At 1.89m, he has a towering presence, but low-key Mitac Synnex Group chairman Matthew Miau may be the most underestimated star in Taiwan's high-tech sector.

On appearances alone, he lacks the aura or charisma of Hon Hai Group chairman Terry Gou or Acer founder and chairman Stan Shih. But Miau has already turned Gou's dream of building a sprawling distribution network into reality. Mitac Synnex Group subsidiary Synnex Corporation, which is headquartered in California, is the third largest distributor of technology products in the United States, and Taiwan-based Synnex Technology International Corporation has solidified its spot as Asia's top information technology wholesaler in the Asia-Pacific region.

Furthermore, Miau's most recent acquisition allows Synnex to directly achieve Stan Shih's "Build Your Own Cloud" dream, by taking an early lead in the global war for cloud networking supremacy.

Moving Up in the Technology Services Market

In a merger that fell under the radar, Synnex Corporation completed the acquisition of IBM's customer care business (call centers) on Feb. 3, 2014. For Taiwan's struggling high-tech sector, the acquisition signaled the possibility of investing in technical services and internationalization as a potential lifeline.

Synnex paid US$505 million to acquire IBM's customer care outsourcing services, which generate more than US$1.2 billion in revenues a year. It put up US$430 million in cash and transferred 5 percent of its shares to IBM, making IBM one of its shareholders and a strategic partner. The deal also immediately catapulted Synnex from the highly competitive distribution market into the higher value-added services market.

"We were really surprised they (IBM) were willing to sell. The business has a gross margin of 20 percent," says an ebullient Miau in an interview with CommonWealth Magazine.

Targeting earnings per share of US$20 by 2015, IBM has been selling off lower-margin businesses to focus on cloud computing and big data analytics, which can deliver margins as high as 60 percent.

Miau jumped at the opportunity, and in so doing, he inconspicuously enfolded our lives within his "cloud atlas" without our even knowing it.

Penetrating 10 Major Industries

Forty years ago Miau founded Taiwan's first computer company (Mitac Inc.) using Intel microprocessors. Today he has built a new "Taiwan Inside" brand in the global services sector.

If you want to borrow books from the library and have an RFID (radio-frequency identification) library card, you don't need to have a librarian check the books out for you. The system behind this fully automated library has been developed by Hsinchu-based Claridy Solutions Inc., one of the companies in which Miau has personally invested.

When a car is stolen, police in the Taipei and New Taipei metropolitan areas scan more than 10,000 surveillance cameras to try to break the case. This monitoring system is maintained by Mitac-Synnex subsidiary Mitac International Corp.

If you're traveling in the United States, and your satellite TV reception is poor, the customer service company answering your call for help will likely be Concentrix, a wholly owned subsidiary of Synnex Corporation.

In the future, you may call your bank to ask about your credit card balance or call an airline to change a reservation or call customer service to get help with a problem with your Xbox or even get a call from your car dealer reminding you that the time has come to get a tune-up or change your car's tires. But in those cases, the company talking to you will not be major brands such as Citibank, Microsoft or Toyota, but Synnex Corporation, in which the Mitac Synnex Group has a 27 percent stake.

After Synnex acquired IBM's customer care outsourcing business, it immediately became the world's sixth biggest business process outsourcing (BPO) provider. The newly acquired IBM business will be combined with Concentrix "to support high-value interactions at every stage of the customer life cycle," Synnex said in a statement announcing the acquisition.

Synnex acquires two to three companies a year and has bought eight over the past five years, helping Miau live up to his nickname of "Mr. Merger." But the acquisition of the IBM business had special significance for Miau's group.

To Synnex Corporation, which is slightly bigger than Synnex Technology International, with annual revenues of US$11 billion, the IBM business will only add about 10 percent to its annual revenues, but it will also generate annual cash flow of US$100 million and pre-tax profit of US$120 million a year.

Even more importantly, the acquisition gives Synnex a strong foothold in the global customer service BPO market, worth US$58 billion-a-year. The company has traditionally represented different products to expand horizontally, but it will now suddenly have access to several major IBM customers.

Aside from its core consumer electronics business, Synnex will now be able to penetrate nine other major industries, from automobiles, banking and financial services, government services, and retail and electronic commerce, to health care and pharmaceuticals, insurance, media and telecommunications, travel, and transportation.

"That has given Synnex a lot of new room for growth. But it has to be careful not to be reduced to the cheap services or software contracting seen in India," cautions former IBM Taiwan Global Business Services executive Paul Liu, who is now an executive director at PwC Consulting.

An Empire on Which the Sun Never Sets

Miau's "kingdom in the cloud" has evolved into an "empire on which the sun never sets."

Even before the acquisition of the IBM business, Synnex had a combined workforce of more than 10,000 employees in customer service, and information centers in Puerto Rico, the Philippines, Ireland and India processing 2 million phone calls a day.

But now its workforce has swelled to 43,000 employees working at over 50 service centers across six continents, providing services in 40 languages for more than 300 major brands.

At a time when Taiwan's high-tech sector has grown despondent as its brand and contracting business models both face serious challenges, Miau saw another opportunity: IT-enabled services.

"Taiwan has been arguing over the past 30 years about which is better – branding or contracting. But it's not a question of branding vs. contracting. It's a question of manufacturing vs. services," Miau says. "BPO still has a lot of room for growth! The market grows by US$3 billion a year, but everybody is still trying to squeeze into the 'manufacturing' area."

Internationalizing the service sector may be more difficult than internationalizing the manufacturing sector, but Miau's stable of companies has always been the first to stride onto the global stage. The reason: international-standard management capabilities.

Aside from the fact that Synnex Corporation's biggest shareholder is a Taiwanese enterprise, it does not betray even the slightest hint of having a Taiwanese character. The company's president and CEO, Kevin Murai, is a Canadian of Japanese ancestry. Eight years ago, he was chief operations officer at America's biggest wholesale technology products distributor Ingram Micro but later jumped to Synnex, a company not even one-fifth the size of his former employer. Murai has never felt Synnex is a "Taiwanese company."

"We are a global company. I respect Matthew so much. He gives a lot of advice, but he also trusts us and allows us to make key decisions," Murai says.

One example: Distributors fear unpaid accounts receivable more than anything else, and credit checks are critical to their financial health. But Miau is perfectly content having them done by employees on the front lines in the United States.

Only 4 Days a Year to Run Synnex Technology

"There are two management approaches a company's headquarters can take. You can either control people or enable people," says Miau, who clearly belongs in the latter category.

Synnex Technology CEO Evans Tu admires Miau's management skills, once revealing that Miau spends only half a day every quarter reviewing Synnex Technology's financial results and meets with the company's branch managers for one full day at the beginning and end of each year.

"He needs only four days a year to manage Synnex Technology," Tu says.

One approach that has served Miau well is turning his professional managers into shareholders. Aside from institutional investors, Tu is Synnex Technology's biggest individual shareholder with a 2.17 percent stake in the company, higher than Miau's own 1.9 percent stake.

So how has Miau been able to so adeptly manage an empire that ranges from flour to computers, from petrochemical plants to distribution warehouses, and generate consistent revenue growth for the group?

"He's hired strong executives and trusts them," says Murai with a chuckle, getting to the heart of the matter.

Over his 40 years in business, Miau has developed uncanny business instincts, able to assess and decide almost instantly such key issues as what kind of companies he should buy and how much he should pay for them.

"You can look at a company from three different angles," Miau says. "The first is its organizational chart, as an outsider would see it. The second is its financial and legal structure, the most efficient way to either integrate it or split it up in the future. The third is a company's network organization." On the subject of business management, Mr. Merger is able to chat with refined ease at a moment's notice.

Mr. Merger has struck again, but this time he has done more than help Synnex upgrade its operations and open a new market. He has also blazed a potentially new trail of prosperity for Taiwan's struggling high-tech sector.

Translated from the Chinese by Luke Sabatier