If the bottom line is the chief measurement. Ron Verni has had a successful tenure as CEO of Best Software, the arm of the Sage Group in the United States. The unit has been making money and growing at a faster rate than its parent company or rivals. In the last two years, the company has purchased MIP, the not-for-profit accounting software vendor, and CPASoftware. It is now working on weaving these diverse operations together. In April, Verni announced a major reorganization in which operations were placed in two major divisions.
The Small Business Division is headed by Doug Meyer, executive vice president, and former president of Peachtree Software. Meyer has responsibility for retail products such as Peachtree, Act, DacEasy, and OneWrite Plus. The Mid-Market Division includes products sold largely to accountants or through resellers, including the MAS accounting software line, BusinessWorks, Abra, FAS, SalesLogix, and MIP not-for-profit accounting software. In a recent interview, Verni outlined the reasons for the move and his views on the state of the market. The head of the division will report to him. In the other major move, Dave Butler, who had presided over the MAS and BusinessWorks line for years, becomes executive vice president in charge of “customer-facing” operations, such as sales of installed base products. Accounting Technology editor Bob Scott recently spent some time with Verni talking about these issues. Here are Verni's thoughts on some of these changes.
Your reorganization seems very similar to the one Microsoft Business Solutions recently enacted in which sales and marketing were placed in a new division. Do you agree?
Yes. We’ve been working on this for about six months. It’s the logical structure and the two companies have come to similar conclusions.
What is the basic reason for the assignment of the responsibilities to the two divisions?
The Small Business Division and Mid-Market Division, split by market customer size and method of distribution. This gives a framework to make acquired companies part of the Best family a lot quicker. They will be able to tap into how to do installed base sales.
Dave Butler has been running the MAS 90 operations for several years. What is his new role?
Dave Butler is taking on an entirely new role entitled customer and channel operations. It’s all of our customer and channel partner activities. It’s not the sales force. Dave has the installed base, customer support, and customer programs. He has about eight direct reports. David Horn, customer support, Stephanie Cleve, channel programs, and Taylor Macdonald will report into Dave for our partner programs. Dave has dotted line responsibility to all the sales organization. However, the general managers of each of the units have P&L responsibility for day-to-day sales. Sales people are under Dave’s guidance for programs and procedures. Taylor will continue to report more or less formally or informally to me.
Best has emphasized cross selling of its products. Are you taking any new measures in this area?
This is one of Dave Butler’s charters. He will be looking at where and how where we are gong to move the needle on that. How do we make that happen? How can we create relationships among expert partners, such as CRM partners and accounting software partners? How do we become the intermediary?
Where there any changes in staffing level as part of the reorganization?
There were about 3 percent of our employees who are redundant. It’s under 60 people. When we put everything together we had duplicates. However, we are not closing any locations. The most important thing is leveraging, this gives a framework to become part of the family a lot quicker. They will be able to tap into how to do installed base sales.
CPASoftware’s Visual Tax application only has about 300 users. Do you plan to stay in the tax preparation market?
We’re committed to the product. We don’t expect to sell to the individual. We are concentrating on selling it as part of the Visual suite. That’s what the accountants tell us they want.
Do you plan any changes with how the CPAS products are sold? Will we see any of the tax and write-up products sold through your accounting resellers?
We will bring the CPAS products into our channel. We have tons of accountants we have as customers as well as recommenders. We will still sell the CPA products directly, but I would say we’re just in the beginning of that execution.
What can you accomplish by selling traditional CPA products through the reseller channel?
We concentrate so much with selling to accountants with the MAS 90 product. We are knocking on doors they are not knocking.
Are software sales improving?
The issue from the partner standpoint is that new units and new customers are still hard to find. Customers are still hibernating. Closures are still difficult.
Do sales of CRM products have the potential to improve the reseller’s business?
Microsoft is doing a good job in raising the awareness on a segment that is underpenetrated. There are only 19 to 26 percent of the people who have a CRM solution. But it’s a different kind of sale. It’s a processing engineering, business process kind of thing.
How effective is Microsoft as a channel competitor?
One of the things we keep hearing from the partners is they are trying to understand what Microsoft’s strategy is. The company says it wants to recruit 10,000 resellers. We know there aren’t 10,000 quality partners in the world.
Do you intend to provide a higher-level product in the area of CRM? Are there any plans to increase the functionality of SalesLogix?
We believe SalesLogix is where it needs to be right now. If you take it further upstream, you move into where Siebel and PeopleSoft are. It would allow easier customization. But we wouldn’t take it to that next level because if you take it one step higher, it becomes a direct sale. Where we do see the product penetrating very large companies is when it’s a large company with multiple locations and the divisions operate like smaller companies.
SAP recently introduced BusinessOne, which combines accounting and CRM features in one code base. What do you think of that approach?
BusinessOne is a good application. We are all aspiring to be able to integrate our products better. We are working on integration tools that can be universal between all our products. We are hearing our customers want integration. They don’t want to have to type data in again. But it does not have to be one package.
In a previous interview, John Manry says that Best may use Web Services technology to integrate its wide-ranging product lines. How will this be accomplished?
Within Jim Foster’s organization, John will be responsibility for developing technology and standards. He will be looking at all our technology to understand what we need to do where appropriate for commonality. The obvious things are looks and feels.
Do you have any plans for Linux-based products?
We run on Linux, but there’s no demand for it in our segment. Where I am seeing Linux is way up in the market place, where they are running the server farms. We have a version of it because we have a Unix version of MAS 200. But I don’t even know if we sold one. I wish it would develop some interest. I would love someone to figure out how to break the Microsoft stranglehold.
What are the company’s biggest challenges?
Most of them are making sure that with our new direction, we are moving forward as we bring together a number of different groups. My biggest challenge is making sure that as we transition through that we don’t lose sight of how we perform.
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