On November 1, 2011 Sage North America announced Sage ERP MAS 90 Online, a cloud-based solution of Sage ERP MAS 90 and 200. Hosted by Sage, this option lowers up-front costs, eliminates the need to build an IT infrastructure and associated staff, and provides web access to a fully integrated business management solution for small to mid-size businesses (SMBs). Because this deployment choice is added to current on-premise options, it also comes with the option for seamless migration to an on-premise deployment in the future. Sage ERP MAS 90 Online will be available November 22, 2011.
Here’s what you get for $169 per user per month:
- Access to all core software modules
- Sage Business Care support
- Backup services and disaster recovery
For existing customers of Sage 90 and 200, this will also include an upgrade to the latest version 4.5, announced at the same time (more on that in the next post). This may very well provide incentive to small companies currently running small business accounting solutions like Sage’s own Peachtree or Intuit’s QuickBooks.
The Product Line
The Sage MAS product line is one of three offerings in Sage’s ERP portfolio, which also includes Sage ACCPAC and Sage X3. MAS 90 and 200 share a common set of code that forms a fully integrated business management solution for small to mid-size businesses (SMBs) managing a local operation. While MAS 90 runs on a single computer, MAS 200 uses a client server structure. This new deployment option adds web-based access to the mix. As part of a re-branding exercise, in January, these two products will become Sage 100. The numbers loosely relate to the number of employees and annual revenues in its target market. So in this case, Sage 100 is well suited to SMBs, often with up to 100 employees or $100 million in revenue. However, these are only guidelines and fit is primarily based on complexity of accounting and financial needs.
Extending the Solution
In addition to ERP for SMBs Sage also offers what it calls “Connected Services.” These are extensions to ERP such as Customer Relationship Management (CRM) or payment services, employee benefits, sales, marketing and lead generation services, etc. By adding these as separate cloud-based solutions, Sage has been adding value to all its product lines simultaneously and making that added value easier to consume. So “cloud” is not necessarily a new concept for all MAS 90 and 200 customers.
How much do SMBs care about SaaS ERP?
However, sometimes any company, including SMBs might be receptive to moving these complementary solutions to the cloud while still resisting moving ERP, which runs their business. In the past I have referred to ERP as “the last bastion of resistance” to SaaS but these barriers are beginning to break down and we may very well be on the cusp of a mass change in mind set. The Mint Jutras 2011 ERP Solution Study collected responses from over 900 survey respondents, qualified by their knowledge of ERP implementations. It asked the question, “If you were selecting an ERP solution today, which deployment options would you consider?” The percentage that would consider SaaS, taking into account all sizes of companies, was 47%. But when we examine the same data cut in a variety of way we find some interesting results.
While many industry observers and ERP solution providers think of SaaS ERP as a small company play, our survey results actually see the willingness to consider SaaS ERP increases with company size:
- 42% of small companies (revenues under $25 million) would consider SaaS ERP
- 48% of lower mid-size companies (revenues between $25 and $250 million)
- 51% of upper mid-market companies (revenues between $250 million and $1 billion)
- 59% of large enterprises (revenues over $1 billion)
So while companies who initially select a cloud deployment might feel it is important to have the option to move to on-premise later, it may not be growth that prompts that movement. This is particularly true since many large enterprises are comprised of a collection of small to midsize divisions, operating locations or business units. Because many of them have a multi-tier strategy for ERP (an administrative ERP is implemented at the corporate location and one or more different ERP solutions run the operating locations), cloud deployment may indeed be a way to bring remote locations on line more easily while standardizing implementation. So growth as a result of expansion to a new geography or an acquisition might also prompt a new deployment. And it may not just be new purchases that are considering SaaS. We may start to see current on-premise installations moving to the cloud and therefore we may be just as likely to see current Sage MAS 90 and 200 implementations migrate to a cloud deployment in the future.
But there was another way of looking at this data that was even more “telling.” The Mint Jutras 2011 ERP Solution Study was also used to benchmark the performance of ERP. It defined “World Class” performance as the top 15% of implementations based on results produced, progress against company goals and current performance of selected metrics. Interestingly enough, those with World Class ERP implementations were 35% more likely to consider SaaS as a deployment option for ERP (58% of World Class versus 43% of all others). Generally speaking, the companies with World Class implementations focus more on the end goals of increased revenue and profits and less on the means to the end. IT and enterprise applications are that means to the end and not the end in of themselves.
Sage ERP MAS 90 Online will utilize the same cloud service that already supports Sage Accpac running in the cloud, which has had a 99.874% recorded up-time for 2011. While the application itself is managed by Sage, the data center is run by QTS Atlanta Metro Data Center, the second largest data center in the world with an on-site Georgia power substation and direct fiber access. It is also SaaS-70 Type II Compliant. This data center is backed up by a second data center on the opposite coast in Santa Clara, California which is a fully redundant environment, with near real-time data duplication and less than four hour recovery time.
While we are seeing increased interest in SaaS ERP, there are still lingering concerns. Only 12% of survey respondents indicated they had no real concerns at all, and the top concern is still one of security. Security should be a concern for everyone whether running in the cloud or on-premise. Unless your systems are behind an impenetrable fire wall with no access from the outside world (including remote employee VPN access); and laptops never leave the premises and are never connected to any other network, you need to worry about security. And this is where small companies should be looking to secure SaaS solutions to bring a level of redundancy and security they would never be able to afford to build on their own.
Key Takeaway: Choice
Sage MAS 90 Online is being announced along with new database options and innovation which includes 50 customer-requested enhancements. In combination, it is all about giving customers more choices. Sage MAS 90 is an important element in providing deployment options with no lock-in whether you choose to run on-premise or