The July purchase of logistics service provider Kewill by a private equity firm is allowing the company to get back to basics and invest in its core compliance operations by removing the pressures of Wall Street.
“This was an acquisition and a take-private program. We see a huge upside benefit in that now we can invest in growth,” said Alan Gold, Kewill’s vice president of marketing and business development.
Gold characterized Kewill’s buyer, Francisco Partners, as a technology-focused private equity firm with a history of growth, as opposed to a takeover entity that piecemeals out a company and sells off many of the parts.
“We see a significant opportunity for Kewill, as long-term growth and increasing complexity in the trade and transportation of goods drives the need for comprehensive software solutions,” said Deep Shah, a partner for Francisco Partners, at the time of the acquisition.
||— Alan Gold, vice president of marketing and business development, Kewill
|“It isn’t about software people having an easier time writing compliance; it’s about enabling carriers and
customers to do something. That’s the real competitive
differentiation for us.”
“If we make a conscious decision to materially change our business, reinvest in an area, or choose to bring profitability down for a period, and the new owners approve it, we can do it,” Gold said. “This is going to enable us to execute very aggressively against our strategic plan and I think we’re really poised for significant growth as a result.”
Part of this execution strategy has already come to light under the company’s development and launch of a Universal Carrier Module (UCM) which addresses some of the major issues around parcel carrier compliance, the vetting and accountability practices and standards related to selecting carrier partners.
Kewill’s UCM is designed to simplify the process of bringing on board new carriers and related carrier service compliance requirements into a company’s software. In essence, UCM allows carriers and Kewill’s customers to build their own compliance templates – which must be approved–and integrate them into the Kewill platform without having to wait for the next update in Kewill’s cycle. The role of creating and maintaining carrier service compliance can be put in the hands of analyst-level employees on the carrier and customer side.
Perhaps the most significant part of Kewill’s UCM is that customers and carriers can create and manage service compliance through a simple interface that requires no knowledge of programming languages.
“Typically across all software providers, whether they’re willing to admit it or not, it’s all about a bunch of programmers in a room banging out code and getting it stuffed into an application so a new release can come out,” Gold said. “It’s difficult to consume, to maintain, and it has to be created by programmers that are really deep down in the code.
“What we’ve done with the UCM is separate out the core software from the services content,” he explained. “What we now have is a module that allows the business analyst-level person at the carrier, customer, or here at Kewill to write and maintain their own compliance without requiring a software release or vendor support.”
Gold said moving the platform to a UCM and away from an update-release cycle was developed to address the fact that carrier compliance is always changing and, before now, Kewill had to make the call about when to add in service compliance information.
Kewill sometimes found itself looking at a service that wouldn’t impact its customers but that carrier partners wanted available so they were not at a disadvantage against competitors. It also saw customers who looked at moving into new markets and found their existing carrier services or third-party software lacked coverage in those new markets, causing a disruption in the supply chain as they expanded.
For carriers, they can now create their own compliance and service on their schedule and deploy it on their own. Kewill then certifies the service and makes it available to customers so they can take advantage of it as soon as the carrier wants it available. On the customer side, they’re controlling more of their own destiny as they can write carrier compliance for partners in new regions.
Gold noted one customer wanted to implement Kewill’s Flagship, a multi-carrier shipping management system, in Australia and was currently using Toll as its logistics services provider.
“Toll Australia wasn’t supported so they actually came here and wrote the compliance with Toll, so now they can deploy and execute their supply chain in Australia in a way they couldn’t six months ago,” he said. “For them it’s the ability to take control of their own destiny.”
For Kewill, putting this control and maintenance into the hands of customers will allow it to continue to execute against its strategic plan, such as creating an exchange where templates for UCM can be developed, approved, and shared with anyone on Kewill’s platform.
“It isn’t about software people having an easier time writing compliance; it’s about enabling carriers and customers to do something. That’s the real competitive differentiation for us,” Gold said. “The interest on the customer side, and in particular among the carriers, has been extremely gratifying because they see this as technology that’s enabling their respective strategies.”
While UCM is only currently available on the latest release of Kewill’s Flagship system, version 5.2, Gold said the company plans to make it available across its product line in the near future, hinting at a more singular platform down the road.