Posts Tagged ‘Sage’

Sage Hits a Milestone

Posted: September 5, 2012 in CRM, Current Affairs
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Today Sage North America announced the 25th anniversary edition of ACT!, the contact management software.

What were you doing for a living 25 years ago?  That would be 1987 and I can remember vividly.  I was selling software for a company whose offerings ran on DEC VAX and PDP-11 mini-computers.  We had a fax machine, VT-100 terminals on everyone’s desks and we were thinking about getting a phone system.  Remember those pink message slips?

The VAX was the primary development machine and it hosted all the people in the company for things like word processing and spreadsheets.  My company had been founded by a smart programmer which meant the VAX was his and we just lived on it.  Whenever he wanted to compile a program the lights dimmed, screens froze and we went out for coffee.

I saw an ad for ACT! in an in-flight magazine next to some ads for steaks flash frozen in the mid-west and rushed to your door.  As a sales guy, the load of paper on my desk and in my briefcase was killing me.  I’d experimented with keeping data in a spreadsheet but it seemed like more work than it was worth. I’d also recently taken a relational data base course and dreamed of a simple database that could track my contacts and remind me when to call them again.  I’d gotten far enough to convince my SE to write something like it.  I almost got fired for using precious resources in such a profligate way too.  Good thing I was crushing my numbers at the time.

Ah, the good old days.  I looked at the ad with longing but knew that our CEO would never let a PC into the building and ACT! ran on DOS so all I could do was look and wonder when I’d be able to get my hands on it.

Twenty-five years is a very long time in this industry and it is a testament to ACT! and Sage and Pat Sullivan who invented it that ACT! remains relevant.  Sullivan got it mostly right when he built the first version and Sage continues to keep it relevant for a large and loyal customer base that needs just what ACT! delivers.  Congratulations to Sage.

Sage Charts Its Course

Posted: August 22, 2012 in CRM
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Pascal Houillon, the CEO of Sage North America, has been at the job for a bit over a year.  He took over the reins at last year’s Sage Summit where he famously introduced a new branding exercise.  Houillon’s idea was to make Sage a more prominent brand by de-emphasizing the individual product names, in many cases renaming them.

For a little background, remember that Sage grew by acquisition, one product and its development and marketing team at a time.  By last year, Sage had become the Babel of the software industry with a mix of products, mostly ERP, with different code bases and even file systems.  Notice I said file systems and not databases because some products were, and still are, running on flat files.

When a company rebrands it can either be interpreted as a positive and forceful thing or it can be seen as something else.  The idea last year was to replace a product name with a unique Sage brand name containing a number like Sage 50 for instance.

Since Sage has multiple overlapping products, tongues began to wag.  Would ACT! become known as Sage CRM 101, for example?  We didn’t know.  To many of us, the rebranding resembled chair rearrangement on the deck of the Titanic.

But fast-forward a year and things have worked out.  The rebranding was not an isolated exercise and the company has asserted itself by identifying products that are core to its mission and those that are not.  Non-core products, which tend to run stand-alone, are not destined for the dustbin but they are being treated differently than the core products, which can be combined in an integrated solution.

Sage has three CRM-ish products, ACT!, SalesLogix and SageCRM.  ACT! is CRM-ish because it is billed as a contact manager, not specifically SFA.  SalesLogix is an older CRM product built for a Windows client-server world that has received many upgrades and SageCRM is a SaaS product that can also be installed on-premise.  And the winner is?  Well, there are no winners and no losers.  But if you want Sage’s most modern (and I didn’t say feature rich though that is a debating point) CRM you’ll want to go with SageCRM because it is the one that is “core” and will receive the lion’s share of development dollars and integration support with ERP going forward.

The old Sage approach was to sprinkle development dollars across the whole portfolio sometimes paying different brands to reinvent the wheel.  That was necessary because each product had a constituency (read reseller network)  brought along in the acquisition.  While some resellers carry multiple products, many just focus on one or two products on which they base their business and this is key.

So all this preamble was needed to say that one of the biggest areas of re-thinking for Sage is not about any single product but about its go to market strategy and its resellers.  Sage doesn’t sell direct and over time, its resellers may have gained the upper hand in driving product development and enhancement for their pet products regardless of the overall good of Sage.  It’s human nature.  As Sage tries to rationalize its product set and brands, it is slimming down the number of code bases it has to support while trying to bring along its partners — a non-trivial task.

Nonetheless, Sage has to deal with (and has begun the process over the last few years) a marketplace that demands social, mobile, analytic and real time solutions.  And it’s core/non-core strategy is focused on freeing up the resources needed to give the partners products with the ability to compete in the years ahead.

Does everyone like this strategy?  What do you think?  But more importantly it’s working.  During Houillon’s keynote, they showed a powerful video of customers using Sage products from the iPad driven customer meeting to the back office do-we-have-it-in-stock query, to placing the order and billing.  It looked very cool and was especially impressive because the technology was focused on the SMB market with the clear message that almost any business can afford to work this way and this is how it will be done in the years ahead.

Partners that have become successful writing programs for reports or managing systems or just running cable might bristle but there aren’t many of them.  Most understand there are major changes happening in the industry and the name of the game is “adapt”.  Most worry about driving enough revenue from continuing operations because they are accustomed to the license and services model.  I would only suggest that there is an important difference between revenue and profit and everyone would be well served to revisit that distinction.

There is a raft of new thinking about ideas like churn, monthly recurring revenue, deferred revenue and other things that are common to the subscription economy. The information is out there and I have to believe that the more progressive partners are doing everything they can to learn about it.  For now it was good to see a CEO like Houillon use words like “tough love” to give the troops the idea that the path has been set and they aren’t going back.

Sage ACT! Turns 25

Posted: April 2, 2012 in CRM
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Seems like ACT! has been around forever.  Actually, it’s just 25 years and while that’s an eternity in software, kudos to Sage for keeping the technology up to date with improvements like social and mobile access.  The company has released a short video commemorating the milestone.

Today’s ACT! is a far cry from the product I first used in the 1980s running on DOS.  I remember reading an ad for it in an in-flight magazine and thinking, this is it!  Back in the day, there was no such thing as SFA or CRM and contact managers like ACT! and Goldmine were amazing.  They ran on your desktop and soon your laptop computer and they became places where everything you knew about a deal was stored.  No more lists, spreadsheets, and legal pads with cryptic notes and scribbled phone numbers.

Sure, CRM would follow with even more functionality but for many organizations and individuals, a copy of ACT! and a laptop were about all you really needed (add Word, PowerPoint and Excel or if you’re a geezer like me Word Perfect, Harvard Graphics and Lotus to complete the ensemble).

ACT! has a remarkably loyal user base and over three million deployments.  And while most of those deployments are for individuals, a growing cadre of businesses — tens of thousands, actually — are now using the technology to support sales workgroups.

ACT! has prospered despite all this competition because it fits a big niche that demands simplicity, economy and that keeps up with the times.  So, good on you SageACT! and happy birthday.

Sage took a major step in clarifying its position in the market when it hosted an analyst day in Boston last week.  The company has been around for a long time and has been one of the higher revenue generators for many years thanks to an assortment of products that span the front and back offices of SMB companies.  But the company grew through aggressive acquisition and that left it with a hodgepodge of products and a weakly defined strategy.

A few years ago Sage had multiple overlapping accounting and CRM systems with weak integration and the product-line suffered in comparison to newer, cloud computing offerings from upstart competitors.  The company still has challenges ahead of it but in the last few years — a period that overlaps nicely with the leadership of North America CEO, Sue Swensen — the company has begun to put its house in order.

Analysts had been treated to glimpses of a product strategy turnaround before, but last week’s meeting in Boston was by far the most cohesive delivery of Sage’s core strategy yet.  The company must have thought so too because in attendance were three high ranking executives including Guy Berruyer, Sage Group CEO, Swensen, CEO North America and her designated successor Pascal Houillon who will officially take over stewardship of the North American operation later this year when Swensen retires.

Sage still has a plethora of products and even now speaks of returning to an acquisitions strategy when the time is right.  But the company is coming to terms with a need to refresh an aging product line and embracing cloud computing on terms that will cause minimal disturbance for its only channel to the marketplace — resellers.

The last point is not made lightly.  Resellers are generally small companies that add value through consulting, customization and building long-term relationships that drip revenue into the bucket rather than pouring it.  Sage’s partners are not all technical vendors.  Accountants, auditors, bookkeepers and others who advise small businesses recommend many Sage products around the world.

So there is little surprise that Sage’s strategy retains a three-tier character — cloud computing for the smallest, most cost conscious, new arrivals, a hybrid approach for the broad middle and updated traditional products for established businesses that want continuity and few surprises.  This is progress and it mirrors what many other vendors with large user populations — Microsoft and Oracle for example — have done.  There is no use in thinking about converting every conventional customer to the cloud in a short time and these vendors have done their best to support and, where possible, future-proof their customers.

In line with all this, Sage added better definition to its customer for life strategy. Accounting and CRM are more sticky than either alone according to the company’s experience so, logically, one part of its strategy is to grow accounts.  But that requires multiple talents in its partner base or the alternative, cooperation between partners.

Beyond delivery modes, Sage has a three part strategy to address the market.  Two parts of the approach should not surprise anyone.  Improve existing products in functionality and user experience and grow the Sage footprint within each account.  Implicit is this approach is a prime directive to improve the customer experience wherever possible.  So far all of this would be standard for almost any business software vendor.

The third leg of the stool demands closer examination.  Sage began selling what it calls connected services a while ago and those services are the nucleus of a potential new vendor model that connects partners and customers as well as offering potential new profitability.

Connected services can be anything and generally, these services constitute either things that Sage can do in bulk that its end customers spend disproportionate amounts of time getting right or highly specialized services that require outside expertise.  Some of the offerings include employee benefit services, legal assistance and tax compliance as well as more quotidian things like shopping cart, payment and backup services.  These go beyond software and make the whole offering stickier.  Other vendors should consider this approach.

The thing about connected services is that Sage need not be the only vendor in the mix and an ecosystem is growing up around the model.  This ecosystem provides a way for non-technical business services vendors to access a big market and for Sage, or any vendor, to add value.  The model can and should provide a tollgate for vendors too presumably because they provide the service of vetting the third party’s work quality.

This ecosystem most closely approximates the AppExchange form Salesforce but unlike the AppExchange, the Sage ecosystem is open to non-technical service providers.  A further advantage of this model for Sage is that it opens up a line of communication between it and the end customer that may not always be filtered through the partner.  While this can be a delicate matter, as long as the services provided are not competitive there should be no objection.

However, the open line of communication provides Sage with the ability to know and communicate with its customers better than in a model that requires all communication to be filtered through a partner.

In the era ahead, increasing profitability in business software companies will depend on increasing the vendor’s footprint.  But there is a practical limit on how much software a customer might buy or lease and this is especially true in the SMB market where the number of users per customer entity is low.  Connected business services is more of a green field and offers greater growth prospects.

Finally, connected services is a smart way to educate customers — even reluctant ones — about the realities and benefits of cloud computing so that at some point in the future a move to the cloud might seem less daunting.

In many ways Sage has not changed much.  It still has roughly the same constellation of products but it has come to terms with the cloud and put together a future direction for its partners and customers that was hard to see before.

The company will return to its acquisitions model because that is in its DNA.  But future acquisitions will probably have a cloud flavor and they will likely further drive Sage in the general direction of the cloud.  Very little, if any, of this approach was envisioned in “The Innovator’s Dilemma,” but if Clay Christenson writes a new edition I could see this as a chapter.

I don’t like ambiguity and there was some in yesterday’s post so let’s get to it.  Yesterday I wrote:

Microsoft is confidently offering replacement systems that have been the beneficiaries of significant investment over the last several years.  These systems also run on cloud infrastructure, though cloud does not necessarily mean multitenant.

Microsoft and others — with the notable exceptions of companies like NetSuite and — have decided to kick the can down the road with regard to multitenancy.  While multitenancy might have advantages, it is not advantageous enough yet to push the issue.  As a result, it may have to wait 10 more years — until the next wholesale replacement cycle — until multitenancy becomes more of a standard.

The “can” in this case is a metaphor referring to how vendors address the issue of single tenant vs. multi tenant cloud-based systems, and I thought the second paragraph did an acceptable job of illuminating the metaphor.

Not that long ago cloud and multitenant went together but a revolution in the last couple of years by major software vendors including Oracle, Microsoft and Sage among others, has changed the complexion of the situation.  Many vendors have adopted a strategy that leverages a single code base that can be deployed either as single or multitenant.  Moreover, the single tenant versions can still be housed in a common, cloud-based datacenter to deliver cloud services that are almost indistinguishable to the user.  But no conventional vendors are pushing multitenancy as the wave of the future.  They are letting the customer decide.

It’s still true that you need to work with your vendor to establish the right balance of cloud services to go with your cloud infrastructure.  For instance, do you want to manage your system from afar or do you want your vendor to provide management services including configuration, backup and upgrades?  The choices are numerous.  So when I spoke of kicking the can down the road, it was about the choice of deployment—as in letting the customer decide the deployment approach—rather than saying that any vendor did not possess the ability to deploy in multitenant mode.

Clear, right?


CRM Evolution wrap up

Posted: August 4, 2010 in CRM
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There were many encouraging signs of economic recovery at the CRM Evolution conference in New York this week.  Attendance was up over last year and even close to the previous highs.  Companies and their executives seemed upbeat and one or two announced new funding, a sure sign of resurgence.

The company with new funding that caught my interest is Xactly, the sales performance management company.  In conversation with CEO and founder Chris Cabrerra I learned that they had successfully raised a new round of funding worth twelve million dollars including an undisclosed position taken by  Such an investment is a vote of confidence in the company and its sector and I think it will mean a lot as the company rolls up to a future IPO.

Salesforce was not present for the event and I didn’t even see a company employee among the crowd.  That was a mistake, frankly, I don’t know how you get to a leadership position and then fail to show up at a major conference, maybe they do.

At any rate, the other leading vendors were there and many others that are now emerging.  Oracle, SAP, Microsoft and Sage all had representatives there though not all had booths.  The CEOs or other ranking executives from these companies all attended and it made for interesting panel discussions.

Tuesday morning for example, Paul Greenberg hosted a panel with Anthony Lye from Oracle, Jujar Singh from SAP, Greg Gianforte from Right Now and  Brad Wilson from Microsoft.  I can’t say this panel was all that enlightening but it was certainly entertaining and you needed to be able to read between the lines to grasp the full effect.  A case in point, vendors with extensive investments in on-premise technology and large installed bases were in favor of hybrind — premise and SaaS implementations.  Not exactly news but progress from a few years ago when the thought SaaS was a fad.

Likewise, suite vendors thought the best approach to integration is buying an already integrated suite while point solution providers spoke more about the progress they’ve made on the integration front.  All of this served as high entertainment though not exactly great information and I am not sure any minds were changed.

Nonetheless, it was good to see them sparring again and it would have been nice to have Salesforce there to lent more weight to the pure multi-tenant SaaS and cloud computing view.

Apropos of nothing, I was out to dinner with people from Oracle and a large contingent of analysts the other night.  The restaurant was the Grill at Bryant Park.  Next door in the park they were showing a movie under the stars which I had assumed would be some classic like “Roman Holiday” or “The Philadelphia Story”.  I was right about the classic idea but the film turned out to be “Rosemary’s Baby” which made quite an impression when the primal scream happened in the middle of dessert.  CRM Evolution was anything but a horror show and they even let me give the keynote for which I am grateful.

Last week was busy in a good way and also in ways that we have not seen in a while and at least some if that busy-ness showed promise for the economy and our industry.  In no particular order, Cloud9 Analytics announced it closed its C round financing, SAP held its user meeting in Orlando, Sage held its partner meeting in Denver, and Microsoft sued Salesforce.

You might think that last bit didn’t fit with the rest of the list and aside, from the fact it happened last week, it doesn’t.  But it struck me that the two companies are getting into each other’s faces over a market that has significant upside.  Regardless of its merits, this suit suggests to me that Microsoft, at least, thinks important issues need to be decided before the market really heats up.  The way suits move through courts it’s unlikely we’ll see a result soon but to be fought over like this it makes you feel like the prettiest girl at the ball doesn’t it?

Perhaps the most interesting item in CRM, for me at least, is that Cloud9 raised eight million dollars.  Cloud9 is certainly worthy of investment but the announcement says more about the state of the venture community that had been almost sleeping in the last year.  According to the National Venture Capital Association (NVCA), 2009 was the worst year for venture funding since 1997, with less than $18 billion invested and just over $15 billion raised.

Last quarter biotech led software in investment dollars, a trend that has been developing for some time.  That high tech is not leading the venture parade should be a concern and the trend bears watching.

I know what you are thinking, you can still do a lot with eighteen billion but it pales in comparison with the hundred billion invested in 2000 or the twenty to thirty billion more typically invested each year in the last decade.

The Cloud9 investment is a silver lining for the industry but the rainbow is still not shining.  Keep in mind that this represents a C round which means the investors are looking to a liquidity event in the relatively near term.  That’s completely different from the longer-range expectations held in a typical A round.  Nonetheless, it’s good to see money being put to work and the optimism that it implies.

Also on the optimism scale Sage and SAP convened meetings with their users.  Sage is continuing to evolve itself and as Doug Meyer, Chief Customer Officer told me and CEO Sue Swenson said in her keynote, the company is going all out to make itself easy and fun to work with.  Customer experience is a top priority as is product evolution and Sage showed it is serious about the on-demand market by launching a version of SalesLogix that will be delivered from the cloud.  All indications are that the partner community is receiving the offering well and general availability is scheduled for later this year.

Although I didn’t go to Orlando (because I was in Denver) from the emissions at Sapphire it seems like the ERP world has discovered the importance of crowdsourcing and the wisdom of crowds and their eponymous books.  The tweet-storm coming from Orlando can be summarized in Co-CEO Bill McDermott’s keynote sound bite: “SAP embraces People, By Design.”  Promising greater collaboration with its customers as well as the tools to enable SAP customers to more effectively engage in collaborative business processes with end customers, SAP unveiled new products and new attitudes.  Since I was not there it’s best to get the skinny from those who were, including Sameer Patel, Vinnie Mirchandini and Dennis Howlett to name a few.

The collaboration thing has me more than intrigued.  I can’t find a soul who cares to object to the idea and that tells me that CRM and our focus on all things social over the last few years is having an impact that goes well beyond front office borders.  You might call it the triumph of CRM.  It became readily apparent last week and, the economy not withstanding, that may be the biggest news coming out of one of the best weeks in CRM we have had in a while.

Sage’s introduction of SalesLogix for cloud computing has caused me to do a lot of thinking.  The operative terms we use in the industry for software functionality delivered across the Internet is SaaS or now cloud computing and numerous vendors find themselves twisting themselves and the definition into barely recognizable forms.  Enough of this I say, let’s do a re-think.

If SaaS and cloud computing are mysterious to you, let me provide some background.

I started covering the field (it wasn’t a market yet) in 2000 and I devoted my practice at Aberdeen Group to it.  In those early years other terms dominated the discussion, notably, hosted, on-demand and ASP.  All applications were hosted and available on-demand but the earliest distinction, one that persists today, was between ASP’s and multi-tenant solutions.

Briefly, ASP’s or application service providers offered client server products like Siebel served from a central location across the Internet.  It was slow going and each customer had a single instance of the software running out on the Internet.  It didn’t work out well and many VC funds took goose eggs on their report cards from the ASP’s.

Multi-tenant was another matter. was a pioneer but so were Salesnet, RightNow and UpShot.  Ironically, only Salesforce understood the power and value of its proposition (RightNow got religion a little later) and most treated the multi-tenant on-demand solution as simply a delivery model and not much more.  UpShot was bought by Siebel, Salesnet by RightNow and the debate about superiority abated because Salesforce and RightNow (which hardly competed then) had prevailed.

Then something interesting happened.  Vendors like Oracle (which bought Siebel) started dabbling in on-demand services and began delivering application services that hybridized the on-demand and ASP models.  They did this by re-architecting away from client-server and supporting applications in browsers.  They then began hosting their applications in a have it your way scenario.  The re-architected applications had been retrofitted to support the multi-tenant model but multi-tenancy was strictly voluntary.  Customers could elect to run their applications as single instances in their IT departments or from a remote data center.

With multi-tenancy everyone shares a single instance of the application and through metadata configures and customizes their instance.  All data in a multi-tenant system is stored in one server farm with metadata again serving to segregate it.  Some people worry about this virtual segregation but so far it has been resilient to corruption and hacking.  Nonetheless, some vendors offered single tenant solutions to assuage jittery nerves.

But wait there’s more.

Terminology evolution continued and SaaS or software as a service and cloud computing have been front and center for several years (in the case of SaaS).  In its quest to differentiate multi-tenant from conventional single tenant, the industry keeps adding differentiators.  SaaS has usually meant multi-tenant and cloud usually refers to a plethora of computing services available on the Internet.  So, raw computing power is also called Infrastructure as a Service (IaaS), there’s still SaaS and cloud seems to refer to platform — the whole computing stack of hardware, operating system, database, middleware, applications and more.

So where does this leave us?

In a word, confused.

The relative dearth of terms has caused us to re-use what we have in ways that have confused the market.  I also do not leave out the possibility of savvy marketers hitching a ride on a popular term to bend it to mean whatever they need it to, which lead me to my opening paragraph.

So I propose the following.

ASP is the new term used to describe a single tenant implementation in some remote data center that serves applications across the Internet.  A vendor that serves multiple customers with this architecture would be said to be delivering an application service in single tenant mode. Full stop.  No need to apologize for it.  If that’s what the customer wants then sell it to them.  It doesn’t have all the advantages of multi-tenant cloud computing but some people clearly don’t see these things as advantages anyhow.

SaaS refers to multi-tenant application delivery across the Internet.

Cloud computing is an umbrella term encompassing ASP and SaaS as well as IaaS and Platforms.  ASP’s and SaaS providers may very well use infrastructure from other cloud providers as Sage is doing with SalesLogix.

My whole point in doing this is simple.  I think the industry and the market are mature enough for us to develop some new terms or possibly adapt an old one.  Since there are obviously several models for delivering software as a service, why not differentiate enough to give concreteness to them?  Calling everything SaaS without qualifiers is not helpful to the market or the customer and the confusion it can cause can only slow down a sales cycle and who needs that?

Perhaps the most interesting CRM development to come out of Denver this week was Sage’s unveiling of its SaaS or cloud offering.  But now that the initial hoopla has died down (mine included) it’s time to take a more measured look at what is being delivered.

As I mentioned in an earlier post on my blog the announcement means that Sage is offering a hosted version of SalesLogix but not one that has been re-architected to take advantage of multi-tenancy.  The company still legitimately claims a better total cost of ownership profile for SalesLogix because the arrangement off-loads from the partner the need to support a physical installation and from the customer, the cost of most infrastructure.  The usual configuration and modification cycle remains the same however.

So is this good or not?  I say both.

First, let’s ‘fess up, this is not SaaS or cloud computing, except in the broadest possible definition you can imagine.  Amazon’s EC2 compute services, which delivers infrastructure as a service (IaaS), provides the cloud aspect.  It’s really ASP or application service provider, a model that waned away in the last decade for competitive reasons.  ASP is back because the applications are no longer client-server and thus have lower server overhead; that single change should make the model much more competitive.

Sage is betting that this change is enough to help its partners battle against NetSuite, Salesforce and RightNow (and others) by enabling them to check off the SaaS box in any bake-off and that’s a good point.  In fact, in briefings with SVP Larry Ritter and EVP and GM Joe Bergera that scenario came up.  Sage partners can continue the discussion about CRM and business issues with prospects once they’re past the SaaS beauty pageant and for them it’s a good thing.

Sage’s secret sauce has always been its partners.  The channel may be hard to administer at times but one thing you have to admit is that partners get right into the shoes of their customers in ways that software sales people simply cannot.  No wonder then that most SaaS companies are trying to breathe life into a channel solution.  Microsoft has sold through a channel for a long time, NetSuite is building one and even Salesforce has its version with its AppExchange developers who sell seats as a matter of course.

Sage’s strategy from here is to enable a hybridized approach to its solutions by offering the choice to customers over core CRM functions but increasingly to also offer complementary SaaS solutions that leverage customer data wherever it happens to reside.  That may represent an optimum for this business model, at least for now.

On the other hand, though, Sage seems to be taking its time bringing out complementary solutions and appears to regard that as its domain.  It would be better if the company opened up this space to more competition and contribution from partners and ISVs.  A more open approach would enable Sage to stock its catalog faster and make the promise a reality sooner.  The company’s statement so far is that it’s going for quality over quantity but I have a mild disagreement here.  I think it’s better to look for quality by letting a thousand flowers bloom and picking the best, rather than by over controlling the process.

SalesLogix in the cloud takes the company a long way to delivering lower cost solutions but Sage still has work to do.  Its customers represent a market very much oriented toward operational efficiency as opposed to, say, customer intimacy.  It needs to deliver low cost, easy to implement and deliver solutions, a quest that never ends.  Now that infrastructure has been dealt with Sage can focus more attention on business processes and vertical deployments, which is always on its roadmap.

So to net it out, Sage was the odd man out in the hosted services derby but that changed this week because Sage is now in the hosted services game.  It’s a solution that might seem odd to a SaaS purist, but it fits the special circumstances of a channel operation.  I think we need a new name to distinguish multi-tenant SaaS and cloud computing from solutions that simply use IaaS, something that is assertive rather than pejorative.  ASP anyone?

At Sage Insights, Sage North America’s annual partner conference being held this week in Denver, the company announced its first cloud based CRM product.  This is a significant event for the company for a couple of reasons.  First, until this point Sage did not have any cloud offerings and second Sage sells through a partner channel which sometimes lags over adoption issues.  In this case, over 50 partners are participating in a pilot program for Sage SalesLogix which is an indication, perhaps, of the interest in the partner community.

The offering is hosted on the Amazon Elastic Compute Cloud™ (EC2™) infrastructure which gives partners the chance to sell a hosted offering without most of the deployment issues that would be associated with a conversion to a SaaS offering.   According to the press release this offering will be available in June at $65 per seat.  Most of the attributes of the conventional SalesLogix offering will be maintained because the deployment will be single tenant.  For instance the architecture maintains segregation of company data and control over update release cycles.

This is a big deal for Sage and its partners.  For several years the partner community appeared to be lagging the general market in acceptance of the cloud model but recent economic conditions may have convinced some to take the chance.  Partners that offer SalesLogix as a cloud-based service will be able to offer a lower total cost of ownership solution and the possibility of additional connected services such as Sage’s email marketing service and other services in the pipeline.

This announcement needed to happen and it is another manifestation of Sue Swenson’s leadership as she tries to update all aspects of the company and products.