A deal for new space in Irvine caps a year of big changes at Kofax PLC, a maker of office software that helps businesses cut down on paper.
Chief Executive Reynolds Bish, who was brought in about a year ago from a competitor, has taken a “velvet hammer” to Kofax, he said.
He’s streamlined the reporting structure at Kofax’s sites around the world, rebranded the company’s portfolio of software and added five executives to its upper ranks.
Along the way, the company, which trades on the London Stock Exchange with a recent market value of about $130 million, has seen a gravitational shift in power to Irvine.
The company’s local office always has served as its operational headquarters. But now all of the company’s offices around the world,including its British hub in southern England, where Kofax’s directors meet,report to Bish.
The biggest shift has been cultural, Bish said.
“It may sound like the rebranding and restructuring was difficult, but it wasn’t rocket science,” he said. “The greater challenge has been moving from the old culture of being teamwork-based to more of a performance-oriented company.”
Kofax, which got its start in Irvine in 1985, has 365 workers here and some 1,200 in all.
“Historically, this company was a led by a number of CEOs who treated it somewhat like a family business,” Bish said. “To a great extent we’re promoting from within as opposed to bringing in professionals from the outside.”
Kofax’s previous managers favored consensus decision making.
“There was lots of discussion,” said Andrew Pery, chief marketing officer. “But in a lot of cases it prevented us from making decisions.”
Before Bish came on board, each Kofax site reported separately and took care of its own administrative tasks.
“We had all of these centers in each country and replication of administration function, creating an enormous amount of inefficiency,” Pery said. “It was hard to read into any of these businesses.”
Bish made Kofax’s Irvine operations a reporting hub.
“That’s a major transformational change that occurred,” Pery said.
Pery, who’s been an executive at Kofax for nearly three years, calls Bish “bottom-line oriented and proactive.”
“It was a sea change in the way the company operates,” he said. “Agility and speed are important to him.”
After about a half-dozen acquisitions in 10 years, Kofax had grown unwieldy. The company had $255 million in sales for the 12 months through June.
A decentralized approach made it less effective, according to Pery.
“The company has grown through acquisitions and we ended up with somewhat of a fragmented brand image,” he said.
Bish renamed Kofax’s products and various subsidiaries around the world. He also gave its logo a facelift.
He had to be a bit of a tough guy in order to “improve shareholder value” – his marching orders from Kofax’s board.
“When a company gets to a certain size and encounters the challenges this company saw a year ago, it’s necessary to focus on achieving quarterly revenue and profit objectives and place a much greater emphasis on authority and accountability,not just for trying but for actually producing results,” Bish said.
It didn’t sit well with everyone. Some 5% of Kofax’s workers opted to leave.
“We’ve had pretty broad based support for the changes,” Bish said. “But there have been people who said that it’s not the kind of environment they want to work in. That’s a little more than I had anticipated.”
Kofax makes scanning software used by businesses to get rid of paper and speed up work productivity.
The software collects paper documents, forms, invoices, e-mail and photos and organizes them into a searchable database of electronic files.
Customers include Wells Fargo & Co., FedEx Corp. and government agencies.
Bish, 56, came out of retirement a year ago after being recruited by Kofax’s board. He replaced Rob Klatell, who retired.
He hails from San Diego-based Captiva Software Corp., which he founded in 1989. The company grew to be a competitor of Kofax and was bought by EMC Corp. in 2005.
Earlier this month, Kofax said it’s moving its headquarters to the Irvine Spectrum next year and increasing its square footage by a third.
The company signed a seven-year lease for two new buildings with more than 90,000 square feet at the Discovery Business Center, which is owned and managed by Irvine Company.
The move “is consistent with projecting a much more high-profile image in Orange County,” Pery said. “The decision to move was economically sound and it also brings us into a much more modern, prestigious location that enables us to plan for our growth in Irvine. We will be one of the major tenants there.”
