This week I put together a document called Case For Ending Sage 500 Maintenance (click the link to see the PDF document). My company currently pays a very sizable sum of money every year to Sage for the privilege of upgrading to the latest version of Sage 500 ERP. In recent years, however, it has become apparent that this money would be better spent on other things.
In contrast, each new version of Acumatica is providing substantial new features. Even the upcoming release of the lowly version 4.11 is full of many new features (the number of the version suggests that version 4.11 is supposed to be only slightly better than the current version 4.1 and significantly less “cool” than version 5.0 which is due this Summer).
I would gladly recommend that my company pay maintenance on Sage 500 ERP if it continued to deliver substantial new features like Acumatica.
Here are a couple of interesting articles on ERP software maintenance fees.
This one basically recommends not canceling maintenance, but I don’t think that Sage 500 ERP falls into this category since it’s very likely going to go away in 2017:
http://panorama-consulting.com/canceling-erp-software-maintenance-when-the-corporate-hero-becomes-the-erp-fall-guy/
This article is a little more in favor of leaving your software vendor because of high maintenance fees:
http://panorama-consulting.com/shifting-erp-system-maintenance-to-a-third-party-support-provider/
I completely agree Andy. You would think that Sage would have lowered their maintenance costs or sent clear signals sooner about which products were going away. Their portfolio consolidation process has been so long and drawn out that I think they have lost the trust of many of their customers. Either end a product or keep it, but don’t draw out the process and continue to charge high maintenance fees while doing it.
This is a good thing for Acumatica though. I think that a lot of current Sage customers on retired Sage products will move to Acumatica since they no longer trust Sage. Sure, they could upgrade to another Sage product, but how long until that product is also put out to pasture?
Yeah, exactly, and especially with a product like 300 which they bought and haven’t really known what to do with. Our clients are constantly complaining about the maintenance fee and the lack of value for money. If you take the cost over the last 5 years, it’s pretty much a new accounting system, just without any ROI.
By continuing to charge the annual fee though, it gives customers some hope that the product isn’t dead and they don’t need to look elsewhere. So it can prove a tough battle trying to convince them to move away. Especially as I can’t use the line “All that money you’ve spent in the last 5 years has been for nothing!”
That said, with the end to Server 2003 and XP support this year and the cost of new hardware to upgrade, customers are looking to the cloud and Sage have no decent offering, so it opens up Acumatica.
Love your blog by the way, I started learning Acumatica 18 months ago and it’s interesting seeing someone go through all those same steps now. I really like the multiple choice questions in the university. It means I can do the exercises and then immediately get certified while it’s still fresh in my mind.
I like the way you describe it, “by continuing to charge the annual fee though, it gives customers some hope that the product isn’t dead and they don’t need to look elsewhere.”
This strategy of intentional ambiguity has allowed Sage to milk more cash out of their customers in the short run, but it will backfire in the long run since it has caused them to lose the trust of many of their customers. Even if X3 is the best product in the world, it’s not always about the technology, but about trusting who you buy the technology from.
Let’s keep in touch about differences between Sage 300/500 and Acumatica. I’d love to hear your perspective. So far I’ve only really looked at the Financial area in Acumatica, but I’ll be looking at the Inventory area next.
I love how many features Acumatica pack in to their releases every 6 months. More than Sage have added to 300 in about 5 years! They can stick their 10% annual maintenance! Haha!