Microsoft to aim at small biz with new Office

Microsoft to aim at small biz with new Office

Microsoft is to expand its Office product line-up with a bundle designed to help small businesses operate better.

The new Microsoft Office for small-business management product bundle will include the familiar Office 2003 applications along with a new financial management product called Microsoft Office Small Business Accounting and an updated version of Outlook 2003 with Business Contact Manager.

Microsoft pitches the new Office Small Business Accounting product in the bundle as an opportunity for partners. Other software makers or ISVs can offer vertical and horizontal applications on top of the new Microsoft accounting software, the company said.

It will be available in the US before the end of next year but Australia, the UK and Canada will have to wait a further 18-24 months, according to partner relations manager for Microsoft Australia, Kerstin Baxter.

"We are not talking about a product that is going to be available tomorrow but we felt it was important to give our partners a roadmap so that they can develop solutions around it," she said. "They want to concentrate on value-added solutions for key vertical or horizontal markets and this [small business management bundle] will be a core engine they can work around."

Some certified Microsoft partners will be given access to a software development kit for the new bundle early in 2005, Baxter said, although this would be based on the US market.

With the new Office edition, small businesses will be able to manage customer, financial and business processes, according to Microsoft.

Payroll functionality is offered through integration with services from outsourced payroll services provider, Automatic Data Processing.

The new Office edition was developed jointly by Microsoft's Office group and Microsoft Business Solutions (MBS), the Microsoft group that sells business applications to small and medium-size businesses and divisions of large enterprises. By offering a path up to the more sophisticated MBS products such as Great Plains and Microsoft CRM, Microsoft was filling a significant gap in its product offerings and taking on Intuit, analyst at Directions on Microsoft, Paul DeGroot, said.

"Microsoft has a major gap in its small business offering," he said. "They have basically left that to Intuit and QuickBooks is the dominant product in that area. As a consequence there has not been a ladder for small businesses to climb on and get to Great Plains. I would say that this is an important gap that Microsoft needs to fill."

For the smallest businesses, Microsoft today offers a simple chequebook-type application called Money Small Business. The next step up is Small Business Manager, an entry-level ERP product.

"There is a gap today where people need an entry-level accounting system, but don't need entry-level ERP," vice-president of Microsoft's small and mid-market solutions and partner group, Steven Guggenheimer, said.

"There are standalone accounting applications out there today, but they do not connect very well with the other applications most people use in their business. They don't have the seamless connection with contact management or Excel, which some people use for their accounting."

Among the features of the new Microsoft application combination is the ability to mark hours as billable when a calendar entry is created in Outlook.

This information could then easily be transferred to the accounting application, he said.

Another feature is easy invoicing using Word. Microsoft will also offer tools for QuickBooks users as well as users who do their accounting in Excel to migrate to the new Microsoft Office suite.

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