Sage's strategy shake-up
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Sage has detailed radical plans to reshape its existing product portfolio, moving to three integrated business management software suites.
UK software maker Sage is not generally known for its position at the forefront of technology. Instead it prefers to position itself as the company that bases development directly on user feedback.
With its customers calling for greater integration between its core financial software and the company’s numerous add-on products, Sage detailed radical plans to reshape its existing product portfolio, moving to three integrated business management software suites.
This is a major departure for Sage. Three core offerings – Sage 50, Sage 200 and Sage 1000 – targeted at the small, mid-market and larger business respectively.
Across all three new product lines the key theme is integration, which, according to Sage UK chief executive officer (CEO) Paul Stobart, is “the most important challenge [Sage] faces”. To help improve its operation in this space and ensure the integration and interoperability of its products, Sage has pledged to increase its investment in integration to 25% of its research and development budget, up from the 5-10% that it has dedicated to integration issues in the past.
While the move to suites of integrated software solutions represents a significant change for the company, Klaus-Michael Vogelburg, Sage UK’s chief technology officer (CTO), says the change in direction is essential because the “ERP software market is maturing and is becoming increasingly commoditised”.
Sage has previously concentrated on increasing the functionality and usability of its products but, says Vogelburg, the integration issue has always been important to the company. “Now, however, we are finding that customers are becoming more aware of the capabilities of integrated software and are no longer prepared to deal with inefficiencies of data or prepared to teach staff different processes for different applications. It is time for us to concentrate on providing the tools customers need.”
But, with the company currently the third largest player in the business applications market, how will these changes affect Sage’s overall position in the market place? “We need to retain a competitive edge,” says Vogelburg. “Moving forward, that competitive edge will come if we make it easier for our customers to do what they need to do.”
