deal architect

Love the smell of SKO in the morning. Smells like optimism

My favorite vendor event format is the analyst summit. A close second is the annual Sales Kick Off.  That is where the vendor gets the entire sales and marketing team offsite to prepare for the new year. This time of the year, I get invited to a couple of SKOs.

I love the optimism at these events. Executives set stretch goals for their teams. They are unusually honest about what they did well or screwed up in the previous year. New product launches are discussed. You  can see the genesis of new products and the planned conquest of new markets.

Partners, customers, analysts like me get to banter in a relaxed setting. The fact that I am there means they want to hear about changing market dynamics. They want honest feedback on competitive positioning.

I do not blog from SKO events. Too much NDA stuff is shared.

I do appreciate being invited to such events. It is a good, positive way to start most years.

Rethinking the two technology Moores

Throughout our technology careers, most of us have cited Moore’s Law about how fast technology evolves, or Geoffrey Moore’s “Crossing the Chasm” to speed up launches of products. To say each has been seminal to strategizing and marketing in technology would be an understatement.

In recent years, however, I have noticed how we conflate the two. We are increasingly confusing speed at which technology supply evolves with speed of customer adoption.

Bill Gross tweeted the graph below. Most of us shake our heads and go, see customer adoption is accelerating with new product introduction. You don’t have to go to CES every year to see we are releasing new products at a breathtaking pace. You don’t have to be a Gartner analyst to see hot buzzwords only last a a few weeks. 

But the graph only shows 50 million users in a world with 8 billion humans. How long does it take to get beyond the first 2% or 20% or however you want to define as the “chasm” and capture the rest of the world?

In my research for Silicon Collar, I found tons of examples that it actually takes decades. Here are a few examples:

• Oscar H. Banker was granted way back in 1940 the patent for the automatic transmission in cars. In 1965, Playboy highlighted "Bye-Bye Stick Shift." Now, over 50 years later, more than half of the light cars sold outside the U.S. still have manual transmissions.
• Luther Simjian, a prolific inventor, convinced some New York City banks to try out his Bankograph, the predecessor of the modern-day ATM, in 1960. Almost six decades later, although mobile banking has taken off and ATMs are ubiquitous, our downtowns and strip malls are still studded with bank branches staffed by human tellers. Just in the US we still have 90,000 bank branches and countless more around the world. Virtually every bank customer has the means to automate their transactions, but hundreds of millions still choose to do so in person.
• With digital voice mailboxes, word processing, and smartphones, who needs secretaries or administrative assistants? According to the Bureau of Labor Statistics, that category still employs nearly 4 million workers in the United States decades after those innovations started showing up in our offices. Many million more do those jobs around the world. 

There is no proof that contemporary products are getting adopted quicker. The most successful product launch ever – the iPhone - has sold around a billion units over the last decade. But several consumers have bought multiple versions, so the global penetration is still less than 5% of the total addressable market (my definition, not sure Apple wants to sell the product to every consumer). Even more startling - Tesla for all of Elon Musk's marketing reach has only .2% of the US car and light truck market. That's not a typo. Globally, it has less than 1/10th of 1% market share.  

In the enterprise, product adoption is far slower. Watson, even after years of rollout and publicity, still does not generate even 5% of IBM’s revenue. HANA, after years of SAP’s pushing, still does not have even 5% of the database market.  Cloud applications after two decades since Salesforce and NetSuite were launched have replaced less than 20% of enterprise on-premise applications. In SAP Nation 2.0, I cataloged the slow pace at which Oracle Fusion, J D Edwards OneWorld, Infor CloudSuite have been rolling out. SAP’s S/4HANA is following a similar trajectory.

What does this mean? We really need to stop hyping customer adoption and celebrating too early.

Which brings me to Gordon Moore. I have not met a single person in the industry who does not take pride in Moore’s Law and the price/performance curve technology supposedly moves on. In contrast, I have not met a single software or outsourcing executive who will not argue that it does not apply to them. It only applies to chips. Really? Productivity and efficiency can apply every where. Go see Six Sigma and CMM Level 5 shops.  

There are some notable exceptions. AWS has delivered 50+ price cuts in the last decade. And look how fast it has grown.

So here’s the lesson. If you move down Gordon Moore’s curve you will also move quicker past Geoffrey Moore’s chasm. Time for the industry to renew our commitment to each of the Moores. But with some serious commitment.    

SAP Nation and the new horror movie

My books go through (at least) 3 edits. My wife, Margaret does a readability review. Mark Baven does a thorough edit for grammar, flow and facts. The book design agency, 1106 reviews it for style.

It is a lot of work and as author I appreciate the thoroughness, but hate it when they ask me to delete big chunks. Each page of writing reflects days and sometimes months of research and interviews so I am possessive of every sentence. Since they work independently, at least 2 out of 3 have to ask to delete a section before I agree.

On SAP Nation, both Margaret and Mark strongly recommended I delete a couple of pages. I grudgingly did.

Four years later, Hollywood has decided to make a movie out of the subject in those pages starring the wonderful Helen Mirren. I saw the trailer of Winchester in a theater last week and it scared the daylights out of me. Shorter version of the trailer is in video below.

Go pay to see the movie and get scared out of your wits. Or review the deleted pages below the video, starting with Mark's comments. I think it is very mild in comparison to the movie. Importantly, this portion is free and I promise there is no Indirect Access exposure. The spirits will, however, expect you to buy several copies of 3.0 when it comes out later this year and will show a much more welcoming house 

 

The Deleted Pages - click on image to enlarge

Davos–a down year?

Every year the mix of events I attend changes and I sit back and ask – should I have gone to this one? Should I have made a greater effort to go an event I missed?

My event choices are driven by several decisions – will the event help my consulting or sponsor clients? Will I find new perspectives or products to showcase in my books and blogs? Can I watch the bulk of sessions on the web and save the body wear and tear? Will the event be covered by other analysts that I respect?

It is a complex decision matrix but the net result is I have not been to the Nasscom annual leadership meeting since 2007, Dreamforce and HIMSS in a few years. May be time to go back. 

As the WEF meeting kicks off in Davos this week, I was thinking I would have enjoyed last year’s event. The theme of the Fourth Industrial Revolution was enticing – not because it was new. I have been writing about it and IoT and robotics for years. But the theme of the year defines the breakouts and the audience. Interviewing Malcolm Frank of Cognizant after the event I definitely had the “I should have been there” vibe. Also, it would have been nice to see Xi Jinping, the premier of China present. I see him as one of the few global leaders who is more of a technocrat than a politician.

This year, the agenda is far less alluring. The theme is “Creating a Shared Future in a Fractured World”. I do believe the world is changing after three decades of the Soviet Union’s demise. But I believe other rich countries need to step up in many areas as I wrote in the Post-Trump world post. I am not convinced the WEF audience has yet bought into the premise that other countries need to join the US as locomotives in the front, middle and back of the increasingly strenuous global train. I will watch some of the stuff on the web but in general the WEF panels are not that lively. They tend to be a bit too respectful of the global leaders who show up.  

Then there is the miserable weather this year. And the circus around President Trump and whether he will even show up with the US Federal shutdown.

I look forward to hearing from friends who happen to be there. They just might me make me change my mind it was worth missing.

Why technology financial reporting needs to evolve

I started my career at PwC as an accountant. I kept renewing my CPA certificate for a decade after I had moved to the technology consulting practice. These days, I listen to (some) quarterly earnings calls of vendors I analyze. But since I mostly work with buyers of technology, I find quarterly and annual reports only matter so much. Vendor architecture, functionality, TCO are far more important.

Off late, I have noticed how technology financial reporting has become even less relevant to buyers ( as compared to investors). For example, analysts get excited to read about ACS 605 on Revenue Recognition. Most buyers I know cringe about RevRec as they see it as just another crinkle vendors rely on during negotiations.

Here are a few areas where most buyers would welcome more transparency

Capital investments

The promise of cloud computing was to turn technology capex into opex. The unwritten premise behind that was the onus of capex would move to the vendor world, not magically disappear. It is striking how obtuse vendors can be about capex. Example, in a data center deal we asked Verizon for capex details. It would only share a number in aggregate. Thanks but investments in FiOS underground cabling and mobile towers across the country were not so relevant for this decision. Same with Amazon – be nice to see what is going into AWS data centers and network as separate from what goes into their distribution centers and eCommerce infrastructure.

R&D

This is something which has been obtuse for a while but has gotten worse as we the tech sector has globalized and moved to the cloud. Most software vendors will say they spend 10-15% of revenues on R&D. But how much goes into maintenance of older releases versus new products?  How much is staff related and where are they located? In a cloud setting, how much of R&D is the amortization of capex? Outsourcers like to brag about solution centers as their R&D spend. Without details on the spend, more than likely it is a marketing expense. Buyers would like to make a much more educated guess on the vibrancy and relevance of the R&D spend. Today they have to guess, read detailed product road maps, rely on user groups to see where the R&D money is going.

New Product revenues

Every vendor wants you to believe their products are flying off the shelf like iPhones. They will share volume data – number of customers, objects developed using their tools etc. But almost none will share data about revenue from new products. Try finding out how much Watson has generated for IBM in the last 5 years, or S/4HANA for SAP or Fusion for Oracle.   Worse, there is an unverified meme which has taken over that technology is evolving exponentially. We are supposed to all be excited about that and welcome anything new and shiny. Reality is form/function may be evolving, customer adoption is as slow as ever. In Silicon Collar I had many examples of technology introduced decades ago which consumers still ignore.

I would love to see technology vendors follow the lead of 3M. One of the most innovative companies in the world with over 55,000 products, 3M keeps a close eye on new product introductions. It coined the term New Product Vitality Index (NPVI) to measure the percentage of 3M sales coming from products launched in the previous five years. In 2015, it reported its NPVI as 33.3%.Bear in mind, this is one heck of an innovative company and even a product launched five years ago is considered "new." For the average company, customer adoption of its new products is considerably slower. I would love to see tech vendors share details not just pretend how well their new products are doing.

There are many other areas where financial reporting should evolve to make it more interesting to technology buyers. Not sure many would still call into quarterly earnings calls, but there would be lot more information for them to make smarter technology decisions. That in the end is healthy for our sector.

Enterprise Software Platforms have underperformed

My first exposure to a software “platform” was back in 1983 when McCormack and Dodge introduced Millennium and started to migrate all its modules to have the same look and feel, extensibility, queries and other features. I was part of a team rolling out a wide range of functionality across refineries and other units at Petromin, the Saudi oil company. I quickly became a power user of the platform - able to deliver so much with so little programming.  Like when we hit the wall as we realized the US centric HR module was not designed to handle multiple wives of employees – not sure why were we surprised I proposed an elegant solution using the platform tools.  I was a huge fan, and thought John Landry, the EVP of Development was a genius (he went on to other successes at Lotus, IBM and beyond).

Things were primitive back then – green screen UX with data on VSAM files. The world has gotten better and better. And we have seen a much more expanded definition of platform. I heard Peter Evans, ex GE, now KPMG, present a couple of years ago about his research on 175+ platforms around the world. He identified 4 types in the exhibit below. (click on image to enlarge)

 

Not obvious how he classified them under each moniker, but the second group included most of the enterprise software vendors we know and love, and as you can see they have been overshadowed.

In the last couple of decades I have seen too many enterprise platforms where the owner would have done better developing their own applications. Instead they handed that opportunity to a variety of partners and startups on the platform and only did ok.

I have seen Microsoft develop dot.net and Azure ecosystems and Oracle do similar with its tools and PaaS. But I often wonder if both had invested more money and energy in their own applications, how much more competitive they would be.

I have seen SAP try with NetWeaver and more recently around HANA. And I can see why so many of its customers bitch and moan that their maintenance dollars would be better spent on their industry and other application functionality. Worse, SAP thought its service partners would use them to develop industry and other apps. Some did, the majority did unique customizations, which actually has led to a mess as customers cannot now easily migrate them to S/4. 

What about Salesforce? After a decade only one vendor which used its platform, Veeva has gone public. Zuora may join it this year. Wait a minute you say – look at Apttus, CipherCloud, Gainsight, GreatVines, JobScience, nCino, and Resilinc? Yes, well known in startup and venture world, less so in the corporate world where dollars are spent. ERP via FinancialForce, Rootstock and  Kenandy (the two recently announced a merger)?  Products on the Force.com platform by Cornerstone OnDemand and Xactly?

Fair points but Salesforce itself has generated $ 35bn in revenue in the last decade. After a decade, is it unreasonable to expect revenues at these partners be 1X or 2X their own? Especially when 80% of the world’s enterprise applications are still on-premise and are impatient for cloud functionality beyond CRM and HCM?

My relative disappointment with enterprise platforms is one reason I was one of the few analysts who was not clamoring for Workday to open up its own platform. It did last year and I hope they set ambitious goals for partners who develop on its platform - make sure they are well funded, go after massive and underserved markets across verticals and geographies.

It’s time for enterprise platforms to set stretch goals. Consumertech has shown the way.  The Apple AppStore is estimated to have generated over $ 125 billion in revenues in the last decade. Fulfillment by Amazon launched in 2012 will get there even quicker.

I want enterprise software vendors to excite young Vinnies to extend their own functionality. But I also want them to aim much higher and aggressively recruit and incent partners. So much white space to conquer.

A weekend with inspirational ladies

Two books and a movie were the highlight of this long MLK weekend. The common theme – ladies in business whose grit and determination can inspire anyone of any gender, age, race, political belief.

First, a couple of personal perspectives on opportunities. I was born and raised in a refugee camp, with all the stigma that goes with that. I spent years in a highly religious Islamic country even though I was advised it was not smart to take an assignment there as a non-Muslim. I have been to 70 countries and felt subtle and not-so-subtle digs. Bias and discrimination are everywhere.

But somebody told me early in life if you let these things bother you, they will eat you up. Navigate around them. So, even today I admire others who similarly navigate the cruel world. Sex, color, age, height, anything to make you feel different. You cannot change it, just smile and navigate around it.

Secondly, in researching my recent book, Silicon Collar, I found growing number of people with second, third, later acts in their careers. The job economy has become a series of concentric circles. The F500 only directly hires 10% of our civilian work force. But many more are hired at their first and second tier suppliers, in their services firms, in their franchises, on their platforms. Once you leave the corporate world there are plenty of opportunities in government and non-profits. In venture and start-up world. In the consumer world, there are small businesses our parents would have never heard of – in alternative healthcare, ethnic food, coaches and artisans of every stripe. We may not have the lifetime employment of our parents but we have exponentially more choice. The Bureau of Labor Statistics tracks over 800 occupations, and the book showed how new categories are emerging at a rapid pace with technology impact on work.

In my dealings with thousands of executives, I have also come to this conclusion: When they discriminate they give their competition an advantage by narrowing their own talent pool. Bigots tend to hurt their own businesses.

So, the opportunities for all of us are actually much much larger than we realize. Spend more time understanding this wide but confusing opportunity economy than fretting about bias.

The two books I read, Jumping the Queue by Michelle A Turman and Disrupters by Dr. Patti Fletcher come at bias and navigating around it from very different vantage points. Turman’s is more local, more in the nonprofit and small business realm. Fletcher’s is more global and covers a wide swatch of STEM areas – enterprise software, health technology, venture capital. Fletcher also has more data on bias in the boardroom and in the executive suite. But the books are not whiny. They show how to use mentors and how to fight for your corner.

Both have plenty of examples of condescending male bosses, relatives and colleagues. They shed light on two different concentric circles of the job economy I mention above. I found Turman’s book especially fascinating because she describes her own first, second and later acts - including being the youngest woman to dive the Titanic and the youngest female art director in Florida - and she is only now getting started. Fletcher draws from her wider network and profiles Sophie Vandebrook and her trajectory at Xerox, Liz Walker the first black TV anchor in Boston and Anula Jayasurika who graduated from Harvard’s joint MD/PhD program then chose to go into venture capital, not academic medicine – a major “betrayal” to the medical profession as she humorously calls it.

Over and over again you get the sense we are not in Kansas anymore

Fletcher

“Don’t say you want to empower me. You don’t own my power. I don’t need your permission to do what I want with it. You cannot get what is already mine. I’m already empowered.

I can say that; my grandmother couldn’t.”

Turman

“Years ago, the trajectory was: Work somewhere for a minimum of five years. Get the experience, then move on to somewhere else. That five-year minimum was because you wanted it on your resume.

Millennials do not think that way.”

Both authors are incredibly brave and share very painful personal experiences, and highs and lows in their careers (in contrast, my six books have shared only tiny details about my own journey). That’s what make them so readable. I also loved that both books are chalk-a-block with inspiring quotes – from the interviewees, Maya Angelou, Steve Jobs and even one from one of my favorite Styx numbers, “Come Sail Away”.

BTW I have had the honor to meet both authors. Michelle is married to Eric who I worked with at Gartner.  Patti is omnipresent at SAP events. The next lady I describe I have a bit more of an obscure connection with.

I also saw the movie The Post. The two main characters – Ben Bradlee (played by Tom Hanks) as editor of the Washington Post and Katharine Graham (played by Meryl Streep) as the publisher grapple with responsibilities and risks of running extracts from the Pentagon Papers, classified documents about US involvement in the Vietnam War.

No disrespect to Hanks, but the Streep character to me was way more poignant. Graham took over the paper following the suicide of her husband, who had succeeded her father. Sound familiar – the son-in-law got priority for the job over the daughter who had already been working there for years? The movie shows her balancing act with family and social commitments and the business. Shows her mentors and condescending board members who still don’t think she deserves to be the boss. It vividly shows the tensions she balanced.

I wrote about the Post in my book, The New Technology Elite. I interviewed Don, Katharine’s son. I could feel her spirit continue in the much more digital version that Jeff Bezos of Amazon then bought in 2015.

In one of the final scenes in the movie, the Supreme Court rules in favor of the New York Times and the Post. Executives from the Times come out and address the media. Graham instead walks into a crowd of young ladies who silently look at her in admiration. Go see the movie if only for the scene. It is director Steven Spielberg at his best. 

So quite a weekend with so many inspiring ladies. And you don’t have to be female to enjoy these books/movie and benefit from them. It’s about ignoring all the bias around us and marching toward your own true north.

SAP: When you come to a fork in the road, Take it!

“Who pays when the SAP data center goes on strike and the solution is down?”

Data Center going on strike? That portion of a quote from Hermann-Josef Haag, spokesperson for the DSAG HR management working group made me stop in my tracks. In 20 years of covering cloud applications I have seen most clients protect themselves with SLAs for uptime and recovery. But in the downtime scenarios we discuss it is hardware or telecom failure, or poor systems management hygiene, or an act of God, never a union strike. Especially since even massive data centers are managed by only a handful of humans.

Haag points to a broader caution in Germany (and many other EU countries) about cloud computing. There are concerns about data residence, inadequate local vendors with that model and general discomfort with someone else running your infrastructure.

Haag made his comments as part of SAP’s recent decision to ”offer a new on-premise HCM option based on SAP ERP HCM with a comparable functional scope (except for the SAP E-Recruiting application and SAP Learning Solution).”  It is intended to be deployed alongside, and integrated with, SAP S/4HANA. The solution is planned for availability in 2023, with maintenance planned at least through 2030.”

Many of my analysts friends in the US are aghast that SAP would announce a NEW on-premise product. Jarret Pazahanick commented on LinkedIn SAP has “made a major mistake with the announcement below and will ultimately regret this strategic direction.” Another who shall stay nameless told me “I look forward to SAP taking us back to 80 column cards”. Ouch!

I am less sanguine. Markets evolve differently. I have been to over 60 countries and have only driven in one which has right-hand drive, and I have never driven a stick-shift car. My nightmare scenario is a rental car company has lost my reservation and I have to struggle with a right-hand wheel and stick-shift  But here’s the reality. Citizens of 75 countries around the world including Japan, UK, Australia and India drive cars on the “wrong side”. Last year, nearly half the cars sold around the world were still manual transmission. Seriously. That’s 5 decades after Playboy magazine ran an article with a two-page shot of a Corvette shifter covered in cobwebs and the headline "Bye-Bye Stick Shift."

Ford and Daimler and Toyota learned a long time ago you cannot “fight city hall”. Give customers what they want. I think SAP needs to do the same. Give the German speaking market on-prem, give the N American market clouds.

Even though its cloud acquisitions – SuccessFactors, Ariba, hybris, Concur etc – were not cheap, they have helped keep SAP competitive on this side of the pond. With what we have seen in the first couple of years of S/4HANA the ship is tilting back to the on-premise world. Oh sure it promises three options – public cloud, private cloud or on-premise but the public cloud option is a tiny portion of the deployments.

It’s still early in the S/4 journey. I think SAP should go talk to Mercedes and Toyota and Ford about how they deliver both right hand and left hand drive and a mix of automatic and stick-shift (and many hybrid gear configurations).  

The US market has evolved very differently from the European market. Time to develop a clearer, two-tier strategy.

Photo Credit: Amazon

Oracle Database: Solid for Now

Kicking the year off, Information.com ran a story which said

“But Mr. Ellison’s comments about Amazon and Salesforce don’t tell the whole story. In reality, both companies are actively working to replace Oracle software running on critical business systems with open-source database software alternatives, and have made significant progress toward getting off Oracle entirely, according to people familiar with the matter.”

Several analysts used the Salesforce Analyst Summit last week to probe into this. Parker Harris of Salesforce said “We have a great relationship with Oracle. Of course we build our own extensions and if you look at our portfolio of built and acquired products we use several other databases”. Ariel Kelman of Amazon Web Services was more competitive "I haven’t met a customer that doesn’t want to move off of Oracle" and “customers have used our DB migration services 45K times“ but he did not touch on how many have moved from Oracle or Amazon’s own internal moves to get off Oracle. SAP was not at the conference but they have also announced plans to move many of their cloud products and ECC customers to HANA and many of their other acquired databases. It is a long work in progress for them as well.

I tend to discount vendor positive references or negative talk about technologies. These are just too many conflicts of interest to untangle.

When I talk to corporate buyers, I get a similar vibe of “little love” for Oracle. They constantly evaluate open-source, NoSQL, HANA and other options.  But the talent, systems management tools and other “bag of tricks” they have invested in to tune the database, recover from downtime etc. keep them grounded. Having said that Oracle sometimes misreads continued commitment to the database as customer loyalty. 

Most customers grudgingly look at other Oracle products, and if Oracle thinks customers will line up in droves for its IaaS to take advantage of autonomy features announced in future releases of the database, I think it could be miscalculating. It would do far better to also offer such enhancements for the on-prem database (without, of course the SLA that comes with the cloud infrastructure). And that business, for the near future continues to looks solid.

Salesforce Analyst Summit: A solid B

I prefer going to vendor analyst summits over user conferences. I always feel like I am intruding on customer time at conferences. Salesforce hosted an analyst summit last week. Here are my scores:

Venue: A

The venue was to say the least memorable. The Palace Hotel in downtown San Francisco was considered the most opulent in the world when it opened in 1875. The big earthquake in 1906 caused extensive damage and a replacement was opened in 1909. The  earthquake in 1989 ended with a 2 year retrofit. The Garden Court with its spectacular Austrian chandeliers and the iconic Pied Piper bar have survived and still evoke the old time luxury.

How do I know about the history? We had an earthquake during the summit. Analysts were abuzz and tweeting at 2.40 am! This Florida boy turned on Foreigner’s “Feels like the First Time” and read up on the hotel’s history and thanked the retrofit for keeping us safe.  See what I mean by memorable?

They also brought forward the Trailhead motifs and badges and presentation templates from Dreamforce. The energy of Trailblazers and  MVPs and the enthusiasm around making Salesforce a fun learning experience contributed to a positive vibe.  

Executive Access: A

A well-done summit allows you plenty of access to vendor executives. This one reminded me Salesforce has a formidable team which has skyrocketed it to over $ 1o billion in revenue. CEO Marc Benioff missed this event, but co-founder Parker Harris fielded architectural, security, data center questions with his usual openness. Peter Schwartz, SVP Strategic Planning, who cut his teeth doing long-term scenario planning at Shell, played futurist talking trends around artificial intelligence, genetics and automobiles. I enjoyed catching up with Tony Prophet who has appeared in two of my books, with Bruce Richardson I used to run into all the time when he was an AMR and I was at Gartner, and John Wookey, a development executive and Polly Sumner, a sales executive I have long respected from their time at SAP and Oracle.  

Plenty of executive access.  They had a couple of customers and AWS represented. Would have liked a bit more customer and partner presence but overall well done

Product roadmaps: B

I enjoyed spending time with Ketan Karkhanis, GM learning about Analytics Cloud and getting updates on the Sales and other  functional Clouds.  I liked the fact that the hype around AI and Einstein was a bit subdued. The chart below represents well the reach of Salesforce.

I loved a demo which showed how 20th Century Fox uses the Salesforce platform to manage its movie releases – management of trailers and other promotional assets.

And yet, I expect more from a team which is so talented and has been at it for two decades. In my book, The New Polymath, Marc Benioff was quoted as saying “Every time someone buys a server, a switch or a data center, I have failed” The reality is 8 years later, clouds have only penetrated 20% of the enterprise apps world when you add in industry applications and geographic reach. Its mostly CRM, HCM, some financials.

During the summit I heard from several analysts I was trying to push Salesforce to get into ERP functionality. Not at all, they have plenty of partners aiming at that. But every industry has “books of record” – utility billing, retail merchandising, electronic patient records, insurance claims processing etc – that clouds have not targeted. There is so much white space for Salesforce and its partners. Salesforce likes to point out 80% of objects on their platform are custom developed, that 300b rows (out of 1.2T) access non-Salesforce data. I wish they would take push themselves and their partners much deeper into verticals. Parker Harris did point out Marc Benioff would love to do more and more, but his job was to keep Salesforce focused.  Well, I am with Marc on this. I expect much more from the leading cloud apps vendor.

Customer Economics : C

Customers have been rewarding Salesforce (and other cloud vendors) with multi-year contracts. The expectation in return is Six Sigma and CMM Level 5 continuous improvements. AWS has delivered 50+ price cuts over the last decade. Cloud application vendors have not. In the discussion around data centers there was focus on security, and balancing across multiple infrastructures, data residence and Kubernetes, but zero on economics. Similarly, there was nothing on keeping tabs on services partners. If anything, I cringe every time Salesforce brags about it is helping create millions of new jobs or takes credit for hoping to generate $ 859bn in GDP impact by 2022. Not with the limited functional road map as currently spelled out by Salesforce. And those jobs end up hurting the TCO and ROI of Salesforce.

So, overall an enjoyable summit. And yes, a memorable summit now that I am back on terra firma. I have decided I quite like the advance notice I get with our hurricanes in Florida