McHugh Relaunches as RedPrairie

Supply chain execution player introduces shared risk-rewards option

Waukesha, WI  June 10, 2002  Supply chain execution specialist McHugh Software International relaunched itself this week under a new name, RedPrairie Corp., pledging to offer a "a fundamentally different approach to delivering value for its customers."

RedPrairie's DigitaLogistix product suite includes productivity, transportation and warehouse management functionality, along with visibility and analytics solutions.

As part of its rebirth, RedPrairie promised a new process for ensuring customers achieve measurable results from the company's logistics solutions and a willingness to guarantee those results through a shared risk-rewards framework.

Steve Banker, director of supply chain research for ARC Advisory Group, said the McHugh's rebranding move makes sense for the company, particularly since the company is undertaking product, process and internal cultural changes designed to ensure that the return on investment promised to customers is actually achieved. "This is more than rebranding hype," Banker said. "These changes, if successfully executed, will truly differentiate RedPrairie within the supply chain execution space."

Mike Bittner and Jonathon Sroka, analysts with AMR Research, agreed. "McHugh Software International surprised everyone with a radical shift in it focus, along with a new company name," the analysts wrote. "The corporate culture, management structure, product positioning and market messaging are all being transformed to emphasize the delivery of value and return on investment. The company is willing to back up its claims with an optional gain-sharing model that might be of interest to enterprises looking for more than just warehouse management system (WMS) functionality at a low entry fee."

In a statement, the newly rechristened RedPrairie said the company is making these changes during a time of significant financial health and industry momentum. The company reported record financial results in first quarter 2002, including more than $7 million generated from first quarter operations; total revenues of nearly $19 million, representing growth of more than 27 percent over the previous year; and earnings of 18.8 percent of total revenue.

The Waukesha, Wisc.-based company named a new CEO at the beginning of this year, with John Jazwiec taking over concurrent with the retirement of former CEO Ritch Durheim.