Three-year-old Salesforce.com is one of a handful of companies that have fully embraced the web services model, and supplies its CRM software as a service over the internet. S3 is the latest version of its software and the first to be built on sforce.

The sforce system allows Salesforce.com software APIs to be exposed to external developers, and encourages programmers to tailor the business suite to enterprise needs using integrated development environments from partners.

The initiative has attracted support from Borland Software, BEA Systems, Microsoft and Sun Microsystems, which will all support sforce in their IDEs. The idea is that developers will be encouraged to build extensions to the Salesforce.com offering as individuals will be able to use their existing IDE rather than be forced to learn something new.

S3 is the culmination of a huge project that the company says has been 4 years in development and cost $100m in research and infrastructure investment. The company has also released the Salesforce.com Tibco Integration Server, which offers out-of-the-box integration with major enterprise applications such as those from SAP, Siebel, Oracle and PeopleSoft.

Although S3 adds a whole swath of new features to the existing Salesforce.com service, which will go a long way toward bridging the gulf between its own and traditional vendors’ functionality, that is not the most significant aspect of the announcement.

Salesforce.com has decisively moved away from the traditional software supply and sales model, and while it needs to build customer mass among large enterprises, it has established itself as a viable alternative to classic CRM vendors, using an alternative model. Having proved the validity of the software as a services model, the next stage is to create the ability to enable others to develop, explained Tien Tzuo, VP of product management at Salesforce.com.

Rather than build everything itself, its aim is to build a web services-based CRM ecosystem that fulfills all the needs of customer related activity, as opposed to just the front-office requirements, by stretching out into areas like order management, contract management and billing for example.

It is investing in additional functionality itself, as demonstrated by S3, but by opening up the route to integration and application customization, it is trying to create a new type of application that is as open in terms of development options as well as on the integration front. Instead of viewing partners as peripheral to its activity, it is making them and their expertise central to the development of the Salesforce.com environment without tying them to proprietary standards or development tools.

This approach also enables it to overcome accusations that the application is limited in scope because of sparse integration facilities. Existing subscribers who log into their service today will automatically access the S3 application and will also have access to the sforce system to build out or integrate as they choose, using their preferred development tools.

With these latest moves, it is well on its way to establishing itself as a viable alternative to traditional vendors though its combination of high functionality, expandable and customizable, on-demand software offered at low cost and low risk. In addition, the backing of a host of development and integration partners provides all important wider market support thereby validating its approach.

Privately held San Francisco, California-based Salesforce.com has 6,800 customers and has just become profitable.

Source: Computerwire