111 best lessons from reading the book Behind The Cloud, Marc Benioff
111 best lessons from the book Behind The Cloud, Marc Benioff
Behind The Cloud is a book about the rise of Salesforce.com, the company that Marc Benioff founded in 1999. The book is a great read, and I recommend it to anyone who wants to learn about the rise of the cloud computing industry.
About the author
Marc Benioff is the founder and CEO of Salesforce, the world’s #1 CRM company. He is also the author of the #1 New York Times bestseller, Behind the Cloud: The Untold Story of How Salesforce.com Went from Idea to Billion-Dollar Company—and Revolutionized an Industry.
Part I – Start-up Manual
How to turn a simple idea into a big company
Lesson 1: Allow yourself to rest
I've been senior vice president of Oracle for ten years and am a slave to the corporation. I wanted to have a balanced life, I decided to take a vacation to get away from work. This is the most valuable time of my career: resting, relaxing, meeting and getting advice, it has helped me realize things that have changed my life.
Lesson 2: A big dream
I envisioned an opportunity to deliver software to businesses in a new way, to make purchasing software easier, simpler, and more democratic. Software as a Service (Saas) is called cloud computing. Users use the service over the internet and pay monthly. This service will have an economic and social impact. To follow my dream, I need to believe in my passion and be ready to defend it.
Lesson 3: Believe in yourself
I worked with Tom Siebel at Oracle. I recognize the shortcomings of the product here. I told Tom about a customer relationship software solution (CRM Saas) that I envisioned, where the customer just signed up and paid a small monthly fee. However, Tom only sees very little potential. I found the idea much more appealing, and I decided to pursue it myself.
Lesson 4: Trust the people who support your idea and listen to their advice
I had definitely wanted to build Salesforce.com but hadn't told anyone yet. In the fall of 1998, I had lunch with Bobby, a friend at Oracle, who told him I wanted to build CRM software online.
Bobby said: “I have three employees at Left Coast Software who are good engineers, visionaries, I will introduce them to you.”
Coincidentally, this is luck, after the meal was over, my fate was decided.
Lesson 5: Pursue the most talented
I met Parker Harris, he was very confident, he said he wanted to do something more meaningful than what he was doing. I know that service scalability is what appeals to any large software developer. Parker was sold. He needs his partner to find the light.
Lesson 6: Sell your ideas to the skeptics and calmly respond to the critics
On a Saturday morning in November 1998, programmers from Left Coast Software came to my house to discuss building Salesforce.com. After listening to me briefly, Dave said, "It's a wacky idea, just enterprise software," I said, "Different, completely different. It will end the current software engineering paradigm.” Dave continued: “Why do they believe? Why did they buy it?”, “Because people are fed up with the current system,” I replied.
Dave explained, he questioned me to see how I was convinced and admitted that I had this temperament to survive and thrive.
Lesson 7: Define company values and culture from the start
On March 8, 1999, Parker, Frank, and Dave started working in a small rented apartment next to my house. There are no office furniture, just a desk, a few chairs, a server in the bedroom, a picture of the Dalai Lama and Albert Einstein on the wall, a beautiful view of the San Francisco Bay. We built a culture of simply doing what we love.
Lesson 8: Only do the things that really matter
Our goal is to develop fast, simple, accurate and extremely easy to use. It's like Amazon. There aren't enough people, there isn't enough time to do everything. So focus on the 20% that can make 80% of the difference.
Lesson 9: Listen to potential customers
We invite friends and colleagues to visit our office and try out product samples and reviews. A colleague suggested browsing the site with as few clicks as possible. Another friend shared what they were not satisfied with in a traditional product. American, Japanese and Korean business delegations came to visit. With input from our future customers, we built a product that could become a global CRM solution aimed at the vast majority of users.
Lesson 10: Break the rules
Ask for user feedback so you can improve the product. This approach is not suitable in the software field. Don't be afraid to undo the old rules in your industry. Thinking differently is all you need.
Lesson 11: Have and listen to a trusted advisor
Larry Ellison, my boss at Oracle, wholeheartedly advised and encouraged me to build Salesforce.com. He facilitates both time and personnel. Larry believed Salesforce.com was a big idea and made an initial two million dollar investment and joined the board. Larry is more than a boss to me.
Lesson 12: Recruit the best “players” you know
I am grateful to Larry for letting me pick some talented people at Oracle. We began to expand the group and quickly filled the apartment. We developed into a real company with a great team.
Lesson 13: Be willing to take risks
It's time to cut the ties with Oracle, I take the risk, and this is a big turning point. In July 1999, I worked full-time at Salesforce.com. I'm looking for a new location in Rincon Center. Salesforce.com now has 10 people. “Too wide,” Parker said, and he worried. "We'll use up this space when you realize it," I said. Parker did not believe these words of mine.
Lesson 14: Think big
The internet companies are all going strong, the financial deals are heating up, like Hotmail being sold for $400 million. As for me, I never sold Salesforce.com even for a lot of money. A year later, we used up the space because the number of employees doubled. In November 2000, we rented an office on One Market Street. This leap heralds a whole new era for us.
Part II – The Marketing Handbook
How to get rid of rumors and build a big picture
Lesson 15: Position yourself
When Salesforce.com was six months old, Don Clark, a reporter for the Wall Street Journal, wrote: "A historic opportunity to work in the high-tech industry." And to quote my quote: “This is going to be the birth of a new industry.” The next day, opening the website, we had 500 customers! At the world's leading technology CEO conference, I held a small party in Paris, more than 30 reporters from major newspapers were present, and we carried out interesting communication activities. They understood that we were talking about something bigger than CRM: “The End of Software”.
Lesson 16: Have a Party with a Purpose
We held an event at the Regency theater, San Francisco, to introduce a whole new market – Saas, or cloud computing, against the traditional inefficiencies in software distribution.
At the end of the party, I boldly announced: "We're going to be a $100 million company in three years." A few months later, the dot-com storm caused many companies to stand. But I still believe in the power of the internet to change everything.
Lesson 17: Build a personal image
At the party, I dressed in military uniform, ready to wage war against the existing software industry. Many CEOs are smart about personalization and carefully build an anecdote about themselves. But you have to be sincere and honest, not just using tricks.
Lesson 18: Different, different and different
We hired Bruce Campbell, a leading advertising expert, he came up with the NO SOFTWARE logo (the word no software enclosed in a red circle with a slashed line). I wear the shirt with that logo every day and force the staff to do the same (they reluctantly do). But the interesting thing is that the Times put my ads on the front page and other newspapers also ran this ad, which made the public interested in Salesforce.com even more. We have proven differentiation to be an effective marketing strategy.
Lesson 19: Make every employee a key member of the marketing team and make sure everyone understands the message
Someone once asked, “So what exactly does your Salesforce.com do?”. Four people in the company responded differently. This is a troublesome problem. Therefore, we had to conduct training classes so that everyone understood the company's message and how to protect the company against objections. The results were great.
Lesson 20: Always stand on the shoulders of giants
We always want to be the giants in our field. On February 22, 2000, the giant Siebel User Group held a conference. We hired a few actors to gather outside the conference, who held up a NO SOFTWARE poster and shouted: “The new internet is great… the software is out of date.” Some reporters were hired to pretend to interview passersby. Siebel called the police, but only protected the protesters. The more tumultuous, the more people's attention. This marketing stunt worked.
Lesson 21: Strategy uses multiple strategies
We used the “Stick your back” tactic many times. On the day of the Siebel conference in San Diego, with almost 2,000 people in attendance, we gave them peanuts and ready-to-drink coffee with the quote “Wake up Siebel, Salecforce.com is a breakthrough company. break…”. Cheerful atmosphere, Salesforce.com brand coffee entering the conference, even President Siebel accepted a cup of our coffee. We are just mosquitoes on the back of the giant elephant Siebel, our quirky tricks made the elephant dance too.
Lesson 22: Commit to being a market leader
President Siebel said in an interview: "Salesforce.com is not likely to live more than a year." Never let your competition make you angry. We get rid of the traditional software style and make a long-term commitment to our customers. The relationship between people is eternal, business is a healthy competition. The press started coming in to see the war, which made us legit.
Lesson 23: Reporters are writers too, tell them stories
While the clash between Salesforce.com and Siebel wasn't so intense, reporters liked to make it dramatic and sensational. The press is interested in us because a small company dares to challenge a leading company. Incidentally, the reporters told a story where both “our troops, enemy troops” and readers were interested in what happened.
Lesson 24: Build good relationships with some reporters
I enjoy meeting journalists, and I maintain a relationship with them through regular one-on-one meetings. This relationship breeds trust. When I send them a document, or make a comment, they are more receptive to it. It is clear that getting a journalist to write a story is less expensive than buying a magazine ad, and always has tremendous power.
Lesson 25: Create your own metaphor
I like to use "metaphor" when talking to journalists. At the beginning, I said: “Salesforce.com is the meeting point of Amazon.com and the Siebel system”, and later “Force.com is the internet windows system”. Metaphor is the simplest way to explain the service and convey the message of the company.
Lesson 26: There are no sacrificial cows
When George joined the company, he used Salesforce to determine sales, he discovered there were 14 businesses ahead of us, we were shocked. That proves our advertising strategy has not won customers yet. The time has come for us to make a drastic change.
Part III – Handbook for organizing events
How to use events to build your reputation and run your business
Lesson 27: Provide data for media marketing
We start with a strategy to enhance service value through two methods: Press and Testimonial: users share through experiences.
The first event had fewer attendees than expected. But attendance is not as important as diversity. Customers using the open platform are willing to share their excitement about the service, which is an effective way to maximize the viral effect.
Lesson 28: Build a “street cheerleader” and endorse products
We invite MC Hammer to share the idea of “street cheerleaders”. We organize “city tours”, every time I stop at an important place, I talk to customers. After observing the event, we determined that the customers attending the event did not come to see us. They come to see other people using the service. Customers have automatically met and exchanged with each other. Making customers part of your company's marketing power is a powerful way to do it.
Lesson 29: Selling to direct users
Traditional software companies often target business leaders. We target direct users who are brave enough to use our product as opposed to other traditional software. We honor them as “heroes”. We soon realized, on some of the websites of some companies that recruiting people with skills required to use Salesforce.com. Many people have emphasized the advantage of “knowing how to use Salesforce.com” as a distinct skill. By targeting users directly, we've created an economy – full of value supply and demand.
Lesson 30: Events are also messages
The event venue should reflect what you want to tell your customers about your brand. Therefore, you should organize events on magnificent streets, cool, attractive four-star hotels. If you are innovation-oriented, the event you organize shows the spirit of innovation. If you're promoting sustainability and responsibility, make sure that even the chocolate bar you offer your customers has that aftertaste.
Lesson 31: Reduce costs and increase impact
The secret to a successful event is to bring current and potential customers together, create intimate meeting situations with a small cocktail party. The most effective sales method is not done by the sales team but by the people who are talking about your product. The information exchanged has a pervasive influence and enhances the reputation of the business.
Lesson 32: Always stand in front of the vanguard
To keep your position, you need to establish yourself as a leader in the industry you are in. Organizing events is an effective way to convey the company's message to consumers and the press. Newspapers need something to publish, so you need to always come up with new information. The frequency and coverage of our news in the press increases with the rotation of the event, so does the number of people visiting our website. More importantly, the company's revenue increased.
Lesson 33: The Truth About Competitors
In October 2003, Siebel announced they were also building an on-demand Siebel CRM service. So finally our biggest competitor started to acknowledge the internet as the next hosting platform, which is exactly what we wanted. Siebel's foray into this field is a validation of the model we built.
Lesson 34: Be prepared for any situation, and have fun
We replaced city tours by organizing seminars, this event called Dreamforce 2004 took place in early November, right on the day of the US presidential election. The seminar, which took place at the Hilton Hotel in San Francisco, was attended by nearly 3,000 people. After I introduced myself, the marketing director came on stage and whispered in my ear and passed me a small piece of paper. I announced, “The President is nearby. The president said he would show up now, but I don't believe it."
Then suddenly the music started playing, the eagle icon lit up on the screen and “president” Bush stepped out onto the stage. Of course it's a "fake president" but very similar, played by Steve Bridges. When the "Mr. President" finished his role, I returned to the stage and gave a speech. We love such fun games.
Lesson 35: Face the unexpected to stay in shape
Some people always believe in luck and destiny. They certainly exist, but only those who make the effort to capture them. At 4:30 a.m. on the opening day of the Dreamforce 2005 conference, I received news that Oracle had acquired Siebel. Strangely timely! Then we were on the CNBC news, the reporters covered our favor, talked about our client conference, talked about the Siebel-Oracle event so much that I couldn't can imagine. Bruce, vice president of Siebel commented: "If you read everything in the press, you would think Salesforce.com is taking away Siebel's 'lunch'."
Lesson 36: Accept arguments, but not too much
At the 2006 Dreamforce conference, a group of people protested outside the convention center, not knowing what they were protesting or if they were performing the tricks we usually do. But we must never forget or underestimate the ### lessons we have just learned.
Part IV – Sales Manual
How to turn customers into salespeople?
Lesson 37: Give
From the very beginning, Salesforce.com's sales strategy went against the norm. Our service is available 24/7 on the web, customers can visit, learn and register to use the service. It is a do-it-yourself service, the service price is 50 USD/user/month. We initially offered a free service that increased our chances of valuable feedback, we knew it was the “secret” to a successful product.
Lesson 38: Get your first customers by treating them like partners
The contribution of many early partners is really necessary for the development of the application. We contact them regularly to discuss their experience using the service. Our strategy has been successful for several reasons. First, it's a free trial, potential customers get to actually test the service, and they know it works well. Second, the service has a very small risk ratio, because they pay for the service on a monthly basis and they can completely change their plans or refuse to use the service without any fuss. Third, it's a good product that pays a small fee, so they quickly fall in love with it. They need it.
Lesson 39: Turn your website into a sales rep
In December 1999, an article titled: "Salesforce.com Leads the Latest Revolution in Software" appeared in the Wall Street Journal. After the article appeared, the company's phone rang continuously. More than 100 people visit our website and find information. You should invest in the company's website to make it sell, more effective than any direct marketing campaign. It is essential that the website be easy to use and stay fresh with constant updates.
Lesson 40: Turn every customer into a sales team member
We can build a customer base that supports the company's sales team. To do so, the sales and marketing teams must work in tandem to drive users. We have to put in the work to make our customers feel successful every time they visit – otherwise they will leave. We create the most convenient system to help our customers and make them happy.
Lesson 41: The effectiveness of telesales
The task of the sales team is to directly introduce products on all fronts, at home and abroad. They must have communication skills, sales techniques, an investment of time, and persistence. Through business cards, through acquaintances, they make phone calls to create curiosity of customers and customers want to see a trial version on the web. This is a great way to save both parties' time and money at the same time.
Lesson 42: Don't lower your first product with promotional methods
Often discounts become a familiar strategy to get there quickly. But discounting, in my opinion, entails many risks. Instead, agreements should be made to ensure service quality. Our sales campaign is reasonably priced, keeping the lowest prices for everyone and offering no discounts to anyone. When a new product launches, don't go wrong from the start by downplaying its value.
Lesson 43: Sales is a numbers game
We found that the more sales people we hire, the more sales we get. Not simply motivating employees to increase sales. Don't be "cheap" with the sales department, you need to add people, add people and add people!
Lesson 44: Market Segmentation
Rob Acker, who has been a huge part of the company's growth, thinks that the small company market will thrive with the help of new technology, which is a huge opportunity. "We thought that market wouldn't bring anything, but it's a whole gold mine, just know how to mine," he said.
Lesson 45: Change to survive
Our business development is thanks to dot-com companies. From October 2001, suddenly venture capitalists withdrew from dot-com companies. That crisis impacted our business. Some customers shrink, our cash situation is dire. Bankruptcy is coming.
Magdalena suggested that we change our strategy: collect money from customers upfront every year, customers will get some promotion. Many customers agree, but some customers disagree. We have to apply both forms, pay by month and pay by year with promotion. As a result, our cash position improved and we continued to grow.
Lesson 46: The seed is sown, now let's grow it
When we first started, we just "catched" the "small fish" customers, our next goal is to conquer even bigger companies. We had to expand the customer service center. Salespeople must focus on “why not?” i.e. on the reasons why the contract is not signed. Always end a contract on your desk, which means be ready to sign it. You must be present at the right time and at the right time when the customer needs it, prepare all the paperwork, negotiate fairly, share the best experience and move on.
Lesson 47: Experiment and expand
When starting out, you can't ask for the backing of the whole company, because they also want to limit the risk. Once you've had success with several departments, you have a better chance of convincing the whole company to use it.
Lesson 48: Let go of strategies that no longer work
As our distribution network grew, we quickly realized that some of our previous strategies were no longer relevant. One of the changes we made was the introduction of a more complex trial, a proof to the big companies that we had enough solutions for their needs.
Lesson 49: Reinforcing interest in old customers
We know when the user is logging in successfully or not, what he has collected, and from there the customer decides to sign the contract or not, we have a CSM team that regularly asks, Find out and help them for free.
Lesson 50: Attachment and Improvement Services
Our service is designed for large businesses, so it should be more reasonable, more standard. This new version is multi-level responsive and creates additional support services for sale. I often receive and respond to customer emails to fix service complaints and absorb customer suggestions to help us improve. Making customers happy is a ### lesson that all companies must learn.
Lesson 51: Success is the most important factor in sales
Our best customers are also our best salespeople. After we proved our service quality to Dell, the company introduced us to two of their biggest partners, who also became our customers. Customers who are satisfied with your service are the most powerful of your sales armies.
Part V – Technology Manual
How to develop more and more products that customers love?
Lesson 52: Have the courage to pursue a new path, before it becomes a rut
We aspire to create a service that our customers love. To design an unlimited system, we must have a different way of thinking about software design, built on the internet platform. Our Saas model allows users to be in complete control of their proprietary data, but that data is housed in our server house. All companies eventually switched to using the internet instead of all the software they used to install in their computers.
Lesson 53: Long-term investing on the principle of establishing a solid foundation
We develop the principle: “It is a product that is fast, simple and accurate from the first use”. We minimize all commands. The structure also makes it easy to correct mistakes. The pressure now is to introduce the product to try and find a solution. But the trial product must form the basis of a finished product. If you have trouble when you debut, how will you stay strong?
Lesson 54: Imitate companies that are loved by customers
The old model companies did not develop in time to the needs of customers. Companies that come into direct contact with users like Google, eBay, and Yahoo! has a steady growth rate. But these companies only develop one application. The members of Salesforce.com are more ambitious, but we also know that a fledgling tech company's biggest risk is doing too much at once. Priceless customer reviews will be the guide to help us build new things in the future.
Lesson 55: Stand on the shoulders of giants, not build new ones
Our database system is still the database system of the giant Oracle but has been modified for each purpose, and we can absolutely continue to update it. As Singh puts it: "We're like the next generation of IBM, but independent of the hardware."
Lesson 56: Transparency and building trust
In late 2005, our website crashed for the first time. We got into a really serious situation, customers protested, the press quoted. We stopped taking phone calls and didn't call customers back. This makes us feel uncomfortable. Bruce said, "Escape is not the way to go." The whole engineering team went to great lengths to handle it, we worked with the vendors Oracle, Sun, Veritas and rebuilt the software. We've taken our accountability and accountability to the next level, we've opened up our internal system for all to see, I call it a website of trust, guiding our customers to find the information they need. need. Solving problems quickly is the only way to build and maintain trust. Amazingly, the trust site is an opportunity to talk about the positive – transparency.
Lesson 57: Let the customer lead the improvement
Salespeople often ask customers what they want and pass their feedback on to product managers. If we still want our services to continue to appeal to the masses, we need to selectively change. We had to design so that custom users create a small application that allows to change according to their needs. We move users from accepting to “addicted” to our services.
Lesson 58: Simplify for customer acceptance
We transform our products and technologies so that Salesforce.com data is not isolated in cyberspace, but can interact with other data systems or websites. Easier access to further learning opportunities has proven to be the right move.
Lesson 59: Models of superior technology
Our idea is to turn our service into a platform or an operating system for the Internet, allowing people to create applications online. To make things simpler and less expensive by sharing the source code. We give our customers what they need, our service has grown fundamentally.
Lesson 60: Provide a receptacle for solutions
We decided to create an on-demand marketplace for packaged and distributed applications. We called that marketplace the App Exchange and built it as a stand-alone site that allowed developers to upload the applications they build, while customers could search, read comment on trial apps and finally buy and download new apps.
Lesson 61: Exploiting customer ideas
In 2004, we launched a website for customers who successfully uploaded an application of their own to our service, as a way for them to share their experiences with others. This service is much more profitable than a suggestion box. We named it Idea Exchange. Some ideas were very viable and we decided to invest in them.
Lesson 62: Building a Community of Collaboration
We want to be close to a number of companies to help us build online software associated with our service. We introduce them to potential customers to help them market their products. This new model has transmitted a huge energy to people. Capable of allowing all to use is a new computing paradigm. In the end, the end of software is here.
Lesson 63: Speak with an intelligent response
Responding intelligently – or following the call of innovation is our guiding principle. Things will be easier with a successfully positioned product and a constantly growing company if users are included in the product process as an active factor.
Part VI – A guide to corporate philanthropy
How to keep your company from sinking?
Lesson 64: Business in business is more than business
I was invited to join the presidents summit to build on the “America promise,” a commitment to a better future for young people. Entrepreneurs bring everything they have – property, money, human resources… to serve the interests of mankind.
This is very different from the perception of economists: "Business in business is business". I felt a responsibility to tell Larry Ellison about the summit. He was very interested and built the charity fund of Oracle. Thousands of computers are donated to schools to improve the lives of young people. Oracle's name is known to many people and has since brought profits to the company.
Lesson 65: Incorporate philanthropy from the start
The founders of Salesforce.com all embraced the idea of building a business that could simultaneously give back to the community and to the world. We founded the non-profit Salesforce foundation. We invited Suzanne to join our company and run the Salesforce.com charity. Our intention is to find the best ways to work for a socially responsible organization.
Lesson 66: Make crowdfunding part of the business
Along with the development of the company, the charity fund is also growing. We built a 1-to-1 (1% equity; 1% employee time and 1% product) model for our homeless outreach program. 100% participate in the project, some staff even bring family and friends to participate in helping activities.
Lesson 67: Find a Meaningful Motivation and Get Professionals to Work
We aim to provide a door to access information technology for young people in the community. My friend Julie Trell, a technology expert and teacher, says: “You shouldn't just give computers and money to schools. You need to train teachers and young staff there as well.”
Lesson 68: Model Sharing
We opened a youth technology center at the Christian Youth Association. In my opening address, I said, “I challenge other internet companies to follow this model and set a percentage of the company's stock capital for community activities.” You'll be more successful if you can ignite the philanthropy of your network.
Lesson 69: Build a great program by listening to the community
The purpose of Salesforce.com's technology hub is to erase the line between those who know and don't know about technology. The center's efforts still did not attract the attention as expected. The attendees were not first-time computer users, and some even knew better than the teachers. But we realized that we still had a very exciting opportunity to explore the world of the Internet. They watch videos, listen to and compose Rap music, build websites. We teach them filming skills. They have worked hard and the results are short films, web sites and they are proud to present to everyone.
Lesson 70: Creating a self-advocacy model
In the summer of 2004, when we first issued Salesforce.com stock, we raised $12 million for the welfare fund. That confirms we will make a greater contribution to the community. We call the best people in the company, investors to open classes to teach students to become business owners.
The results obtained were higher than expected. Students with technology and business skills, some students apply for scholarships to study at university. Our programs are the card for students to apply for jobs. Others are working for us as community coordinators.
Lesson 71: Share your most valuable resource – Products and People
One easy way to start a charity is to start giving away your products, services, or substantial rate discounts to nonprofits. It's exciting to see these organizations run more efficiently thanks to the Salesforce.com platform
Lesson 72: Collaborate with your partners, suppliers, and networks
In 2002, Bluewolf Corporation called us to set up a charity partnership program. Bluewolf has seen the benefits of this for their business. It is great to combine with partners. We are also proud to have inspired other companies such as NetSuite, iRobot, LiveOps and Palm One. Cooperation and promotion have created our strength.
Lesson 73: Let employees inspire the organization
We capture the interest of employees in the company and make them truly believe that the welfare fund is their fund, an employee-led welfare fund board. They have enthusiasm and create change, they believe the work they do will be useful so they are ready to dedicate themselves to something bigger than themselves.
Lesson 74: Build a similar social fund in your company
The company's social fund grows in tandem with the company's growth, as a tool to connect the company with other companies. It makes our employees more satisfied, helpful, trustworthy and happy. Our clients are also greatly appreciated, because our charity work is part of their work.
Part VII – The Global Handbook
How to promote your product and introduce your model to new market
Lesson 75: Bringing global functionality to a product
Demand for CRM is global. We build the Salesforce app so that users can configure it into any currency and language.
Lesson 76: Infusing company ethos into local leaders
After months of discussions about building the European market, we recruited the team in Ireland and brought them to San Francisco to test the Salesforce.com service. The Irish executive team wears suits, while we dress comfortably, the office is cramped, the garbage is dirty. They feel shock. This incident is considered to be the most complete introduction to how we operate. I am anxiously awaiting the idea they will implement when I return to Europe.
Lesson 77: Wisely choose the location of headquarters and offices
Dublin is an ideal location, English speaking city, attractive tax rates. We rent a small office and recruit experienced people from many different countries so they can talk or email with clients in many different countries.
We use the same tactics as in the US: also try it for free, build relationships with the press and mobilize customers to help spread the word about the product. The good news is that Europe has taken our message.
Lesson 78: The office creates trust and stability
The European branch has found customers in the UK, Germany and France. After a year, we moved our offices to the Powerscourt estate on the outskirts of Dublin. The new office is located in a well known place, it works, the public and the media take notice.
Lesson 79: Grow without overspending
Our revenue is still not high, so we need to save on office rental costs. Real estate in London is expensive so we just rented a simple office in the suburbs, like just having a place to build teamwork. And I live and receive guests in hotel rooms. When we have clients all over Europe, we hire employees to work from home and open small offices in Germany, Spain, Italy and other countries if we have enough clients.
Lesson 80: Understand the path to growth
We have set out a development process that starts in the US and applies to most of the markets we enter. Finding partners, building backend programs, developing business systems. This is an interactive process that works effectively. The ability to “filter and iterate” is key to global growth.
Lesson 81: Hold on to common ground despite borders
Our internet and services are not affected by national borders. Our philosophy is to keep the company model intact. However, not everything about Salesforce.com is suitable for Europe, we innovate when absolutely necessary, that experience helps me succeed in Japan.
Lesson 82: Pursue strategy, not opportunity
When entering the Japanese market, a large Japanese company asked us to cooperate with them to become our agent. Mr. Chikara Sano, a teacher of mine in Japan, said: “If you start by linking too closely with one partner, later your ability to reach other partners will be limited.” Yes. Always be open to opportunities but do not rush to take the first opportunity, as it can be a growth barrier or can be a parasite.
Lesson 83: Want to reach out? Find a partner. Want to grow “hot”? Let's go alone
Overseas businesses always have to rely on local resources. I contacted Allen, an old friend, CEO of SunBridge Corporation and they became our partners. The first director, Akira, is excited and passionate about the idea of making cloud computing the future model for business applications in Japan.
Lesson 84: Adjust to optimize international strategy
Eiji Uda, a genius in sales, serves as the president of this department. Uda introduces Salesforce.com as a global company like Google, Amazon, eBay. Uda also takes advantage of its strong relationship with Canon, Hitachi, Nippon Steel etc. to focus its resources on pursuing them. At the same time he approached government agencies and won contracts with Japan Post, which attracted media attention, which in turn led to banks and insurance companies. Conquering these customers is like conquering the rest of the country.
Lesson 85: Send envoys to build new markets
Send the best “special envoys” to work temporarily in new markets. With that in mind, I asked Carl, the North American sales manager, to become the company's COO in Japan. So in Japan there are two great leaders, Uda and Carl. Ideally, have 2 leaders in charge of different areas to build the foundation in the early stages of the foreign branch.
Lesson 86: Skillfully resolving global disputes
Our intention is to enter the Australian market. The day before we flew to Australia, Salesforce of Australia announced that we were infringing their registered trademark. They asked us not to use the Salesforce name anymore. The worst case scenario is that we have to change the name in the Australian market, but that's not what I want.
After the legal department on both sides failed to resolve the trademark issue, I decided to prepare calmly, peacefully, to speak with Kevin, CEO of Salesforce Australia. Kevin's company is a successful company whose culture shares many similarities with Salesforce.com. Kevin and I immediately felt connected. We decided to draft a cooperation agreement. With the right mindset, I've found that it's entirely possible to turn a bad situation into a stroke of luck.
Lesson 87: Change the big picture
We started to penetrate the Asian market, we chose Singapore as the center. We select “sales stars” from Microsoft, Oracle, Siebel who are working in Bangalore, Hong Kong, China, Korea, India… We bring them back to Singapore to approach Salesforce.com leadership and absorb the company's culture. They then bring back the experience and successfully build new markets.
Lesson 88: Old wine, new bottle
We remember the "tricks" of marketing in America. In Singapore we hired 50 people wearing “NO SOFTWARE” T-shirts, also gathered outside the conference. But the police dispersed the protesters and threatened to stop the conference. It's a cultural difference that we don't know yet. We were disbanded, but we succeeded, because the next day the newspapers were reporting the incident. It's an effective marketing "trick"! So, the "trick" of protests can make the authorities angry but extremely attractive to public opinion.
Lesson 89: Don't Use the "Seagull" Approach
Our biggest mistake in Asia is underestimating the importance of a real commitment. Don't take a "seagull" approach (dive in, grab and fly) but demonstrate a long-term commitment. In this way, we build an international data center in Singapore, build a network operations center.
Part VIII – Financial Handbook
How to call for capital contribution, profit without shame with conscience?
Lesson 90: Don't Underestimate Financial Need
"Starting a business" with too little capital is one of the causes of bankruptcy. That's why venture capital funds are so important. Most of the investors I meet shake their heads in denial because they don't understand what we're doing, but that's no reason to stop trading or change models. But that is what drives us to find a financial solution.
Lesson 91: Consider venture capital funding strategies
In the process of finding capital, I contacted friends and colleagues. The main problem is to find visionaries. Convincing someone who already understands and trusts you is easier than with someone you just met.
More than two-thirds of venture capitalists often replace founding CEOs because they bet on someone they consider to be experienced, that's a fact. In the end, my fundraising strategy was more effective than venture capital funding.
Lesson 92: Use the internet model to reduce initial costs
There are already a significant number of startups building Saas-based applications. They have many ways to get the capital they need. These are likable individual investors, often successful entrepreneurs, who are as experienced and knowledgeable as venture capitalists, but much friendlier.
Lesson 93: Be careful about building a business from the ground up, then letting your financial model grow on its own
We had to develop a standard process for executing contracts and managing contract renewals. This financial system allows us to better forecast revenue and become a more stable company. With this model, we collect money upfront on a yearly basis, which relieves us of the pressure at the end of each quarter.
Lesson 94: Judge by sales, not profits
We decided to evaluate all employees by revenue, not profit. If they rely on profits too soon, they will start thinking about taking advantage of another function or department for more personal gain. If it is based on profit, it prevents the manager from sharing his experience and talents with other departments.
Lesson 95: Build a classy financial team
I invited Steve, a world-class CEO, to help build the company. My goal is to reach a million accounts, become a company worth a billion dollars, listed on the NASDAQ. Steve replied, “Yes” and added “let’s list on the NYSE.”
Lesson 96: Creativity and breakthrough in everything – except finance
We want to be a company that issues shares to the public. It is similar to the quality assurance stamp for the company. We needed the prestige and reputation of the NYSE brand.
We invited Joe Allanson to collaborate with Steve. Hire Ernst & Young to be responsible for the audit, hire a reputable law firm to arrange legal documents.
The IPO invigorated the entire company.
Lesson 97: Always play by the rules
A few weeks before the IPO, the SEC thought that we had violated securities laws, the IPO could be suspended, also because of the article about me in the New York Times from a few days ago. I know the spirit of the “silent period” law, as I stated in the article: “the rules do not allow me to make any comments promoting the IPO.” In the end, the rest of the IPO process went smoothly.
Lesson 98: Focus on the future
When becoming a public company, all standards and management change. Our goal is to maintain rapid growth for our investors, while following a set of procedures, policies, laws, and values and business ethics. There is a need to optimize the finance lease, and it will take years for you to see the benefits of this.
Lesson 99: Improvisation
Through the experience of the IPO, now every piece of information before speaking must be scrutinized by analysts. We see what needs to be changed. We also learned that it makes no sense if you just plan the company as it is, you have to plan the company with your expectations.
Part IX – Leadership Handbook
How to make the system work perfectly
Lesson 100: Using V2MOM
At Salesforce.com, everything at the organizational management level is based on the V2MOM model (vision: Vision, values: Values, methods: Methods, obstacles: Obstacles, results: Measures). Vision helps us define what we want. Values define principles and beliefs. The method illustrates how to accomplish the goal. Obstacles define challenges and difficulties. Outcomes determine what to aim for. V2MOM is the glue that holds us all together.
Lesson 101: Use Approach
Our responsibility is to write a V2MOM. I shared with the board, discussed to reach consensus, then passed on to the additional “core” team, then introduced in the global leadership meeting. Then we exchanged V2MOM with all employees via IdeaExchange to improve. From the manager to each employee, rely on the complete version to create their own version of V2MOM. Everyone feels their own importance. We are efficient.
Lesson 102: Build a recruiting culture
When recruiting employees, the HR director looks at the resume, if the department has knowledge about the candidate, they will consult with them. We also decided to recruit new people, smart, eager to work. It's easier to mold new talent than to retrain experienced people.
Lesson 103: Recruiting is also a business
We value hiring as much as we do business. Most employees come to us not purely for salary, we use something more attractive like building a career ladder, well trained to become talented. The relationship between the members of the company has conquered the hearts and minds of talented people.
Lesson 104: Set high expectations even as you grow up
We always follow a rigorous selection process. Find in the top 5% of the university's top people who are enthusiastic, adventurous, want to show themselves off. We recruit by consensus, which means that a candidate who meets 10 interviewers and only one disagrees will not be accepted.
Lesson 105: How to retain talented people
New employees have 2 days of orientation: meeting with leaders, learning about products, learning about V2MOM, after that procedure, they have dinner at a luxury hotel. Then they participate in charity work for half a day, then attend training classes on corporate culture. Make sure they understand the spirit of the company right from the start.
Lesson 106: The Importance of Mahalo Culture
Mahalo culture – Hawaiian spirit of gratitude and praise. The company creates a working atmosphere that makes everyone feel happy, successful, love life and healthy. The company has gifts that reflect the company culture, awarding excellent employees. Meaningful gifts given to employees' relatives will motivate them to the best.
Lesson 107: Cultivate loyalty
I am happy to invite a doctor and bear all costs to treat Steve Garnett. Scott and his pregnant wife were on vacation in Hawaii, and his wife had to go to the hospital for an emergency cesarean section. I pay the fees and give Scott time and money to take care of his wife. Scott was very touched. Act with conscience in unforeseen situations to help employees solve problems, we will win 100% of their loyalty.
Lesson 108: Motivate the best with new opportunities
One of the best ways to keep good employees motivated is to rotate their positions regularly. They will appreciate new challenges. The more mature and leadership they become, the more skills and vision they will have.
Lesson 109: Get employee feedback
I organized a survey and shared the results with action plans that built trust between managers and employees. The survey also provided me with a basic guide and became a strategic planning tool as well.
Lesson 110: Take advantage of everything
We leverage external capabilities for service development, sales, and product development. We leverage our network of employees to find talent. Our resources and capabilities are maximized when working with partners. Take advantage of everything to grow.
Lesson 111: Make Everyone Succeed
The future is not simply about doing better than what is already there, but being brave enough to make big and disruptive changes.
It's only a day when we have to explain to the mayor about the "no software" model. Now, an entire cloud computing industry has grown and changed everything.
Think and work like Einstein: In trouble we find the simple. From discord find harmony. In difficulty see great opportunity.
Read more: blog.boulouma.com