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Sugar CRM Best Fit and Alternative Products

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SugarCRM Best Fit and Alternatives

Sweet Spot
Short list SugarCRM when:

  • Seeking a CRM solution with the flexibility benefits of open source.
  • Seeking best of breed or CRM-only solutions.
  • Seeking CRM with tightly integrated social CRM capabilities.
  • You want a choice in cloud providers.
  • You feel you may change software delivery methods from SaaS to on-premises or vice versa.
  • Budget is an issue and low cost is an important decision making criteria.

Alternative Solutions
IT buyers may be best advised to consider alternative CRM products when:

  • You require advanced features sets and functionality throughout the CRM suite.
  • Sales people need to take sales orders or have access to inventory information.
  • Seeking an enterprise-wide, fully integrated ERP and CRM software as a service solution.
  • Seeking vertically focused solutions with single-vendor accountability.


Concluding Remarks

SugarCRM software strengths include ease of use, software flexibility and open design. The company's message is that the future of business is open—both in transparent relationships and open access to software. It's a good message and one that adds differentiation for Sugar.

SugarCRM is fundamentally different than most open source software companies in two major regards. First, the company's open source business models works—the company is growing, cash flow positive and increasing customer acquisitions at an accelerated pace. Second, the company no longer positions open source technology as its differentiator, but as a benefit, and instead focuses on the competitive advantages and capabilities of its CRM application and partner ecosystem. Other open source software companies would be wise to notice that these two accomplishments are not unrelated.

SugarCRM is also proving that indirect channels work in a cloud or SaaS distribution model. Business software publishers that serve the middle market have learned from over two decades of experience that business partner channels deliver the reach and cost of sale that makes sense for the SMB target market. The on-premises middle market CRM and ERP providers such as Microsoft and Sage only go through indirect channels and have become far and away the market leaders. With online provisioning and telesales, many SaaS CRM companies are reluctant to give away software margin and opt for a direct sales model. While both models have their place, SugarCRM now earns the majority of company revenues from partners and is proving that indirect channels can scale while delivering outstanding local service to customers.

SugarCRM is at the cusp of growing the company to the next level. The company has a good CRM product, a strong channel and talented executive team. Competitively, they do lack clear messaging and marketing reach and will need to expand in these areas to keep pace with the industry's top performers. End

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Comments (8) — Comments for this page are closed —

Guest Lem Swam
  Traditional open source software companies often operate by giving away the razor and then selling customers the blades. This isn't Sugar's approach, which I believe speaks to the real strength of their CRM application, and ultimately their company. The community edition is a viable product for many, and the fee-based commercial CRM products have to clearly justify their purchase prices. My take is that this is a much more sustainable open source business model and one that surpasses the company longevity concerns of most open source providers.

Guest Denis Kirk
  The IBM alliance is interesting, but sugar’s PHP technology will hold back sugar and IBM from making inroads to the enterprise market.
  Guest Clint Oram
    I think the enterprise IT market is ready for PHP and PHP is ready for the enterprise IT market. Now I'm clearly biased since I'm the CTO for SugarCRM, but we get this question occasionally and there are some great proof points for PHP. First off, Facebook is written in PHP. There isn't a better example I can think of showing application scale, performance and security than the 1/2 billion Facebook users putting all of their personal information into a system powered by PHP. Second, PHP 5 is not the PHP scripting language you may have run into 10 years ago. PHP 5 is a powerful, enterprise-class application server environment that gives developers and IT managers the flexibility and control they need. Zend (the company behind PHP), IBM, Microsoft, Facebook, Yahoo and many other large enterprise and consumer IT companies have been putting huge efforts into making PHP meet the rigorous demands of companies of all sizes. I'd love to hear any specific examples you might have of how PHP is not ready for the enterprise. I think you'll be surprised with how far PHP has come in the past decade.
  Guest John Mertic
    Denis, what do you feel makes PHP not ready for the enterprise? I'm asking this honestly, as I've heard this comment thrown around casually without anything behind it. I feel this is a question worth addressing since there is more and more PHP used in enterprise than most people realize.
  Guest Denis Kirk
    No one development language is best for all situations and debating Java versus PHP can quickly elevate to a religious-like war among passionate users and purists. What is clear is that enterprise organizations have historically standardized on Java while website developers have opted for PHP. Taking it a few steps further, Java/J2EE is typically used in team environments which demand team-based tools, strong methodologies, IDEs (integrated development environments) and ancillary tools. These environments are more structured and typically associated with enterprise level projects. Java is also a standard of object-oriented languages. PHP is clearly advancing but has a lot of catch up to do with regard to OO, tools and IDEs. PHP didn’t support either OO or offer a respectable IDE until PHP4. I agree with Clint Oram that PHP5 further advances PHP big time, but I think there is still much catch up to go.
  Denise Chuck Schaeffer
    Perhaps, but I don’t think so. Not so long ago Java/J2EE may have seemed like a superior technology choice due in large part to its scalability for enterprise organizations. However, CRM apps don't require the same input/output or online transaction processing (OLTP) throughput as do many other business apps. Not to diminish their sophistication, but CRM apps rarely do much else than persist data. You add, update and delete accounts, contacts, opportunities, cases, campaigns, etc.—and the data simply persists. Compare this with accounting software or an ERP system, where when you enter a customer record, posting processes commence, debits and credits are churning in the background, new journal entry records are created and migrated from the receivables module to the ledger, credit limits are being checked and decremented, inventory balances are being relieved, procurement economic order quantities are reviewed for replenishment, etc. I think when you consider the use cases for CRM it becomes apparent that PHP is generally scalable for even the enterprise. There may also be some serious benefits via PHP. Many of today's mash-ups, social media tools and consumer technologies are often developed in PHP, making integration with other PHP apps such as SugarCRM that much more streamlined. And as a source of comparison, consider Facebook—a PHP application that is one of the most scalable on the Web.

Guest Tariq Bishar
  Im not sure the vendor lock-in argument is that big a deal, yet it seems this is a very big message from Sugar.
  Denise Chuck Schaeffer
    This is one of those buy criteria that can be mission critical or reduced to a 'nice to have' depending upon your prior experiences, appetite for risk or desire for control. SugarCRM CEO Larry Augustin makes an interesting analogy on this topic. He sometimes asks if you would buy a car which could only be fixed by its dealer, and segways that point to ask why people buy software like that when they could get software which can be customized, appended or fixed by who they want, when they want or as they wish. Or in another scenario, what does a SaaS CRM customer do if their host incurs repeated downtime or poor performance? With most hosts, customers have no option to move their application to a different cloud which better accommodates their uptime, performance or Service Level Agreement objectives. With SugarCRM, the customer can use Sugar's data center hosting, Amazon's EC2 cloud, Microsoft' Azure cloud, a partner host or bring the application in house and run it as a private cloud. These are simple but real world examples that demonstrate varying value of control and choice.

 

 

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Sugar's message is that the future of business is open—both in transparent relationships and open access to software. It's a good message and one that adds differentiation for Sugar.

 

 

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