A PBN SPECIAL SECTION: 2011 BUSINESS EXCELLENCE AWARDS
KVH growth built staying focused on client needs
GROWING INDUSTRY: KVH Industries Vice President of Research and Development Robert Kits van Heyningen talks during an interview at the company’s headquarters. The firm had $112 million in revenue in 2010.
The yardstick for measuring success is an exact and accurate one – much like the products produced and sold by the Middletown electronics company KVH Industries Inc. The yardstick for measuring why a company becomes successful, however, isn’t as precise. If it were, then the late Steve Jobs, a Santa Clara dropout from a liberal arts college, whose LSD experiences made him a visionary in the world of computers, wouldn’t have amounted to much by any metric, flashbacks excluded.
With this in mind, KVH Industries is the very picture of success. As a company it has seen the main indicators of its business health rise during the past decade – total revenue in a three-year period rose by $33 million, to $112 million, in 2010 and its work force increased more than 150 percent, to 378 worldwide. And its product line, which once consisted of only a digital compass used by pleasure cruisers and America’s Cup yachtsmen, has moved into developing satellite communication solutions with its global mini-VSAT (Very Small Aperture Terminal) Broadband network and compatible hardware. The company’s TracPhone V3 is currently the fastest-growing maritime VSAT network in the world.
But this doesn’t explain the nebulous metric of “how.”
In 1978, Martin Kits van Heyningen, KVH’s current CEO and one of the two sons of the company’s founder, the late Arent Kits van Heyningen, came to his technically minded father with a challenge: build a performance computer for a boat. The skipper of the America’s Cup racer France 3 asked the younger Kits van Heyningen this when he discovered the young man’s father was a gifted engineer. Martin Kits van Heyningen responded, saying, “My father can make anything” – which he did, building the first tactical sailing-performance computer of its kind. Writing for PassageMaker Magazine, Steve D’Antonio said of this early creation that, “it could not recognize or use the true direction of the wind or the vessel. Electronic compasses at that time were analog, while computers were and still are digital; thus, the two were incompatible.”
It would take another two years working out of the basement laboratory of the family home in Newport to produce the world’s first truly accurate, self-calibrating digital compass, which the first commercial version of was shipped in 1982. The Azimuth 100 digital compass today is still one of KVH’s top products.
The family company now has Martin and Robert Kits van Heyningen as its president and CEO, and vice president of research and development, respectively. The two brothers are among five employees who still remain with the company from those artisanal days.
KVH still retains the family feel, which might seem difficult when it also has offices in Denmark, Norway, Singapore, and Brazil and on the U.S. mainland in Illinois. “I used to do a lot of the manufacturing,” said Robert Kits van Heyningen, of the former operating methods of almost 30 years ago. “But engineers have to be trained and certified and there is a lot more testing than before. The days of banging in a nail are over.”
The family feel is evident, however, in the company’s commitment to its staff – it invests in the people it believes in. Supervisors and employees are encouraged to keep an open dialogue pertaining to job performance and goals on a daily basis. Each year, Martin Kits van Heyningen leads an offsite retreat, where senior management plot the next five years to discuss the direction of the company and the evolution of its business.
But forecasting the future is easier when you understand the basic fundamentals of your customers’ needs, in fact any customer’s need. “People want one solution,” said Robert Kits van Heyningen. “One phone call and that’s that. They don’t want service and hardware providers pointing at each other when things don’t work. You have to stand by your services and products even if the customer doesn’t know what they’re doing … even when they’re breaking them. And that’s what we do. We guarantee our products.”
It is this attitude, along with their commitment to quality, that has paid dividends. It is also their ability to see what their customers need … see what the market needs and react.
Before the 1991 Gulf War, KVH began working with the U.S. military on a compass for their light-armored vehicles. Seizing the moment, the company had a 90-day window in which to repackage the product, install it and make sure it worked as the war raged on. This pressure-packed period marked a new era for the company, which would lead to an altogether new and diversified product line and a long-standing relationship with the armed services.
Today, KVH is working with the Coast Guard outfitting its cutters with a satellite-communication network, and the introduction of its DSP-1750 fiber optic gyro (FOG) technology has expanded into the commercial and military guidance and stabilization markets. Adaptation of this kind has been crucial to the company maintaining its market share in these tough economic times and is helping to further the next phase of the company’s operating strategy: greater product and service integration, which in turn creates a recurring revenue stream - the smart answer to the theory of soup to nuts.
What illustrates the company’s growth and position in the world of leisure and commercial shipping communications and guidance is an area inside their Middletown headquarters. It’s called the Network Operations Center (NOC). It is where the mini-VSAT Broadband network is managed. The large flat-screen monitors show the network where KVH provides its customers with round-the-clock support … not bad if you’re adrift in the South Pacific, or incommunicado off Block Island.
The NOC ensures that support personnel can monitor weather conditions, as well as the number of users on the network and their location. It also shows where the earth stations are located. In other words, it’s KVH TV and it’s worldwide. “People want data,” said Kits van Heyningen. “We ensure they get it.”
KVH has given sailors telephone, television and Internet connection, turning ships and boats from mere ocean-traveling vessels to receivers and transmitters of every form of communication. In this, the company has manufactured and sold more than 150,000 mobile satellite antennas for vessels, vehicles and aircraft. •