Dreamforce 2014: Process Is More Important Than Analytics

photo by Dion Hinchcliffe

Salesforce.com’s Dreamforce conference this year was the usual mix of spectacle, congestion, and heart-felt philanthropy. But the main announcements felt fairly slight: a new “analytics cloud” that is primarily about visualization and a mobile app builder for the Salesforce1 platform.

The analytics cloud* is a step forward only because Salesforce has been so far behind: it bulk loads data into a star schema relational database using inverted index for speed, which is a solid but old-fashioned approach. Of course, it’s cloud-based but so are other, newer approaches that are ultimately more flexible and scalable. Solutions to the really hard problems of entity association (matching identifiers for the same person in different systems) and predictive analytics are not included. Nor does the system handle real-time updates or allow queries by external systems for purposes like message personalization. The visualization itself is indeed fast and pretty, but it’s not obviously superior to Birst (also cloud-based), Tableau, or QlikView. The core technology was acquired when Salesforce.com bought EdgeSpring last June.

The mobile app builder for Salesforce1** is the sort of innovation only a geek would love: after all, most people don’t think much about system building in general, let alone get excited about making it easier to build mobile apps for Salesforce. But it’s certainly the more important of the two announcements, because it illustrates how broad the scope of Salesforce has become. The most impressive demonstrations were operational processes such as remote order-taking and customer support, which are far removed from traditional sales automation. They also illustrated how absolutely central mobile devices have become to most business processes, something we all vaguely realize but are still not necessarily acting upon. Business processes need to be reimagined from a mobile perspective, taking into account the possibilities of doing things instantly while on-site at a store, a shopper’s home, traveling, or whatever. This is no longer a new thought, but few companies have actually done it. By providing a drag-and-drop mobile app builder, Salesforce opens up possibilities for companies to innovate along these lines quickly, easily, and cheaply. That’s important to everyone, not just Salesforce geeks.

In fact, the closest thing I had to a deep thought during the conference was that people put too much emphasis on distributing data for decisions and not enough about distributing processes. Demonstrations for tools like Wave always show users drilling into sales data to uncover weak pickle sales at convenience stores in Milwaukee – something that’s exciting the first time but you don’t do on a regular basis. By contrast, a distributed process like better store shelf allocations provides continuous benefits, even though it doesn’t require a human analyst to have a brilliant insight. A really good organization has smoothly running processes that handle each situation according to rules that require little or no judgment. (Of course, a certain amount of discretion by empowered employees is still necessary –but I’d argue the sorts of decisions that make for, say, a great hotel experience have nothing to do with advanced data analysis.)  People like decision management guru James Taylor  have long known this and distinguished operational decisions from strategic decisions, so I guess this isn’t really a new thought, either. But, like the growing centrality of mobile, it’s something that companies need to address by giving them resources. Winners will; losers won’t. It’s that simple.

And while I’m being blunt: two Hawaiian dances in a keynote is two Hawaiian dances too many.


_____________________________________________________________*a.k.a. “Wave”, apparently to justify many Hawaii-themed promotions and an appearance by the Beach Boys.

**called “Lighting”, which suggests it was named separately from Wave, since it's unsafe to surf during electrical storms. But nomenclature notwithstanding, the two systems do seem to work together.

More on the Future of Demand Generation Systems

Summary: let's not forget that most companies are still not even doing simple demand generation. Systems for that might succeed even though advanced integration between sales and marketing is the long-run trend. And, my car hit a deer.

I hit a deer last Thursday while driving to Boston for the Sales 2.0 conference. I'm treating the four hour delay that followed as field research into customer relationship management, which ranged from great (the family-run auto shop that towed my car and took me in) to poor (the Enterprise car rental office that kept me waiting nearly two hours before admitting they didn’t have a vehicle available). It ended with the retired dad of the auto shop owners driving me into the next town to pick up a rental car there. The finishing touch was waving as we passed the local traffic cop, who had earlier stopped at the auto shop to chew the fat in true Mayberry RFD style. All told, my little visit to Plantsville (the actual town name) was straight from a grade B movie—city slicker makes an unplanned stop in a small town and learns about real life—except that I didn’t fall in love with a local shop girl.

The net result, beyond some new anecdotes, was that I missed much of the conference. My only extended conversation was with a sales manager who was just recognizing that cold calls were not the most efficient use of his time, and was quite excited to learn that many vendors can provide qualified lists and do the appointment setting for him. He was also starting to think that maybe the company Web site could play a role in attracting leads. In other words, he far behind the times. Yet he also appeared to be seasoned, competent and generally successful. In its own way, this conversation was as much an intrusion of the real world into my bubble as the stopover in Plantsville.

But then it was back to the bubble (so much more interesting than reality) with vendor meetings. Much of the conversation related to my blog post of the day before, which argued that self-adjusting statistical models will replace manually-generated business rules for alerts, lead scores, segmentation and message selection in demand generation systems. Discussing this idea let me to refine the presentation, which I now describe in terms of marketers catching up with changes in their role. That is, most marketers understand their job as generating leads and are just starting to implement systems to do this better. But their job today is actually to manage relationships deep into the buying process. Industry leaders have recently recognized this. The next step, which has barely begun, is for demand generation vendors to deliver solutions that support the new role. My specific argument is that self-adjusting models must replace rules because only models let the systems handle their expanded responsibilities and still be simple enough for marketers to actually use them. My broader argument is that self-adjusting models, rather than a variety of other new capabilities, will be the really important features for vendors to add.

My vendor discussions also touched on the other side of this coin, which is that demand generation systems to perform the original marketing tasks are quickly becoming commodities. Interestingly, I’ve spoken with more than one vendor who sees this as an opportunity, so long as they get to be the dominant commodity provider. Whether these vendors know how to make this happen is another question. I don't know myself, although I’m guessing the primary requirement (beyond a suitable product) is deep pockets for extensive marketing to grab share quickly.

Nor am I convinced that commoditization is a very good strategy, since even the dominant player may not make much money. But, with my little reality check still fresh in mind, I don’t want to underestimate the market for old-style demand generation systems. Perhaps a simple, low-priced system really can be a major success even though marketers will eventually need something more advanced. (Yes, the obvious strategy is to offer one product that can start simple and expand. But I’m very skeptical that this is actually possible.) It’s an interesting strategic puzzle. Fortunately for me, I don’t have to solve it. I just observe and report.