper says, "and there's some concern at the purchasing level.
"This is the sort of thing that makes a lot of sense at the corporate level but has yet to filter down through the ranks. From our perspective, it's just another way to do business," Hopper says.
Also in February, Pugh announced the formation of two industrial distribution business units, one for fluid power products and one for industrial products.
"Fluid power is a technical specialty business requiring dedicated management attention and tailored resources,'' said Pugh in a written release. "By separating fluid power and industrial products into their own operations, we believe we have significantly enhanced our capacity to grow both core businesses and provide higher levels of specialized customer service.
"The Industrial Products Unit represents our traditional distribution business,'' stated Pugh. "Although it is the oldest and most mature part of our business, there is still room for significant growth, and these changes will allow us to re-focus resources and align the product and service platforms needed to support it.''
The Fluid Power Unit, headed by vice president and newly appointed unit president, Justin M. Jacobi, will include the company's seven fluid power subsidiaries: Applied Hydraulic Technologies, Dees Fluid Power, Engineered Sales, ESI-Power Hydraulics, Air and Hydraulics Engineering, ElectAir and Fornaciari.
The Industrial Products Unit, led by vice president and newly appointed unit president, Donald L. Chargin, will include more than 380 multi-technology service center locations in 46 states.
Applied distributes bearings, power transmission, specialty products, rubber products and fluid power components through these traditional service centers. This unit will also include the company's fabricated rubber division and mechanical shops.
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