It’s hard to slog through mega-conferences like Dreamforce, and not just because 135,000 people are way too much for San Francisco and its Moscone Center to handle. The sheer girth of Salesforce.com is also a factor: the company has become an immensely complicated and multifaceted company, maybe too much so for a single conference. Regardless, Dreamforce reminds me of why I don’t see my favorite bands in a coliseum setting: The volume needed to fill a coliseum washes out the undertones and overtones that make music a rich and complex listening experience, instead leaving the listener to sort through a lot of random, washed out noise.
And so it seemed with this year’s Dreamforce, and yet there were a number of powerful undertones and overtones worth trying to pay attention to, despite the distracting chatter generated by the likes of Tony Robbins, Eckhart Tolle, Hillary Clinton, Wil.i.am, Al Gore, and others non-techies adding to the cacophony at Dreamforce. (Even if I try, with the utmost equanimity my cynical analyst’s brain can muster, my mind still reels at the quantity of lucre, clean, filthy, or otherwise, that went into paying the speaker fees that a set of bold-faced names like that commands. Wow.)
Perhaps the most powerful undertone playing in the background – in particular as seen through the lens of the enterprise and its requirements, and Salesforce.com’s relative market position as a provider of solutions for those requirements — came ringing through in a number of presentations I attended and discussions I had with customers and partners. And as I listened carefully, and filtered out the waves of white noise, a cluster of functionality, technology, and aspirations came into view that together will define the future of Salesforce.com in its battle against the likes of Microsoft, SAP, Infor, and Oracle.
The battleground that best defines the future for Salesforce.com, and its competitors, as I have alluded to previously, lies in the requirement to support complex business processes that span the silos of functionality (CRM, ERP, SCM, HRMS, etc.) and the deployment options (public cloud, private cloud, hybrid and on-premise) that make up the present and future of the modern enterprise. While Salesforce.com’s continued growth in CRM, marketing automation, and the like are of course interesting, particularly for the short-sighted investors who have bought into Salesforce.com’s hyperbolic forward P/E ratio of 70+, the company has some important mountains to scale if that ratio is ever going to remotely come true.
Those mountains have less to do with the company’s core customer and marketing automation messages and much more to do with a future defined by Salesforce.com’s ability to be the go-to vendor for supplying the infrastructure, connectivity, and business context that can support the complex business processes that define enterprise innovation today. Salesforce has more than just aspirations in this regard – it is moving to provide as many of the pieces of the solution as possible: that undertone rang in my ears load and clear. And, like every other vendor in this race, Salesforce has some obvious strengths and a few major lacunae to overcome before those undertones are going to become a major motif.
A good example of this complex business process opportunity lies in next generation enterprise asset management. EAM is poised for a revolution that will take the best of the industrial internet, and combine it with the latest in talent management, operations analysis, direct materials procurement, and customer service management, and by orchestrating these elements, deliver an integrated, complex business process that will be, compared to the fragmented state of the art today, a thing of beauty.
In this future that is about to happen, the maintenance process for a jet engine or wind turbine or subterranean drilling platform will take an alert generated by a sensor and turn that into a customer service event: maintenance will be scheduled so as not to interfere with core operations, the right repair people will be identified and positioned to effect the maintenance request, the right parts will be ordered from the ERP system and tracked through logistics to ensure they are on site at the time scheduled, and of course, the customer will be kept in the loop as the service request moves from alert to scheduled to complete. This is just an archetype: the examples of complex business processes that span horizontal technologies and vertical industries stretch on and on into perpetuity.
It’s a given that delivering this kind of complex process will change the world of enterprise software and business in fundamental ways, just as it’s a given that no single vendor’s applications will be able to orchestrate this kind of complex process by themselves. It’s also a given that the business opportunities for new and unheard of levels of service will entice the stakeholders in this complex process dance to find out a way to do this by cobbling, kludging, or otherwise stitching the different software assets together – internally and across business partner networks – that are needed to make this new opportunity hum. No one has to time or inclination to wait for a single suite or a single data model to deliver this vision.
The big prize on the table for every vendor that aspires to the simultaneous platform and application superiority – both of which that seem to be the twin focal points of all the top enterprise software vendors today – is to be the go-to supplier for as much of this complex process vision as possible. At a minimum, success will require credibility in infrastructure, applications, and vertical industry knowledge, plus some serious analytical prowess to support the monitoring and predictive analytics upon which this near-term vision is based.
And while Salesforce.com has one of the core applications for my archetypical EAM complex process (and many others) in the Service Cloud, the beginnings of the analytical component in its recently announced Wave Analytics Cloud, and a modicum of orchestration components in its Platform Cloud, there’s a fair amount of territory to cover before Salesforce.com can challenge competitors like SAP, Oracle, Microsoft, and Infor in filling out the rest of the requirements. No talent management, no ERP, a very nascent vertical focus – the gaps in Salesforce.com’s ability to tackle complex business processes are telling. Salesforce.com has one other key element that it could bring to the table – a focus on communities that, when they are one day synchronized with the company’s forthcoming vertical offerings, could form an important nexus for vertical industry processes. One day.
But wait, there’s more. One of the problems for pure cloud companies tackling this complex process opportunity is the ability to support a hybrid environment that includes not just on-premise applications, but legacy, way-behind in the upgrade process, on-premise applications. This is a non-trivial exercise for the vendors who own these legacy apps, it’s even more complicated for a pure cloud company like Salesforce.com (and Workday, while we’re casting aspersions) to make a credible play in this corner of the market.
It’s important to stop and acknowledge that no single vendor has a lock on delivering on the promise of these complex processes. Every hybrid vendor has major challenges to overcome, much of which center around the complexities of orchestrating the broad set of on-premise and cloud apps these vendors own or are accumulating. Microsoft may be the furthest along in blending its on-premise and cloud offerings, but its dependency on partners for its vertical and geographically-specific offerings, plus the need for Microsoft to continually orchestrate with non-Microsoft products that are often running headquarter operations, continues to present challenges in terms of scale and support for the global customers that are most likely to lead the charge in rolling out these complex business processes.
I believe Salesforce.com is aspiring to this complex business process opportunity, though those aspirations were hard to hear over the noise at Dreamforce. I saw glimpses in the Wave demos – where the SAP logo was prominently on display as one of the data sources that Wave Analytics can target – but that too was largely aspirational. While Salesforce.com partner Informatica stands poised to deliver the connectivity Wave will need to hook up to SAP, it’s clear from my conversations with Salesforce.com’s analytics execs that the real goal today is analytics for Salesforce.com data, with third party data integration coming later.
The fact that complex process messaging wasn’t front and center isn’t the problem. Like Successfactor’s conference earlier this year, there wasn’t necessarily the right audience in place for this conversation – the focus on CRM and marketing is what draws that massive crowd to San Francisco, and, frankly, it’s what Salesforce.com’s core business is really about anyway.
But it’s clear that Salesforce.com has to move in the direction of supporting a more complex business process world than it supports today, and I don’t believe relying on partners from Force.com will cut it. There may be partners like Kenandy trying to pitch in to help, but Sandy Kurtzig 2.0 has a long way to go before it can match up to the functionality that Sandy Kurtzig 1.0 – a.k.a ASK – could offer. Salesforce.com – like Workday – will one day have to acquire its way into being able to offer a critical mass of functionality beyond its core product line, relying on partners or organic growth won’t be enough.
I think it’s clear that Salesforce.com is a contender in the complex process market, and it has the money, market clout, and people to make its dreams more than just aspirational. But instead of having Tony Robbins exhorting the crowd on Day One to do something – was it walking on hot coals, or has that gimmick finally run its course? – that has nothing to do with enterprise greatness, Salesforce.com should start focusing more of its consider market voice on moving its customers forward to where they need to be – building and running the complex business processes that will define the enterprise of tomorrow – instead of making them feel good about where they are today as users of the CRM market leader’s current product line.
It’s fun to party at the Moscone Center, but, I think those 135,000 people also need to know how to stay relevant in a world that is heading their way, and for which neither they, nor Salesforce.com, are probably ready for. Maybe that’s a separate conference – slightly smaller, no walking on coals, less music – that discusses how Salesforce.com will stay competitive, and help its customers stay competitive, as supporting the sales force, the marketing team, and the customer becomes increasingly less important than supporting the entire enterprise and its partner and industry-specific ecosystem, of which sales, marketing and customer are only a few of many key components.
It’s a harder message to sell, it’s definitely a harder path for Salesforce.com to take, and it might not lend itself to the party-hardy atmosphere that permeates Dreamforce. But it’s as necessary for Salesforce.com to begin the discussion in earnest as it is necessary for its customers to begin thinking this way. The party doesn’t have to stop completely, but maybe it needs to get a little more serious. There are some important business challenges on the horizon, and it’s time to tone down the noise, put away the party hats, and get a little more serious.