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January 5, 2016updated 31 Aug 2016 12:18pm

Consulting firms buy into Salesforce as Hybrid IT complexities hit home

Analysis: Have consulting firms pursued Salesforce experts due to slow acting SAP & Oracle cloud plays?

By James Nunns

Everyone wants to get closer to Salesforce, at least that’s what a number of Salesforce related acquisitions and collaboration announcements seem to suggest.

Relationships with the CRM cloud giant have been major factors in acquisitions by Accenture and Capgemini, while companies like Box and Microsoft have been busy collaborating with the company.

So why is Salesforce becoming such a popular focus for consulting and tech companies alike?

Accenture offers more than 3,400 in-house Salesforce certified professionals. Its acquisition of the Dutch firm CRMWaypoint will bolster this number and plays to Accenture’s "Cloud First" strategy which is designed to provide customers with cloud strategy and technology consulting, along with cloud application implementation, integration and management services.

Accenture’s CRMWaypoint buy was announced on the same day as fellow consulting firm Capgemini’s acquisition of oinio, a company which specialises in the consulting and deployment of Salesforce and an elite Salesforce Platinum Cloud Alliance partner.

These of course aren’t the only acquisitions, in May Accenture bought UK Salesforce consultancy Tquila.

Saideep Raj, Managing Director of Accenture Cloud First Applications Team Accenture, told CBR: "Accenture is boldly investing in this space. We are driving a cloud first agenda, which is about proactively positioning cloud solutions to our clients. And it is very compelling. So we did the acquisition with Tquila."

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Analyst firm Gartner predicted in March 2015 that the CRM software market would grow at a 14.7% compound annual growth rate and that SaaS deployments represent 40% of all CRM deployments, rising to 50% in 2016.

Based on those growth figures, the CRM market is a strong area to be a part of, perhaps explaining some of the interest from other companies to be somehow connected to the market and benefitting from the growth.

Dr Katy Ring, Research Director Cloud & IT Services at 451 Research, told CBR: "The old complaint that you cannot make money as a consultancy or system integrator (CSI) around SaaS is largely being laid to rest as the number and complexity of projects increase."

Tied in with the complexity of projects is that Salesforce is a key component of many digital transformation projects. As many of these are typically customer-facing, Salesforce is becoming a leading partner for these projects, says Ring.

The choice of Salesforce rather than CRM competitors Oracle Siebel and SAP is helping Salesforce to grow, and according to Ring this is because: "There is a level of exasperation among CSIs around the slowness of software vendors such as SAP to move to commercial cloud models, which is helping Salesforce to grow."

While SaaS is designed to be much more flexible and extensible than a code-base that is set in stone, the challenge is understanding the business process involved and how you want them to change, which is where business consultancy skills come into play.

The complex business project, combined with Salesforce becoming an important aspect of hybrid IT, is why firms like Accenture and Capgemini are being sought out by clients.

Research from Sungard highlights why UK organisations are turning to these consultancy firms.

The majority of organisations (83%) said that they have a shortage of several of the skills essential for managing a Hybrid IT environment successfully.

Areas of great concern were IT security with 38% saying they lack the necessary skills to deal with security issues, while 27% said they struggled to integrate private cloud environments into their IT estate.

To compound the issue, Hybrid IT is viewed by 77% as a necessary part of staying competitive. Where consultancy firms may be interested is in the finding that 74% said they are willing to invest in order to ensure they have the correct levels of skills sets.

These factors appear to answer the question of why consultancy and tech firms are aligning around Salesforce, having positioned itself as one of the leaders in the market.

For the system integrators, it’s an attractive proposition for being able to sell projects to integrate Salesforce with back office systems and is why firms like Accenture are investing heavily in companies like Cloud Sherpas to build their own skills base.

Saideep Raj, told CBR in a recent interview: "Talent is definitely a driver. The deep skills that Cloud Sherpas brings are scarce in the arena, in the entire market. Accenture has seven of these certified technical architects, think of them as the uber architects – they are ‘gods of architecture’ and there’s a pipeline of more. When you have that deep technical base it pulls along an enormous following around the application arena as well."

"We’re the great engine of building these people and now we’ve got 6k Salesforce consultants at Accenture. These people live and breathe Salesforce and we’re scaling and adding depth of talent in areas where we’re seeing growth."

Whether 2016 will see continued acquisitions in this vein from consultancy firms and further Salesforce alliances, it is yet to be seen. However, if Salesforce continues to be a leading force in the CRM market then the chances may be high.


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