Executive Strategies

Document Management Magazine

The Rebirth of Keyfile Corporation

by Robert Smallwood


Keyfile is BACK – and in a big way. Today in 1999, Keyfile has become the leading provider of workflow software integrated with the Microsoft Exchange groupware platform. After an intensive development effort over the past four years, the Nashua, New Hampshire-based company signed a 22,000+ seat contract for their Keyflow product. It will be installed in Defense Finance and Accounting Services (DFAS) at the U.S. Department of Defense. The bid was done jointly with Microsoft, with Unisys acting as prime contractor.

In the competition for the contract, Keyfile was in the position of being the differentiator with Keyflow in a groupware battle between Microsoft Exchange and Lotus Notes. "They (DFAS) wanted a solution that leveraged their messaging infrastructure - which they were choosing at the same time - to automate business processes. They also wanted to lay the groundwork for implementing an e-commerce solution," states Roger Sullivan, VP of Professional Services and Strategic Relations at Keyfile. "We offer the only horizontally scalable workflow solution in the Exchange environment," Sullivan proclaims. Discrete departmental applications, like processing an employee from recruitment through hiring and performance review, or purchase order processing, are the building blocks for interdepartmental workflows. Once these processes are automated, a standard way to link the organization and automate the routing of work becomes required. "Customers are concerned about end-to-end, cross organizational business processes," states Sullivan.

Customers are also concerned about Year 2000 compliance. Both the Keyflow product (version 2.x and higher) and its cousin, Keyfile Classic (version 3.2+) for imaging and document management are compliant. Both comply under the definition of Y2K compliance by the British Standards Institute.

In the 22,000 user project, the Defense Finance and Accounting Services’ approach is to allow line-of-business managers to author processes with a solution out-of-the-box, which can be done with Keyflow, while complex process flows will be developed by their IT department. Each department will have its own discrete processes and subflows; i.e. the output of one process is the input to another.

Just a year or two ago, Keyfile Corporation (www.keyfile.com) was in the throes of a struggle, and seemed to have gotten lost in the shuffle. Keyfile had maintained a high profile in the document management and workflow industry in the early 1990s, and seemed to lose momentum by mid-decade. What was brewing was a single-minded focus on delivering the most robust message-based workflow product possible, tightly integrated with the Microsoft Exchange groupware platform. The result was Keyflow, a feature-rich, messaging-based workflow package. It follows what now is, "… a most remarkable trend…" in the marketplace, as users flock to the Exchange platform, according to Keyfile’s Sullivan.

Keyfile President & CEO Chris Robert came on board 5 years ago and began a wholesale overhaul of Keyfile. He eliminated further development on the IBM OS/2 and Unix server platforms and focused all resources on the Microsoft NT platform. He then decided to focus on the Exchange messaging and groupware platform. "There was a real risk at the time in going away from the Notes direction. Now, it seems clear to many that Microsoft NT and Exchange have the upper hand, but at that time, a lot of planning and analysis went into the decision." Robert goes on to say, "With the commitment to NT, we suddenly did not have to worry about porting trade-offs, communications ‘plumbing’ and other platform issues. We could just focus on document management and workflow applications. So I told my team to build the best possible workflow product on top of Exchange, with no constraints – and they did. Now, we find that our software meets 95% of the workflow needs out there."

In late 1994, when the decision was made, the commitment to Exchange was hardly an obvious choice. Lotus Notes and Novell GroupWise were far outselling Exchange. Now, GroupWise has slipped dramatically with the fall of Novell, and the Notes and Exchange groupware platforms are neck-and-neck, with over a million Exchange seats per month being sold in the marketplace. There are now over 15 million seats of Exchange sold. The momentum is clearly now in the Microsoft corner, although that wasn’t always the case.


Under CEO Robert, Keyfile also implemented a rigorous Quality program, beginning with customer surveys in Technical Support to see what they were doing right, and where they needed work. In an unusual move, they re-organized to have Technical Support report directly to the Sales VP. "Ultimately, support directly impacts sales," states Ed McLaughlin, VP of Worldwide Sales at Keyfile. What was implemented is a ‘closed loop’ quality process, while investing in Customer Service training to ensure that customers were being handled effectively and courteously. Product releases were reduced in size and scope, while frequency was increased. Instead of one big release annually, two smaller, semi-annual releases are now made.

And what do their strategic alliance partners think of the changes? Rich Noffsinger, Director of Industry Marketing at Microsoft (www.microsoft.com) asserts, "Keyfile has been a wonderful organization to partner with. They work well with our team and build great DM and workflow products. They made a big investment in Exchange early on, and it has really paid dividends for them." Keyfile requires resellers to be certified Microsoft Solution Providers.

In some cases, the software is sold directly through other software providers. Australia-based, production imaging provider Tower Technology (www.towertech.com) recently signed a deal to re-sell Keyflow. "We extensively evaluated the message-based workflow market, and Keyflow is the absolute best collaborative workflow product out there," proclaims Bill Zastrow, VP of Marketing at Tower. "This is simple-to-use stuff that executives can quickly pick up and utilize. It’s as easy as setting up an e-mail distribution list. Further, the mail reporting, graphical workflow development and performance statistics are very rich features. It goes far beyond any other mail-based workflow systems on the market.."

Keyfile has real momentum going. Recent contracts include General Instrument, the $1.8 billion communications provider, PT-1 Communications and Gucci Timepiece in Switzerland.

All this adds up to a 50% revenue growth rate in 1998 for Keyfile. But Keyfile is not standing still. In the fourth quarter of 1998, they acquired F3 Software Corporation of Burlington, MA, which markets Professional Designer for Windows (PDW), a forms construction and processing product that has been used to create approximately 10 million different forms – more than any other forms design product on the market. F3 also focuses on forms-specific automation solutions that create and distribute forms of the Internet. The integration of F3 forms technology with Keyflow will strengthen its web functionality by allowing enterprise forms to be routed to all personnel in an organization, whether they work on thick or thin client desktops. It will be integrated with the next release of Keyflow. "F3’s software tools provide Keyflow with a critical paper forms conversion capability that will significantly shorten the time required to incorporate a customer’s paper forms into Web-based workflow readiness," Keyfile’s Robert says. Paul Prusa of Empire Fire & Marine says, "This acquisition makes good business sense for Keyfile and F3. As a customer of both companies, I can see the synergy that will develop from the deal. We’re pleased with this announcement because we see many areas where Keyfile and F3 complement each other."


Robert Smallwood is a Partner with IMERGE Consulting and Treasurer/Vice-Chair-elect of the AIIM International Board of Directors. He can be reached at (504) 525-4500 or bob@imergeconsult.com.