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Zoho Rounds Out Small Business Suite with Accounting App–Zoho Books

This morning Zoho, known for SMB focused SaaS offerings in the areas of productivity, collaboration, business processes launched an Accounting app: Zoho Books. I typically don’t do detailed product reviews, when I see the first good ones, will link to them – just a few points here and then let’s discuss how it rounds out Zoho’s overall strategy.

The following video introduction is a bit “cutesy”:

-and that’s quite intentional.  In fact simplicity is one of the key points in Zoho Books:

  • Clear, streamlined UI, tabs, easy terminology –i.e. Money In, Money Out. This service is clearly targeted at non-accountants, which is most of us in a small business – hey, even I can understand most of it.Smile
  • That said, Books offers the opportunity to share data and collaborate with accountants (Ouch, did I really needed that reminder for tax time?;-) )
  • Multi-currency support – this is typically a later add-on in many systems, but Zoho has a wide international presence with most of their other services
  • Integration with Zoho CRM, Invoice, Mail – somewhat basic now, will be improved as we’ve seen with the rest of Zoho’s offerings
  • Support for electronic payment systems like Paypal, Google Checkout, Authorize.net. This is a “hidden treasure” inherited from twin service Zoho Invoice, which is a subset of Book’s functionality and can be easily upgraded. Why hidden? Because relatively few know that Paypal offers 50 cent (yes, that’s $0.50 per transaction) Business Payments NOT available through the Web, only via their API, i.e. apps like Zoho Invoice and Boooks.

Having said that, is Zoho Books a Quickbooks killer?

(Cross-posted @ CloudAve » Zoli Erdos)

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SAP Business ByDesign Video – Plain and Simple, Making Fun of …Wow, ERP!

We’re just having an intense internal debate in the Enterprise Irregulars group whether SAP’s Business ByDesign (ByD) is late to the market and what it all means, when hot off the press here’s a promotional video, that’s not so much ByD advertising but a SMB / SME SaaS 101, and a very good one at that (now, that was a mouthful of acronyms).

Ironically, the video makes fun of the Big Ugly Beast, ERP – which happens to be SAP’s bread and butter. (Hey, I’ve long been saying SAP should have copied a chapter from Larry Ellison’s book, invest in a SMB Startup and let it grow independently…)

Hat tip for the video: Timo Elliot.

See our (more serious) Business ByDesign coverage here.

(Cross-posted @ CloudAve)

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Redux: Will Google Enter the Business Applications Market?

I am dusting off an old post I wrote more than two years ago, and while it shows my lazyness, I am doing it in the belief that the ideas I raised back then may soon get an answer … albeit not exactly the way I imagined.  And interestingly enough, just about every company I mentioned may have a role in it.  Or not.  After all, it’s just speculation.  So here’s the old post:

Google’s next killer app will be an accounting system, speculates Read/WriteWeb. While I am doubtful, I enthusiastically agree, it could be the next killer app; in fact don’t stop there, why not add CRM, Procurement, Inventory, HR?

The though of Google moving into business process / transactional system is not entirely new: early this year Nick Carr speculated that Google should buy Intuit, soon to be followed by Phil Wainewright and others: Perhaps Google will buy Salesforce.com after all. My take was that it made sense for Google to enter this space, but it did not need to buy an overpriced heavyweight, rather acquire a small company with a good all-in-one product:

Yet unlikely as it sounds the deal would make perfect sense. Google clearly aspires to be a significant player in the enterprise space, and the SMB market is a good stepping stone, in fact more than that, a lucrative market in itself. Bits and pieces in Google’s growing arsenal: Apps for Your Domain, JotSpot, Docs and Sheets …recently there was some speculation that Google might jump into another acquisition (ThinkFree? Zoho?) to be able to offer a more tightly integrated Office. Well, why stop at “Office”, why not go for a complete business solution, offering both the business/transactional system as well as an online office, complemented by a wiki? Such an offering combined with Google’s robust infrastructure could very well be the killer package for the SMB space catapulting Google to the position of dominant small business system provider.

This is probably a good time to disclose that I am an Advisor to a Google competitor, Zoho, yet I am cheering for Google to enter this market. More than a year ago I wrote a highly speculative piece: From Office Suite to Business Suite:

How about transactional business systems? Zoho has a CRM solution – big deal, one might say, the market is saturated with CRM solutions. However, what Zoho has here goes way beyond the scope of traditional CRM: they support Sales Order Management, Procurement, Inventory Management, Invoicing – to this ex-ERP guy it appears Zoho has the makings of a CRM+ERP solution, under the disguise of the CRM label.

Think about it. All they need is the addition Accounting, and Zoho can come up with an unparalleled Small Business Suite, which includes the productivity suite (what we now consider the Office Suite) and all process-driven, transactional systems: something like NetSuite + Microsoft, targeted at SMB’s.

The difficulty for Zoho and other smaller players will be on the Marketing / Sales side. Many of us, SaaS-pundits believe the major shift SaaS brings about isn’t just in delivery/support, but in the way we can reach the “long tail of the market” cost-efficiently, via the Internet. The web-customer is informed, comes to you site, tries the products then buys – or leaves. There’s no room (or budget) for extended sales cycle, site visits, customer lunches, the typical dog-and-pony show. This pull-model seems to be working for smaller services, like Charlie Wood’s Spanning Sync:

So far the model looks to be working. We have yet to spend our first advertising dollar and yet we’re on track to have 10,000 paying subscribers by Thanksgiving.

It may also work for lightweight Enterprise Software:

It’s about customers wanting easy to use, practical, easy to install (or hosted) software that is far less expensive and that does not entail an arduous, painful purchasing process. It’s should be simple, straightforward and easy to buy.

The company, whose President I’ve just quoted, Atlassian, is the market leader in their space, listing the top Fortune 500 as their customers, yet they still have no sales force whatsoever.

However, when it comes to business process software, we’re just too damn conditioned to expect cajoling, hand-holding… the pull-model does not quite seem to work. Salesforce.com, the “granddaddy” of SaaS has a very traditional enterprise sales army, and even NetSuite, targeting the SMB market came to similar conclusions. Says CEO Zach Nelson:

NetSuite, which also offers free trials, takes, on average, 60 days to close a deal and might run three to five demonstrations of the program before customers are convinced.

European All-in-One SaaS provider 24SevenOffice, which caters for the VSB (Very Small Business) market also sees a hybrid model: automated web-sales for 1-5 employee businesses, but above that they often get involved in some pre-sales consulting, hand-holding. Of course I can quote the opposite: WinWeb’s service is bought, not sold, and so is Zoho CRM. But this model is far from universal.

What happens if Google enters this market? If anyone, they have the clout to create/expand market, change customer behavior. Critics of Google’s Enterprise plans cite their poor support level, and call on them to essentially change their DNA, or fail in the Enterprise market. Well, I say, Google, don’t try to change, take advantage of who you are, and cater for the right market. As consumers we all (?) use Google services – they are great, when they work, **** when they don’t. Service is non-existent – but we’re used to it. Google is a faceless algorithm, not people, and we know that – adjusted our expectations.

Whether it’s Search, Gmail, Docs, Spreadsheets, Wiki, Accounting, CRM, when it comes from Google, we’re conditioned to try-and-buy, without any babysitting. Small businesses don’t subscribe to Gartner, don’t hire Accenture for a feasibility study: their buying decision is very much a consumer-style process. Read a few reviews (ZDNet, not Gartner), test, decide and buy.

The way we’ll all consume software as a service some day.

(Cross-posted @ CloudAve )

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Netbooks Resurfaces from Hibernation as WorkingPoint: SaaS for SMB with Nicer UI but Much Less Functionality

I’ve previously covered Netbooks, provider of an Integrated SaaS Business Suite for Very Small Businesses.

The company had an affordable On-Demand integrated business management solution for the   VSB – very small businesses, the “S” in SMB / SME: typically companies with less then 25 employees, sometimes only 3-5, and, most importantly, without professional IT support, in which case Software as a Service is a life-saver.

NetBooks tried to cover a complete business cycle, from opportunity through sales, manufacturing, inventory / warehouse management, shipping, billing, accounting – some with more success then others.   The process logic, the flow between various functional areas was excellent, but it was rendered almost unusable by a horrible UI. And it didn’t scale… so the company disappeared for a long year, completely re-building their code base.

Read on

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SAP Discusses SaaS Strategy

John Wookey has a tough job. The former Oracle Exec, currently EVP @ SAP, the Enterprise Software leader is supposed to charter SAP’s foray into On-Demand – in a company whose bread-and-butter is clearly in installed applications and which still largely considers a threat to its traditional lucrative business.

He spent the first 6 months crafting the new strategy, which he first announced at the SIIA OnDemand Europe conference in Amsterdam.

Continue reading

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Business ByNetSuite Goes After SAP, While The Giant is Sleeping – Where is Business ByDesign?

Ben recently reported on how NetSuite is going after Salesforce.com, by announcing their Renewforce program.  Today NetSuite is going after bigger  fish: the leader in Enterprise Software, SAP.

The aptly named Business ByNetsuite program guarantees at least 50% savings to current SAP R/3 customers relative to  – watch this! – the annual maintenance fees they are now paying to SAP.  Yes, it’s not a price-to-price comparison.  With the perpetual licence model customers pay upfront, but are still forced to pay annual maintenance fees – with SaaS there is only a subscription fee, and now NetSuite proves it can be half of only the maintenance component of traditional software’s TCO.

Read on to find out how SAP’s own blunder around their excellent product, Business ByDesign opened the opportunity for Netsuite…

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Google Lockouts are not Fun. Are You Prepared?

Loren Baker, Editor of Search Engine Journal discusses his experience of getting his Google account frozen without a warning.  Nothing new, we see these cases every few months. If you’re a well-know blogger like Loren, getting resolution might take 15 hours –  I don’t even want to think how long it would take for less prominent users get their account issues fixed.

There are a few things we can all learn from Loren’s case:

  • Communication – $50 buys you Phone Support
  • Backup – offline, within Google or another Web service
  • Your Domain – should be a no-brainer for Branding reasons anyway, and when all hell breaks lose, allows to quickly switch to another provider.

I’m discussing these and other steps to avoid disruption on CloudAve. (To stay up-to-date on SaaS, Cloud Computing and Business, grab the CloudAve Feed here).

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“SaaS as Recession-proofing Software” Theme Picking Up

It looks like I may have started ( actually, just re-started) a trend discussing How Software Can Be Resilient to Recession.

Sramana Mitra @ Forbes talks about ‘SaaS-ing’ Back At The Economy:

Some of the robustness of SaaS companies comes from the fact that the sector caters heavily to small businesses….

Fellow Enterprise Irregular Ismael Ghalimi makes the case that:

Some will gain, but most will lose, and some to be really affected by the downturn are enterprise software vendors selling expensive perpetual licenses for their products…

He than takes the oppurtunity to turn the analysis into a cocky offer to his competitors.smile_wink

Read more here

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Zoho CRM Enterprise Edition @ SMB Price

This morning Zoho announced the Enterprise Edition of their CRM product.  The key updates are:

  • Introduction of Role-based Security Administration
    • Profiles for managing CRM module-level permissions
    • Roles for modeling organizational hierarchy and setting up data sharing rules
    • Groups for sharing the data among various departments
    • Field-level security for controlling the access rights (View or Edit) of fields in CRM modules

  • Enhancements in product Customization & Data Administration
  • Multi-language Support (11 Languages)
  • SSL Support for Professional & Enterprise Version
  • Integration with Zoho Sheet
  • Improved Business Functionality
    • Automatically update Stock information once the Purchase Order is approved
    • Find and Merge the duplicate records in Vendors module
    • Convert Quote to Sales Order or Invoice in a single click
    • Convert Sales Order to Invoice in a single click
    • Add account information automatically while creating quotes/orders/invoices from the potentials
  • Wiki-based Context-sensitive Help

     

    The key in “going enterprise” is no doubt the new security/permissioning scheme. That said, Zoho CRM has already been functionally rich even before today’s upgrade.  I’ve repeatedly stated that supporting business processes like Sales Order Management, Procurement, Inventory Management, Invoicing  Zoho really has a mini-ERP system, under the disguise of the CRM label.smile_wink.  In fact let’s just stop here for a minute. 

    Today’s announcement aside, I still consider Zoho’s primary focus to be the small business (SMB) market.  As for CRM, it really comes down to the classic breadth vs. depth of functionality question.   Zoho CRM’s breadth, along with the other productivity applications allows many SMB’s to use it as their single, only business application.  The market leader in SaaS CRM, Salesforce.com clearly supports fewer business processes, offering more depth in each – probably a better fit for larger enterprises which likely run several applications anyway.   This matrix provides an overview of Zoho CRM vs. Salesforce CRM Group and Professional Editions. (click on pic for detail)

     

    Having done a functional comparison, a quick look at pricing demonstrates why Zoho CEO Sridhar Vembu called Salesforce.com still very expensive:

     

    CRM Pricing Comparison - http://sheet.zoho.com 

     

    No wonder Larry Dignan at ZDNet declares “Zoho aims to poach Salesforce.com customers.”  But Larry (and Marc), you ain’t seen nothing yet… just wait till Zoho comes out with a Salesforce.com importer smile_tongue.   

    Clearly, Salesforce.com does keep a close eye on Zoho, otherwise why would they spend money on the Google Adword “Zoho CRM“?

     

    But again, reality check: Salesforce.com does own the Enterprise space.  For now.

    Finally, a word about integration.  After all, Zoho is known for their almost endless range of products, they should work together…  Currently Zoho Sheet, the spreadsheet application is fully integrated with CRM – most data can be edited either inside CRM or in the spreadsheet format that many business users are more familiar with.

    Zoho plans to integrate Writer, their word processor, Mail (still in private beta) as well as some of the business applications, namely recently released Invoice and People. When all that’s done, Zoho will have a more complete offering than two industry giants, Salesforce.com and Google together.   I can’t wait…

     

    (Disclaimer: I am an Advisor to Zoho. Take anything I say with a grain of salt.  In fact with a pound of salt.  Don’t believe a single word of mine about Zoho products: go ahead and check them out yourself).

     

    Related posts:  Zoho Blogs, CenterNetworks, VentureBeat, CNET News.com, Mashable!, Between the Lines, Web Worker Daily, Irregular Enterprise, InformationWeek,

     

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    3 Half-Truths about SaaS

    I am a big fan of Software as a Service, but it frustrates the hell out of me to see industry pundits over-hype it without really understanding it.  Here are 3 killer (in the bad sense) half-truths about SaaS:

    1 – SaaS is simpler, easier to implement than On-premise software (see update at the bottom)

    2 – SaaS is for the SMB market

    3 – SaaS is bought, not sold, it’s the end of Enterprise Sales

    Let’s examine them in detail:
     

    1 – SaaS is simpler, easier to implement than On-premise software.

    The only part that’s absolutely true is the technical installation, which the customer no longer has to worry about with SaaS.  But we all know that this is a fraction of a typical implementation.  Implementations are all about business process and training, hence the difficulty / duration / cost of an implementation depends on the complexity of business and the size of the organization – these two tend to correlate with each other.

    It just so happens that all SaaS solutions so far have started (and many stay) at the SMB level, so they are simpler not by virtue of being SaaS but by their target market’s needs. 

    2 – SaaS is for the SMB market

    Yes, traditionally all SaaS started with Small Businesses, but that does not mean it may not move upstream. Salesforce.com and several HCM applications have proven technical scalability, but they offer partial / departmental functionality. 
    I am a strong believer that in 4-5 years most software developed will be SaaS, and that in 10 years it will be the predominant method of “consuming” software by large enterprises – but I can’t prove it.  There’s no empirical evidence, since there has not been any Integrated Enterprise SaaS available so far.  The closest to it is NetSuite today (but it’s still SMB focused), and SAP’s Business ByDesign tomorrow.  In fact despite SAP’s official positioning, driven by market focus and current limitations (functional and infrastructure), I believe that SAP will use BBD  to learn the SaaS game – i.e. BBD will be a test bed for a future Enterprise SaaS offering. But we’re not there yet.
    (longer discussion here)

    3 – SaaS is bought, not sold, it’s the end of Enterprise Sales

    Hey, I’ve said this myself, so it must be true (?).  Well, it depends on the position of the sun, the constellation of the stars, and several other factors, but mostly the first two we’ve just covered.smile_wink

    SaaS for very small business: that’s the clear-cut lab case for the click-to buy pull model to work.  In fact in this respect (sales model) I believe the business size is the no.1 determinator.    Some solutions will have to be configured and may even require pre-sales business process consulting.  This inflexion point will clearly be higher for functionally simpler solutions, like CRM and lower for integrated business management systems, like NetSuite or SAP’s Business  ByDesign. 

    Once you reach that inflexion point, you’re in a more interactive, lengthier sales process, and that’s typically face to face.  At least that’s what we’re conditioned to: but it does not have to be that way.  That will be the subject of another post – to come soon.

     

    Update:  Ben Kepes challenged #1 on his blog, and to some extent I have to agree.  My post here is continuation of a discussion we started at the virtual SAP Marketing Community Meeting, and my mind-set was still business process software, e.g. CRM, ERP..etc, but I forgot to specify that.  Instead of replicating the argument, why don’t you read my response to his response at Ben’s place.