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Salesforces strategy
Sustainability of approach
Subscription model, 68
dollars a month, no
upfront huge investment
Yes: Easy adoption (low cost), higher flexibility & better customer
experience will nurture customer loyalty, and ultimately increase
customer base (to middle & small b2b customers).
Difficulties in integrating
with legacy system
Cloud computing
service
Trial, subscription
model
Lack of customization
Force.com
Salesforces rapid growth in the face of well-established and highly successful competitors was because it continuously
disrupted the market through a variety of innovations. However, the most important factor in the growth of Salesforce has
been that it has continually focused on the customer for each of its innovation.
Salesforce followed a process - As mentioned in the HBR Article, Surviving Disruption, Disruption is less a single event
than a process that plays out over time. Sometimes quickly and completely and in other times slowly and incompletely. This
immediately ties back to Salesforce as it innovated through a strategic process that not only delivered innovative products but
also continually aimed to complete each innovation through another innovation that followed. For example, the cloud
computing software was further completed through the app exchange by adding customization; this was further completed
through Chatter by adding a social and collaborative aspect.
Salesforce created needs not just fulfilled needs - Salesforce was build on the premise of fulfilling a customer need - A
more affordable and easily deployable on demand software. They grabbed the attention and loyalty of customers through their
lower risks, lower entry barriers and lower costs. They further fulfilled needs through providing customization to companies.
However, they also created needs through aspects such as Chatter that added an experience of Social networking and
Collaboration to their existing platform.
Salesforce provided what competitors could not: Salesforce provided accessibility through which customers could access
the software through multiple devices, their lower costs let 2 tier and 3 tier businesses try the product and hence expanding
their market and their adaptability did not interfere with the companys existing heritage systems. Through this Salesforce
realized an opportunity that pre-existing market leaders could not lower costs as their investment was larger and could not
provide adaptability as their system was built in a way to integrate with the heritage system.
Extendable Core - The HBR article Surviving Disruption introduced a concept, Extendable core, the aspect of a business
model that allows the disrupter to maintain its performance advantage. Salesforce had this extendable core, the cloud
computing system, which had proven to be its performance advantage. This set a base for Salesforce to continually innovate
as the customer had already accepted its initial offering. The extendable core further led to the building of an ecosystem, as
there were no ecosystem or technological implementation barriers.
What should Salesforce do next? The answer stems from the question what can customers do next after CRM? Reaching a
customer facing insight, managing customers and understanding behaviors leads to a next step of developing strategic
marketing to the customers. This is where Salesforce has a potential strength as they have already achieved credibility in a
very closely related business. This strength could be executed in 2 ways:
1. B2B Enterprise Marketing Objective (EMO) based software
2. B2B Individual Marketing Objective (IMO) based software (stripped down features & opening up to a new
market).
These marketing objective oriented software could be further packaged to serve the needs of an enterprise or individual
(businessmen, entrepreneurs), while adhering to the IMC loop. The software packages would be able to serve the needs of
financial planning to achieve marketing objective oriented goals and determining the risks associated with a plan. Salesforce
can thus incorporate forecasting from trends noted from the CRM and real time market scenarios to help provide ease of
planning to individuals and institutions.