Sheila McGee-Smith
Sheila McGee-Smith, who founded McGee-Smith Analytics in 2001, is a leading communications industry analyst and strategic consultant focused on the...
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Sheila McGee-Smith | January 17, 2017 |


Salesforce CTO Shares Look Ahead

Salesforce CTO Shares Look Ahead Co-founder Parker Harris candidly discusses integration challenges, global expansion, the services portfolio, and the AWS relationship.

Co-founder Parker Harris candidly discusses integration challenges, global expansion, the services portfolio, and the AWS relationship.

The first workday of 2017 found me in San Francisco for the third-annual Salesforce Analyst Summit. Fifty (mostly CRM) analysts, four customers, two Salesforce MVPs, and seven partners spent a couple of days getting an in-depth strategy and product update.

Sprinkled into the agenda were items that highlighted the company's culture -- for example, the "Salesforce Culture & Equality" session delivered by Chief Equality Officer Tony Prophet and a volunteer activity with Family Giving Tree. The company's philanthropic 1-1-1 Model, which dedicates 1% of Salesforce's equity, 1% of Salesforce's product revenue, and 1% of Salesforce employees' time back to communities around the world is happily evident even during an analyst event.

Parker Harris, CTO, Salesforce

One event highlight was a one-hour open question and answer session with Parker Harris, Salesforce founder and CTO. Coming as it did at the end of the meeting, analyst questions were informed by the updates that the Salesforce team had delivered over the prior two days. Here's a recap of the conversation.

What's new at Salesforce since Dreamforce in October?
Ten acquisitions, totaling $4.5 billion, marked 2016, Harris replied. He called out two in particular, for being significant in terms of expanding the scope of the Salesforce business: Demandware, which has become the Commerce Cloud; and Krux, whose Intelligent Marketing Hub data management platform will extend the Salesforce Marketing Cloud's audience segmentation and targeting capabilities.

Since Dreamforce, Harris said his primary focus has been on integration. "With all the acquisitions, the marketecture slide just keeps getting bigger," he said. "We need to work to keep it simple."

How do you get to $20 billion in revenue in a few years?
This question was based on comments made by Salesforce CEO Marc Benioff in November 2016. "I'm delighted to announce that we expect to deliver our first $10 billion year during our fiscal year 2018, which puts us well on the path to reach $20 billion faster than any other enterprise software company," Benioff had said, citing fiscal 2017 (ending Jan. 31) revenue guidance of roughly $8.4 billion.

Global expansion will certainly help the company double revenue in the next few years, Harris said. In addition, he pointed to the Demandware acquisition, which brings Salesforce into the e-commerce business for the first time. Lastly, the company's new focus on vertical industry selling will be an important part of future growth, he said.

"We see the ability to get to $20 billion staying with a CRM focus," Harris said. "We don't need to add a market adjacency, like ERP."

With new offerings like SOS, Lightning Voice, and LiveMessage, does Salesforce have any plans to add voice to Service Cloud?
SOS, announced in 2014, offers video customer care. Lightning Voice is a Twilio-supported ability to make outbound voice calls to customers added to Service Cloud in 2016. LiveMessage, as highlighted in a December No Jitter post, allows a company to engage customers via messaging over Facebook Messenger or SMS/MMS.

"There are lots of things we could do but we don't want to get spread too thin," Harris replied. "Our strategic focus is on the customer and CRM."

That said, Salesforce has certainly added or announced its intent to add several functions to Salesforce Service Cloud that have traditionally been performed by contact center infrastructure solutions. The artificial intelligence capability in the recently introduced Salesforce Einstein platform services could be used for call routing, but not the switching that got the call to the contact center, Harris said.

For call delivery, Salesforce will "continue to work on partnerships, like our work with Cisco -- contact center switching is Cisco's bailiwick -- and our partnerships with Genesys," Harris said.

Musing on the contact center, Harris went on to say, "But I am surprised at how slow that market has moved. The contact center market evolves in decades. It's 'fine, fine,' then a big replacement cycle."

Can you provide an update on Salesforce plans to run on Amazon Web Services (AWS)?
"We didn't build on infrastructure as a service (IaaS)," Harris said. "It didn't exist at the time."

To address the burgeoning area of IaaS, two years ago Salesforce hired longtime Microsoft engineer, Randy Kern, as EVP Infrastructure Engineering. Fast forward to 2017, and Salesforce has a "great partnership with AWS," Harris reported. Core services, including, Service Cloud, and Sales Cloud are now working with AWS infrastructure APIs. And, Harris said, AWS will be one prong of the strategy to boost international expansion. Noting Salesforce's plan to begin offering services in Canada this spring, he added, "We can ride AWS infrastructure in other geos so we don't have to build data centers."

As is true of other companies in the customer experience market (Genesys/Interactive Intelligence, Serenova, and Avaya with its Oceana proof-of-concept customers), AWS is becoming a key asset as Salesforce seeks to globalize its SaaS offerings. Also like other companies, Salesforce doesn't rule out partnering with additional IaaS vendors, Harris said. "We're talking to Google and Microsoft, but AWS is still our preferred vendor."

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