Salesforce and Google team to conquer the enterprise

Salesforce and Google team to conquer the enterprise

Summary: The long-awaited integration of Salesforce.com's CRM applications with Google Apps has arrived today. I've had advance notice of this move, which in my view is game-changing for Office 2.0, PaaS, and enterprise take-up of on-demand applications.

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Salesforce has just released (see all coverage) the long-awaited integration of its CRM applications with Google Apps, embedding email, documents, online chat and integrated calendaring directly into its core sales force automation, marketing and customer service applications. I've had advance warning of this move, as [in a paid engagement — see disclosure page] I wrote the white paper for today's launch. Here are the key takeaways in my view.

Salesforce for Google Apps icon clusterThis is a huge validation for Office 2.0 — the whole notion of collaboration and productivity applications delivered from the cloud. Salesforce.com has more than 41,000 customers, including a growing number of large enterprises. It's now saying unambiguously to all those customers that Google Apps is its preferred productivity suite. The integration is far in advance of anything achievable with MS Office. Product manager Kraig Swensrud, who has been closely involved with the project, described the Google Apps components to me as 'first-class citizens' within Salesforce.com.

Screenshot showing Google Apps integrated in Salesforce.com

This will spread faster than people expect or realize. When it takes just a mouse click to open Gmail and have the message saved with the prospect record, it won't take long before Gmail becomes the default email system for most Salesforce users. The Google Talk integration is just as compelling. The ease of storing and sharing documents along with prospect records will make people want Google Docs to become the system of record for sales and marketing documents, even if they still use MS Office to create and edit the originals — but many users will feel just as comfortable working natively in Google Docs.

The viral effect within enterprises is going to be significant. Once one or two people within a workgroup start sending others links to view and share their Google Docs documents, it'll reinforce usage of the online apps by everyone in the same group. They'll also share documents with colleagues in other departments and with partners, customers and prospects, exposing many more to the experience of using Google Docs.

Much of this will happen under-the-radar. David Armstrong, product and marketing manager for Google Enterprise in EMEA, told me yesterday that Google Apps already has half a million organizations — not individuals, organizations — signed up worldwide, with 2000 more signing up every day. But that astounding adoption rate is visible only to Google. There are no shrinkwrap packages passing through distributors' warehouses or flying off retailers' shelves. There's not even any money changing hands for sign-ups to the free version. It's just an invisible stream of bits in the ether. Adoption will be mostly unseen, until one day it will suddenly have become too big to ignore.

I know some of my ZDNet blogging colleagues are skeptical that enterprises — particularly the larger, most established organizations — will be comfortable using Google Apps. Josh Greenbaum dismisses the relevance of Google Apps to Salesforce.com users because "Google’s terms of service severely hamper the usability of its Apps in the real world of corporate computing," a view seconded by Dennis Howlett, who also criticizes Google's release cycles: "Google is among the slowest to get things done. Even when it does, there seems to be no development strategy or roadmap that discerning buyers can assess. That’s not comforting to business buyers."

When I put those criticisms to Armstrong on Friday, he wouldn't be drawn, stressing that, "What we're announcing here is fundamentally a reseller agreement." Google evidently won't be rushed on resolving these defects until it becomes convinced of the need, which may put a brake on announcing larger deals. But let's not forget that similar criticisms were advanced a few years back as reasons why enterprises weren't going to adopt CRM from unproven on-demand vendors like Salesforce.com. Part of the genius of the company's strategy was in picking a core application where business decision-makers have a great deal of autonomy. Sales and marketing departments tend to get what they want, and if they want Google Apps, there are very few organizations out there where IT will override them (added to which, many individuals within corporations are already using these tools unofficially for aspects of their work anyway).

This is a showcase for on-demand integration. Salesforce for Google Apps is a close integration of two distinct on-demand application stacks, in which both applications can continue to follow their separate upgrade and evolution paths without breaking the integration. All the integration is based on APIs (in fact both Salesforce and Google have added some extra APIs to round out the integration). Like all APIs in the on-demand world, they've been designed to allow each application to upgrade separately. They'll also permit other applications to be linked in, making it possible to build a completely integrated suite of applications to run a whole company. Later today, the first integrations built in that way will be announced by three partners of Salesforce.com and Google, and it'll be a key message of the launch. As Google's Armstrong told me, "We're really excited about the opportunities this creates for the developer community to build a set of applications, tools and integrations that we can only imagine."

Salesforce for Google Apps is a PaaS offering. Because of the two APIs and Salesforce.com's Force.com development platform (I'm excluding Google App Engine because Google itself has already ruled it out for business use), it's possible to build on top of Salesforce for Google Apps to create additional functionality and — most important of all in an enterprise context — to create workflows and business processes that flow and leverage collaboration, email and documents across multiple applications. This is potentially one of the most powerful attributes of the combination.

It's worth recalling for a moment the enormous disappointment a year ago when Salesforce first unveiled its alliance with Google. The announcement had been overhyped and rumors had swirled for several weeks prior, including my own speculation whether Google might buy Salesforce.com. With far less hype this time (apart from an over-enthusiastic Reuters report, which Salesforce.com can hardly bear responsibility for), I believe today's release has fulfilled many of those early expectations. It's taken a while, but that's because the two companies' developers have worked together to create a solid integration that is live and ready to use now — except for certain aspects including several of the new API hooks, which won't be available for custom use until Salesforce.com's summer release.

For Google, the combination brings Google Apps into big enterprise accounts and also expands its footprint among smaller businesses. For Salesforce.com, it expands the reach of its Salesforce application and further validates its Force.com integration and development platform. But more importantly for both of them — and for the rest of us who are committed to the on-demand model — it puts extra weight behind the gathering trend towards running business applications and computing in the cloud. Marc Benioff is fond of saying that we often achieve less than we expect in a year, but more in a decade. In the past year, it may seem that little has been achieved. But in a decade's time, we may look back on this moment as one of the key turning points in the shift to on-demand.

UPDATE [added 4:40 am PDT, plus Sxip para at 6:20 am]: Some links of note. On the Appirio blog, Ryan Nichols has introduced the four applications being launched today by the Salesforce and Google integrator. The post also makes a strong argument for the business value of integrating the two application stacks together.

Also Astadia, probably the largest specialist on-demand integrator, has just issued the press release announcing its two new applications for Salesforce for Google Apps.

The full list of add-ons is at a new AppExchange category page for Google Apps. Also included on the list is a potentially invaluable free utility from Sxip Identity, the Sxip User Manager, which "allows administrators to provision and manage users to both applications from a single screen" and also gives users single sign-on to the two application stacks.

Henry Blodget does a good job of outlining the Innovator's Dilemma position that Microsoft is getting squeezed into as Google Apps accelerates its penetration of the enterprise. It dovetails with my own argument outlined above and in my white paper why this combined offering will make strong headway even while people continue to argue that it can't.

Finally, my ZDNet colleague Larry Dignan debates Google and Salesforce.com: Why don't they merge?. I've added my take in a comment. I'm not sure that Google would stomach the price. I'm also doubtful whether Google has yet accepted how much it needs to learn to sell effectively in the enterprise — it may even be arrogant enough to believe that it doesn't have to, because it's changing the rules of the game. I think Benioff would be wise to hold out for now if the approach did come.

Topics: Apps, CXO, Enterprise Software, Google

Phil Wainewright

About Phil Wainewright

Since 1998, Phil Wainewright has been a thought leader in cloud computing as a blogger, analyst and consultant.

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19 comments
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  • What a Contrast

    This is a deep and insightful post, not a lot to add on the
    details of the announcement. But I did want to draw a
    contrast to the old world. Microsoft and SAP with Duet
    attempted something similar and its been a train wreck. It
    only worked with their recent version - ironic that the
    upgrade pains they cause customer came back to bite
    them - and it was a hardened approach that made it
    difficult to impossible for partners to innovate with / for
    them.

    As you noted, we at Appirio were able to create four
    applications with limited resources in a short amount of
    time. We were limited only by our own imagination and
    resources.

    The world has changed, and the model of on-premise will
    not allow them to create breakthrough innovations. In a
    few years, we will look back to these months with such
    clarity in hindsight (Salesforce and Google, AppEngine,
    etc.) that it will be assumed all in the market must have
    known what was about to come...
    Narinder Singh
  • RE: Salesforce and Google team to conquer the enterprise

    An interesting development. But is it too "Emporer's new clothes" of me to point out that Google Apps are not very good? Whereas this announcement brings some welcome credibility to the suite, I wonder whether over time it will in fact do more to drag Salesforce.com down then build Google Apps up...

    Ian Hendry
    http://www.wecando.biz
    wecandobiz
    • Google apps are REAL good. They do what you need.

      Enter the content, set fonts, add figures, etc. Less and less reason to print, just share / publish online.

      All of those baroque formating features for 8.5x11 paper of MS Office are looking sillier every day.
      DonnieBoy
  • Master Joe Says...

    First of all, since when is the SaaS thing such a big deal? I have to be honest. I woudl prefer desktop applications, over a web-based productivity suite, any day of the week. I prefer to ahve FULL control over my applications, and to knwo exactly what they are doing, what information is being transmitted to and from them, and who can see that information. Using software online, ro software managed by another source, is a HUGE comprimise of security. Also, with all the complaints people throw at Microsoft for privacy violations, and lack of security, have we all forgotten that Google has taken a distant lead in the privacy violation and compromisation of your data, e-mail, and important information? Google is the modern day "Big Brother," and that is not anywhere clsoe to an overstatement of the importance of this issue. The fact is, I trust myself to handle and manage my information, and the LAST organization I would EVER trust to do that is Google. Ten years from now, if Google even lasts taht long, which is questionable itself, people will suddenly start shouting that Google is violating their privacy, as if it is something new. I, on the other hand, will just sit back and watch the idiot masses cry because that is the nature of the human race. Google is COUNTING on peoples' stupidity and lack of care because it allows them the freedom to keep such a strong hold on your personal data and information. If people opened their eyes to all of the privacy violations Google has made, there would be a HUGE uprising against Google, and they would most likely not survive.

    --Master Joe
    SteelCityPC
    • Better question: since when was SaaS/Paas NOT a big deal.

      Take a look around, the world is changing. People said the same thing about cars, radio, the telephone, electricity, . . . . .
      DonnieBoy
  • RE: Salesforce and Google team to conquer the enterprise

    SECURITY, SECURITY, SECURITY....
    Medium to Large Businesses will not want to adopt applications and data stores that are not controlled by their own company. There are too many issues involved with placing your companies information on servers you have no control over. Look at free email services, they have been around for awhile now and businesses did not adopt those resources for the same security issues. Losing email or worried who is reading your email is still not as troublesome as not having full control of your comapanies workflows, documents, bug reports, software version control systems...etc. How can a company feel secure in knowing they have no physical control over the way their data is stored, accessed, or even updated...SCARY. You might think you have a user agreement with GOOGLE that promises certain things but you dont really know what is going on behind the scenes.
    BlueScreen4u2c
  • Socialist movement in the computer industry

    It seems to me that bloggers pushing the 'all computing in the cloud' concept are merely socialists pushing their political precepts in the computer industry. In as much as people ceding control of their entire lives to others has never worked in the history of humanity, companies turning their entire IT operations to others cannot be expected to work here. As they say, if you don't learn from history, you are bound to repeat it.
    P. Douglas
    • A unique view of historical determinism!

      Yes,people ceding control of their entire life's expenditure to banks has never worked either (look at the subprime mess, for goodness' sake!) ...

      What about ceding control of agriculture and food distribution to others? No, it'll never work!

      Ceding control of water supplies, power, sewage and trash collection to others? Perish the thought!

      I know, let's give up on civilization altogether and go back to living in caves. Relying on others is a waste of time. History proves it. Doesn't it?
      phil wainewright
      • What I mean ...

        ... is that ceding control of vital areas of your life that you can yourself afford to manage, does not work. At least you get far better results when you manage these things yourself. Given that IT is virtually the nervous systems of large companies, these companies will not overall get better results if they turn this vital area entirely over to others.
        P. Douglas
        • You are just going to dig a deeper hole if you continue, you already made a

          complete fool of yourself. People said these same things about banks, electricity, telephone, . . .
          DonnieBoy
          • You cloud extremists are dreaming

            [i]People said these same things about banks, electricity, telephone, . . .[/i]

            People never trusted banks until they became federally insured. Is the Federal Government going to compensate cloud customers for damages when their data becomes compromised, made inaccessible, etc.? Another thing, money is just money. Data can be abused in far more ways. Data can be secretly copied and harvested for money. It can be corrupted without anyone realizing until it's too late. Also the idea of companies handing over all their valuable IP to Google when they balked at having MS store customer identity information in its Passport system a few years back, seems highly implausible. Can you imagine say Google holding 25% of the world's corporate data, and 30% of the world's consumer data? That would make Google one of the scariest companies in the world. Not even governments would have the power Google has.
            P. Douglas
    • We respectfully disagree..

      "Cloud Computing" is no more than a technological advance, and as the "Grid", fiber-optic concept advances it will only become more prevalent and more efficient.

      Perhaps Google partners could be given a peek under the hood prior to joining up for this type of integration, and perhaps preamble security agreements would be appropriate..

      But it's far from a political agenda disguised as some sinister "something else" ...

      ;-)
      a_chameleon
      • I do not object to the technology

        I do not object to cloud computing itself. I object to the principle being pushed by bloggers, that companies will be better off ceding control of vital areas of their businesses to others. it is one thing to outsource non-vital parts of your business. However, how well large companies manage their own IT (vs. rely entirely on others) can have a significant bearing on their competitiveness.
        P. Douglas
  • Sounds like a good way

    To extract you cash once you are "in". Forced upgrades, add-ons, you name it. I don't like any of it.
    Crestview
  • RE: Salesforce and Google team up

    "This is a showcase for on-demand integration"

    Amen. SalesForce (IOHO) is fortunate to get this;
    it's the future, vis-a-vis Web 2.0 and it's a great example of on-line, on-demand productivity tools at their best!

    The Team
    http://wirelessspeech.blogspot.com
    a_chameleon
  • Master Joe Says...Again

    There is a difference between SaaS and television. The difference being is that one, television, simply evolves. SaaS is now what it will always be. The reason for this is that if it evolves, it will be called something new, and it will be placed in a different category. The same thing goes with telephones. We now have land lines, cellular phones, and VoIP. They are all categorized differently. In addition, it still goes back to who is more capable to manage your data and privacy, you or another outside company.

    --Master Joe
    SteelCityPC
  • On Demand Integration - the bigger story

    Phil is completely on point in highlighting the issue (and opportunity) around on-demand integration. The cloud is becoming the new venue for strategic partnerships via web services and APIs. In fact, it's becoming the newest form of business development. There is little question that web services are the future of integration -- whether integrating platforms or services, or enabling better content distribution. While some question the ???If we build it, will they come?" challenge of web services ??? recent evidence suggests that if it???s valuable and interesting, they will come. Reuters' Open Calais project has done extremely well, as have Twitter's API and others.
    laura@...
  • And Salesforce/Google will own your content too

    A recent article about Google app T&Cs says that it owns any and all content. Nothing like them having control of your email, spreadsheets, documents, etc. Put something proprietary in there and you are just asking for trouble.

    No thank you for now.
    Keeping Current
  • Calm down buddy

    http://diversity.net.nz/more-on-sfdcgoogle-apps/2008/04/15/
    benkepes