Measuring from Top to Tail
The New Zealand Herald Monday, April 9, 2007
Keith Phillips is aiming high after overseas success with “unique” QLBS.com performance management software.
Keith Phillips is itching to tango with the giants. The former head of technology investor IT Capital handed over the chairmanship of Cadmus Technology a fortnight ago to focus on his latest project – performance management software firm QLBS.com.
Think audacious. Think Bill and Melinda Gates’ US $32 billion foundation. Add on Warren Buffet’s fortune, and the not-for–profit agencies dealing in billions of dollars around the world. This is where Phillips, the company’s president, thinks as customers are – in the health, social and education, sectors – and he’s determined to capture them.
QLBS.com’s system is all about assessing risks, measuring performance and keeping scorecards so these not-for–profit organisations, as well as profit-making concerns, can get the biggest dynamite for their dollars. The future looks bright if the company gets it right.
“We will succeed,” says Phillips emphatically. He is convinced that QLBS.com stands tall in a world crowded by performance measurement and management systems.
The company markets itself as a “measurement system for continuous improvement”. The system has a database of leading indicators which tell companies whether they are up to scratch. It also helps them benchmark themselves against the best in class, so they can then find and patch existing gaps.
Phillips is wary of the taboo phrase “We have no competitors”. Having been a venture capitalist dishing out money to businesses looking for funds, he knows it’s rarely true. But he can’t help himself. “I hate to use this phrase, but I really think that what we have is unique. The system has full scalability and sits on the spectrum on its own,” he says.
There are many competitors in this market, ranging from financial performance management, corporate performance management and balanced score-card systems to HR management tools. Phillips says most computers do well measuring output or lag indicators. A few provide lead indicators with the measurement system.
“The holy grail is having both the lead and the lag indicators. When you have both these indicators you start to get a good idea of what is happening.” QLBS.com has a system that is scalable and adaptable. It is a best practice model for benchmarking. “Our biggest defence against the competition is speed,” he adds.
Phillips has a 50% share in QLBS.com. The other 50% is held by the company’s Steve Lewin, and chief operating officer Margaret Mulqueen. He won’t disclose details of revenue but says “we are cash flow positive”. However, the company will need to raise money soon from investors to keep growing at its present pace.
Phillips had the opportunity to parade QLBS.com last week in Seattle, where he ran a workshop for incubator managers for the National Business Incubation Association (NBIA). QLBS.com has signed a deal with the NBIA where the association and its clients will be offered special rates to use QLBS.com to measure and manage the incubation of small businesses.
Murray Cleverly, chief executive of the Aoraki Development Trust in South Canterbury, is convinced of its value. The agency has used the tool to measure its own performance, and now also offers a tool to clients of the agency to help them measure their performance.
“the basic premise is that if you can’t measure it, you can’t manage it. Whether it is profit or not-for -profit, organisational performance is difficult to measure at the best of times,” he says.
Cleverly adds that the challenge for not-for-profit organisations has always been to demonstrate and communicate to stakeholders that management is doing the right thing and has the right competencies. The assessment showed his agency did very well but also found areas for improvement.
Ann Verboeket, executive director for training and development for the Economic Development Association of New Zealand, says the system was invaluable for business managers at the agency.
And the former general manager of the South Waikato Economic Development Trust, Dianne Turco, says it has allowed the economic development agency to reach more businesses in a cost-effective manner. In her case, the agency has three people trying to reach 1500 businesses, assessing their needs and working out how to help them. While there are other assessment systems, she says, the QLBS.com one is the “most complete I have seen”.
Phillips has struck a few successes, including the funding of Virtual Spectator while at IT Capital and later with Terabyte Interactive. He says his work at Cadmus has been rewarding as the firm has grown from a $2 million company to a $30 million one.
Phillips was introduced to Lewin through Dave Penny, formerly of New Zealand Trade and Enterprise. Phillips was convinced he could marry his marketing savvy with Lewin’s brilliance to make QLBS.com a global name. Four years ago, he bought into the company.
From now on, it’s all about building momentum. India looms on the horizon after QLBS.com signed a deal last year with CMC, the technology solutions company owned by India’s largest company, The Tata Group. The agreement allows CMC, a listed company with revenues of over US $300 million ($416 million), to introduce QLBS.com to its customers. QLBS.com will also be helping Tata automate its quality management process, currently built around the Malcolm Baldrige quality management archetype, Phillips says.
There are other large opportunities out there, and Phillips understands the challenges of getting to them. “It is extremely hard to get New Zealand businesses to the world. The area is more rarefied here. The market’s that far away."
But he believes he can do it if he gets fully involved. “You can make it happen, by self-actualising it, by travelling.” He is now focusing on building resources and sequentially attacking the market. This may well be a classic story of a small Kiwi company making the market happen – in Phillip's own words.
Yoke Har Lee