Sage looks to disruptive product strategy to leapfrog competition

At Sage Summit, Sage has outlined to partners a much more detailed roadmap than it has ever done before, in order to get the partners to understand fully where things are going, to buy into the changes, and engage closely with Sage on them.


Jennifer Warawa, Sage’s EVP Product Marketing

CHICAGO –A key theme at this year’s Sage Summit has been the need for the company to enhance its product strategy to drive growth. The company has pledged to make its products easier to use, with a key change being the rationalization of their product strategy to focus on growth areas, a more collaborative development ecosystem between the product lines, and the sharing of product road maps.

“Twenty months ago when I came on board we had 270 products, so of course we had massive fragmentation of resources,” said Stephen Kelly, Sage’s CEO. “What we sought to do is sensibly seek to prioritize around customer needs and market needs – what is most appropriate. Now 90 per cent of our investment goes into our growth products.”

The legacy situation was the reality of a company having products in the market for twenty years, Kelly said.

“Now everything is mobile first, and agile,” he added. “By using cloud platforms and mobility first, we are able to integrate. When I joined, we had a lot of closed APIs. Now they are open. This enabled a significant shift of acceleration in terms of R&D.”

“Before, on our product road maps, in terms of R&D resources, we didn’t double down, and make the most strategic bets,” said Jennifer Warawa, Sage’s EVP Product Marketing. “Now, it’s much more market and customer driven for the greatest value. Instead of adding 1000 features we might invest in two ‘WOW’ features. Customers don’t want 1000 new features. They want one or two big things that change the way they work. Doing it this way creates a lot more customer delight.”

Warawa said that Sage has a three-pronged product strategy.

The first is leveraging existing assets, to continue leveraging existing assets, while putting strategic investments into the high-growth cloud products.

“We will continue to enhance our on-prem solutions like Sage 50, Sage 100, and Sage 300,” she said. “We are committed to our existing products, but we are also invested in the future. We are actively investing in products partners sell and consult on today – Sage 50, 100, 300 and x3.”

How long will support for the legacy on-prem solutions last? That’s a very good question, said Nick Goode, Sage’s EVP of Product Development

“How long — 10-20 30 years? — we don’t know,” Goode said. “These are still massive assets to us. However, we have finite R&D resources. We need to throw everything at our new cloud offerings like Sage Live and Sage One, and invest heavily in those products.”

The second pillar of Sage’s product strategy is improving product delivery.

“We are committed to building products that are easy to use,” Warawa said. “This involves balancing feature development with functionality, to make it easy to move through our portfolio and be customers for life.”

It also involves preserving customer choice on cloud. While Sage foreswore last year to stop using the term ERP – and delivered on that at this year’s Sage Summit, at least in their keynotes – other vendors who still use the term have had difficulty in getting customers to move from on-prem to cloud. Before their annual event this April, Epicor, one of these competitors, polled and found that half of their manufacturing customers had no interest whatsoever in moving to the cloud. Warama said that even though cloud offers many advantages, Sage isn’t going to use a stick to get customers to move.

“When you look at our existing customers, it’s not about convincing them they should move to the cloud,” Warawa said. “It’s all about getting new customers in the cloud and enabling market share there. If the old ones don’t want to move, they don’t have to move. But the moment they do decide to move, we want them to know we will be there for them.”

The third element of the product strategy is leapfrogging customers through innovation. Of course, it’s also the hardest, as Sage’s competitors are also picking up their game. The new cloud version of Microsoft Dynamics, for example, has received strong praise for the major advances it made over the conventional product. Warama, however, emphasized that Sage has achieved massive new efficiencies in product development with the move to the cloud.

“Our old desktop products were built in siloes,” Warawa said. “They were not connected together. We’ve made dramatic improvements in development in moving to a cloud ecosystem.”

Warawa said that Sage’s rebranding of its SMB and mid-market product segments, to Startup and Scale-up respectively, is subtly tied to this move beyond siloes in the cloud.

“All of our marketing was in product siloes as well, which meant that the customer was evaluating us not just against our competitors, but against all our other segments,” she said. Now Sage can tell prospects that the way their business LOOKS points them to the type of product that they should use.

“It’s much less focused on terminology that only serves us,” she said.

At Sage’s Partner Day Monday kicking off the event, Warawa and Goode presented several very detailed slides outlining precisely where the product road maps were going — something the company had never previously offered partners in anywhere near this level of detail.

The Startup segment is not a big one for Sage’s value-added channel, as Sage serves that segment primarily direct and through retail. Nevertheless, Warawa detailed key improvements in this segment as a result of the new cloud enablement

“Our integration between our cloud Sage One and on-prem Sage 50 now means that Sage customers can now use Sage One to enable Sage 50,” she said. “In addition, our new Sage 50 integration with Microsoft Office 365 has now gone live. Sage 50 is now using Office 365 as a platform. Sage is the first company in the world to do that here with Microsoft.”

Warawa indicated as well, that this Office 365 integration is unlikely to be the last such effort.

“There are other opportunities we are exploring,” she said.

The Scale-Up segment, with the traditional Sage 100 and 300 offerings in North America, and Sage Live in the cloud, is the one of prime interest to the channel. Enterprise focused Sage X3 is also sold by partners.

“Sage Live is a truly revolutionary product, set to disrupt the market,” Warawa stressed as one of her key takeaways to partners. “Our ultimate aim is to ensure Sage Live is THE application of choice for the scale-up company of the future.” Built on the Salesforce1 platform, and first announced a year ago at last year’s Sage Summit, Sage Live went live earlier this year in the U.S. and the U.K., and just last week in Canada. It is designed to be mobile first, social, and verticalized with templates, with new templates for non-profits, service management and e-commerce on the way. Warama and Goode outlined the detailed road map, which includes Sage Live Payroll in 2017.

“Very soon, partners will be able to resell Sage Live,” Warawa said.

Road maps were also presented for the Sage 100c and 300c offerings, as well as details regarding interface changes and integration with other Sage products. Sage is also acknowledging this year that the ‘c’ in these products actually does refer to cloud – something that had been rather murky previously.

Sage X3, the company’s top of the line enterprise product, which started out as on-prem, and was extended into the cloud last year, will also get significant enhancements.

“Sage X3 will see massive improvements in sales resources and training,” Warawa said. “It’s a natural upgrade path opportunity because it is faster, simpler and more flexible than typical enterprise accounting solutions. It will also be easier to build add-ons, which will provide differentiation.”

Sales X3 Payroll, the product of Sage’s collaboration with Human Capital Management cloud provider Fairsail, was previewed, although it’s a little further down the road map. It is scheduled for availability next March.

From a channel perspective, Warawa acknowledged all this will require constant education and reinforcement on Sage’s part.

“Some of our partners have told us they don’t quite get it,” she said. “Startup! Scale-up! Leverage! Leapfrog! We need to say those words over and over again, and we need to engage closely with partners on those product roadmaps.”