Sage Partners Reeling Over Channel Exec Shakeup

Call it VARBusiness's version of the Sports Illustrated cover jinx: the same week Sage Software channel chief Taylor Macdonald graced our cover to celebrate Sage's strong showing in this year's Annual Report Card rankings, Sage announced his ouster from the company. Macdonald's sudden departure earlier this month was part of a broad Sage executive shakeup that left partners reeling and waiting to see how the company's channel changes will affect them.

"I think they missed the mark," Anthony Castle, CEO of New York-based Sage partner Castle CRM, said of Macdonald's dismissal. "Taylor certainly contributed a lot to the community, was entirely partner-focused, and will be greatly missed."

Macdonald's removal was part of a broad purge imposed on Sage's North American business unit, the company's biggest sales base, by its U.K.-based parent organization, the Sage Group. Sage dismissed North America CEO Ron Verni and CFO Jim Eckstaedt, announcing plans to recruit new hires for those roles. It also eliminated the channel chief position Macdonald held and the chief technical officer position occupied by Jim Foster, opting instead to push channel and technical strategy decisions down to the business-unit level. Sage reorganized in May to form four distinct business units around its profusion of product lines.

Sage's purge came as the board reviewed its North American operations and decided that "a change in leadership is required to realize the full potential of this business," the company said in a written statement. Sage concurrently released preliminary financial results for the fiscal year it concluded on Sept. 30. Sage's North American unit generated annual revenue of £508 million (US$1 billion), up from £361.5 million (US$ 741.6 million) in 2006. Excluding the effects of acquisitions, Sage calculated its organic growth rate in North America as 4 percent.

Sage Software spokesman John Schoutsen said Sage's design to have more channel decisions made at the brand level was behind the move to eliminate Macdonald's job.

"Those divisions already have very strong channel services in place, and those organizations will pick up the strategy," Schoutsen said. Some of Macdonald's subordinates, such as Vice President of Partner Programs Stephanie Kleber, remain on the job and will continue running company-wide channel initiatives, he said.

Many Sage partners said they were sorry to lose Macdonald, a popular channel figure. A veteran Sage VAR before he joined the company's executive ranks, Macdonald was a fierce channel advocate who introduced innovative programs to support partners like the "100/100" initiative, a venture that offered partners financial grants to assist in training and recruiting staff. Macdonald also launched a series of "sales academies" that partners enthusiastically endorsed.

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