The ERP Lifestyle Consultant

The new year is here and with it is the hope and anticipation of an even better year than 2009!

With that in mind I have 10 predictions for 2010. Because I work primarily with Sage MAS 90 and MAS 200 accounting software you’ll find that most of the predictions have to do with Sage or MAS90/200.

My predictions are based only on my gut hunches and careful observation at public seminars – in other words I don’t have any inside confidential information.

Score a win for any of these predictions if they’re announced in 2010. Most of the changes that I predict will be multi-year efforts meaning that I don’t expect them to be both announced and completed in 2010.

The year 2010 will introduce some changes for everyone in the software industry. The old prediction of ERP buying cycles where users changed accounting software every 5 (or pick a number) years have been proven wrong.

Instead what we have is an installed base play. Software companies everywhere are earning well over half their revenues from recurring annual maintenance paid by existing customers.

Expect annual maintenance to continue to be a big component of revenues. Going forward however there are several ways that ERP publishers will change to meet their own growth expectations as well as to serve customers better.

Here are my top 10 predictions of changes we’ll see beginning in 2010:

1. Get ready to love EES (Sage Extended Enterprise Edition). This software package of MAS 90 / 200 + Fixed Assets (FAS) + SageCRM is off to to a nice start. Clients like it because the cost is very low for what they receive. Consultants like it because clients like it.

If you’re a consultant be prepared to sell only EES beginning with what I anticipate will be an announcement in 2010.  I look for Sage to at least announce plans that MAS 90 / 200 EES is their “go forward” brand.

The other flavors of MAS90 and MAS200 will stay around until a reasonable transition period is reached.

At various sessions held by Sage management around the country they’ve been vocal about simplifying pricing. What could be simpler than the one price model of Sage MAS 90 and MAS 200 EES which bundles the most important Sage modules with Fixed Assets (FAS) and ERP (SageCRM)?

This means as a consultant you should get comfortable with your new annual authorization fee which, unless Sage makes a mid-year change in 2010, may be about 5 times what you pay now for  Basic Partnercare. Happy New Year.

Probability: 90%

2. Party’s over for small remote offices. Thinking of merging with a bigger  partner? Until now these mergers and acquisitions have been handled pretty informally. Remote offices have been on nearly equal footing with Sage so far as tier computations go.

Sure, you need a legalese merger document, but once you iron out the paperwork for the most part it’s smooth sailing. The remote office tier structure is treated the same as the main office.

Sound too good to be true? It probably will be after 2010.

Watch for the rules to be tweaked so that unless a remote office is  staffed with sales personnel (or other more stringent pipeline reporting requirements) that reduced margins will be in effect.

This may not happen in 2010 – thus my rating of 50% probability -  but I predict it will happen eventually. The coming year will begin laying the foundation of how remote offices might be treated more separately than equally.

Probability: 50%

3. Tier gets goosed – again. The time period between March and the annual reseller conference in May  is typically bad news season. The majority of information that might be perceived as negative is released in plenty of time for tempers to settle before annual conference time  in May.

Last year it was a double whammy of reorganization (May 5, 2009)  and tier restructuring taking effect.

This year we’ll see at least a single whammy of  tier modifications.

It doesn’t take a genius to figure that maintenance commission rates are the most obvious candidate to hit the chopping block. I’d love to fantasize that there will be some type of magic loophole and that “good partners” will be exempt from tier slashing – but don’t we all think we’re good partners?

Instead I predict we see another 2-5% margin decline on maintenance commissions – partly offset by an increase in margin on new deals.

Let’s hope that along with simpler product pricing Santa  leaves a tier schedule weighing in at under 7 pages under the tree this year.

Probability: 33%

4. Jodi Uecker-Rust takes the reins. When Jodi Uecker-Rust was announced as “Interim” lead of Sage Business Division in February 2009 it didn’t take a genius to predict that she’d soon be running the division but not as an “Interim”.  Jodi worked for years as Doug Burgum’s right hand person at Great Plains before retiring shortly after the Microsoft purchase of Great Plains.

It made no sense that Jodi Uecker-Rust would come out of retirement to be named an “Interim” leader of anything. We were right on when we predicted that 2009 would see Jodie Uecker-Rust move up the ranks quickly.

Sure enough on May 6, 2009 she was named President Sage Business Solutions.

Look for Jodi’s control to expand significantly in 2010. While the exact title that she may take is a bit unclear I predict that 2010 will be the year that Jodi Uecker-Rust steps out from behind the curtain and takes a much more public decision making role in the Business Solutions area.

Probability: 75%

5. News (rumors) of MAS90’s death are  greatly exaggerated. Every year there’s rumors and innuendo about products reaching the end of their lives. In 2009 the popular whisper rumor was that MAS90/MAS200 had reached the end of life in favor of Accpac. Prior years had Businessworks on the chopping block.

It would be shocking to see a company,  who admits that well over half of annual recurring revenues comes from maintenance, get rid of the MAS90 maintenance cash cow. It’s not going to happen in 2010  unless the right offer comes along and MAS90 is sold – which in this environment seems  unlikely.

Probability: 99%

6. Act! gets a second wind. Let’s hope that in 2010 the Act! CRM program which is wildly popular with clients gets a second wind. An official iPhone version is overdue and I hope we see it in 2010.

Probability: 20%

7. The online knowledgebase stays the same. The long suffering poor Sage Online Knowledgebase has struggled for years under a tired user interface that has perpetually been promised an upgrade as soon as Sage’s internal IT upgrade project is done.

I’m predicting  the Sage Knowledgebase gets coal in its stocking again this year – so what you see is what you’ll have for 2010.

Probability: 75%

8. Sage makes a full court press for premium (aka phone) support - Within their 2009  earnings report Sage’s parent company said growth in premium support sales was a goal for Phase 2 of  Sage North America’s business plan (presumably under way now).

While Sage  say’s there will be growth in “offers” and not sales, it seems logical that they’d like more than a few premium plans to be sold.

The most likely way  this will occur is by bundling phone support (at least limited calls) into software pricing. Until now premium phone support was  optional. With Sage working diligently on simplifying pricing it’s probable  2010 will see many products offering a bundled premium phone plan with initial purchase.

From Sage’s 2009 Earnings Report:

Phase 1 of the changes to our North American business has been successfully completed with the new management team in place and an appropriate reduction of the cost base. Operational improvements planned in Phase 2 are underway including reinvigoration of the channel, growth in premium support offers and several product launches. We are making good progress in these areas and have seen increases in customer satisfaction scores across our product lines.

Items like this don’t go into a corporate earnings report footnote unless they’re virtually certain to happen.

Probability: 99%

9. SQL Version of MAS 200 is delayed into 2011. Call me a cynic but anytime I hear how easy and quick something’s going to come to market little flashing red lights spin in my head. By “delayed” I’m talking about the shipping version and not a preview release.

Sage has a full plate with their MAS 90/200 4.4 release.  Expect an all-hands-on-deck release late in the first quarter for 4.4 leaving slim resources to devote to MAS 200 SQL.

Probability: 60%

10. Business Objects Interface (BOI)  becomes the most respected new feature of MAS 90 4.4 that hardly anyone uses. People rave about the capabilities of BOI. Know anyone other than  hardcore techies who use it? Me neither. I don’t expect that to change in 2010.

Every release starting with 4.0 has brought gushing about how great BOI is and how it will grow hair on your head, make you more attractive to the opposite sex and help build strong bones and healthy minds.

Most people are still waiting to master Business Objects Interface.

Better documentation (free) and training (free) are both needed and should be a new component of premium maintenance.

Probability: 95%

Crystal Ball Is Too Hazy To Call These

There are numerous other issues that will be on the radar in 2010 but where my crystal ball is too hazy to make any prediction:

• Extended Solutions being turned over to developers and the end user reactions
• Purchase of third party products for incorporation to MAS90 / MAS 200
• Adoption rate for the latest MAS90/MAS200 upgrade
• Announcement of an FRX replacement
• Announcement of a SaaS (software as a service) ERP product
• X3 product plans

DISCLAIMER: Most of these predictions are wrong. They’re my personal opinions and do not reflect the opinion of anyone else (that’s why they’re called personally opinions silly).