One of the anomalies of the Salesforce.com story is that in application terms it is a CRM pure-play in a world where customers favor integrated multi function suites. Although its AppExchange platform provides for additional functionality, it also increases the number of vendors an organization has to deal at time when users are looking to consolidate their software suppliers. However, the company is planning to address part of the problem with the offer of application bundles.
Although the plan is in the early stages of development and has not been formally announced, the goal is to offer customers various bundles based on a mix of applications. Today [customers] buy from third parties and have a separate relationship with them, but are asking ‘Why can’t we buy it all from you?’ They are looking for a one-stop shop, said Salesforce.com president Jim Steele.
The company is still figuring out the details. One of the major hurdles is on the business administration side, as the company needs to figure out how to implement a billing system that will enable it to provide a single bill covering multiple services from different vendors. It also has some hard work ahead of it in creating a support policy that will be able to cater for applications from multiple vendors. It is still evaluating how it will go about offering support.
Offering and supporting application bundles is not a straightforward operation. In addition to billing and support there are complex issues around installation, ensuring integration between the applications, sign on and security, and co-ordinating upgrades.
It is not clear whether the embryonic service will provide for fully integrated and supported bundles, or whether it will focus on administration by providing for single billing. There is scope for it to go in many directions, but one of the most valuable would be in using it as a vehicle for micro vertical market activities, with Salesforce.com proactively bringing together groups of application providers to create very specific bundles.
Salesforce.com has been adamant that it will not overstretch itself and compromise quality by expanding into too many functionality areas. It has always ruled out developing its own ERP applications for example. We had to be very focussed, even though it was tempting to stray and develop outside CRM, said Steele, on the grounds that if it tried to answer all its customers demands for new functionality it would always have a backlog.
The AppExchange platform was designed to allow third-party application providers and customers to extend, build and exchange applications, providing the means to cater for the needs of specific industries, geographies and languages, as well as core business functions Salesforce.com did not develop. The missing element is a means of centralized management.
The just launched AppExchange platform is being pitched as an exchange marketplace at the moment, but it and the architecture behind it are key to the next stage of Salesforce.com’s development and they represent a second line of business that has the potential to dwarf the salesforce automation section.
