Peachtree 2012 Annual Report Download - page 42

Principal risks and uncertainties
Sound management
External business factors Products and services
Risk As a technology company, operating in many different
countries throughout the world, there is a risk that Sage
does not appropriately respond to external business factors,
such as changing business needs, changing technologies,
competitor activities, compliance and regulatory requirements
and the economic environment.
There is a risk to Sage’s reputation and future ability to grow
as a business if poor quality products and services are released to
customers. This risk relates to both traditional on-premise products
and services and online, customer facing products and services.
In addition, for online customer facing products and services,
Sage must ensure that it adequately protects and secures
customers’ data.
Potential
impact
There is a potential for an adverse impact on business
performance if external business factors and changes thereto are
not appropriately addressed. Such adverse impacts could affect
Sage’s competitive position, revenue and margin, make demands
on employees and cause nancial penalties to be incurred.
Sage’s reputation and competitive advantage could be jeopardised
if a poor quality product or service is released to customers. The
impact of Sage’s products and services on its customers’ ability
to do business increases the severity of the risk. The change in the
product and services landscape in terms of online customer facing
products and services and the need to ensure reliability and
availability also increase the potential impact of the risk.
Mitigation
process
We continue to build strong customer relationships, develop and
expand our product and services offering and seek organic and
acquisitive growth opportunities. We develop appropriate strategic
direction and maintain knowledge of industry developments to
ensure a proactive response to changing needs. Our business model
and the signicant percentage of our revenue which is recurring, give
comfort and support against economic exposure. Our Group-wide
compliance programme seeks to ensure that local, national and
international regulatory requirements are identied and complied
with. A detailed quarterly forecasting process helps to ensure robust
and realistic challenge to nancial performance.
Sage has detailed product and service release and quality control
procedures which are adhered to in advance of a product or service
release. Sage also has thorough quality assurance processes and
initiatives relating to the level of service provided to customers. Sage
has a detailed framework to control the risks associated with the
provision of online services and the protection of customers’ data.
Risks can materialise and impact on
both the achievement of business
strategy and the successful running
of our business
A key element in achieving our strategy and maintaining services to our customers is the
management of risks. Our risk management strategy is therefore to support the successful
running of the business by identifying and managing risks to an acceptable level and
delivering assurances on this.
In addition to the principal risks and uncertainties set out below, we have reviewed our
plans in light of potential risks to achieving our strategic objectives. Principal risks and
uncertainties have been updated to reect high level strategic risks. Lower level strategic
risks are analysed and mitigated via the normal embedded risk management processes.
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