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Sage ERP X3 version 7

Sage X3 sees the light in Lisbon

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21st May 2014
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In a week when Benfica of Lisbon were hoping to win their first continental football trophy since 1962 by winning the Europa League final, Sage had its own important fixture in Portugal’s capital. Nick Huber reports.

The accounting software supplier announced a new version of its enterprise resource planning (ERP) software, ERP X3 version 7, for medium-sized companies.

It has taken about four years to develop.

Sage says the new version is faster, can collate and analyse more data and is easier to use. It also has mobile access and a web-browser interface.

Version 7 can be hosted online but there wasn’t a big announcement about cloud technology at the conference.

“We’ve listened to our customers, we’ve listened to the market and we’ve re-designed our business solutions directly to answer the needs and challenges faced by mid-market companies today,” said Christophe Letellier, CEO Sage ERP X3.

Sage makes about 80% of its sales from small business. But the mid-market, where profit margins are higher, is becoming more important to the company.

It says that that sales to medium-sized businesses with between 100-500 employees are growing in the double digits.

Until a few years ago the UK supplier said it wanted to go upmarket by selling to the biggest companies. That would mean competing against established ERP suppliers such as SAP and Oracle.

But Sage is now focused on two markets - small and medium-sized business. It also wants to streamline its product range after multiple acquisitions during the past decade.

Sage’s ERP upgrade comes as it faces increased competition from small cloud-based suppliers and concerns over its strategy after its chief executive Guy Berruyer recently announced he will retire.

The announcement accompanied half-year results that were in line with expectations to hit 6% organic growth for the year. One analyst at Investec was surprised by the decision which cast doubt on Sage’s 2015 targets, which were closely associated with him.

Some experts reckon that Sage has been slow to catch on to the rise of cloud computing and mobile technology. Panmure Gordon O’Connor speculated whether an external candidate might be brought into the company to drive stronger growth and create a more modern product offer.

In speeches at the Lisbon conference Sage executives sometimes acknowledged these criticisms.

Sage’s European CEO Alvaro Ramirez even referred to Sage’s brand as a “disaster”, but also said that the company would work hard to improve it.

He didn’t elaborate but one Sage manager told Accounting WEB that the reference was probably an acknowledgement that the number of Sage’s product ranges and acquired companies can be confusing.

Early customers for version 7 who spoke at the conference said it would help them improve customer service by making their business data easier to understand and analyse – including when they’re out of the office.

Michael Petzing, IT manager at California-based Vacuum Engineering and Materials, said: “We’ve had any data, anywhere for a long time but the data hasn’t been usable. Using social-media type technology at a corporate level [will help businesses].”

Nigel Montgomery, an expert in enterprise software at Gartner, a research company, said he was “positive” about what he had seen of version 7.

“Other vendors can do the same [as version 7] but in different ways,” he said. “Version 7 will be a lot easier to use.”

The main benefit for customers will be being able to tailor the landing page of the ERP software for their own needs. For example, someone in accounts may want to have different daily tasks or key performance indicators such as invoice processing times, or monthly management reports.

Having your own version of the software will save time re-entering information.

But Sage will have to work hard at explaining the new benefits of version 7 to customers so they get maximum value from it, Montgomery said.

Some of the product’s new features, such as the ability for users to customise it, are not easy to grasp when looking at the software online, he said.

Benfica lost to Sevilla on penalties. Sage will be hoping that its new addition to its line-up has more luck in the software market.

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