Six Technology Resolutions for a Happier and Healthier SMB New Year

Happy New Year! While we often make personal New Year’s resolutions, I don’t think too many businesses make them. But you can start to change that in 2014 by resolving to make better use of technology to power your business, and create a more sustainable, competitive business.

With that in mind, here are a few resolutions that can help you work smarter, not harder, and enjoy a happier, healthier business in 2014.

iphone1. Manage your mobile investment. SMB Group research indicates 67% of SMBs view mobile solutions and services as “critical” to their businesses. SMBs are using mobile apps and solutions to help employees work more productively and efficiently, and to boost customer engagement and transactions. But while mobile apps are often easy to use, you also need to provision, support, and track and manage them on the back-end. Unfortunately, many SMBs are not yet using solutions to manage mobile devices and applications, and to protect valuable data from being lost or stolen. The good news is that vendors have taken notice and are offering cloud-based mobile management solutions specifically tailored to SMB requirements and constraints. Just a few to check out include: AirWatch Professional, Mobile Iron, Tangoe, and Dell Cloud Client Manager.

Social Business People Network  inside Speech Bubble2. Tune up your content marketing strategy. Many SMBs feel overwhelmed by the care and feeding that marketing requires these days. Back in the day, when marketing was a one-way street, businesses could get by with creating a marketing campaign and collateral that would see them through a quarter or even the year. But in the digital age, businesses are under pressure to create new content every week or even every day to keep customers coming back. If you don’t have one, put a plan in place for creating and scheduling content to keep everyone on track. When you create fresh content, think upfront about ways to recycle and reuse it. For instance, if you create a YouTube video, write a blog post about some aspect of it, and tweet out bite-size tidbits from the post. In addition, put a system in place to measure what networks and content click for your target customers. Depending on your business, free or low-cost tools such as HootSuite, SocialMention, Facebook Insights, Twitter Analytics, Google Analytics, Bit.ly and/or Buffer may fit the bill. Or, you may want to investigate marketing automation solutions, such as Infusionsoft and Hubspot, that integrate social more tightly with sales, marketing and content management applications to make your content investments more actionable.

men with puzzle pieces3. Integrate key workflows to get more bang for your software buck. The cloud has made it easy for businesses to add applications to address pain points on a piecemeal basis. But integration is often an afterthought. As a result, many SMBs end up with a hodge-podge of disconnected applications and workflows. People end up wasting time and making mistakes manually re-entering data into different systems, and getting accurate reports for decision-making can become a Herculean task. Things start falling through the cracks because the different applications and processes “don’t talk to each other.” This could be the year you do something about it! If you’re looking to upgrade core business apps, such as accounting, HR or CRM, consider pre-integrated suites from vendors with open application programming interfaces (APIs) and marketplaces. This makes it easier to snap in new, integrated functionality as needed. If moving to an integrated suite isn’t feasible, you can still get plenty of value just from the most repetitive workflows in your business. Many vendors (Informatica, Scribe, Actian (formerly Pervasive), Dell Boomi, Jitterbit and Mulesoft, just to name a few) offer integration solutions that enable you to connect, map fields, and integrate business processes between different applications.

Slide14. Go green to save green. You don’t need to be a tree hugger to get value from green technology. Most businesses waste not only environmental resources, but also money and time as well. Often, these resources could be invested in developing new products or services, or to hire and train employees.But its easy to be green. For instance, when you buy new products, look for vendors with green certifications from ENERGY STAR or EPEAT; use eco-friendly packaging to reduce packaging waste; and use recycled plastics in their products. Use “set it and forget” tools, such as smart power strips, to automatically turn off peripheral devices when you turn off the main device, and recycle old equipment so component materials don’t end up leaching into landfills. Moving up green curve, consider making the switch from paper-based marketing, forms and faxes to digital solutions for email marketing, invoicing, etc. Replace some of your travel with web conferencing and consider creating a telecommuting program (cloud-based collaboration solutions such as Google Apps for Business, Microsoft Office 365 and IBM Smart Cloud make this easier than ever) if you haven’t already done so. Finally, if your business suffers from server and storage sprawl, virtualized server and storage resources, consider solutions such as Dell PowerEdge VRTX, which take up less space, require less power to run, and help simplify maintenance.

baroquon_Add_Money5. Upgrade and integrate payments with accounting and financials. SMB Group research shows that many SMBs still spend a lot of time manually re-entering and reconciling payments back to their accounting and financial systems. This not only saps productivity, but also results in errors that end up taking even more time to correct. If you’re still doing this manually, its time to look at solutions that automatically integrate payments with accounting, cutting time and errors out of payment processing, such as those offered by Intuit and Sage. While you’re at it, investigate whether your business would benefit from being able to accept new payment methods. Chances are, you already take checks and credit cards, but getting set up to accept ACH, mobile payments, gift cards or PayPal may be able to help you attract more customers, gain new business, and enter new markets–or just get paid faster.

cloud6. Take to the cloud–but proceed with due diligence.  Cloud computing promises organizations a faster, easier and cheaper route to get the IT solutions they need to create and run their businesses. So it’s no wonder that SMBs are moving to the cloud. However, not all cloud vendors are created equal–and some have backtracked on the original cloud pledge. They have replaced monthly subscription pricing with annual contracts, tacked on fees for all but the most basic support, and created pricing and contracts that are about as clear as mud. Others fall short when it comes to taking security and privacy precautions. Seek out vendors that stay true to the original cloud promise as evidenced with transparent pricing, clear and flexible contracts, free trials and clearly documented virtual and physical (data center) security measures.

Sage Summit 2013: That Was Then, This Is Now

logoI’m a bit behind in getting my wrap up and thoughts on Sage Summit–Sage’s annual event for business partners and customers–together. But better late than never! As you can see in the related links at the end of this post, I’ve attended these events for many years. During this time, Sage North America has gone through many significant changes to bring sharper focus to its mission and more value to its customers. At this year’s event, I saw promising signs that these efforts are beginning to pay off.

That Was Then

Sage North America has been on a transformational journey since 2009, when Sue Swenson took over as CEO, made some tough choices, and began setting the wheels in motion to change the company’s downward trajectory. In the four years since, the company hired another new CEO, Pascal Houillon, in 2011. Under his leadership, Sage made some controversial (at the time) moves to unify the Sage brand and product names and divest Sage of seven non-core businesses, including ACT! and SalesLogix, which had large installed bases. To help streamline the company’s focus on its core business and on improving customers’ experience with Sage, Houillon also brought some fresh talent into the executive ranks.

This Is Now

The result of all this is a more focused, purposeful Sage. Gone are the days of trying (unsuccessfully) to rationalize an unfathomable number of overlapping products. On Houillon’s watch, it is unacceptable for Sage executives to position the Sage portfolio in different ways. At Sage Summit 2013, the executive team was singing from the same hymnal regarding Sage’s core positioning and messages:

  • Continue to focus on its core businesses (accounting, payroll, payment processing, ERP, etc) for very small businesses, SMBs and the midmarketSlide1. Key to executing on this is the company’s move to centralize R&D Centers of Excellence for cloud, mobility, customer experience. In the past, each individual product brand would undertake separate development efforts for new functionality. Now, Sage R&D develops new features, extensions and add-ons once (for mobility or analytics, for instance) that individual product groups can replicate across their solutions. Sage is also in the process (though not yet there) of standardizing service and support offerings. It launched Sage City, a new centralized online community for customers, business partners and employees, last month. And, Sage will make new acquisitions when needed to supplement its core solution focus.
  • Expand its connected services strategy and offerings. Sage is building more cloud services, such as SageExchange.com, Sage Mobile Sales, and Sage CRM, that connect to core financials and ERP solutions, as well as for partners to build and sell add-on connected services. The company’s big picture vision is to “liberate” data and services that had been locked into ERP so that customers can use them in the cloud, anywhere, anytime, and from any device. Sage is building a data cloud on Microsoft’s Azure platform with common connectors, bi-directional synch, multi-tenant storage and disaster recovery. This means that Sage connected services will work the same way regardless of the backend ERP/financials Sage customers use. This will all come together in the Sage Marketplace, slated to launch in FY14.
  • Going all-in on the subscription pricing and the cloud. Sage now offers subscription-based pricing for all of its solutions, and comps partners on a percentage of subscription sales over the life of a contract. It has also committed to developing cloud versions for its solutions, including a cloud version of Sage ERP X3, which will feature a user pure web experience when available in 2014.

Taking the Marketing Road Less Travelled

sage lisltensThe Sage commitment to putting customer experience first underpins these initiatives. Sage has several initiatives underway to up its listening game, such as the Sage Listens RV Relay, which is allowing Sage to also kick off a “Shop Local” campaign to encourage people to shop with local businesses.

In contrast to the “build it and they will come” tack that most tech companies take, Sage is taking its cue from the Proctors and Gambles of the world. It is getting customer input upfront before developing new products and functionality. Sage is hearing that customers want easy to use, flexible solutions, mobile capabilities and a low-cost of entry, and is concentrating resources on these areas. In fact, in one of the breakouts, when an analyst asked a Sage executive about social and big data plans, the exec said that customers are not calling these out as priorities. He added that while Sage isn’t ignoring these areas, it is prioritizing development and marketing based on customer input.

For instance, Sage recently launched Sage Healthcare Advisory Services , which includes a new “My Workforce Analyzer” tool to help SMBs understand plan for the Affordable Care Act. Analytics are under the covers, of course, to help SMBs develop what-if scenarios and optimize planning. But Sage isn’t calling it a big data solution.

Sage has often been knocked about for not keeping pace with the generational shift in the North American workforce. But it is now facing the facts–specifically that people born before 1968 will comprise less than 20% of the workforce by 2015. Sage is recalibrating its strategy to align more closely with different generational expectations. As Brad Smith, EVP of Customer Experience stated in his keynote, “We have to over-service the pre-PC guys but we also have to find ways to reach the ‘digital natives.’”

To that end, Sage demoed a voice-to-text initiative in which users can use voice-activated mobile technology to interface with ERP systems on mobile devices. It’s sort of like Siri, but within the context of the business and business workflows, so it appears to do a better job of handling user queries and requests. While the voice command initiative is in its infancy, it could be a key differentiator in the future.

Finally, Sage is putting its money where its mouth is, by tying Sage metrics and compensation for all Sage execs to Sage Net Promoter scores (NPS). The company’s previously shrinking North America business has grown 4% year-over-year.

Channeling The Channel

6a00d8345177fc69e20192ac233035970dSMB Group research shows that accountants/CPAs and technology business partners represent 2 of the top 3 influencer channels for SMBs selecting financials and related business solutions, with peers in other businesses rounding out the list. Sage has a large channel in both areas–with over 25,000 accountants in North America and more than 26,000 technology reseller partners worldwide. But over the past few years, cloud competitors have been trying to poach these very valuable resources.

Accordingly, Sage has several new initiatives underway to re-focus partners back on Sage. In addition to committing to provide cloud-based offerings across the portfolio to give partners a Sage cloud offering, Sage is:

  • Partnering with the Business Learning Institute to develop a curriculum for accountants to help them provide more competitive services to their SMB clients.
  • Planning to launch a new certification program for accountants focused on startup market, with a collaborative version of Sage One, Sage’s solution for very small businesses, to make it easier for them to automate tasks and take care of clients.
  • Introducing the Sage Advisor Partner Dashboard, which uses current customer data to help Sage reseller and accountant partners more readily identify new opportunities in the installed base, and provide a more personalized, consultative sales experience.

Sage is also recruiting new partners for midmarket Sage ERP X3, and new accountant partners to help it build traction among very small businesses for the Sage One solution.

Summary and Perspective

Minus ACT! and SalesLogix customers and partners, this year’s Sage Summit was smaller than in 2012. But, the energy level was much higher. Sage executives were more confident and relaxed, and the messages they delivered were consistent and crisp. Sage demos were more engaging, and even at times, entertaining.

Key metrics, including rising NPS scores, modest growth in its North America business, and a stock price that recently reached its highest point in 13 years are also good signs for Sage. As important, conversations with customers at the event led me to conclude that “Sage Listens” has moved beyond a slogan to put the programs in place to proactively engage customers.

However, there are a few areas in which I believe Sage needs to double down:

  • Sage One marketing. Worldwide, Sage has about 10,000 customers using this very small business management solution today. But most of the millions of very small businesses have never heard of it. Sage needs to significantly enhance awareness and demand gen campaigns to become more than a blip on the radar.
  • Third-party connected services . Sage has a big installed base, which should make it an attractive partner for third-party developers–especially now that developers can write just one connector and reuse it for all of Sage’s core products. But Sage has only about 20 endorsed connected partner services today. Again, many developers don’t know about this opportunity. Sage must raise its overall visibility in the developer community and launch a targeted recruitment program to get developers to build the apps that its customers need.
  • Clarity around CRM. After divesting ACT! and SalesLogix, the company’s sole solution here is Sage CRM. But other than discussing integration and a cloud version of Sage CRM that is in the works, CRM was very low profile at the event. Given Sage’s focus on core financials/ERP it leads me to wonder how committed is Sage to Sage CRM, and if will make the investments required to provide a truly first-rate CRM solution.
  • Innovation. Sage made a good case for its direction in the cloud, mobile and integration areas. However, analysts and press did and will continue to hound it on social and big data/analytics. While Sage customers may not have put these areas at the top of their priority lists yet, it’s only a matter of time before they do. Sage needs to get out in front in these areas.

That said, it’s challenging to do everything at once. The Sage leadership team has made the decision to move forward instead of standing still. All in all, I get the impression that Sage as a company has a better sense of who it is, where it’s going and how it will serve SMBs.

Related posts:

Sage Streamlining Takes a Major Turn With the Sale of ACT! and SalesLogix

Sage Turns a New Leaf: Top Takeaways from Sage Summit 2012

Sage’s Rebranding: More than a Name Change

Sage Summit 2011: Tackling the Sage NA Branding Challenge

Impressions from Sage Insights 2009

Sage Streamlining Takes a Major Turn With the Sale of ACT! and SalesLogix

sage imagesLast week, The Sage Group announced that it is selling its Sage Act! contact manager and SalesLogix CRM to Swiftpage. Swiftpage is a U.S. based digital marketing software vendor and has been a Sage partner supplying Sage E-Marketing as a connected service for three-plus years. The move is part of Sage’s strategy to streamline its business software portfolio and focus on its core application areas, accounting, ERP and payroll. Sage is also selling Sage Nonprofit Solutions to Accel-KKR, a private equity firm.

In addition, Sage is unloading four solutions sold in Europe. Combined, these sales amount to about $145 million, and result in a loss to Sage. Accel-KKR and Sage provided Swiftpage with significant capital to help finance Swiftpage’s SalesLogix and ACT! purchases. Sage will retain 16.1% ownership in this deal.

The sale affects about 1,000 of Sage’s 13,000 employees, with about 250 people from Sage ACT! and SalesLogix moving to Swiftpage. In my conversation with Himanshu Palsule, Sage’s North American support group is working with Swiftpage to put an escalation process in place for customers.

Sage isn’t exiting the CRM market, however. It is retaining Sage CRM (which it acquired as part of its purchase of ACCPAC several years ago) as its core CRM product.

Following Through On a Strategy to Streamline

Sage’s announcement doesn’t come as a big surprise. At Sage Summit 2012 last August, Sage North America management revealed its strategy to concentrate development on what Sage termed core solutions areas–namely financials, ERP, and payroll, as discussed in my post, Sage Turns a New Leaf: Top Takeaways from Sage Summit 2012.

At the event, Sage North America CEO Pascal Houillon set forth Sage’s strategy to move from a heavily decentralized product management and marketing approach to one that is more centralized and focused—and to put the company on a stronger growth trajectory. By streamlining its offerings, Sage intends to provide customers and partners with a more integrated experience and more flexibility to take advantage of new cloud-based connected services.

Shedding CRM Solutions That Weren’t Keeping Pace with Market Trends

Over the years, Sage has been very acquisitive. But many of its acquisitions haven’t really paid off. This has been particularly true for Sage ACT! and SalesLogix, both of which Sage acquired in 2001 when it bought Interact Commerce. Sage bought these products when desktop and client-server computing were at their peak–but about to wane. Since then, of course, the likes of Salesforce.com, Zoho CRM, Nimble and many other CRM cloud offerings have come to the forefront. Meanwhile, Sage has struggled to make the cloud transition with its CRM products. In addition, Sage hasn’t been able to keep pace with developing the new social capabilities that customers want in CRM solutions. These limitations have made it difficult to sell these products to new customers.

While Sage did develop integrations for ACT! and SalesLogix with its financials solutions, its attempts to cross-sell CRM to its installed base of financials and ERP customers met with limited success. The partner channel and end-user decision-makers for CRM and financials solutions are very different, and Sage was unable to develop an effective method to bridge the gap. As a result, there is very little customer overlap between the two.

With ACT! and SalesLogix off the plate, Sage intends to increase its focus on its core financials and ERP products, including Sage 50 (formerly Peachtree), Sage 1oo ERP (formerly Sage ERP MAS 90 & 200), Sage 300 ERP (formerly ACCPAC), and Sage ERP X3, and provide a richer set of connected services for these solutions.

Moving Forward

For a very long time, Sage has looked to acquisitions as a way to fuel growth, acquiring scores of business software products over the years. Sage has had a hard time rationalizing its strategy, sparking much criticism for having a cluttered portfolio, too many products and not enough focus.

Now, Sage is taking a 180-degree turn to sell off surplus solutions, freeing up development and marketing resources to create cleaner, more integrated solutions and messaging. While it’s too early to tell if this new strategy will result in the growth Sage is looking for, the move does give the company more bandwidth to concentrate on its core financial solutions, and give its remaining Sage CRM product the types of cloud, social  and mobile capabilities that it needs to be competitive. In addition, Sage no longer has to contend with the politics of competing product lines and partner channels.

While the move may be a bit emotionally jarring for current ACT!  and SalesLogix customers, they shouldn’t experience too much change in the short term. Over time, they may in fact see an upside, if Swiftpage, which has a strong focus in the digital marketing space,  can infuse the former Sage solutions with the updated cloud, social and mobile capabilities that they will need to attract new customers.

Tech Tidbits for SMBs: What’s Behind Xero’s Online Accounting Discount for Non-Profits

Earlier this week, I had the opportunity to speak with Jamie Sutherland, U.S. President of Operations for Xero, which provides an online accounting solution for small businesses. Jamie discussed what makes non-profits tick, Xero’s latest announcement, which is a 25% discount for non-profits, and other Xero news.

Laurie: Jamie, can you start by giving us a little bit of background about what Xero is and what it does?

Jamie: Definitely! Xero is beautiful online accounting software designed specifically for small businesses. At the very outset, when we built the application, we went around to a number of small businesses around the world, and uncovered their workflows and the way they do business. We set out to solve key processes for them in an easy to use fashion. What was born was Xero as an application. Ever since we’ve been expanding rapidly with customers in over 100 countries now, and doubling our customer base and revenue every year. So it’s quite exciting.

Laurie: How do you define small businesses?

Jamie: Our definition is between 0 and 100 employee businesses, with a specific effort around the lower end of that spectrum. Now businesses take many shapes and sizes, and one distinction is around services-based businesses versus those that carry inventory or are involved with manufacturing or wholesale. So we’re more focused on the services-based businesses.

Laurie: So Xero announced this week that it is offering 25% off to all nonprofits?

Jamie: Yes. We know that non-profits are essentially small businesses, and are experiencing the same types of challenges other small businesses have. With the slow rebound of the economy, non-profits also have challenges around fund-raising and managing their finances. We did a panel and discussed this with a number of non-profits. We learned that managing their funds is one of their biggest challenges. So we want to make it easier for them to manage their finances.

But what we also know is that not every non-profit has an accountant or bookkeeper on staff—they typically use a volunteer to staff this position. The volunteer may not be as adept as an accredited accountant or bookkeeper. So we want to make it very, very easy for non-profits to do finances. Again, Xero is built in a very user-friendly fashion, which is helpful for the non-profit sector.

Laurie: So how does the 25% discount for non-profits work?

Jamie: Xero has 3 pricing plans. We have a $19/month, a $29/month, and a $39/month plan. All three plans include unlimited users. So no matter how many people are working in the business or non-profit, this one monthly fee covers everything, there are no additional charges. That’s unlike many of our competitors. That 25% discount is right off the monthly plan price.

Laurie: What are the differences between the three plans?

Jamie: The $19/month plan is our entry-level plan, which allows you to send up to 5 invoices a month and a certain number of bank reconciliations. For $29/month, you get the full feature set of Xero minus the multi-currency capability. The $39/month plan includes multi-currency. The majority of our customers are on the $29/month plan.

Laurie: When we do our SMB surveys, we always include non-profits, because we also see a lot of similarities with small businesses. So I’m just wondering, in what ways did you find that non-profit needs differ from those of commercial small businesses?

Jamie: We did research across the U.S., Australia and New Zealand. We found that non-profits’ needs don’t differ that much from small businesses. They focus on cash flow to make sure that cash coming in can cover expenses. Like small businesses, they have issues with employee turnover, complying with rules and regulations, etc.

But non-profits are unique in that they typically have a volunteer workforce. Whether small or large, this is very different from the typical small business.  The other big difference is that people running non-profits tend to understand finances less than the average small business owner. So something like Xero accounting, which makes it really easy to understand your finances, can help out.

Laurie: Are there some tips or best practices that came out of the panel that you can share?

Jamie: Budgeting is a big thing. There’s a budgeting tool in Xero to budget and forecast. It’s important to any business. You can import and export from Excel, and track what’s going on. So if you have a lot of volunteer turnover for accounting or bookkeeper roles, you can still have consistency around your financial and monthly reporting. With an online solution like Xero, you have real-time access to info anytime, anywhere in the world. This is helpful to anyone doing accounting or bookkeeping.

Laurie: Before we wrap up, I’d be remiss if I didn’t ask if there is anything else on tap for Xero that you can fill me in on?

Jamie: Yes. It’s been a busy 6 weeks or so. We recently announced 100,000 paying customers across the globe. It took us 5 years to get to 50,000 and then we added the next 50,000 in 10 months. So we’re starting to see much more rapid growth and adoption.

We also announced  payroll integration with ADP, the world’s leading provider of HR and outsourced solutions. The payroll integration we developed with them lets you do your payroll online with ADP and seamlessly sync with Xero. This alleviates the need for duplicate entry between the two applications, which is also exciting.

We’ve also put together a partner advisory council in the U.S., the Xero Partner Advisory Council. The council will look at the things we’re doing in the market, the products and our strategy and help us really try to cater to the needs of small businesses and make everybody better off.

SAP Business One, Chapter Two: Raising the Small Business Bar

In the world of SAP enterprise resource planning (ERP) solutions for small and medium businesses (SMBs), SAP Business One is sometimes overshadowed by SAP Business All-in-One (BAiO), which has SAP’s large enterprise ERP at its core, and by and SAP Business ByDesign, which is SAP’s first software-as-a-service (SaaS) ERP entry.

But Business One, which is designed from the ground up to meet the needs of small businesses with fewer than 100 employees, has quietly kept growing both its capabilities and in new customer acquisition. During the past year or so, SAP has also made some significant new investments in three key areas: mobile, on demand and big data.

Taken together, these developments could open a new chapter for Business One–and for small businesses that want to use IT to transform their businesses.

Chapter One–A Brief History

Business One has its roots in SAP’s acquisition of TopManage Financial Systems in 2002. SAP made the acquisition to provide small businesses (and subsidiaries in larger companies) with an affordable way to move up from entry-level accounting solutions to a single, integrated business management offering.

The solution is designed for small businesses that have little or no IT resources. It provides a unified suite of financials, sales, customer relationship management, inventory and operations capabilities, along with embedded analytics and reporting capabilities.

Over the years, SAP has continued to invest in Business One to keep pace with changing market requirements and global demands. Business One is now available in 27 languages and 40 localizations. To help partners more easily extend solution functionality, SAP built an integration platform for Business One that has since attracted over 550 add-on solutions. Today, Business One has over 35,000 customers in over 80 countries. At its current pace, SAP estimates that it is on track to add about 5,000 new customers per year.

Chapter Two–Mobile, On Demand and Big Data

Fast forward to today. SAP is infusing Business One with the new mobile, on demand and big data capabilities it needs to take the solution to the next level.

On the mobile front, SAP launched Version 1.5 of its Business One mobile app in February 2012. The mobile app gives customers access to key Business One functionality, such as alerts and approvals, real-time Crystal Reports, customer and supplier data and inventory information via mobile devices. The app is available for the iPhone and iPad via SAP, and for Android devices through its partners. Looking ahead, SAP plans to add new mobile functionality for as sales document creation so that sales reps can do more on the go. SAP is also updating the user interface (UI) so that mobile users can have multiple windows open the same time so they can more easily view the information they need.

In March, SAP introduced Business One OnDemand to offer Business One in a cloud-based, subscription model. The OnDemand version has and will maintain the same functionality and interface as the on premise version. SAP is certifying partners to host the solution to ensure that they meet security, performance and quality standards. In most cases, these hosting partners provide the back-end infrastructure, and team with SAP VARs who sell and implement the solution. SAP has also created a Cloud Control Center that supplies partners with automated tools to manage Business One OnDemand throughout the solution lifecycle.

Some pundits have claimed that Business One OnDemand is not a true, multi-tenant, software-as-a-service (SaaS) solution. So I asked SAP for clarification on some of the technicalities and learned that users do need a remote desktop solution (such as those from Citrix or Microsoft) to access Business One OnDemand. And, while the solution is multi-tenant in that users share the same instance of the application and SQL server, each user has its own database schema.

Since Business One OnDemand requires a remote desktop solution and customers don’t share a database schema, cloud purists are likely to discount it. However, these details are much less likely to create issues issue for actual small business customers–and may work in SAP’s favor.

The fact that SAP’s on premise and on demand versions share the same interface and database structure means that existing customers can move to the cloud without complex data conversions or additional user training. Meanwhile, SAP Business One can now get into consideration among prospects that are only considering a cloud solution. And, some of these prospects may prefer to have their own dedicated database schema, along with access to the 550+ partner apps that are in Business One arsenal. Finally, NetSuite, arguably the leading SaaS ERP vendor, has been moving away from its original small business focus to concentrate more on the mid-market and departments of large enterprises, ironically paving the way for SAP to make inroads here.

SAP also announced Analytics powered by SAP HANA for SAP Business One, which will be generally available in late 2012. HANA is SAP’s “big data” solution. It’s a column-based, in-memory database that allows applications to zip through calculations for millions of records in just fractions of a second. SAP HANA for SAP Business One is scaled for the needs of small companies. It combines the SAP HANA-based application with SAP Crystal Reports software so small businesses can get the benefits of speedy data crunching and use the tools that they are already comfortable with to analyze this data. The solution includes a set of predefined, ready-to-run dashboards and reports.

While some small businesses may not require this added horsepower, the offering is relevant for those that need to more effectively analyze more and more complex content–including audio, video, and text–to compete effectively in their markets. These customers will be able to create interactive reports and run ad-hoc analysis much faster than they could before; navigate through various business objects from one screen; and use free-style search to access information more quickly.

The Rest of the Story

SAP Business One isn’t for all small businesses. After all, although the price tag is low compared to other SAP offerings, Business One still represents a significant expenditure compared to the typical small business accounting solutions.

But, even amidst–or maybe because of–economic uncertainties, our SMB Group 2011 Small and Medium Businesses Routes to Market Study indicates that there is sizeable segment of the small business market that plans to increase IT investments. These “progressive” small businesses see IT as a means to create market advantage and achieve their business goals. While price is a factor, they rate other criteria–such as the ability to customize solutions, strong vendor reputation and local support and service–higher than other SMBs when making technology purchase decisions. Business One hits the mark on these criteria, and consequently, is likely to enjoy continued good growth in this segment.

However, this progressive segment is demanding and will expect SAP to stay ahead of the curve. To do so, SAP will need to address a couple of additional areas in this new chapter, including:

  • Collaboration and social. One of the biggest trends in social-collaboration space is to connect collaborative activities with business processes. SAP has already merged its Streamwork team with its newly acquired SuccessFactors’ Jam team, and the combined entity is hammering out SAP’s future direction in this area. SAP needs to add social and collaboration capabilities to Business One sooner, rather than later, to ensure that Business One customers can take advantage of integrating collaborative and business processes.
  • Mobile applications for external users. Business One has a solid solution and game plan for internal (employee) mobile apps, but what’s the plan to extend access to selected functions to external customers, partners and suppliers? The SMB Group’s 2012 SMB Mobile Solutions Study indicates strong plans among small businesses to provide mobile apps for external users for activities such as appointment scheduling, payments, marketing offers and service. Over the long-term, partners should probably be responsible for developing most of these apps, but SAP needs to seed the area to jump-start partner app development.

Overall however, SAP Business One, Chapter Two is off to a good start. The mobile app has already been downloaded more than 34,700 times; about 60 partners are preparing to come on board to offer Business One OnDemand; and over 30 customers are in ramp up with Analytics powered by SAP HANA for SAP Business One.

In addition, while large enterprise solutions will continue to dominate SAP news, SAP’s commitment to and investment in small business solutions is growing. For instance, the vendor recently announced that it is sponsoring a global competition with Ashoka Changemakers, The Power of Small: Entrepreneurs Strengthening Local Economies.  The contest is designed to identify innovative strategies that can help small businesses grow and thrive in underserved communities.

The bottom line? SAP clearly takes small business seriously–and small businesses that are ready to move up from stand-alone accounting solutions should take SAP Business One seriously too.

Sage’s Rebranding: More than a Name Change

Love it or hate it, the first results of Sage North America’s brand transformation strategy have started rolling out in North America. Sage North America CEO Pascal Houilon announced the rebranding initiative last year, which aims to strengthen Sage’s brand–especially in North America. The initiative is designed to address the fact that while many individual Sage products (think ACT!, Peachtree, etc.) enjoy strong brand recognition, the overall Sage brand must be stronger to optimize cross-sell, upsell and connected services opportunities between its products.

Sage reasons that a stronger Sage brand will both increase the odds that existing Sage customers will turn first to other Sage products when they need new solutions, and elevate consideration among small and medium businesses (SMBs) who don’t currently use Sage products. Under Sage’s new naming convention, most products will have a number and descriptor (as Sage has been doing in Europe for a while). So for instance, Peachtree is becoming Sage 50 Accounting–U.S. Edition.

When initially announced, many derided the strategy on the grounds that the numbers were boring, Sage would lose much of the hard-won equity of the individual brands, and partners would need to shell out to support the rebranding. Last but not least, would the rebranding go beyond name changes to encompass significant product and services transformation as well?

This past week, Sage launched its new website for its North American business, www.na.sage.com, and kicked off a new integrated ad campaign to highlight how it can deliver value to small and medium businesses. The campaign will run on national print, radio and online outlets (including The Wall Street Journal, The New York Times, The Business Journals, BusinessWeek, Inc., Entrepreneur, Fortune and others) and will expand to television (CNN, CNBC, Bloomberg Television and others) in the summer.

Along with this, we can also see some initial results of the transformation in the new Sage 50 Accounting (aka Peachtree) and Sage One, a new offering. Prior to the launch, Sage provided us with briefings and demos of both. Here are my first impressions of how Sage’s strategy is playing out in the early going.

Peachtree Becomes Sage 50 Accounting, the New Era of Peachtree (add photo)

Although Peachtree, with its 34 year history, has been one of the biggest brands in Sage’s portfolio, it has also led the rebranding charge in North America, so it’s tempting to view it as a bellwether for how well Sage can execute on it’s transformational strategy.

Sage has given the product a fresh new look and added “the New Era of Peachtree” to the Sage 50 Accounting label to help preserve Peachtree equity. The little American flag on the box denotes that this is Sage 50 Accounting for the U.S. (Sage Simply Accounting, its Canadian counterpart, will also get the new Sage 50 Accounting handle, but the Canadian maple leaf will fly on its box instead). Sage is messaging the change to current customers through its newsletter, resources in the product, its channel partners and social media.

There’s ample evidence that the change is more than skin deep. In addition to doing a painstaking review of in-product taxonomy and labeling, Sage has put the new version through its paces in its usability labs, and made some significant changes to make it easier to use and get value from, including:

  • Sage Advisor Technology. Sage continues to improve this service, which provides real-time, in-context guidance within the solution. For instance, if you’re working in Sage 50 Accounting, and you manually enter your banking information several times, a message will pop up and offer you advice for an automated feed. You can choose to look at the advice or save it for later, and see a historical list of all the messages you’ve gotten when you have time, and change the rules determining when you get these messages. According to Sage, the service has a very high opt-in rate, and Sage can also use it to inform customers when a Sage Connected Service–such as Sage Payments–may be of interest.
  • Sage 50 Business Intelligence (BI). Sage had been partnering with Alchemex to provide customers with a connected cloud BI service. Sage liked it so much they bought the company. Sage 50 BI is integrated into Sage 50 Accounting, giving customers the ability to run what-if scenarios, standard and custom reports. The solution is Excel-based, so it has the familiar look and feel that bookkeepers and accountants love. But once you create your report template, you can re-run and update reports with new information from Sage 50 Accounting with the click of a button.
  • Connected Services Strategy. Sage says that most of its customers aren’t ready to put accounting in the cloud. This jives with SMB Group data, which indicates that while plans for cloud-based accounting are rising, this area is moving much more slowly than areas like sales, marketing and customer service (Figure 1). Sage’s Connected Services for Sage 50 Accounting include direct deposit, 401K administration, payment services, tax filing, document management and online backup, and with this release, Sage is adding integrated e-marketing via partner Swift Page (who has been offering this as a connected service for Sage ACT! for a couple of years).

Figure 1: The Cloud Becomes the New Normal–But Accounting, ERP Lag

  • Sage Business Care. This provides customers with upgrades, updates, unlimited support, a dedicated account manager, online training, and an HR resource center. Up until now, this had been a premium service except for top-of-the-line Peachtree Quantum customers. But with Net Promoter scores for Business Care customers are 3 times higher than for those not using the service, Sage has decided to bundle it into all Sage 50 Accounting offerings.

Sage One

Sage One U.S. Edition, is Sage’s new online business management system designed to help the smallest of small businesses (less than 10 employees) manage money, time and projects. Many of these businesses currently manage their businesses with shoeboxes, pencil and paper and/or a jumble of personal productivity tools.

As part of product development, Sage spent a lot of time watching micro-businesses work and getting their feedback. The Sage team went to their sites, brought them into Sage’s usability lab to test prototypes, and ran focus groups for input. Not surprisingly, it found that most entrepreneurs and sole proprietors don’t get into business to do accounting–they want to teach karate, style hair, or install lighting–basically to do more of whatever it is they love and that makes them money.

Sage also found that these customers want workflow consistency–the ability to create proposals, track projects, assign and mange work, create and send invoices, record payments, and manage expenses. In a nutshell, they want to simplify business management and streamline collaboration. But they have very little time to learn new things: in a Sage survey among businesses with 0 to 9 employees, 66 percent said they use three or more software applications to manage their day-to-day operations–which leads to wasted time, inefficiencies and errors.

Sage One U.S. tackles this problem by bringing money management, invoicing, project tracking, task assignment, messaging and reporting into a single integrated web-based application. Accounting is at the core, and connected to other management functions to reduce data entry time. The solution provides collaboration capabilities to help businesses with distributed teams of employees, contract workers, partners, clients, etc., share and communicate, so no one works in isolation. Automatic notifications, reminders and tracking of in-progress or completed tasks are built-in to keep everyone on the same page. Pricing is $29 per month, which includes two administrative users, unlimited collaborative users (who can share projects, files, etc.), and five gigabytes of storage–as well as online and phone support. Sage is offering a special deal for the Sage One debut–customers can subscribe for just $1 per month for the first three months.

Sage is working with organizations such as the Future of Entrepreneurship and the Community College Association of Entrepreneurship, and plans to also leverage its Sage Accountant Network. These initiatives should help get Sage One onto the radar of very small businesses.

An Early Assessment

The paint is barely dry on these first steps in Sage’s brand transformation, and it’s much too early to tell if Sage will be able to truly reinvigorate its brand and its customers. But the early steps bode well.

With Sage 50, Sage is providing significant new benefits through additional services for BI, and raising the support bar by bundling Sage Business Care across the product line. And, Connected Services give customers a clear path to consume additional connected services in an incremental, yet integrated way (which is how most SMBs need to deploy them). I think that Sage’s existing customers will get over the name change (and eventually, so will partners). But, product differentiation isn’t enough–Sage will need to double down to reach and penetrate more of the non-Sage base in order for Sage 50 to really spread its wings and grow.

Meanwhile, Sage One is a good start at giving micro-businesses an all-in-one solution. The pricing model–which includes unlimited collaborative internal and external users–should appeal to small businesses that need flexibility and are wary of per user, per month pricing. Some of the things that I think it will need to add to really cover the bases for these businesses are email integration, some light document management, and some tools to automate basic marketing functions (such as email marketing and social media marketing). But the solution is built on Ruby on Rails, and should have ample flexibility to evolve–the question will be how quickly.

Finally, Sage’s new ad campaign seems significant and should also help it get on the radar with the new prospects that it needs to reinvigorate growth. However, Sage will also need to make sure that it has a solid social media plan in place so that it can engage with new customers and re-engage with those who have dated perceptions of Sage.

Tech Tidbits for SMBs: PaySimple and BizSlate

I’m back to serve up the second edition of Tech Tidbits, with a new sampling of SMB solutions that you might not know about, but could provide just what you’re looking for.

On the menu this time are PaySimple and BizSlate. If you use or try either of these solutions, please let me know what you think!

PaySimple. Our SMB Group studies consistently indicate that improving cash flow is a top SMB business challenge. But many small businesses still collect payments the old-fashioned way–handwriting invoices or using word processing or spreadsheet apps to create invoices. This can slow down receivables cycles, or worse, make it easy to forget to invoice or follow-up on overdue payments.

PaySimple’s solution automates and simplifies billing and collections with a cloud-based (aka software-as-a-service) solution so you can manage everything from one place. The all-in-one service integrates multiple payment types (credit card, ACH and eCheck), multiple payment channels (virtual terminal, recurring billing, email invoicing, web payments and mobile payments). PaySimple is great for service businesses that are built around repeat customers, offering capabilities for things such as subscription billing and automated communications.

If you don’t have a merchant account yet, PaySimple will get you up and running. PaySimple also provides an import/export function that can map custom fields for integration with most small business accounting solutions, and offers a mobile app so that you can use it when you’re on the go. With this type of solution, SMBs can cut the time they spend on billing and collection, save money and get paid faster. PaySimple is available direct and through private label partners such as American Express Open, Chase, Western Union, among others. Pricing direct from PaySimple is $34.95/month, plus transaction fees.

BizSlate. It’s not too often that customers guide product development from inception, but BizSlate, which provides cloud-based ERP for small businesses, took exactly this approach.  In his prior role as CEO of eZCom Software Inc., a cloud-based EDI (Electronic Data Interchange) provider for SMBs, BizSlate founder Marc Kalman saw that many customers needed to move beyond entry-level accounting software to an ERP solution, but hadn’t found a solution to fit their needs and budgets. So Kalman left eZCom to start BizSlate–convincing over a dozen of his eZCom customers to kick an average of $18,000 each into the venture and join a steering committee to guide product development.

He conducted extensive interviews with each, asking them to throw out their old ideas about software and focus instead on helping him better understand what they really needed to solve their business problems. What he came up with is BizSlate, an ERP system that spans areas such as customer management, vendor management, order management, product management, multiple warehouse and inventory management, receiving from vendors and shipping to customers.

Interestingly, BizSlate doesn’t aim to create another accounting system, so you can, for instance, strap QuickBooks right onto it. BizSlate’s initial focus is on manufacturing, wholesale and distribution industries, but the company plans to extend into the services verticals also. The original 12 customers/investors are using BizSlate now, and the public beta starts this week–so check it out if you’ve been searching for this type of solution.

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