90 Minds Community

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

I think we all know where we are so it's not surprising. The frog has been slowly cooking since Sage bought it decades ago. 

Sage is NOT a technology company. They are a holding company who buys technology products with revenue streams and then they use financial metrics to optimize cash flow. ie; they cut costs and squeeze every penny for as long as they can.

Compare them to Accumatica, Intacct, Salesforce, Microsoft and the differences are stark. 

Sage CRM is a great example. There is functionality that has been in Sage CRM since the early 2000s that Salesforce and Microsoft are just now rolling out. Where could the product have been if Sage had understood what they had purchased?

Sage 100 is a great example. They waited and waited and waited and instead of making small incremental investments, they just kept milking their base and making cosmetic marketing and superficial system changes. Now the situation is untenable. 

Sage products will be around for a long time still because of inertia. People hate to change. 

All the same, it's hard to imagine that their new, replacement business is equal to natural customer attrition from mergers, bankruptcy, downsizing, etc (and of course a certain % will actively change systems and not wait for a trigger event like those I listed).

Oddly enough, Sage could be a fine investment in the stock market. As a services firm who cares about their customers, they are a painful partner to deal with as they just don't care about the same things we all care about. 

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Providex is the Latin of the programming language community, as I've said before.
Hiding under a desk was a defensive maneuver and those that hid well are still there, unless they found greener pastures.
Those that didn't hide but complied, we'll wait to see what happens next.
Steve Hare is an auditor as we've seen from the audit results of commission rates.
Steve Hare is a CFO not CEO as we can see by the recapture of commissions paid on error (their error mind you).
Sage 100 needs more than a face left, it needs a technology overhaul - and if they did an overhaul, leveraged their considerable install base plus lapsed customers, they'd overrun the combined install base of Acumatica and Intacct.
------------------------------
Moira Goggin
Executive Director
90 Minds, Inc.
------------------------------


Original Message:
Sent: 08-19-2019 11:49
From: Peter Wolf
Subject: Ex-CEO Kelly On Sage " I would have loved them to hire a rainmaker [to replace me] who was better than me...a rockstar."

I think we all know where we are so it's not surprising. The frog has been slowly cooking since Sage bought it decades ago. 

Sage is NOT a technology company. They are a holding company who buys technology products with revenue streams and then they use financial metrics to optimize cash flow. ie; they cut costs and squeeze every penny for as long as they can.

Compare them to Accumatica, Intacct, Salesforce, Microsoft and the differences are stark. 

Sage CRM is a great example. There is functionality that has been in Sage CRM since the early 2000s that Salesforce and Microsoft are just now rolling out. Where could the product have been if Sage had understood what they had purchased?

Sage 100 is a great example. They waited and waited and waited and instead of making small incremental investments, they just kept milking their base and making cosmetic marketing and superficial system changes. Now the situation is untenable. 

Sage products will be around for a long time still because of inertia. People hate to change. 

All the same, it's hard to imagine that their new, replacement business is equal to natural customer attrition from mergers, bankruptcy, downsizing, etc (and of course a certain % will actively change systems and not wait for a trigger event like those I listed).

Oddly enough, Sage could be a fine investment in the stock market. As a services firm who cares about their customers, they are a painful partner to deal with as they just don't care about the same things we all care about. 

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.

Providex is the Latin of the programming language community, as I've said before.
Hiding under a desk was a defensive maneuver and those that hid well are still there, unless they found greener pastures.
Those that didn't hide but complied, we'll wait to see what happens next.
Steve Hare is an auditor as we've seen from the audit results of commission rates.
Steve Hare is a CFO not CEO as we can see by the recapture of commissions paid on error (their error mind you).
Sage 100 needs more than a face left, it needs a technology overhaul - and if they did an overhaul, leveraged their considerable install base plus lapsed customers, they'd overrun the combined install base of Acumatica and Intacct.
------------------------------
Moira Goggin
Executive Director
90 Minds, Inc.


Original Message:
Sent: 08-19-2019 11:49
From: Peter Wolf
Subject: Ex-CEO Kelly On Sage " I would have loved them to hire a rainmaker [to replace me] who was better than me...a rockstar."

I think we all know where we are so it's not surprising. The frog has been slowly cooking since Sage bought it decades ago. 

Sage is NOT a technology company. They are a holding company who buys technology products with revenue streams and then they use financial metrics to optimize cash flow. ie; they cut costs and squeeze every penny for as long as they can.

Compare them to Accumatica, Intacct, Salesforce, Microsoft and the differences are stark. 

Sage CRM is a great example. There is functionality that has been in Sage CRM since the early 2000s that Salesforce and Microsoft are just now rolling out. Where could the product have been if Sage had understood what they had purchased?

Sage 100 is a great example. They waited and waited and waited and instead of making small incremental investments, they just kept milking their base and making cosmetic marketing and superficial system changes. Now the situation is untenable. 

Sage products will be around for a long time still because of inertia. People hate to change. 

All the same, it's hard to imagine that their new, replacement business is equal to natural customer attrition from mergers, bankruptcy, downsizing, etc (and of course a certain % will actively change systems and not wait for a trigger event like those I listed).

Oddly enough, Sage could be a fine investment in the stock market. As a services firm who cares about their customers, they are a painful partner to deal with as they just don't care about the same things we all care about. 

Nah... stick with "arrogant fraud." It fits perfectly and your assessment was spot on. 

He came in and assumed he knew best and hastened the decline of both existing customer value and channel love. Sage can temporarily survive eroding customer value but they cannot survive without channel love. The only way their long in the tooth products get sold is by passionate folks in the channel acting as advocates and selling customers on the belief that the Sage products are super-duper.

There is no doubt he was put in an ugly spot. Decades of neglect in product R&D has left the Sage product line severely wounded. 

As @Jeff Schwenk hinted at above, Kelly could have slowly started to increase that missing R&D and slowly expand into a new whiz-bang, change the world of Sage, Cloud ERP System to end all Cloud ERP Systems.

Instead, he further slashed investments in existing products in some sort of "burn the bridges, our only path is forward" management style. 

Plain and simple, he messed up big time because of his massive ego tricked him into thinking he could be the revolutionary hero that Sage needed. 

Will the last partner out the door please turn off the lights?

A couple notes @Jerry Norman

1. Sage did have some good NA executives - most left very quickly ( Jody Uecker, Rich Spring ) - in retrospect that should have been foreshadowing

2. I think Sue Swenson was brought on more to fix a big mistake ( remember the medical package Sage bought?). I heard that stabilizing/selling that division was her primary goal. I also think Sue implemented some structure ( unfortunately, I think the arguably disastrous SAP conversion happened on her watch)

3. Agree on the "Turn the Handle". Turn the handle on what? Sage Live? Sage Business Cloud? Continuous installed base price increases? 

4. I disagree with your label of Kelly as an arrogant fraud. Failed Sage Exec? Perhaps. But I feel he had enough oversight that the reporting and management did not rise to the level of fraud. Kelly did go into a lot of detail on earnings calls and briefings which disclosed his plans that relied initially on the failed Sage Live initiative then X3 then Sage Business Cloud. What I think Kelly did have was a very difficult job to turn around a company with many different unrelated products so that it could take advantage of the new cloud era. Given that Sage did not appoint an outside tech executive it might be that they had trouble finding anyone of high enough caliber to take on yet another Sage turnaround.

The day I saw Mark Benioff appearing via a recorded iPhone video stream ( as opposed to live on stage ) at a Sage conference was the day I figured Sage Live was sunk.

If I had to point to one of Kelly's biggest problems during his reign is he seemed to turn North America into an organization that became very content to "hide under their desks" and not take any type of initiative that clashed with the U.K.  Of course, that's speculation since I wasn't in Sage meetings but my guess is North America suffered and became immobilized  ( deer in the headlights )  during Kelly's time at Sage.

I like Wayne's points. But I think it begs the question, "Why do these and similar things keep happening?" Because, if that fundamental problem isn't fixed, similar mistakes will continue.

I think the "tell" in the answer was Kelly's comment about hiring "a US technology CEO", which UK decided against. (Who wants to bet they couldn't find anybody who was really interested?) A company's "culture" starts in the Board room. After its initial product, Sage started as a portfolio management company. They bought up companies in broadly-related spaces and ran them as if they were mature, requiring significant profits always. This works in mature markets, but the accounting-related market surely wasn't in the 90s and CRM wasn't in the noughties (they managed to run Saleslogix into the ground by the time they sold it off - its revenues were 1/5 of those at acquisition).  Sage UK started as a company run by finance guys, and it has never changed - you could argue that Kelly "foreign infection" which the Board's antibodies ultimately rejected.

The other part of this was its Euro-centricity. Most of the Board never did understand how the software business works in America. Combined with its finance-heavy Board, they never understood how American technology is marketed and sold, especially to customers in Sage 100's market. Yes, the NA execs in during the naughties got fat, lazy, and arrogant, but Sue Swenson had NO experience a channel or products that weren't mass-markets. What were they thinking?

After two strikes in NA leadership, the  Board then decided the problem was that America needed more European management. Not English management, European. Despite a century of American business history without ANY success case for a Euro business to run an NA division without an American in charge. So we got Pascal. That went well ...

And through this, we've never had an NA Exec who understood how tech can be developed, how much investment it requires, and how long it takes. Nor one who understands marketing in B2B environments.

This "culture" of the UK Board results in a list of tech development failures which almost always have a strong start, and then they lose interest when the hard part comes. We get half-baked marketing which results in brand overhauls to make marketing easier, but we never see the quality or volume of marketing spend needed to move the dial when businesses want to change their system. We get a strategic mindset which idolizes a stream of "rents" without realizing how much investment it takes (especially in the back office) to pull it off.

Kelly's wish that he'd been replaced by a sales rockstar exposes the bankruptcy  of his understanding how these tech pieces must work together in order to produce a product line, global or not, which can compete against those which were heavily overhauled (not just a "framework") in the naughties (such as Epicor or Acumatica).

I would dearly love to see Sage succeed, for many, many reasons. But strategic success for its NA products would require a dramatic change in culture at the Board level That doesn't happen IRL.

What does happen are takeovers and sell-offs. Kelly arranged this interview to advance his job-hunt. I don't see how anybody who knows what is going in Sage NA would not ROLFL at his comment "What they need to do now is 'effectively turn the handle.'" At best, he completely misses the decisionmaking necessary to make things happen at the layer below the "grand strategy." At worst he has no clue about whether the elements of his grand strategy can work together in the technical mish-mash of their legacy product line. It particularly ignores the failure of the enormous investment they made in their new generation products which are now literally dead. So their strategy going forward mainly depends on the legacy products and not screwing up Intacct once its founders leave.

IMO,  Kelly was an arrogant fraud. His previous two tech successes blinded him to the enormous problems that Sage UK presented. I'll be interested to see if there is any blowback from this puff-piece. 

I think Kelly's biggest problem was he tried to turn an ocean liner and ran out of room to maneuver.
Years ago it seemed sound to acquire as many products as possible and figure out what to do with them later

Then the Internet and cloud computing severely disrupted Sage's playbook of consolidation.
Kelly once said at an analyst meeting that Sage had a great strategy until the internet came along.

My interpretation of Kelly's comments about his first meetings at Sage was that they wanted to keep collecting maintenance on their installed base ( which is what seems to be Sage's bread and butter today ).


I think the issues in North America run deeper and include:

1. Product name changes - IMO Sage's top NA blunder
2. Loss of the CPA mindset - this started happening long before Kelly
3. Integrations ( CRM, FAS, etc ) that were difficult to set up, often required a 3rd party assist, poorly supported/maintained
4. Aging product technology - due to lack of R&D effort for about 3-5 years
5. Globalization too ambitious - "boil the ocean"
6. Hail Mary product focus - Sage Business Cloud, confusing "cloud" naming
7. Executive churn, under/misqualified, no long-term playbook ( new executive = new playbook, repeat every 3 years )
8. The Sage business plan runs quarter to quarter and over-reliance on price hikes
9. Ignore ISV & channel partners
10. Lost acquisition opportunities - Intacct ( late ),  Acumatica ( ate Sage's channel + assumed lead offering for many of Sage's formerly loyal partners)

​Sage is very vulnerable because they are left with a channel that has taken on competing products and those competing products are frequently the first ones the channel partners are pitching to NEW named licenses. Which means long-term Sage has to either win back those partners, sell direct or keep hiking prices to existing users.

I don't think Sage is unaware of these issues but fixing them is a bigger project than we might think because we only see the Sage 100 North American issues.