Most mornings when he’s not traveling, Travis Engen, chairman, president, and CEO of ITT Industries, eases his Acura NSX out of his suburban Connecticut garage for the 20-minute drive to ITT‘s White Plains headquarters. Engen obeys the speed limit for the commute here but when the 53year-old aeronautical engineer drives his Formula Four or other two race cars he owns nine cars total-it’s pedal to the metal.
That flat-out sail-shuddering-in-the-wind approach is how Engen negotiates the business landscape. “We’re in a race, competing for investment dollars getting people to buy our stock instead of someone else’s,” he says.
Those who did buy shares of ITT may consider themselves flush. Shares of the $4.4 billion industrial products company-spun off from the old $23.5 billion ITT Corp. in 1995-have climbed more than 18 percent in the past 12 months. For the nine months ending September 30, 1998 net income soared 17.7 percent to $203.5 million and operating income rose 15.6 percent.
In non-fiduciary terms, Engen equates success with achievement, and credits his father with his own success. “My father succeeded in a series of very different careers and is widely respected by everyone who knew him,” he says, proudly.
Engen orchestrated ITT‘s success by pruning, reorganizing, divesting, acquiring, and developing. In December, he announced ITT would cut as many as 1,200 jobs-3.5 percent of its workforce of 34,000-to trim costs and stabilize profits in anticipation of a slowdown in Asia and flattening worldwide. Between 5 and 7 percent of ITT sales come from Asia.
Last fall, the company reorganized into four divisions and sold most of its auto-parts business to concentrate on pumps, its largest unit, and connectors, both industries that thrive in slowdowns. ITT‘s Cannon brand makes switches, cabling, and connectors that read “smart cards.” The principal products of the defense unit are air traffic control systems, jamming devices that guard military planes against radar-guided weapons, digital combat radios, night vision devices, and satellite instruments. Pumps are also big, with ITT selling $2.1 billion of pumps annually-14 percent of the world market.
Engen expects more consolidation to slash costs and boost pump profits next year, as will new ways of operating. ITT ships pumps or pump parts within hours of when any of its 250 largest global customers-including BASF, Dow Chemical, Phillips Petroleum, and Bechtel-places an order.
Another innovation: Some 600 engineers in 20 locations around the world operate as a “virtual” design group-working on projects almost continuously. Teams of engineers in Asia, Europe, and the U.S. hand over control of computer design terminals to colleagues in another continent at the end of each working day, as different global time zones open up for business. Engen expects computer “time sharing”-plus the greater pooling of creative ideas-could shave ITT‘s development costs considerably.
(Donald) Travis Engen was born June 1944 in Pasadena, the son of a peripatetic career naval test pilot. Engen attended 17 schools before graduating high school. The oldest of four children, he always liked technology but was no child prodigy; in 1952,
Engen tried to make a light bulb, but instead “managed to burn all the circuits in the building where this great experiment took place.”
At MIT, he’d planned to major in chemistry but disliked his advisor and the smells created in the lab. Aeronautics beckoned. He managed as a sophomore to successfully design an airplane, but when he had to demonstrate a physical principal of balance and motion his props “took off and ate the lab.” From that “very dramatic demonstration,” Engen learned that “practical knowledge is as important as theory…This lesson appears daily to anyone who’s observant; you have to consider in advance the practical consequences of things.”
Engen’s first job, after graduating from MIT in 1967 was a field service manager at Textron. Although #62 in the draft lottery, Engen stayed out of the military with a critical job deferment. In 1983, Engen moved to ITT Corp., where he became president and GM of its avionics division. Promotions came fast and furious; when ITT Industries was formed in 1995 he became its chairman, president, and CEO.
Engen savored his increasing levels of responsibility for various ITT units. “I was acting as COO for those businesses and loved that I was responsible for developing a perspective on many businesses in many settings around the world.”
For Engen, the key to operating a business is to press on. “I’m not the kind of person who regrets things or ponders what-ifs,” he says. Indeed, he sleeps soundly. Although Engen considers his greatest accomplishment “being where I am,” he concedes he’s not satisfied. “I try to do whatever I do well, but there’s always something to learn. My personal goal in life is to do a great job but as for how I’d like to be remembered? That’s a moot question. I want to outlive them all.”
Chairman, President, and CEO
Birthplace: Pasadena, CA
Family: Wife, Anne Elizabeth Erickson; one daughter
Education: Aeronautics, MIT, 1967
Weak spots: Failed Latin and Russian reads a book a week
Tech Tac: Five cell phones, two PCs
Tick Took: Collects and repairs grandfathers clocks; owns 10 built from 1600 to 1800
Triathlons: Swims 2.5 kilometers, runs, and bikes
Passion: Vintage car racing weekends
Favorite books: Too many to name. “I read lots of books of all kinds: science, biographies, fiction, and books on car racing and antique clocks.
Current Reading: Biography of James Cook
Favorite vacation: Staying home, relaxing. “I travel enough on business.”
Favorite room: Kitchen