Irwin Lazar
Irwin Lazar is the Vice President and Service Director at Nemertes Research, where he manages research operations, develops and manages...
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Irwin Lazar | February 01, 2017 |


Slack Goes Enterprise: What IT Execs Need to Know

Slack Goes Enterprise: What IT Execs Need to Know Slack's launch of Enterprise Grid puts Slack clearly into competition with Cisco, Microsoft, and others in the enterprise communications and collaboration market.

Slack's launch of Enterprise Grid puts Slack clearly into competition with Cisco, Microsoft, and others in the enterprise communications and collaboration market.

Slack has gained a great deal of notoriety in the last year, not to mention adoption of its team messaging/chat/workstream communications platform. According to a recent Nemertes Research Benchmark, of the more than one-third of participants using team chat, 58% were using Slack. But Slack adoption has largely occurred in silos -- workgroups, teams, departments, etc. In only a few cases have we seen enterprise-wide adoption.

Slack’s announcement yesterday of Slack Enterprise Grid aims to position the company as an enterprise collaboration platform by delivering functionality, administrative tools, and security controls required to make the leap from line of business to central IT (see related coverage, "Slack No Longer Brushing Off the Enterprise"). Slack is delivering Enterprise Grid as a cloud-only solution, with customized instances for each large enterprise and the ability to scale to half a million users.

Slack’s announcement centered around three key enterprise features:

  1. The ability to create teams that include anyone in the company
  2. Security and compliance controls that enable organizations to archive and manage data, and ensure compliance with industry and government standards (e.g. FINRA and HIPAA)
  3. Extensive integrations for Slack with enterprise applications (including a new announced partnership with SAP in addition to previously announced integrations with Google, IBM, and Salesforce)

Taken together, these moves elevate Slack from a cool startup to one that is fully able to play on the enterprise collaboration battlefield. But for IT leaders, several questions remain:

  • Can Slack effectively compete against Microsoft Teams? Today Slack has a larger installed base, more integrations, and a head start on application features and usability. But Teams is free for those already using Office 365. The key question is if companies will pay extra for Slack when those using Office 365 already have access to a team chat app (actually multiple team chat apps if you include Skype for Business and Yammer in the mix). One IT leader told me that the most attractive aspect of Teams to him was its ability to support chat while co-authoring documents in Microsoft Office. Slack must be able to compete with that level of integrated functionality.
  • Where does Slack fit into unified communications? Slack includes built-in voice and video chat, but lacks integration with enterprise telephony and UC platforms like that offered by Cisco Spark, RingCentral Glip, Unify Circuit, and several other vendors. It also lacks integrations into the rapidly emerging immersive group collaboration space of the kind recently introduced by Cisco with its Spark Board product (see, "Cisco Pushes Into Immersive Group Collaboration"). Slack has the ability to invoke apps like Skype, but it doesn’t offer the ability to use Slack as a softphone to make calls like other competitors. To achieve that level of integration will require further partnerships, or self-developed capabilities.
  • What’s the business case for investing in team chat? Early adopters tell Nemertes that their investments are largely driven by a desire to improve collaboration, and that team chat apps are helping them meet that goal. But it’s a leap for a lot of companies to go from "let workgroups that want it, use it, and pay for it" to "let’s make an enterprise-wide investment to roll it out to everyone." I suspect Slack Enterprise Grid’s security, governance, and compliance capabilities will drive those already seeing Slack propagate within their companies to invest in Enterprise Grid. Worth noting is that other new entrants into the enterprise collaboration market like Facebook face this same challenge, as have social software vendors like IBM and Jive.
  • Is Slack where work happens, or are ERP and CRM apps where work happens? At its launch event, the company stressed its vision of Slack being “where work happens.” It noted that it had amassed more than 900 third-party application integrations, with 90% of paid Slack customers using at least one app. On the UC front we’re seeing a trend of embedding communications, via APIs, into business applications. Slack’s model reverses that paradigm and instead makes Slack the hub for work. Will that model apply to those who spend most of their day in field apps, CRMs, ERPs, or other business applications? That remains to be seen. Slack-provided demos showed that integrating workflows into Slack can offer additional speed and reduced complexity for the on-occasion users of enterprise apps (specific examples demonstrated were for travel management and HR systems), but users who spend most of their time in other business apps may be more desiring of Slack integration into those apps, rather than the other way around.

These questions aside, Slack will also need to build out a partner network to manage large-scale rollouts and enterprise applications integrations, and to provide on-going training and support. Obviously its relationship with IBM is a natural one to build on, though IBM has its own workplace collaboration software, not to mention a separate partnership with Cisco. Slack, like most other team chat apps, is also limited by a lack of enterprise federation that would enable organizations to build cross-company teams.

We’re hearing largely positive feedback from those using team chat apps (including ourselves within Nemertes) for internal collaboration and communications. Team chat apps can largely replace email and IM, and provide context for ongoing communications. Application integrations do indeed offer the ability to improve flow of information and business processes. Overall I’m bullish on this market.

At a minimum, enterprise IT leaders should evaluate Slack (and other team collaboration applications) to determine the applicability of using them to replace email for internal collaboration; but they should also keep an eye out for how team messaging applications will fit with (and potentially replace) existing collaboration platforms and consider how they will measure benefits to build a business case for purchase.

Learn more about next-generation messaging and team collaboration trends and technologies at Enterprise Connect 2017, March 27 to 30, in Orlando, Fla. View the Next-Gen Messaging & Team Collaboration track, and register now using the code NOJITTER to receive $300 off an Entire Event pass or a free Expo Plus pass.

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