• September 7, 2011
  • It’s worthwhile to consider the economic consequences of Dreamforce — the products announced as well as the cultural issues it raised.  Now, I am not an economist and I encourage you to think about that and maybe not read this if that matters.

    Many people might look at the news coming out of San Francisco and try to calculate the ROI on one or another introduction or announcement but I think that’s like looking through the wrong end of the telescope.  ROI is a financial measure and when I think about economics, especially marco economics, I am trying to figure out how the changes affect the ways we work and make money now and especially in the future.  Let’s take a look a just a few ideas.


    Salesforce announced a data residency option (Database Rights Option or DRO) aimed at letting companies store their data on their own devices rather than in the cloud.  I’ve already written that this approach will be welcomed by companies and government entities that can’t for regulatory or policy reasons, let their data reside on a cloud infrastructure.  There are many organizations in that position and this should be a boon to their approaches to IT but also a boon to Salesforce’s business.

    About the only folks who might be adversely affected will be other vendors.  Companies like Microsoft and Oracle have made a big deal of offering architectures that run in any mode including on-line, on-prem and hybrid implementations.  They’ve taken this to market and used it as a differentiator with Salesforce but that’s rapidly fading in importance, in part I believe, because these solutions preserve single tenancy for applications.

    True enough, the other vendors can claim that companies can still own their source code and to be able to manipulate it at their whim while Salesforce still holds the code and is totally responsible for managing it.  Of course customer developed code might be stored in the cloud but Salesforce will not be editing it.  Just backing it up and acting as a custodian.

    Which is better?  I like the idea that Salesforce will continually upgrade its code and make sure that its updates do nothing to corrupt my code.  In my humble opinion VRO is a net positive.  Sure it goes against the Salesforce religion but it gives customers what they want and does not compromise the applications.

    The Social Enterprise

    Salesforce did a good job of defining what is most important — the social enterprise.  This is not a new buzz word or a new shiny object.  In incremental steps over the last three years the company has been defining social business, building products to support it and training the early adopters.

    There is a lot of heavy lifting left to do here and the world outside of Dreamforce is not always welcoming.  At a press conference on Thursday, Marc told an interesting story about this reality.  He said that he speaks with CIOs and other C-suite people all the time and on one occasion recently — a conference, I think —he showed a CIO Chatter.  When the CIO saw the stream his first question was, “So now the person receiving all this has to answer it?”  The answer was not, shall we say, appreciated and with that the CIO said this isn’t for me.  Net/net there’s still a lot of proselytizing to be done and a lot of reticence to be over come.  Last week I mentioned some research just out of Cornell that examines why we like creative ideas but shy away from creativity, check it out here xxx.

    The Social Customer

    There are many manifestations of the social customer.  It can be someone who renders an opinion on a product or service, someone who lends a hand to help out someone with a question or an issue and it’s someone who values privacy.  I was struck in watching Marc’s conversation with Eric Schmidt of Google, of how many times Schmidt in describing a social interaction, used words like, “With the user’s permission”.

    One question from a British reporter at the same press conference had to do with not wanting a socialized customer service person to see everything a customer might have recently posted on social media.  Some things while social are still reserved for the intimates of the poster.  That’s a fair point and one that right now gets the very unsatisfactory answer of, well if you don’t want the world to see it, don’t post it.  That’s hardly comforting to many people but I think the issue won’t be solved with more technology.  I think it will be an issue of professionalism.  We forget that in addition to building out a new technology infrastructure that we’re also building the rules of the road and this might be an example of where smart use of the technology trumps more technology.

    This will likely be a touchy topic for some time and the sensitivity will be different from culture to culture and country to country.  As an economic issue privacy might be the biggest roadblock to mass adoption and my advice to anyone listening would be to never take it for granted and to continue being as explicit as Schmidt.

    Heroku, Ruby and developers

    One of the areas that gets almost no coverage is what all this means for developers and as it turns out there was a lot at Dreamforce for them.  Salesforce is on a path that delivers tools for three major kinds of development — business applications, websites and I don’t know what to call it, web resident apps.  Schmidt was emphatic about the need for the modern company to be able to develop quickly and iterate toward perfection while enabling users to get at products quickly.

    For business applications there’s the Force.com platform with a choice of Java and Apex, the company’s proprietary language that basically fills in declaratively where point, click, drag and drop don’t do enough.  Then there’s the company’s website builder.  You can build a website integrated with your Salesforce instance using your data.  This capability is most useful for building customer facing apps that capture customer data and interact directly with them.  So a registration page is the obvious example.

    Finally, Salesforce spent a lot of cash buying Heroku which is a development environment that uses Ruby on Rails and several other languages like Java, to build applications that are intended to live on the web perhaps at other sites.  A great example of this is Facebook integrated applications.  Some people are referring to F-commerce meaning commerce apps on Facebook and that’s very exciting.  Heroku is a go to choice for building applications that run well and scale massively for the Web.  In a demo we saw an application built by NBC to promote Warner Borothers’ new Harry Potter movie.

    Obviously, this illustrates the idea that Heroku might be a good choice for this kind of app but even more importantly, it shows us that we probably don’t know how all of this technology and infrastructure will be adopted and consumed in the years ahead.  That’s what makes Dreamforce so interesting and the ideas unveiled there so powerful.

    I am glad I dodged a hurricane to get to Dreamforce.  I lost my voice but recovered and saw a lot of cool people.  It’s going to give me something to write about for a while.

    Published: 12 years ago

    It’s amazing to me how we overuse words.  Bothering to notice is an occupational hazard of the writing life, I suppose.  For instance, consider the word unique, which means one of a kind, if you add very or any other modifier to it, you get mush.  Today’s word might be amazing.  There is entirely too much use of amazing in my opinion but curiously, Dreamforce Wednesday was an amazing day and I say that without hesitation or irony.

    On Day Two of Dreamforce the company introduced two new clouds, which is becoming one of its new favorite product words—another would be force though I suspect at this point that Microsoft has had enough of it by now.  The new clouds are for IT service desk in a creative partnership between BMC, which ported its leading help desk product, Remedy, to Force.com; and Heroku, a Ruby on Rails application platform.  That brings the total number of platforms to eight and if you are keeping score at home they are: Sales, Service, RemedyForce, Jigsaw, Chatter, Force.com, Database.com, Heroku.

    What’s interesting to me about this is that there is a rough division between business applications and platform technology.  I had thought that this Dreamforce would focus on business applications because Chatter has been a big success for the company.  But applications were for Day One and while Chatter received its due, it really was the second story of the conference.  The top line stories were all about foundation technology and they show a maturation of Salesforce as a technology company that supplies the enterprise with some very sophisticated and interesting tools.

    In hindsight, announcing database.com on Day One was a dead giveaway that Day Two would bring some kind of developer news.  After all, a database is only valuable when you can write applications against it.  So a logical announcement could have included some new alliance with a company like VMware but that’s been done before.  Instead, Salesforce simply announced the intent to buy Heroku a development platform for Ruby on Rails that will be especially useful for quickly developing and deploying mobile and Web applications.

    So now Salesforce is a company offering a robust suite of cloud based applications that support front office business processes and it is a company that provides tools that enable developers and ISVs to build advanced applications for the Web, mobile devices and the cloud.  This takes me back about five years to a conversation I had with Marc Benioff about S-force, the progenitor of Force.com and the company’s initial foray into opening up its tools to enable developers to customize the Salesforce application.

    I told Benioff then that I thought the platform business would some day eclipse the application business in revenues.  That obviously pleased him but his limited response was to give a wry smile and say, “Well, I am a systems guy.”  So the systems guy is returning to his roots and his company is delivering some very interesting technology that will continue to bend the price curve making advanced information processing more accessible to many more business users around the world.

    The sub-text of these announcements is worth a comment too.  More than at any other time, Salesforce has embarked on an effort to deliver to its customers not only powerful and flexible tools but it has also made a big deal of openness and standards, two attributes that it simply has to offer if it wants to succeed in the enterprise.  I heard this message from Marc as well as Parker Harris, George Hu, Kendall Collins, Bret Queener and anyone else I spoke with.

    Nonetheless, if you look at the now eight clouds you are likely to miss or underestimate the reach of the Salesforce solution set.  The naming of all products is not stable yet and some things are called clouds while others are Forces but leaving this aside consider the following developer environments that have either been delivered already or announced for delivery in 2011.

    Force.com — Plain vanilla application development for the Salesforce platform, buy it now

    SiteForce —Website development tools, WYSIWYG available around mid-year 2011

    VMForce—enterprise Java development, GA Next year

    Heroku—Ruby application development, available next year

    RemedyForce — IT service desk running on the Salesforce platform, buy it now

    That’s a lot and it neatly aligns Salesforce’s new products against Microsoft’s database and development tools.  Salesforce and Benioff see some obvious weakness in the Microsoft offerings because, although they have been made cloud resident through Azure and CRM friendly through Dynamics, Benioff is clearly positioning his company as the new alternative to not only old technology but old fashioned (read software licensing) business processes.  The comparison may not be letter perfect but as we saw this week, it’s all about perception and right now the market perceives Salesforce as a leader in many areas.

    Published: 13 years ago