General Consultant Discussion

Clearly the low hanging services which can be completed quickly and remotely are at danger of disappearing. I think Sage would like to have taken a swing at upgrades -- and at one point listed some type of upgrade assistance -- however they appear to have backed off that offer. At least publicly. Here's another example where Microsoft is hiring people to perform free migrations of email to Office 365. This only applies to 150+ seats of Office 365. Only... Say hello to the future. http://www.crn.com/news/cloud/300073804/microsoft-channel-chief-office-365-fast-track-services-are-not-going-to-eat-partner-business.htm

Before anybody pooh-poohs this vision of the future, first segment your ""vision"" of upgrade prospects in two pieces: 1. Legacy (pre-4.4) on local machines. 2. v4.4 and later, many on Citrix. Segment 1 has little money in it. I guess most (>2/3) haven't upgraded because they either don't care or don't want to spend the money to do so. So they won't. Not an appealing customer segment for anybody. If VARS are building their strategies around these customers, it will be hard to be very profitable. Sage sees this too. Segment 2 more likely shows interest in staying closer to current because they think it is important. v4.5 and later are much easier and lower-risk to upgrade. It is quite possible to create a low-cost program to upgrade these remotely. This is what Sage would target. This is what we should take off the table by including the upgrade in our annual agreements ...

We have started selling O365 and hosted exchange. When doing a larger migration you typically use a third party tool like Skykick. If you are not on an Exchange Server the tools that come with O365 are very limited. So the cost to a service provider for a 150 user deal gets pretty high and the customer does not want to pay. This is about slow sales and Microsoft trying to boost revenue in the short term and not about customer satisfaction. The help desk at Microsoft for O365 has been more like an O236 in terms of knowing what they are doing. @JerryNorman - I think that keeping the upgrade in the BASE annual agreement is fine as long as it is limited in scope. Then when you have the big Segment 2 customer with 3 add ons and some custom work, Sage has no way of providing the service and your annual agreement has to be customized anyway.

Gary, we are very careful about our definition of ""upgrade,"" and the pricing of our annual agreement for add ons. It is very important. Our base upgrade in the agreement is fixed-priced and then discounted depending on which of the 3 levels of annual agreement they buy. So, the highest level agreement the ""upgrade"" is N/C. BUT that is only executables and data, during regular business hours and no testing. If they want off-hours, pre-testing, data cleanups of existing issues, training on new elements, etc., those are extra price. And, not coincidentally, if Sage were able to do upgrades, that is exactly what theirs would look like: bare bones. I am definitely agreeing with your caveat. It also points out that our offerings are ""fixed-price for fixed-deliverables"" to a customer, but when we think about them, they are ""pricing on purpose!

I also like to think about ""pricing realistically"" -- in other words if you think a fair price is $2,500 price in the first change order (or two). The worst is to constantly be running to the end user with a paper change order asking for more money. I agree that change requests are required for major issues. If however you are going to the customer with several changes then there's something wrong in your quoting or project scoping.

I agree. So we present the options (3) to the customer up front. They pick. No surprises. It is a bit of a PITA to work out the options, but for upgrades it's now pretty routine. We've had only one pick the ""no-frills"" option, and they were happy. Giving them the choices to pick from up front is really the key.