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Sage, Salesforce and Microsoft - a cloudy menage à trois

Stuart Lauchlan Profile picture for user slauchlan September 15, 2015
Summary:
Four months after Sage and Salesforce launched Sage Live, Sage CEO Stephen Kelly is pitching an End of ERP message at Dreamforce.

stephen kelly sage
Stephen Kelly

I got a text from one lady who said that she’s using Sage Live. She said it was revolutionizing accounting and that when using it it makes the hairs on her arms stand up and goose bumps on the back of her neck. In 32 years in this industry, i’ve never had that.

There’s no way that anyone can dispute that Stephen Kelly isn’t evangelizing the hell out of Sage’s latest offering. Earlier this year, Sage tied up with Salesforce to deliver Sage Live, an alliance launched with a rare personal appearance by Salesforce CEO Marc Benioff to give it his blessing.

It’s a big deal for Sage and four months on, there are tangible signs of progress. The company has signed with Deloitte Digital to build a practice around Sage Live, as well as partnerships with the likes of Docusign, Fairsail and Apptus. Kelly expects that being at Dreamforce this week will deliver anything up to 100 meetings with ISVs interested in working with Sage.

Meanwhile two customer business centers are being ramped up, one in Atlanta, one in Dublin. These will drive digital sales and marketing using both Sage’s own technology as well as Salesforce’s Sales Cloud and Marketing Cloud.

Atlanta has been chosen for the US center due to its status as the biggest hub for the payments industry as well as for easy access to technical skills, while Dublin is fast becoming the location choice for cloud firms to set up operations. The intention is to staff each center with 300 people.

When the Dublin center opens next month, it will be the launch pad for a digital sales and marketing drive focusing on the UK. The plan is then to push into continental Europe via an unusual route. While the likes of Salesforce and NetSuite have taken the ‘traditional’ US ENSW route of UK, then France and Germany, Sage Live’s strategic destination after the UK will be Spain, then Germany.

The end of ERP?

Just before we met up at Dreamforce today, Kelly had participated in a keynote session, expanding on a now familiar theme of the End of ERP. That’s a great soundbite, but I wondered just how practical it is in reality?

For all the pain that ERP implementations have served up over the years, are end users really ready to ditch the term? Salesforce itself tried moving away from CRM as a term, but came back to it over time. Will the same happen with attempts to close down ERP? Kelly argues:

The End of ERP message has gone down well with customers and partners. When you go and talk to customers who have found themselves 300% over-budget on ERP projets, you find graveyards of failed projects. We did some research and found that 75% of ERP projects ran over time, 55% over budget and 93% of people had to do significant customisation. Customers want simplicity, they not want complexity.

He points back to Siebel as an example of the dangers of complexity:

Siebel got hugely complex. Customization killed it. Remember when we only used 2% of the functionality of a desktop and people paid for 98% redundancy. What Salesforce and Marc Benioff have done is make technology non-invasive. It’s driven simplicity into the technology model. A new iPhone comes out and the applications just works on it straight away.

Kelly reckons that over time other vendors will abandon the ERP terminology, even SAP. But there’s one factor that slows things down: certain analyst firms who make money from ERP consulting aren’t yet ready to give up on the term, although some are getting the idea, says Kelly.

Threesome

Away from the Salesforce partnership, Sage earlier this week announced an expansion of its existing relationship with Microsoft to to collaborate on future product development on next-generation accounting and book-keeping productivity tools built on Microsoft cloud offerings, including Azure. Kelly explains:

We’ve had three cloud platforms. We have Sage One on Amazon Web Services. Azure and Window have also been strategic to us. We see Salesforce1 and Lightning as strategic to us around apps. But the reality is that a lot of our customer are used to Windows. Most entrepreneurs are used to Microsoft.

It’s a sign of the times that the idea of Microsoft, Salesforce and Sage co-existing happily is no longer that unusual. Salesforce CEO Marc Benioff told me last year that there was no way the tie-up between his firm and Microsoft could have happened under Steve Ballmer as CEO , only under Nadella.

Kelly makes a similar point:

It’s like night and day. A year ago we’d probably have viewed them as competitors. It’s down to Nadella.

Given that Microsoft is now Salesforce’s new BFF, with CEO Satya Nadella getting his own keynote slot at Dreamforce this week, there’s the makings of an interesting menage à trois here.

Kelly prefers a different term, suggesting:

It could be a holy trinity.

My take

It’s still early days and, colorful goose bump anecdotes aside, there’s still a lot to prove.

But there’s an energy about Sage today that’s not something that we’d have detected a year ago before Kelly was given the hot seat.

2016 is going to be an interesting year during which to keep an eye on Sage’s progress.

Disclosure - at time of writing, NetSuite, Salesforce and SAP are premier partners of diginomica. 

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