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At SugarCRM, we have embraced an open culture since day one. The reason why we chose to build Sugar as an open source product was because we fundamentally believe in the ideals of the open source way. Openness allows companies to more readily connect and build a relationship with their customers. While building a killer app may put the gleam in our developers’ eyes, solving our customers’ problems is what keeps the people at SugarCRM focused and driven.

After all, the purpose of a company is to create customers. And companies do this by connecting people with problems (customers) to people with solutions (employees). And our employees (we call them Sugas) really like to solve customer relationship problems.

So how does openness help build a better CRM solution? In three simple ways.

1) Focus on Users First. From the beginning, we designed the Sugar app first for the end users of the application. CRM applications have a long history of failed implementations due to a lack of adoption by the end users. Why is this? Because legacy CRM applications like Siebel and Salesforce.com have been traditionally designed for the buyer first, i.e. sales management. By embracing an open dialogue with our end users through the Sugar Forums, the SugarCRM development team is tightly connected with our end users and able to focus on solving their business problems. Our first design use case is around a customer representative getting ready to contact a customer and needing to prepare for the call, meeting or tweet. By ensuring the Sugar application is highly useful and useable, sales managers can then rely on the forecast, pipeline and issue resolution insight coming out of their Sugar application.

2) Built for the Open Cloud. The Open Cloud Manifesto is dedicated to the belief that the cloud should be open. The core tenets of the Open Cloud are that open standards and portability of applications across cloud platforms gives customers control and choice. Our customers demand control of their mission critical applications and data and require choice of their cloud platforms. From Sugar On Demand, a fully managed Software-as-a-Service (SaaS) application to running Sugar on Infrastructure-as-a-service (IaaS) cloud platforms like IBM SmartCloud Enterprise and Amazon AWS, organizations in over 80 countries around the world choose SugarCRM for the flexibility of deployment options. Control and choice means all companies can design a CRM strategy without having to make any compromises in their IT strategy.

3) Leveraging an Open Ecosystem. Today’s most vibrant technology companies are those that get the power of ecosystems. The amplification effect of a large ecosystem of partners gives companies like SugarCRM, Google, Apple, Amazon and others a massive boost in delivering value to customers. However, we are seeing two types of ecosystems emerging: closed ecosystems and open ecosystems. The mobile phone market is a perfect example of this. Apple has built a “walled garden” ecosystem with iOS. Google however has built an open ecosystem with Android. You will find a similar duality in the CRM world with Salesforce.com creating a closed ecosystem and SugarCRM creating an open ecosystem. With an open ecosystem, our customers have more choices. From a wider and more varied choice of implementation partners to the power of SugarForge.org, the largest collection of open source CRM solutions on the Web, SugarCRM customers enjoy the benefits of choice and control not only in their cloud options but also in their ecosystem options.

A culture of openness here at SugarCRM has led to better CRM solutions, solutions better aligned to your needs and better aligned to driving your CRM success.

–Clint

2 weeks ago I came across a tweet promoting the CRM Madness competition.  A fun spoof on the annual NCAA March Madness basketball competition.  Capterra, online destination for business software buyers, put the 64 most popular CRM applications in a March Madness like tournament and created the CRMMadness competition.    All it took was one tweet and I was hooked…

This was not just a popularity contest, the marketing team at Capterra was using the CRM Madness competition to do real competitive research as they explained on their blog introducing the competition.

Over the next 2 weeks, SugarCRM was matched up against the cream of the crop of CRM competitors.  In a classic use case of social media, we used facebook, twitter, LinkedIn and the Sugar forums to get the word out to our Community.  And the results were very clear. In round 2 we beat Sage CRM, in round 3 (sweet 16) Oracle Siebel come up short, in round 4 (elite 8) SAP CRM could not stand the heat and then in round 5 (final four) we beat salesforce.com.  And we beat them fair and square with 30x the number of votes.

That put us in the championship round against PegaSystems who themselves among others beat Sage SalesLogix  and Microsoft Dynamics CRM to get to the final match up.

During the championship round, the Sugar Community showed up and voted in large numbers for SugarCRM.  We owe you a profound THANK YOU.

Great news for SugarCRM from Down Under.

iTnews, Australia’s leading source of enterprise IT and telecoms news, just published ‘Which Clouds Play Nice‘, a 44-page technical study of the integration and extension options offered by the largest 20 software-as-a-service vendors serving the Australian enterprise market.  Brett Winterford, editor of iTnews, writes that this “groundbreaking study asks a series of essential questions for any organisation considering adoption of cloud solutions offered by Atlassian, Financial Force, Google, IBM/Lotus, Microsoft, MYOB, NetSuite, Oracle, Paycycle, Quicken, RightNow, Saasu, Salesforce.com, SuccessFactors, SugarCRM, Taleo and Xero.  Namely:

  1. Can I get my data in and out freely?
  2. Does it integrate natively with other systems?
  3. What third-party integrations are available?
  4. Can I write code to integrate with it?”

The ‘Which Clouds Play Nice‘ analysis has a wealth of information and is a must read for any IT decision maker, anywhere in the world, looking at implementing cloud services and more specifically cloud-based CRM services.  We were humbled and pleased to learn that SugarCRM came out on top of the CRM Scorecard, when compared to salesforce, Oracle on Demand, Microsoft Dynamics, RightNow and NetSuite.

You can download this exclusive research from the iTnews portal here.

When I read GigaOM’s Mike Jones’s great contribution to the growing discussions on the future of SaaS, one thought kept going through my mind. Who’s taking the customer side in this discussion? So far the SaaS vs. XaaS discussion is mostly a technical and infrastructure discussion. “Acronyms as a Service” is a great idea, but really, shouldn’t it come down to giving customers choices?

It’s not up to our industry to dictate what solution customers should use. It’s up to us to create the solutions that enable customers to choose the right deployment model that meets their specific requirements. For some customers that will be SaaS, for others that will be IaaS or PaaS.

So to add to the discussion and focus it a bit more on CRM, what customers need is choice:

  • The choice to freely move their data between different clouds;
  • The choice to where they want to deploy their CRM instance;
  • The choice to integrate with any open social platform;
  • The choice to access their CRM solution from any mobile platform;
  • The choice to change their CRM when they run against the limitations that come with legacy CRM solutions; both on-premise as well as SaaS.

And for that CRM needs to be open. Today, SugarCRM is the only solution in the market that is open and built for the cloud. This flexibility offers customers choice.

For those of you who follow the CRM space, last week provided for some real drama. Here’s a quick recap courtesy of TechCrunch

Oct 4: Larry Ellison Cancels Marc Benioff’s Keynote at Oracle’s OpenWorld
Oct 5: After A Cancelled Keynote, Benioff Strikes Back; Talks Future Of The Cloud
Oct 6: Ellison Reveals Oracle’s Public Cloud; Calls Salesforce The ‘Roach Motel’ Of Cloud Services

I don’t want to dwell on this cloud spat, but the one thing I do want to talk about is one of the points that Larry Ellison raises.  He warned customers: “Beware of false clouds“, and further goes on to state that salesforce.com “is a proprietary cloud, the ultimate vendor lock-in”.  It really delights me to see that Larry Ellison is now saying what we’ve been saying all along.  Salesforce.com is not cloud computing.  Salesforce.com is a 10 year old multi-tenant hosting technology.

True cloud computing allows customers to freely move their data between different clouds;
True cloud computing gives customers the choice where they want to deploy their CRM instance;
True cloud computing is open;
SugarCRM is the only CRM solution in the market today that is truly build for the cloud.

On Oct 12, we announced added support for IBM SmartCloud Enterprise to the set of public clouds that customers can deploy Sugar on.  In addition to the IBM SmartCloud, Sugar runs on Amazon EC2, Rackspace Cloud and Windows Azure.  Customers can also choose to deploy Sugar in the Sugar Cloud, in one of our partner clouds or in their own private cloud.  To learn more about the benefits of REAL cloud computing, take a look at the following:

This week’s Dreamforce event saw a lot of announcements – everything from an on-premise storage option for critical data to a development tool to allow customizations for Salesforce.com applications to work on touch-screen smart phones to a move toward ERP in the cloud. Unfortunately, the narrative doesn’t completely hang together, which is a shame; if Salesforce is great at anything, it’s telling a story, but at this point the story is so sprawling and so interconnected that it’s becoming hard to articulate the answer to the question “why.” Part of this is a result of Salesforce.com’s attempt to become an all-things-to-many-people platform, which is difficult at best, but part of it is a matter of “vision” outstripping concrete development efforts. Vision is great, but it’s no match for vision matched with results.

Before Dreamforce, we pondered the idea of questions we’d like to put to Marc Benioff in an ideal one-on-one situation. While getting that opportunity –and getting truly candid answers – is unlikely, a look at Dreamforce this year did provide answers to many of them:

1. Which of the CRM companies today would you say are giving you a run for your money?

Based on the new features introduced this year, Salesforce sees the market the way many do – as a battle between themselves, Microsoft Dynamics CRM and SugarCRM. Things like Data Residency Option (DRO) – a feature that offers the ability to store sensitive data on premises and off of Salesforce’s datacenter – replicate the model that already exists for SugarCRM (although its flexible deployment models come without the management burden that DRO suggests) and is in the offing from Microsoft. In a Q&A with media and analysts, Benioff said that DRO was intended “only for specific large customers to withhold specific information,” and gave the example of large financial institutions.

2. What are the top three innovations of Salesforce.com this year, and how are they reflected in costs charged to customers?

This year’s major push was on the “social enterprise,” and several modifications were added to Chatter to allow the tool to be a little more sociable (like social analytics the ability to invite selected customers to conversations). No news was released around additional charges to Chatter. DRO was also announced without pricing. The third major announcement was Thursday’s unveiling of a marketing automation and ERP partnership with Infor and a manufacturing partnership with Kenandy. Again, no pricing information was made available.

3. Why do you penalize customers for being successful?

This question remains unanswered or unaddressed.  The crux of this question is this: as a customer grows, the amount charged by Salesforce increases disproportionately. It actually becomes more expensive to use when it succeeds. This is an unfortunate paradox that perhaps suggests a billing approach lost in time; it may have made sense when Salesforce was a champion of small businesses but it’s now obsolete – and it’s costing customers money.

4. When it comes to features, Salesforce offers an abundance. But why are the most valuable CRM features reserved for the more expensive editions?

Salesforce presents this costly billing issue as a matter of choice for their customers – if you can’t afford these features, you simply don’t have to pay for them. However, to paraphrase Orwell, some animals are more equal than others; at the show, Benioff introduced a “Social Enterprise License Agreement,” which includes access to Sales Cloud, Service Cloud, Chatter, Radian6, Force.com, Heroku and Database.com for the entire enterprise. Benioff characterized this arrangement as  “the only way” that a company as large as Coca Cola could have become a Salesforce customer. Landing Coke was a big deal, but tacitly admitting that the Salesforce ecosystem of tools and applications was becoming prohibitively expensive was also a big deal.

5. You’ve said that enterprise software should be like Facebook. Can you provide examples of how Salesforce has been translating that into business results?

To their credit, Salesforce did illustrate how some major companies had implemented more social-like CRM approaches. These certainly paid off handsomely for Salesforce, but it was not clear what return Burberry’s three-week-old implementation or Toyota’s “friend your car” programs had yet delivered.

6. Salesforce.com is consistently one of the overvalued equities in the market. Are you contributing to the new bubble?

Perhaps. During the keynote, Benioff crowed about GroupOn as an example of a star Salesforce customer. GroupOn is the poster child of bubble companies: with an unsustainable 22,000 percent revenue growth last year, it currently owes its customers more money than it takes in annually, and its refusal of a $6 billion buy-out by Google earlier in the year may go down as one of the century’s worst business decisions. Not to be outdone, with costs rising and a second-quarter loss even as it raked in revenue at a $2 billion run rate, Salesforce itself looks poised to be a great Wall Street heartbreaker.

7. According to the Financial Times, you are one of the true masters of the art of sales pitching. Sell me on the higher cost of doing business with Salesforce.

We’re just going to imagine the answer to this one: no comment.

8. If social CRM is about customers, why is Chatter locked up behind the firewall?

In a fascinating response to the question of whether Chatter was social CRM or not, Benioff quite honestly responded that it was an “enterprise social network.” Although it has now added the much-needed ability to invite outsiders into Chatter conversations, these still take place within the firewall. This may appeal to businesses whose leaders fear losing control of discussions, but it’s still not true social CRM since it seeks to control customers and their participation in a manner dictated by the company.

9. What is preventing Salesforce from allowing a customer free access to its own data when it hosts their CRM solution with Salesforce.com?

Data access is still a sore spot with Salesforce. When Benioff was asked about “open data” today, he eluded questions around Salesforce’s obligation to its customers and instead chose to talk about how many potential Salesforce users were afraid of the idea of open data. This is unfortunate; although Salesforce has an impressive retention rate, customers often mention the obstacles placed between them and a useful, easily-migrated version of their data. Should Salesforce develop a more open means of providing customers with their data, they could develop a true measurement of the loyalty of their customers.

10.  How did Yammer inspire Chatter?

There was little discussion of this at the show – possibly because Yammer opted to capitalize on the earlier controversy with a campaign describing the two products as “friends with benefits.” Salesforce frequently pays the greatest form of flattery to its forerunners in other fields – Chatter also strongly resembles Facebook, for instance – and this is in keeping with the company’s remarkable effectiveness at taking concepts pioneered by others, adding them to its ecosystem with a Salesforce flavor and linking them with other tools to increase their usefulness. They may not always be original, but they often are the first to reach customers with new ideas.

The Oracle of San Francisco has spoken.  The Cloud is Passé.  The Cloud is Dead.  All hail to the Oracle.

Or maybe Marc Benioff is so eager to move away from the cloud and on to the next hot thing because he knows that Salesforce.com, as a first generation SaaS application, has become a “legacy application” in the new era of the cloud.” According to Mark Vizard, author of SaaS is Dead, Long Live the Cloud, we’re now in a new era “that is defined by an elasticity that gives IT organizations maximum flexibility in terms of choosing to deploy software on premise, in the cloud or both.”

According to Vizard, “one of the fundamental tenets of software-as-a-service (SaaS) is that the application is supposed to run as a single instance on top of a multi-tenant IT infrastructure. With Salesforce.com, for example, every customer has specific rights and privileges to a shared customer relationship management (CRM) application running on database servers managed by Salesforce.com. Given that model, there is no ‘software’ from the perspective of the end customer. The Salesforce.com business model, combined with the fact that the application was designed from the ground up to run on a specific multi-tenant architecture, means customers can’t run a version of the Salesforce application on their premise.”

In another article, Vizard makes the case that cloud computing “will stand in sharp contrast to the way Salesforce.com operates. In the case of Salesforce.com, there is only one source for the company’s software that runs on a couple of data centers managed by Salesforce.com.”  He adds that “software-as-a-service (SaaS) as we think about it today is moribund in the age of the cloud.”  Vizard makes the case that cloud-based CRM solutions like SugarCRM “are going to let customers run their software on premise or in any data center they choose, as opposed to requiring them to run their CRM software on a data center managed by a software vendor.”

I don’t believe that the cloud is dead.  From where I sit, I see customers very eager to board the cloud train.  Customers really believe in the promise that cloud computing is giving them choice – a choice to deploy their software applications where it makes sense for them: in their private cloud, in the vendor’s cloud, or in a public cloud.  And knowing that they have the option to change their deployment based on their changing market requirements.

“Imitation is the sincerest form of flattery,” said Charles Caleb Colton in 1820.  So we’re delighted to see that Salesforce.com is copying our Mobile, Social and Open messages to give some substance to their latest Cloudforce events.  It is nice to see that after we started promoting these capabilities more than a year ago, Salesforce.com is following our lead.

So why is the 800 lb. gorilla in the CRM industry doing this?  Are they running out of creative positioning ideas?  Is there more to this than meets the eye?

We compete and win against Salesforce.com everyday and from where I sit, it seems obvious that Salesforce.com is concerned that SugarCRM’s flexible, intuitive and open CRM platform gives customers a better Global, Mobile and Social CRM solution.  They are so concerned that they are unable to compete with Sugar’s flexibility or price that they resort to publishing a list of “considerations” for prospects who are evaluating SugarCRM. A list of considerations that is nothing more than a smokescreen of “FUD”: Fear, Uncertainty, and Doubt.

Thank you Salesforce.com.  We are grateful that you are confirming that SugarCRM is the best alternative to Salesforce.com for customers who are looking for a cost effective, flexible, intuitive and truly open solution.  A solution that raises the bar and sets a new standard in mobile CRM and a Social CRM solution where companies get to collaborate with their customers, not provide behind the firewall chatter.

Or in the words of a customer: “Salesforce.com has really evolved.  They offer all the warmth of Oracle and the flexibility of SAP.  Which is why we choose SugarCRM, a flexible, intuitive and open solution that adapts to our business needs.”

So if you are in the market for a new CRM solution and you would like to consider all the facts when choosing the right CRM solution for your organization, please read this overview of SugarCRM.  We’ve included an answer to all the “considerations” Salesforce.com recommends you ask us.  And as a bonus, we added a list of legitimate questions you should ask Salesforce.com.

Many have probably seen that Salesforce.com has acquired web conferencing tools provider DimDim for $31m. (The rumors of this deal had been percolating since before Dreamforce so for many this was no surprise at all.)

The deal pits Salesforce.com in many ways against some big companies and very popular products – Citrix’s GoToMeeting and Cisco’s Webex, in addition to IBM’s Lotus Live set of offerings. With its recent platform buy in Heroku, and this new move, it is funny to see Salesforce continue to add competitive concerns and look to enter in large markets where it has no clout, rather than look to live above the competition in one market where it already does well. Confident move?  Yes. Smart move?  Well, we’ll just have to wait…

And while the DimDim acquisition clearly places SFDC in competition with the likes of WebEx and GoToMeeting, Salesforce would like to look at this differently. Salesforce instead sees this as a pocket acquisition to bolster its Chatter functionality – a tool it is already basically just giving away to gain some stickiness for its actual paid apps. So, if SFDC does not really see much future for DimDim save for part of what is now a free add-on, then the $31m price was not a huge price to pay to make a cool new collaboration feature a little more robust.

But again, if Chatter is basically free at this point, why buy DimDim? The product was open source under the GPL. Couldn’t SFDC simply create an integration to the free tool and offer up that integration along with a simple installer to add video and screen sharing tools to Chatter?

I think the answer here is two-fold. One, I have not yet seen SFDC do anything that resembles open source. Yes, they have opened up their toolkits and platforms for developers, but everyone does that. There is just not that type of culture alive at SFDC in my opinion. This is a company steeped in the grand history of proprietary software.

The second reason (which is definitely intertwined with the first) is that due to SFDC’s multi-tenant model, adding DimDim-like resources without wholly owning the code would be problematic. As we know, in order for SFDC to really have a tight handle on anything its users touch, it has to run on its monolithic platform. This makes upgrades and other things easy, but does set limitations on how SFDC can go to market with technology it doesn’t own.

It will be interesting to see if the nature of a GPL licensed piece of software sitting inside a huge multi-tenant database has any effect on the way in which Chatter users are empowered to make, own and redistribute changes.

All in all, this is chump change for SFDC, and while it plots them theoretically against big names like Webex, I can’t see Salesforce actually making any huge headway into standalone video conferencing with the DimDim technology – most likely Salesforce.com will only relegate the functionality as a nice add-on to Chatter.

Many of the Outsiders readers might remember that last year we spoofed Marc Benioff’s book Behind the Cloud last year at Dreamforce. That stunt caused quite a stir, and this year we decided to make things a little less personal and a little more jovial, as it is the holiday season after all.

So, the marketing team got together and penned some “holiday carols” that tell our side of the CRM story, as well as throw some light-hearted barbs towards salesforce. All in fun, right? You can check out the complete carol book and lyrics here.

The main thrust of the campaign was to guarantee salesforce.com users at least 50% off their CRM subscription fees by switching to SugarCRM – and to make the switch seamless, we will waive the data migration fee.

To top it all off, we hired some professional “carolers” to sing selections from the song book outside the Moscone center as the attendees of Dreamforce piled in for the kickoff keynote. The crowd loved the carols, many chimed in, and tons of people snapped photos and videos and took home souvenir carol books for themselves.

Here are a few clips of the singers singing:

All in all, it was a fun event and we had a great time with all the singers and all the people who stopped by and chatted with us about SugarCRM.  Thanks to everyone who helped make the caroling such a fun and successful event!