A Second Day of Dreaming About the Clouds

Posted on November 19th, by thinkstrategies in Uncategorized. Comments Off on A Second Day of Dreaming About the Clouds

Day 2 of Dreamforce came with a little less enthusiasm than yesterday’s kickoff as many of the attendees recovered from the previous night’s parties. Today’s focus was on the Force.com Platform-as-a-Service (PaaS) which salesforce.com calls “Custom Cloud 2”.

Unlike yesterday’s meandering keynote regarding the Sales Cloud 2, Services Cloud 2 and new Chatter social computing capabilities, Marc Benioff immediately went to work at convincing the Dreamforce audience of the power and growing adoption of salesforce.com’s PaaS capabilities by quickly introducing the CEO of BMC, Bob Beauchamp, who unveiled its new Software-as-a-Service (SaaS) IT service desk application developed on the Force.com in a couple of months.

BMC’s use of Force.com to ‘SaaSify’ its application is another important endorsement of salesforce.com’s PaaS by an established independent software vendor (ISV). It is particularly compelling for other ISVs who have grappled with the technological and operational challenges of migrating their applications to a SaaS architecture. Interestingly, BMC won’t make the new application available until Q2 2010. My guess is that the company will face far more challenges developing and executing the go-to-market strategy for the new app than it had developing and delivering the app itself.

Benioff later introduced John Swainson, the CEO of CA, who also demo’ed a new app built on Force.com and talked about the economic implications of cloud computing which he called “the most profound change in the history of the IT industry…changing the economics exponentially.”

Both CA and BMC are significant because their applications are aimed at IT professionals, and their enlistment in the SaaS movement will help reduce lingering resistance within the IT community.

The focus on Force.com was an opportunity for Benioff to evangelize about the virtues of cloud computing,

  • Eliminate the costs and hassles of hardware
  • Accelerated deployment and time-to-value
  • Greater agility and analytics

Benioff’s views were reinforced by an Accenture guest as well.

He also introduced the CEO of Vetrazzo, a manufacturer of countertops using recycled glass, who talked about how he runs his entire business on Force.com. He was previously a SAP suite user and wanted to leverage a similar suite from salesforce.com. Using  an independent Force.com consultant, he was able to develop a full suite to meet his needs in a few weeks, including enterprise resource planning (ERP), order management, inventory management, and document management, in addition to salesforce.com’s CRM and SFA capabilities. Although the Vetrazzo success story was published a year ago, the company has continued to create additional apps via Force.com. His talk was not only a swipe at SAP, but NetSuite as well which often attempts to position its SaaS solutions as more significant because they are aimed at helping business run their operations not ‘just’ CRM.

Benioff also carved out time at the end of his keynote to revisit the importance of the company’s new Chatter social networking solutions and to reiterate that it is also a ‘social platform’ that can be customized to meet the unique needs of individual companies.

Yesterday’s Chatter announcement met with mixed reviews from the customers, partners and analysts I met. Most didn’t understand why salesforce.com is moving in this direction. They didn’t expect their employees or customers to replace any of the social networking tools they are already using or add another to the list.

This was clearly illustrated when Benioff asked for a show of hands from the keynote audience regarding how many would adopt Chatter and only a small proportion raised their hands despite the fact that nearly everyone in the audience raised their hands when Benioff asked them how many understood what salesforce.com was offering.

I think there is a solid argument for a more robust and secure social networking tool that is more ‘enterprise-ready’ and more easily integrated into an enterprise application portfolio than Facebook and Twitter. But, salesforce.com will face serious challenges convincing customers, and will have to make a significant technological and marketing investment to successfully deliver and sell this new dimension of salesforce.com’s corporate portfolio.

Ultimately, the company will need more customer success stories and ‘use cases’ to convince current and potential customers to adopt this new capability.

Despite these concerns, the overwhelming mood at Dreamforce has been very upbeat, providing another promising sign of the potential growth of the SaaS and cloud computing market.

[Disclosure: Salesforce.com paid my travel expenses to attend Dreamforce.]

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