Sage plans to double growth rate by targeting cloud

UK-based enterprise applications specialist Sage, has said that it plans to more than double its growth rate from three per cent over the past 10 years to six per cent over the next three

The company intends to do this by investing in high-potential products, namely cloud and mobile. It said it would be reallocating resources away from low-growth-potential products.

Sage CEO, Guy Berruyer, said that he carried out a forensic review of the business, its market and its portfolio, something that the company had not done before, in order to enable it to make tough calls and put it in a position to meet its growth goals.

Sage plans to categorise its products into three groups and will allocate its resources accordingly:

 - Sunset (those with low growth potential)
 - Harvest (those with medium potential)
 - Invest (those with high potential)

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According to Techmarketview's Angela Eager, Sage has some 270 products, and whilst it is not actively planning to sell off or discontinue the sunset category, she predicts that some will be heading towards the door.

Cloud-based SageOne, an accounting and business services tool, will aim to deliver the company's entry-level growth, applications built on Microsoft’s Azure platform, such as Sage 200, will drive SME growth, while Sage ERP X3 is positioned to push the mid-market business forward.

Eager believes that the SageOne and Azure offerings will deliver growth, but she said: “It’s harder to see on-premise ERP X3 making a step change”.

However, she also thinks that Sage has woken up to the potential inherent in new technologies in the software applications market, such as cloud and mobile, which she says: “Run through virtually everything”.

She added: "Rather than developing its own cloud infrastructure, Sage is going to align itself with Microsoft and use its assets, which is a pragmatic decision that will help accelerate its cloud portfolio”.