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.

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.

Sage Summit 2011: Tackling the Sage NA Branding Challenge

A couple of weeks ago, I attended Sage Summit 2011, Sage’s first combination partner and customer event. I’ve been attending Sage partner, customer and analyst events for several years, observing and commenting on its ongoing attempts to unify it’s corporate brand across multiple small and medium business (SMB) solutions. Earlier this year, following Sue Swenson’s retirement, Pascal Houillon took over the reins as CEO of Sage North America.  I was interested to find out how Houillon plans to deal with what has seemed like an age-old dilemma at Sage North America: having many strong individual SMB brands (think Peachtree, ACT!, Timberline, etc.), but a relatively weak Sage corporate brand.

The Sage North America Branding Challenge

Over the years, Sage North America has added a myriad of SMB-oriented accounting, ERP, CRM, HR, payments and industry-specific solutions to it’s portfolio. In most cases, these solutions brought large groups of loyal customers with them. Sage has undergone many identity-building initiatives in the past, including co-branding all of it’s individual solutions with the Sage master brand in 2009, developing capabilities to seamlessly integrate Sage CRM, ERP, HR and other applications, and a concerted corporate-wide initiative to make customer experience it’s top priority. But, for the most part, Sage customers have continued to identify more with their individual brands, ala Abra or MAS, instead of the Sage moniker.

This has not only hampered Sage’s traditional cross-selling efforts, but it also threatens Sage’s Connected Services strategy, which provides Sage customers with online, connected services (both from Sage and Sage partners) that integrate with on-premise Sage solutions to provide additional functionality.

Clearly, for Connected Services to achieve it’s goals, Sage needs to make sure that, for instance, Sage Integrated Payments Solutions are the first stop for Peachtree or ACCPAC customers looking for payments solutions that integrate with their accounting software.  In addition, without a strong corporate brand, Sage is at a disadvantage when going up against competitors such as Intuit, Microsoft or SAP.

Tackling the Branding Dilemma Head-On

Houillon wasted no time addressing the elephant in the room. At the opening keynote of the partner session, his first announcement was that Sage NA would embark on a phased approach to drop individual product brand names (again, think ACT!, MAS, Peachtree, etc.) in favor of the Sage brand. So for instance, Sage Peachtree Pro, Complete, Premium and Quantum would become Sage 50 Pro, Complete, Premium and Quantum.

Note the word “phased.” This re-branding won’t happen overnight, but take place over the next 12 to 18 months. Sage has lots of products and in many cases, product overlaps. It will most likely start with entry-level solutions, such as Peachtree and ACT!, and those products that have a well-defined space within the Sage line-up.

As important, along with the re-branding, Sage will ramp up existing efforts to create a more consistent user interface and experience among its products, and make it easier to integrate them. For instance, Sage will be incorporating Sage Advisor (first available in Peachtree), which provides in-product assistance to help guide users through tasks, resolve error messages and find functionality as needed, into more of its products.

Needless to say, all of this re-branding talk caused quite a stir among partners, press and analysts. In many cases, partners have invested a lot of passion in an individual brand–in many cases, partners had been selling the individual brand long before Sage acquired it. They have legitimate concerns about making the brand switch, and the new investments they’ll have to make in marketing collateral, web sites, etc. However, in subsequent sessions, Tom Miller, Sage NA’s channel chief, noted several programs already underway at Sage to help ease partners through the transition.

We (press and analysts) also raised a lot of questions about the risk of eroding brand equity that they’ve built up over the years for the individual brands. Several analysts also worried about the blandness of using a numbering system for product names (as noted in both Denis Pombriant’s and Paul Greenberg’s posts on the topic)–which I’m not crazy about either. And of course, there’s the problem that some products overlap with others–such MAS and ACCPAC.

But, after listening to the Q&As and debates, querying Sage execs one-on-one, and talking to Sage customers (most of whom told me they had no problem with rebranding), I think Houillon has made the right decision.

Short-term Pain, Long Term Gain

No doubt that Houillon’s decision will produce some short-term pain, probably most acutely felt by channel partners. But what’s the alternative? Former CEO Sue Swenson stepped in to stop the bleeding, but major surgery is still necessary for Sage to make a full recovery. In the long run, Sage needs to reset, refocus and re-energize the company for growth–something it hasn’t seen much of recently, for these key reasons:

  1. Although all Sage execs appear on board with the change, I’m sure that there are at least a few that have resisted the corporate call. This is just human nature–either inertia, the fact that an individual brand is doing fine as is, or that some people like to run their own little empire without a lot of corporate oversight. The rebranding and what’s underneath it–common look, feel and experience–should help shake out execs that are idling, and foster a more innovative and collaborative environment.  Ultimately, this should yield more value for customers and partners.
  2. A strong corporate brand is key to the success of Sage Connected Services.  Connected Services enable existing Sage customer to easily tap into add-on online services that give them additional functionality. Sage has about 50 connected services already available and coming soon, spanning HR, payments, payroll, tax, sales and marketing functions. For example, Sage offers a dozen Sage Payments Solutions as connected services to Sage ERP and accounting solutions, and several sales and marketing connected services for Sage CRM solutions, such an e-marketing service, as well as business information services via Hoover’s. But, if customers don’t self-identify as Sage customers, they may not even look at Sage Connected Services when needs arise.
  3. Sage needs a strong corporate brand to help its cloud offerings take off. Sage already offers SageCRM.com, ACCPAC Online, SalesLogix Cloud, Sage Payments Solutions and Sage Intergy on Demand (for healthcare) and Sage Billing Boss as cloud solutions, and several more are on the way. As more companies look to the cloud to deploy new solutions, on demand offerings will increasingly erode the sales of packaged software. Sage needs a strong brand to compete in this space and capture new customers as they turn to the cloud.

Or, as Benjamin Franklin said, “When you’re finished changing, you’re finished.”

What Sage Must Do to Pull It Off

That said, Sage will face many challenges along the way. Here’s my take on what Sage must do to increase the odds that it will be successful:

  1. Facilitate the branding change for partners. The biggest concern I heard partners voice was about the money and time they would need to spend to accomplish re-branding. Sage needs to make it fast, easy and low- or no-cost for partners to re-brand their web sites, marketing collateral, etc. at every step of the re-branding process. Given Sage’s history of providing partners with innovative tools and programs, I’m confident that it will be able to develop and roll out do the same here.
  2. Put more emphasis and resources to make sure that changes beyond product name changes are achieved. Develop and provide Sage employees, partners, customers, press and analysts with a clear vision and solid plan for what the Sage portfolio of the future will look like. Sage has already made good inroads on integration across product lines, and needs to continue investing here. But other areas are fuzzy. For instance, when and how will it bring a common interface to different solutions?  What’s the roadmap to roll out Sage Advisor technology into different solutions? In cases where there is product overlap, how will it rationalize this?
  3. Make the Sage brand stand for something and stand out. Simply using the Sage name to brand all of its products won’t be enough to get new customers in the door. What can the Sage brand represent? IMHO, Sage should piggyback on the Firm of the Future education it’s offering partners. This workshop helps partners analyze their existing business models, understand and navigate change, and build a plan to create a new business model to succeed in a changing world.  Why not take this a step further and help its SMB customers become Firms of the Future? In almost every industry, SMBs are grappling with changes wrought by a global economy, increasing volatility and new technology. Everyone sees the change coming, but few even know where to start to get ahead of the curve and position to capitalize on it.

No one ever said change is easy. But change is inevitable and for Sage, essential if it is to thrive and grow. Sage has taken a big first step is in the right direction, now it just needs to keep moving ahead.

What Are Integrated Payment Solutions and Why Should You Care?

(Originally published January 30, 2011 in Small Business Computing)

What are Integrated Payments Solutions?

Integrated payment solutions are tools that your business can use to integrate accounting, customer relationship management (CRM) and other business applications with payments processing. By integrating payments processing with business applications, you can save time and money, reduce errors and get a better view of your business.

Why Should You Care?

Every business wants to get paid — and get paid faster. But if you are manually entering and reconciling payments with accounting, CRM or other solutions, you are wasting time with redundant data entry, and increasing the likelihood of human error. At the end of the day, you’ll probably need to spend even more time reconciling these errors so that the information is correct in both systems.

When you integrate payment processing with your business solutions, you can achieve the following:

  • Save time and reduce errors, by reducing time spent on redundant data entry and credit card verification, reconciliation and so on.
  • Save money. Time is money! In smaller companies, where one employee often wears several hats, you can re-allocate time spent on re-entering data or re-verifying credit card information to more important tasks that can help your business get ahead.
  • Gain more financial visibility and control. When you integrate payment processing information with accounting or another business solution, it’s automatically recorded in that solution, providing you with better visibility and the capability to create more up-to-date and accurate reports.
  • Improve cash flow. By closely monitoring payments, you can reduce days’ sales outstanding (DSO), and speed up the process to post receivables and improve cash flow.

When you process credit and debit card processing, there are also important security benefits. Using an integrated payments solution from a PA-DSS (Payment Application Data Security Standard) certified vendor ensures that all exchanges of payment data are secure and PCI compliant with PCI security standards, which mandate that businesses safely encrypt and store PIN numbers, CVV2 numbers and magnetic stripe data.

What to Consider

While the benefits of integrated payments solutions are clear, payments processing is often a confusing topic, for several reasons. Vendors offer solutions that tackle different pieces of the payments pie, and integrate with different software solutions and brands. Some require that you use their merchant service provider (which allows businesses to accept debit or credit card payments), while others let you choose.

Ideally, you’d might want a payments processing service that integrates everything — your accounting and CRM software, every form and method of payment you process today, and any you might conceivably want to process in the future—such as accepting payments on a mobile device. Oh, and you’d also want it be affordable on a small business budget.

A few vendors are working to develop comprehensive payment platforms for small business, but most integrated payment solutions available today tend to be point solutions. These solutions integrate a particular form or forms of payment — such as a check or credit card—using a specific device, such as a virtual terminal or a check scanner.

With that in mind, here are some recommendations as to what you’ll want to consider when considering integrated payment options:

  • Where are your highest transaction volumes coming from — credit card, paper checks, PayPal? For many small businesses, checks and/or credit cards make up the bulk of transactions. Wherever this is in your business, this is also where you probably are spending the most time verifying, re-entering and reconciling data back and forth with accounting and/or CRM. Automating and integrating the process here will provide the biggest payback.
  • What business application(s) do you most need to integrate with payments? Most companies start with accounting, because the controller or treasurer wants to not only take time out of the process, but also reduce errors and time spent reconciling payments received with invoices. But many companies also want to provide sales with a secure way to take orders, generate invoices, and accept, verify and track payments within CRM. In both cases, it makes sense to start solution evaluation with the business solutions vendors you already work with. Almost all of the major accounting and CRM vendors in the SMB market, such as Intuit, Microsoft, Salesforce, Sage, etc. have their own and/or partner to provide integrated payments solutions for their business software.
  • What level of integration and automation does the solution provide? This varies among integrated payments solutions offerings. For instance, does the solution pre-authorize, automatically accept or decline payments? Does it securely encrypt and store credit card info so that you don’t need to spend time re-entering for repeat customers? Does it print receipts, send email notifications to customers, and post back to accounting, CRM or an order fulfillment system? You may need some, all or even additional functionality.
  • Is the solution PA-DSS certified? PA-DSS (Payment Application Data Security Standard) certification means that all exchanges of payment data are secure and PCI compliant–particularly important for processing credit or debit card transactions.
  • Can you choose your merchant service provider, or do you have to use theirs? Since credit card processing rates differ, and really add up if you process a lot of transactions, it’s important to find out if the integrated payments solution vendor requires that you use their merchant services, or if you can choose your own. Either way, you’ll want to make sure that you get a fair rate.

You should also think about our future business needs, and if you will need to process payment types that you currently aren’t dealing with — such as mobile payments. Look for solutions that already have these capabilities, or have them on their roadmaps so that they’re ready when you are. Integrated payments processing can help you reduce costs and improve efficiency. It’s worth it to research the options and select a solution that will help you reach these goals.

What is Mobile Commerce, and Why Should You Care?

(Originally published September 13, 2010 in Small Business Computing)

What is Mobile Commerce?

Mobile commerce (also known as mobile ecommerce, m-commerce and other variations) consists of two primary components. The first is the ability to use a wireless phone or other mobile device to conduct financial transactions and exchange payments over the Internet. The second is the ability to deliver information that can facilitate a transaction — from making it easy for your business to be “found” via a mobile Web browser to creating mobile marketing campaigns such as text promotions and loyalty programs.

Why Should You Care?

Just as the Internet and ecommerce revolutionized the way we promote, market, shop for and buy goods and services, wireless devices and mobile commerce are poised to create another revolution in the world of commerce.

As the use of Internet-enabled wireless devices skyrockets, people want to use these devices to do more things. App stores and hundreds of thousands of applications have sprung up to accommodate demand for applications, games and other services. But just as we saw in the early days of ecommerce, privacy, security, usability and interoperability issues have slowed the pace of mobile commerce adoption in the early going — among both sellers and buyers.

However, with the Internet in our pocket or purse, it’s only a matter of time before mobile commerce really takes off. Mobile devices go where we go, and track where we are. The technology makes it easy to find a nearby pizza place and order a pizza, order theater tickets from your car, or check out price comparisons and reviews from a store.

Mobile applications and devices are getting more personal too: based on past history, they can anticipate our needs and promote goods and services to fulfill them. Still not convinced? Think about this: Amazon recently announced that “in the last twelve 12 months, customers around the world have ordered more than $1 billion of products from Amazon using a mobile device.”

Big retailers and companies are investing to make mobile commerce easier, more convenient and more secure. As they do, consumers will become more comfortable with making purchases over their BlackBerrys, iPhones, Androids, iPads and mobile devices we have yet to imagine.

If you sell your vegetables at farmer markets, or your home-made jewelry at craft fairs, or if you deliver pizzas to apartments or dorm rooms, its easy to see how being able to take credit card transactions on your mobile device could help you boost sales and repeat business. You don’t need to limit your sales to people who can pay by cash or check.

Customers that don’t have a checkbook can still buy from you, and they’re not limited by the amount of cash in their pockets. Furthermore, you can easily capture their contact information and follow up with other promotions. Meanwhile, if you run a hair salon, you could use mobile marketing to let customers know when you have openings or send them appointment reminders.

What to Consider

We are still early on in the mobile commerce era. But, as large retailers embrace mobile commerce, small retailers will need to gear up to provide convenient and secure mobile payment and commerce options. Now is a great time to develop a mobile commerce strategy to help differentiate your business. Some key areas to consider include

1. Do you need a mobile Web site? While it may be tempting to try to optimize your existing website for mobile devices, this often results in a clunky and hard-to-navigate site on a small screen. Consider building a separate, streamlined site geared to mobile users. Register it as a mobile site with search engines so it shows up in mobile searches, and provide a link to your mobile site from your main website. Check out services such as Mobify, which helps create mobile-friendly websites.

2. How can you best promote your business to mobile users? You can, for instance, send text messages to customers about specials and discounts. Or a group of retailers on Main Street could team up to offer joint loyalty programs — buy something at one store, get 20  percent off at the next — to help compete more effectively with one-stop big box stores.  SMS text messaging services such as Fanminder, Ez Texting and Ruxter, which helps businesses create a mobile website, and share messages with customers and members.

3. Don’t be a pest. You want to use mobile commerce for good, not evil, so make sure that customers can decide and opt-in if they want to get your promotions via their cell phones–or not.

4. Set up your business for mobile commerce payments. More vendors are starting to offer mobile commerce solutions geared to small and medium business requirements and budgets. These solutions let you take payments on your mobile device, and also send an email or text invoice to the customer. Wireless carriers, credit card companies and software companies are all introducing mobile commerce solutions; start by assessing solutions from vendors you already use and trust.

5. Think about integration. Integrating mobile commerce transactions with your accounting and contact management solutions can help save time and increase efficiency. Good news–If you are one of the millions of small businesses using Intuit or Sage accounting solutions — Intuit GoPayments and Sage Exchange provide integration with their respective accounting and financial solutions.

6. Be sure that it’s secure. Fraudulent activities can be an issue with mobile commerce, and compliance requirements and fines for fraudulent activities — never mind the damage to business credibility — are serious. Businesses considering mobile commerce need to verify that the mobile commerce payments vendor is PA-DSS compliant, which means that its solution has met global security standards created by the Payment Card Industry Security Standards Council to prevent payment applications from storing prohibited secure data, such as magnetic stripe, PIN or CVV2 numbers.

Remember, it took some time for businesses to develop ecommerce sites and for customers to feel comfortable using their credit cards on the Web. Today, mobile commerce is in its infancy, but given the explosion of Internet-enabled mobile devices coupled with consumers’ desire for speed and convenience, mobile commerce is destined to be the next big game-changer.

Will the Appliance Approach Gain Traction in the Wake of Recent Cloud Outages?

This week’s service outage at Intuit is fueling a new round of speculation about the dark side of cloud computing–and whether businesses can depend on cloud-based services to run their businesses. Intuit’s problems come on the heels of other service outages this month at WordPress and Sage, and as well as service outages earlier this year at Salesforce.com and NetSuite, among others.

Clearly, Intuit is not alone, and cloud vendors across the board will need to redouble their efforts to harden, backup, continuity and disaster recovery services.  Customers will also demand more transparent, accessible visibility into ongoing performance, downtime and problem resolution, and compensation when downtime exceeds guarantees in vendor service level agreements. And, as stated so well in a Hubspot blog, cloud vendors must put a a proactive social media strategy in place to lessen the fallout when a problem does occur.

That said, I don’t think that customers should leap to the conclusion that the sky–or the cloud–is falling. Smaller companies, in particular, are likely to have much more trouble keeping their systems up, running and productive than a cloud provider.

However, it does seem to me that now is good time for vendors and customers to consider a hybrid appliance-cloud approach–which has had a difficulty getting air time amidst the cloud hype and exuberance. As I discussed in What is a Business Applications Appliance and Why Should You Care?, business application appliances come pre-configured with all of the hardware and software components required to run a specific business application, such as accounting or CRM packaged together in one box. The appliance vendor pre-integrates the hardware, databases, security, storage, virtualization and other technologies with the business application to provide a complete solution.

This means that users can set up an appliance in a matter of minutes, instead of the hours or days it would normally take to source, install, integrate and tune all of these component parts on a general purpose server. And the appliance vendor (or a business partner) can deliver remote system management, monitoring, updates, patches, support and backup over the Internet, and deliver additional Web-based services, and/or download new applications as needed.

As a result, the appliance approach can bridge the gap between traditional, customer-premise deployments and cloud computing or software-as-a-service (SaaS) model, integrating on-premise, integrated appliance systems with cloud services. In many respects, this model could offer the best of both worlds to companies that want something easy to use and maintain, but are still uncomfortable with complete reliance on the cloud.

Let me know what you think–will recent cloud vendor outages shed new light on the appliance model?

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