Wednesday, November 13, 2013

Salesforce - Strategy Coherence Evaluation

Salesforce - Strategy Coherence Evaluation

Salesforce was a company which was established in 1999, but they came to the forefront in around 2006, as a a successful SAAS (Software as a service) CRM product. Salesforce had a lot of competition in the market from the very big players like Siebel, Oracle CRM, SAP CRM etc. However fast-forward to 2012, and they are dominant players in the CRM market.

Salesforce had a very different approach to customer relationship management, they did not try to evaluate their value proposition against the market incumbents, on the contrary they created value for the customers by providing a solution which provided value in terms of other factors (pricing, scalability, variable infrastructure costs, direct support etc.)  which the incumbents weren't very good at.

For example, Salesforce could provide their product to smaller firms simply because, they charged on a per salesperson model, with all infrastructure and maintenance expenses a part of this fee. Howerever, if a small organization wished to implement any of the other CRM products, it would need to make large investments into infrastructure and also setting up maintenance teams, which would be way too large to justify the need of the technology to the organization.  
Overall Salesforce looked at their internal capabilities, and realized they had a lot to gain by servicing smaller organizations, and providing a model which was scalable, and minimal setup time. Also providing a per user licencing model, they ensured, that customers were receiving value for their money, and capabilities that they needed. Over time Saleforce took their startup mentality and used it to provide more progressive solutions to its customers, like API's to integrate with Facebook and other social networks. This was an area where external progressive thinking worked with their internal startup culture to become trend setters in the CRM space.

In conclusion Saleforce has grown by maintaining a few core values which have defined them as innovative, progressive which work well with their external client pursuits where they try and develop clientele who wish to be at the cutting edge of technology and customer satisfaction. They do reach out to huge organizations as clients, but only for organizations trying to obtain a competitive edge. Age old organization which do not need to be innovative, and are more concerned with retaining their processes are not high up the list of clientele for Salesforce. However the big question remains, as to if saleforce will retain its edge when the avenues for innovations become limited or exhausted?   

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