- Summary:
- Last week's Salesforce announcements give pointers to how sales is changing in a digitally connected world, as business adapts to XaaS
Salesforce announced several tweaks to Sales Cloud last week, as the run-up to Dreamforce later this month starts to build momentum. This wasn't a big announcement, but it highlights several trends that are changing the nature of sales — and most other business functions too — as the world becomes more and more digital and connected, both externally to customers and suppliers as well as internally within businesses.
My umbrella term for these trends is Everything-as-a-Service (XaaS, pronounced 'x-ass'), which builds on the learnings of Software-as-a-Service (SaaS), the first digitally connected product. The technology is now bringing these XaaS trends across every type of product, service and experience. At its core is a continuous, digital connection between the provider and the recipient, through which the provider builds engagement, monitors how the product or service is being used, and analyzes that usage data to improve the experience and the results it delivers. So what are the technology ingredients that enable all of this? The Salesforce announcement includes several of them. Let's break them out.
Real-time information across all aspects of business
In the past, businesses have had to operate based on out-of-date information, because that was the best their data and reporting infrastructure could deliver. Today, with the right tooling in place, that's no longer the case. It's possible to bring data together in near real-time and run it through analysis tools to provide meaningful reporting on what's happening now. The Salesforce announcement provides an example in the form of 'Revenue Intelligence', a new reporting tool that combines Sales Cloud data with Einstein analytics and Tableau reporting capabilities. This allows sales leaders to monitor performance as it happens, rather than having to wait for after-the-fact reporting when it's too late to take corrective action.
We're seeing similar tools enabling this level of responsiveness across functions as diverse as finance, IT, and manufacturing operations. In finance, the trend is moving towards continuous close, where the finance team reports metrics on a weekly or daily basis, rather than waiting until the end of the month or the quarter to collate the numbers. In IT, the rise of observability and AIOps is helping to monitor performance across the IT stack and thus respond to anomalies as early as possible rather than finding out what went wrong after the fact. In manufacturing, instrumentation of production lines and digital connection into back-end systems is helping to improve quality and timeliness.
The common theme across each of these examples is the continuous collection and analysis of data in order to monitor and then improve performance. This is the XaaS feedback loop in action internally, supporting more effective business operations, which in turn help to provide improved outcomes for customers.
Reporting and analytics for real-time course correction
The availability of reliable, up-to-date information isn't the end of the story. Once you have solid data about what's really happening now, you can take pre-emptive action to improve your results before they're set in stone. The Salesforce announcement includes several examples of how sales leaders can use data insights to redirect resources or fine-tune actions to keep performance on track. The simplest one is the use of Tableau analytics to get early warning of gaps in sales targets, or to surface insights that can improve forecast accuracy. Much more is possible with the aid of AI-powered predictive analytics, for example assessing the likelihood of closing individual deals, or monitoring trends in KPIs such as attainment, win rate and quarterly progress.
This is all about using automation and intelligent analytics to collate information and then surface insights that allow for more responsive decision-making. There are similar examples to be found across finance, IT, operations and marketing. People's jobs are changing, but that change is all about spending less time on repetitive, low-value tasks and spending more time on actions that achieve results.
Real-time learning and iterative coaching
Continuous digital connection is also helping people to develop their skills for this changing world. It's no longer necessary to go off to classrooms for learning and development. Interactive tools, on-demand video and online conferencing can deliver training and knowledge in small doses, exactly when it's most useful. Salesforce Trailhead, the vendor's interactive learning platform, is a well-established illustration of how this can work in practice. Last week's announcement highlights its ability to deliver personalized, contextual, real-time learning as part of the sales enablement features within Sales Cloud. The recently acquired Slack collaboration platform also gets a mention as a channel for peer-to-peer knowledge sharing.
AI too plays a role in helping to focus skills development where it's most useful. By analyzing pipeline and deal data, Einstein is able to pinpoint moments where taking action to improve skills may be able to help close more deals. Here again we can see the XaaS feedback loop in action, this time applied to learning and development. By analyzing these enablement activities in the context of key sales metrics such as lead-to-opportunity conversion rate, sales cycle time, and close rates, it also becomes possible to identify which are proving the most effective at delivering meaningful outcomes. Once again, continuous collection and analysis of data leads to improved outcomes.
In the human context of employee enablement, it is important for this to be a collaborative exercise. Constraining people to act in particular ways without any individual agency or autonomy is counter-productive. They must be able to participate in the analysis and take ownership of the steps that lead to improved outcomes. A conversation I had with early Salesforce investor Gordon Ritter several years ago maps out how people and AI should work together. This should be an iterative collaboration, in which the AI can suggest established patterns that will help the human improve their performance, but it is the human who has the creativity to discover and try new patterns that might make a further leap forward.
Rise of subscription and greater customer choice
No discussion of the rise of XaaS can be complete without mention of subscriptions. The continuous connection inherent in the Everything-as-a-Service model typically demands some kind of pay-as-you-go commercial relationship. Therefore it should hardly be a surprise that the final element of Salesforce's announcement last week was the introduction of Subscription Management for Revenue Cloud. This provides a self-service mechanism for a company's customers to manage their own subscriptions, along with management tools that allow the company to keep track of recurring revenue streams and streamline collections.
As customers demand more choice, companies need to put their subscription offerings on the same self-service platforms as they use for one-off sales of products, services and experiences. They need the flexibility to be able to build new packages and options in response to market dynamics and their own performance metrics, and to be able to quickly put these in front of customers. That's quite a challenge when it comes to subscriptions, as it quickly gets very complex to track multiple different subscription contracts across the customer base. This is one more obstacle to negotiate in the journey to XaaS.
Digital teamwork and the hybrid workforce
One important trend relating to XaaS that had just a passing mention in last week's announcement is the rise of digital teamwork. We'll doubtless be hearing a lot more about the contribution that Slack will make to the Salesforce proposition during Dreamforce, building on its initial outlining last month of what it's calling the Slack-First Customer 360 approach to sales, service and marketing. All of the various elements we've discussed above demand close collaboration between the various participants. In today's emerging Vaccine Economy, that collaboration needs to work effectively across teams that are invariably going to be working in different locations as the hybrid workplace shakes up traditional working patterns.
Convergence of sales and service
One other trend to look out for follows on from all of the above — the growing convergence of sales and customer service. The need to build ongoing engagement with customers means that service teams are increasingly getting involved in upsells and renewals, while sales isn't just about closing the deal, it's also about building that long-term relationship. Even back-office functions that traditionally haven't had interactions with customers are now contributing to that relationship, whether it's finance ensuring that the subscription is managed smoothly or operations making sure that what's being delivered is meeting customer needs. The big picture here is that, in a digitally connected world, the entire enterprise has to become a frictionless operation, in which every function plays its part in keeping the customer satisfied.
Disclosure - Salesforce is a diginomica premier partner at time of writing.
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