These are brief small, even trivial, thoughts that have randomly been in my head over the past few weeks, and I'm putting them down on "paper" to let you know what I'm thinking. I need to get them out.
Short -- like Steven Wright jokes, though my thoughts are not nearly as funny as his (if they are, I'm in trouble as an analyst, but I'll have a new career).
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"I got a new dog. He's a paranoid retriever. He brings back everything, because he's not sure what I threw him."
"I broke a mirror in my house, and I'm supposed to get seven years bad luck, but my lawyer thinks he can get me five."
"I spilled spot remover on my dog and now he's gone."
"I went to a place to eat. It said, 'breakfast at any time.' So, I ordered French Toast during the Renaissance."
Those of you who know me know I cover companies, not technologies. Salesforce is almost always the most interesting company I cover, because rarely do I see a company of their size do so much right. Not that their competitors do so much wrong. It's in the nature of analysts to try to poke at things and that often means sussing out problems or quirks or things that are good but could be better. Many of my ilk focus on the technology stacks as the defining component of a company. While admittedly that is a sweeping statement about an "ilk," and if someone wants to challenge it, I probably won't argue with them. My point being, I don't do that. I focus on how much the company impacts the world that it lives in.
When Marc and Lynne Benioff bought Time magazine, Marc was asked why by Mad Money guy Jim Kramer. His response (partial) was telling:
"Lynne and I so strongly believe that business is the greatest platform for change," Benioff told the 'Mad Money' host. "When I went to business school, they said, 'Focus on your shareholder, Marc. The business of business is business.' That no longer applies. We have to erase that from our history books. The business of business is improving the state of the world."
What Salesforce did and does is constantly evolve exactly the model that Marc spoke of in that interview (which is expected) but also their approach to the world that they are part of. That's why, despite the complaints here and there from customers or from third parties, Salesforce's highly visible activism as a company via its CEO and jefe Marc Benioff is refreshing. To me at least. While even some of my friends and colleagues thought that Proposition C -- a business tax to help the homeless in San Francisco -- was not that effective a solution, I supported it, admittedly, as someone not living in California. Probably more germane: I applauded Marc's public stance on it despite his peers (Jack Dorsey of Twitter, etc.,) opposing it in large part.
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But things don't stop with Marc's activism for Salesforce either. They clean up their own house when something unjust arises. In 2017 (I think it was then), I was at a Salesforce Cloudforce event in Washington DC to support my good friend Casey Coleman, former GSA CIO, who had just taken a job as the SVP of Public Sector Strategy at Salesforce -- quite the coup for them. One of the themes of that event was gender equality and the end of unequal pay scales. Salesforce had found that they had a 19 percent deficiency in the pay of women relative to men, so they increased women's pay to the appropriate equal level in November 2016. Very cool, but that wasn't the kicker. They had acquired a number of companies, I think including Demandware, so that by January, with the merger of the companies they had acquired, it was down 19 percent again. And that January, basically a couple of months later, they raised the pay of the women at Salesforce again. Now that was the kicker.
A few months ago, they hired Paula Goldman to head up their newly formed Office of Ethical and Humane Technology Use. She reports to Tony Prophet, chief diversity officer and one of the best human beings I've had the pleasure of meeting. She began work on Jan. 7.
Finally, to drive home the point, Salesforce launched at the last Dreamforce officially a solution they call "Philanthropy Cloud" – which I think may be the solution they have which will have potentially the greatest impact in the world. It was co-created with United Way and is a free solution designed to sit in a Salesforce instance that gives the employees of a company access to 1.3 million charities and allows them to actively participate through contributing their time or their money and to socially engage with others of like mind with the same charity or the same non-profit domain. It is an engagement tool that is designed to involve individual employees in doing some good in some way, and at the same time, have that good reinforced via social interactions and company culture. You'll see a lot more on this as I go along.
I also think that the entirety of this effort is influencing the market from the ground up and the top down, and the whole of Silicon Valley, at least on the business tech side, is being forced to respond. More on that in my next post.
Ultimately, due to its founder and primary public spokesperson, Salesforce is a force for change not just for selling tech to customers. While some customers are peeved at it, the idea of a major company utilizing its significant influence and corporate charisma to do more than sell is really appealing to me
When SAP acquired Hybris and Salesforce acquired Demandware, both of them pulled a stunt that didn't go over too well with me (and others), which was to try to position e-commerce as the fourth pillar of CRM. I challenged each company to show me a single piece of collateral that was published by them before the acquisitions to prove to me that it wasn't just a self-serving effort. Needless to say, neither came up with anything at the time and, to their great credit, neither persisted in calling e-commerce the fourth pillar. Because it wasn't, isn't and never will be.
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However, e-commerce not being the "fourth pillar" doesn't mean that it hasn't become a recent mission critical piece of the world of customer engagement and experience that we are now living in and that business technology companies are focused on, one way or the other, trying to serve. E-commerce, at least in my eyes, is the core transactional technology system enabling and serving a rapidly increasing demand for being able to satisfy what customers need to be fully engaged with the businesses of interest to them. There is no way, given the customer desire for immediate response and control over their own efforts when it comes to interacting and/or transacting with a company, that you can avoid looking at the value of e-commerce as part of your technology matrix if you are a substantial enough company to provide your products, services and tools online. So take heed, not the fourth pillar, but still something to pay attention to.
The current line up of the big 4.8's offerings in e-commerce:
So, four more words: Mission critical. Peace out.
There is an actual substantial discussion occurring as I write this about whether or not B2B and B2C are antiquated categories and, if they are, how should they be replaced. The replacements have been B2B2C, B2P, P2P, and I've added C3PO. So, you know what the hell I'm talking about since it seems so arcane -- let me explain what each of the acronyms means/stands for.
I actually think, despite the multiplicity of acronyms involved, this is a genuinely interesting discussion, as it only exists because the nature of the customer has changed so much.
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For many years I've been saying, at the end of every B is a C –- meaning no matter what you are dealing with, no matter what the buying cycles are, ultimately you are speaking with, impacting, interacting with an actual human being. And whoever "you" is in this equation is also an actual human being, so identifying the sales cycle as say, P2P, isn't wrong anymore People convincing people to buy things.
I'll illustrate with a story from 2006.
I was in Zagreb, Croatia keynoting the first (and maybe the last) CRM conference ever in Croatia. It was hosted by the remarkable Velimir Srica, who had just published the first book on CRM in Croatia. I remember listening to a panel that consisted of, among other participants, the largest wholesaler in Croatia -- among the products they wholesaled was food and a retail grocery chain that also wholesaled food but was also served by the pure wholesaler. They told us that even though they competed all the time, they had come to an arrangement to work together on food because despite their B2B wholesaling, they ultimately served the "C" -- the customer who shopped in the grocery store. The line between B2B and B2C has always been a bit blurry but is increasingly so as the 21st century progresses. The more we look at customer behavior, customer intent; the more that we recognize that we are dealing with -- in all selling -- outcomes that satisfy not just the company being sold to if its B2B, but the person being sold to (in either environment), the more we realize that Ray Wang's P2P and Andres Reiner's (CEO of PROS) B2P are both probably more germane that B2B and B2C. However, the buying cycles of each of them do remain different and that still has to be accounted for.
So, will those arcane distinctions go away? I don't know. I really don't. Probably not immediately.
You're better off asking C3PO.
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This one is simple (I'm cracking my knuckles). Multiple companies are starting to talk about the movements they are creating. Salesforce is calling Trailhead a movement; SAP is talking about the customer experience movement.
Let me be clear: None of them is a movement. I have been part of lots of actual movements over my life from the 1960s on. These aren't like those. Trust me.
They are something though. They are the externalization, the extension of the cultures of the companies that are saying they are movements. Movements sound cooler, sexier, more fraught with possibility. But what is being peddled here are organized efforts to get customers or interested parties involved with and embedded in the culture of the company, which is more than just the purchase of software, which, from a business standpoint, creates significantly more desire to be a part of the company, which is "something bigger" than a transaction machine.
And that's a good thing more often than not. But you'll have to distinguish between those who are beating the drums for good and those who are drumming up business. Need some direction? Contact me on this one. I'm a pretty good at IDing "movements." And movements.
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For me, when I say "the best" I mean the acquisitions that are likely to be the most effectively positive on the company who acquired them. They could enhance the capabilities to make them more competitive. It might be that the acquisition moves the company into new markets or even change the strategic direction. It might just strengthen the overall company due to significant improvements in something other than the technology. But one way or the other, these are my top three and they are in a particular order. My No. 1 is the one I thought is the best of the best. Oh, also, to be clear, I don't give a damn about the acquisition price. My thinking on that is simple: Someone was willing to take an offer that someone made. Who am I to debate the value of the deal? This has zero to do with financial valuation and everything to do about the impact the deal had, has, or will have on the company that acquired it. The biggest caveat here is that I'm talking about what I think are the most significant customer-facing technology acquisitions, so I'm not including, say, IBM's $34 billion acquisition of Red Hat, or Microsoft's $7.5 billion acquisition of GitHub, both of which are significant but neither in the wheelhouse I'm storing my tires in.
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Do you want to do good forecasts or predictions, depending on your predilection to one term or the other? Here's the advice I give all my mentees about everything:
You can say what you want, but be prepared to defend everything you say.
Otherwise, Happy new year to you all, and I predict that I'll see you in 2019 -- maybe. Or maybe not.
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