Sage chooses new CEO from within

Accounting software giant Sage has appointed its head of mainland Europe and Asia operations to take over from Paul Walker, who retires as CEO on 30 September.

Current European/Asian CEO Guy Berruyer will take over as CEO the next day. Berruyer has been a Sage board member for 10 years and has built the European unit into the biggest and most profitable earner in the group.

In 2009, Sage's European region generated EBITA profits of £192m on revenues of £763m, compared to £105m and £576m from north America.

"Guy has led the successful growth of our business in Europe and, more recently, in Asia. He has a strong track record of profit growth, both organically and through the successful acquisition and integration of companies," commented Sage group chairman Anthony Hobson.

"He has a clear and knowledgeable view of how Sage should develop and great ambition for the group."

A veteran of the software industry with more than 20 years' experience, Berruyer worked for Groupe Bull during the 80s before moving on to Claris and then Intuit, where he rose from France country manger to European director. He joined Sage in 1997 and was appointed to the company's main board three years later.

While Berruyer can be considered to be a safe pair of hands schooled in the acquisition-based Sage approach to market growth, his appointment triggered a 1% fall in the company's share price. With signs that accountants and small businesses in Europe and the US are setting aside their reservations about Cloud Computing, analysts and commentators were hoping for an injection of new blood to drive the company's strategy forward in this sector.

Paul Walker's final results presentation in May proved to be an embarrassment for the company as he made the dubious claim that what Cloud accounting suppliers were offering were "actually desktop solutions online". With smaller web-based rivals such as Xero, KashFlow, FreeAgent Central (partially owned by IRIS) and others snapping up small business customers, the pipeline that feeds the Sage profit machine is in danger of drying up.

The new Sage CEO will need to eliminate any managerial complacency at Sage HQ in Newcastle, and come up with more convincing responses to the Cloud challenge than last year's SageLive debacle. Otherwise he could be taking charge of a company that is heading for a long, slow decline.

Comments
John Stokdyk's picture

Asia rather than Cloud holds the key to this appointment

John Stokdyk | | Permalink

Shortly after posting this article, I spent an evening in the company of Advanced Business Solutions CEO Vin Murria and the team from COA Solutions. While I and other commentators fixated on what Berruyer's appointment meant in terms of Sage's Cloud strategy, Murria and COA MD Mark Thompson thought that his experience leading the company's Asian operations was the most significant factor.

And while the appointment was from within, choosing a non-British CEO is a big break from the past for Sage, Thompson added.

Let's see what kind of a show Mr Berruyer puts on when the next results announcement comes around in December.