Sage Software Taps Telecom Executive as Part of Shake-Up

Orange County Business Journal, Apr 14-Apr 20, 2008 by Tolkoff, Sarah

TECHNOLOGY: Woman set to run county's biggest software company

Orange County's biggest software maker is getting a new chief executive.

Sage Software Inc., the North American headquarters of Britain's Sage Group PLC, has tapped Sue Swenson, a telecommunications veteran, to head the Irvine unit starting next month.

Sage makes business software that streamlines a variety of tasks for small and midsize companies, including accounting and other day-to-day operations.

The company's bread and butter are small businesses-companies with five to 250 workers. It sells through a big network of resellers, including Laguna Hills-based Blytheco LLC.

Swenson, who declined to talk before starting the job in May, is taking the helm at a critical time. Sage's parent company recently handed down some big restructuring orders.

Former Sage Software chief executive Ron Vemi, who led the North American unit out of Atlanta, and former chief financial officer Jim Eckstaedt were ousted in October.

The company didn't say why the two left. A statement from Sage Group said that "a change in leadership is required to realize the full potential of this business."

Sage Group Chief Executive Paul Walker cited low profit margins and sluggish growth excluding acquisitions as the primary reason for the overhaul.

"It was something the parent company had been looking at for a while," said Nina Smith, president of Sage's business management division in Irvine. "It was part of their overarching strategy."

Swenson, 59, is set to lead the county's biggest software company by sales.

Sage's Irvine unit saw more than $1 billion in revenue for the 12 months through September. It counts some 500 local workers.

Swenson will join the ranks of just a handful of female chief executives in the area. She is one of the first women to head a major technology company here.

"It's great that we have the CEO here in the North America headquarters," Smith said. "It's great for the Irvine employees because we are able to spend time with her on a day-to-day basis."

Sage decentralized its U.S. operations last year in order to help independent sellers of its software work more efficiently with the company's customers.

U.S. businesses were divided into four units based on products. Some responsibilities were moved from the executive level down into the groups.

The business management division, which includes accounting and customer relationship management software, is based in Irvine.

The industry and specialized solutions division-software for small and midsize businesses in specific industries, such as construction, real estate and nonproftts-is based in Beaverton, Ore.

The heatthcare division, which consists of software for hospitals and doctors' offices that help track electronic health records and billing, is in Tampa, Fla.

And the payment solutions division, software for retailers that helps track sales data and process credit card payments, is based in McLean, Va.

English HQ

As for Sage's parent, the company consists of a small cadre of directors and executives. It's based in Newcastle, near the English border with Scotland.

Administrative tasks, human resources and corporate governance and reporting are run from there.

Everyday business tasks are left to executives at Sage's U.S. units, which made up roughly 44% of sales last year for its parent.

"Sage is very decentralized in its approach," Smith said. "Every geography is running its own business. They are not a parent that's kind of in here every day. They really do allow us to be autonomous."

Sage Group chief Walker led the North American operations in the interim while a search for a permanent head was conducted out of England.

The company was looking for someone who "could come in with a strategy, who was a visionary and who could fit into our culture right away," Smith said.

"Their vision is to have these autonomous divisions with the resources down closer to the company's customers," she said.

Swenson, who lives hi North San Diego County, is set to play a major role building up Sage Software, according to Smith.

"We need the team that can take it to $2 billion and $3 billion in sales," she said.

Swenson will be heading a company that's been big on acquisitions. Sage Software has done some 20 buys in the past 10 years.

It's taking a breather at the moment but always is looking for good fits, Smith said.

A big challenge for Swenson will be getting her arms around a company that's nearly doubled in size during the past few years, Smith said.

"We've brought all of these companies in and we want to make sure that we're really integrating them," she said. "But we don't want to lose the agility and entrepreneurship they have."

Swenson has had a long career in telecommunications.

She most recently was chief operating officer of Irvine's New Motion Inc., a maker of ringtones, games and other wireless content that trades on an over-the-counter stock exchange. Last year, New Motion bought Pearl River, N.Y.-based Traffix Inc. in an all-stock deal and changed its name to Atrinsic Inc.