SaaS Leader Continues Major Product Innovations: Can Partnering Support Keep Pace?

December 9, 2009 at 11:58 pm Leave a comment

By Beth Vanni, Director, Market Intelligence

For nearly a decade, Salesforce.com has created major waves in the traditional enterprise software market. Now with $1.3 billion in revenues and 70,000 customers, the SaaS innovator has clearly changed the way software is delivered and managed.

At this year’s Dreamforce user conference, it was clear that the SaaS provider has aims to not only dominate the legacy CRM and SFA markets, but is trying to innovate the way all parts of the IT ecosystem (customers, ISVs, solution providers) create collaborative relationships using technology.

As many would expect, the keynote sessions were all about software/ service innovation. Marc Benioff, the company’s charismatic Chairman and CEO, evangelized the next generation applications offering.  This included the Sales Cloud 2, Service Cloud 2, Custom Cloud 2 and newly announced Chatter collaboration platforms.  A host of new features were announced for all product sets, to the enthusiastic reception of the user and partner audience.

Admittedly a historically direct selling organization, the company’s legacy partner community has been ISVs developing custom applications based on the Force.com platform.  At this year’s events, the AppExchange ISV population was touted to be 850+ partners strong, with over 200,000 Force.com developers. In keeping with the recent Oracle and Microsoft conferences, we will continue to see the major software vendors aggressively compete to win hearts of mind of commercial software developers around their development platform and unique vision for cloud computing.

As the SaaS model has gained legitimacy with customers of all sizes, the amount of traditional SI integration and consulting services has increased significantly. Several breakouts at this year’s event reviewed examples of the application integration, customization and business process consulting successes experienced  by regional and national SI’s. However, the global SI community adoption of the SaaS platform still seems to be lagging.  And, a new VAR program was announced this past August to round out the company’s partner engagement models.

So, the SaaS pioneer has everyone’s attention, including most solution providers who are weighing their business model choices for the next 3-5 years. But, I leave this conference thinking that SFDC still has a lot of evangelism to do with partners.  The company’s partnering “DNA” and maturity lags that of its traditional software competitors.  The programs and messaging regarding a partner-dependent business model are there, but the next 18-24 months will be a critical time to see if the SaaS giant can become a world-class partnering organization.

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