Galaxy Technologies’ story begins a lot like that of Apple Inc. — the only difference is it began in a Madison, Wis., basement rather than a Cupertino, Calif., garage and involved software instead of a computer.

Jim Wacek, who formed the company with a partner who left the organization in 1991, has lead the enterprise from its humble beginnings to a successful company delivering work force management to companies nationwide and posting nearly $7 million in sales in 2009. As further affirmation of his hard work and that of the company’s 50-plus employees, Galaxy became one of Administaff’s adjacent businesses through a recent acquisition.

Administaff, the nation’s leading professional employer organization (PEO), announced the Galaxy Technologies’ acquisition in late July, and Wacek says the acquisition couldn’t have come at a better time. Galaxy Technologies just released a new version of its flagship time and attendance software, which was about two years in the making.

“Having Administaff’s financial backing and marketing expertise is really going to help us get the word out there about this new release,” Wacek emphasizes. “For us to be able to market this software on this scale is huge.”

Acquisition aside, Wacek says it is business as usual at Galaxy Technologies. Existing management and staff will continue to oversee operations and deliver the same high level of service its customers have come to expect.

“In our industry, an acquisition typically means the product or technical team is going to go away, the customer base is going to be transitioned or vendor relations are going to be broken,” says Carlos Gonzalez, Galaxy Technologies director of sales and marketing. “This acquisition is unique in that all of these things will remain the same.”

Keeping it under one roof

How does a company grow from two guys in a basement to a multi-million-dollar operation acquired by the country’s leading PEO? “Simple: Good business, unmatched customer service and a willingness to say ‘yes’ to a project when others have already said ‘no,’” says Wacek.

From the very beginning the company has kept its engineering and technical support teams in-house. This fact enables Galaxy Technologies to keep pace in an ever-changing market, which has moved from a DOS platform to Windows to client-server to Web-enabled to Web-Native/SQL dating back to 1988.

“As the product has moved from all of those different platforms, we have not outsourced any of our development, and I think that’s a key point to our success,” says Wacek. “It has allowed us to grow and support our product at a much higher level,” he says. “If an issue arises we’re able to respond quickly to our customers’ needs.”

The decision to keep development under one roof enables Galaxy Technologies to customize solutions for each client’s unique needs. For example, when Madison’s HospiceCare Inc. sought a time and attendance solution, they wanted to pay employees for the tasks they completed rather than the time it took to perform them. When patients transitioned to a different room, for instance, the organization needed the software to apply a unit of pay to the correct staff member who helped them, who moved them, and/or readied the room for them and so on.

“We were selected over our competitors in that scenario because of our customization capabilities,” Wacek says. “Because we have our engineers in-house, if a client wants to customize the application, we’ve been more than willing to provide that. It is one of our key differentiators.”

The customer comes first

From a customer service standpoint, once a company has Galaxy Technologies’ products, they know exactly where to turn for support. Wacek and his wife, Tammy, who have run the business together for more than 20 years, have always subscribed to the belief that the customer comes first.

“Our clients know our support people by name and our support people know our clients by name,” says Gonzalez. “In other companies, clients call and provide a client number and rarely talk to the same support person.”

Supporting a payroll system, says Wacek, became the driving force behind this philosophy. “If someone had a payroll problem and couldn’t get their payroll out, everybody had their hair on fire around here,” he says. “That just kind of evolved into all of our products. We took the view that our clients are dealing with employees and their paychecks — you have to take that seriously.”

The advent of Internet capabilities has helped Galaxy Technologies support products more efficiently than ever before, adds Wacek.  The company now uses tools that enable technical support to connect to the client’s desktop, see what they are seeing and walk them through technical issues. Software updates are now delivered via the Internet.

“That has really helped us grow the customer service aspect of our business,” he says. The company bundles upgrades and technical support into one contract that provides clients with software updates and technical support as opposed to charging for each item separately like many competitors.

Integrated solutions

Another factor Wacek attributes to the company’s success is its ability to provide an integrated payroll, HR and time and attendance solution. In 1990, Galaxy Technologies partnered with Sage Business Software to make this possible.

The idea behind this partnership was that when a company seeks a time and attendance solution they likely need payroll and
HR solutions as well.

“We refer to it as ‘Punch to Paycheck,’” says Wacek. “Our integrated solution automates the entire process, from the point when an employee clocks in to the end of the pay period when they receive their paycheck.”

Integration capabilities allow Galaxy Technologies to take a consultative approach with every prospective client. If a client outsources its payroll, Galaxy Technologies can still offer its time and attendance piece. But if an organization requires a more complete package, Galaxy Technologies can offer that as well.

“This approach helps Galaxy Technologies devise solutions that meet the unique objectives of separate company functions,” adds Gonzalez. “Payroll wants a smooth end of payroll process. HR wants a good corporate culture. Information technology wants to make sure we don’t obstruct their network. Finance wants to control labor costs. We identify the objectives by functional role, then present the product and show them how each functional department will be better able to do their jobs with our solutions.”

Tough timessmooth sailing

“Delivering what the customer needs, when they need it, and helping them keep it operating smoothly is what helped the company weather the recent economic downturn when many Wisconsin companies didn’t fare nearly as well,” says Wacek.

Having long-term, dedicated clients who were happy with Galaxy Technologies’ products and services kept the majority of them from jumping ship during the downturn. In fact, Wacek says very few clients left Galaxy Technologies as a result of the recession. The company’s SaaS (Software-as-a-Service) product line also allows clients to pay for services monthly instead of making a large payment up front, which has been attractive to many businesses.

“In times of growth, we can help our clients manage their growth and in times of recession we can help save them labor costs,” says Gonzalez. “We have a good message in either direction the economy is heading.”

Looking toward the future

The future, with the acquisition completed, looks very bright, adds Wacek, who points out he required a prospective buyer to meet several criteria in order for him to consider an acquisition. When evaluating the Administaff opportunity, Wacek said he looked for the following:

• That employees would not be dramatically affected,

• Clients would see no change in the services they received,

• Partners would not be impacted by the ownership change, and

• Galaxy Technologies would maintain its own identity.

“Administaff gave us the opportunity to accomplish all of this,” he says. “As one of Administaff’s adjacent business units, they are strategically helping us grow into a larger company than we are today.”

The acquisition allows Galaxy Technologies to stay the course while fueling the strength of its product line, according to Gonzalez. “Administaff acquired Galaxy Technologies because of the strength of its products, not to sunset the technology or change the product’s direction,” he explains.

And Wacek for one says he’s excited about the possibilities this acquisition will bring. “We’ve gotten this far, and I’m excited to see it being taken to the next level.”

By Ronnie Garrett

Ronnie Garrett is the Editor of Corporate Report Wisconsin.