Salesforce.Com - Example Of Distruptive Technology

Arnaud HALVICK

E-Business – Example of
disruptivetechnology

2010
SalesForce.com, the world’s leader in on-demand CRM applications.

S OMMAIRE
Introduction ................................................................................................................................ 3
Cloud Computing........................................................................................................................ 4
SalesForce.com ........................................................................................................................... 6
Background prior to disruption .................................................................................................. 9
Evolution of the disruption of CRMSaaS.................................................................................. 11
CRM SaaS 1.0 ........................................................................................................................ 11
CRM SaaS 2.0 ........................................................................................................................ 11
CRM SaaS 3.0........................................................................................................................ 11
Reaction of the “Victims” ......................................................................................................... 14
BACK TO SIEBEL .................................................................................................................... 14
Reaction of the major competitors...................................................................................... 14
Results to date .......................................................................................................................... 17
Lessons learned ........................................................................................................................ 19

I NTRODUCTION
These past 10 years a very wide range ofapplications, softwares or other services delivered
through internet are born. Whether they are free (Like Google Apps, Hotmail, Facebook, Twitter,
Forums, Blogs, …) or not (SalesForce.com, Netsuite, Aplicor, HyperOffice …). This led to new business
models based on a disruptive technology. Actually it is more about various kind of disruptive
technologies developed around the concept of CloudComputing. Cloud Computing is not very new
but it possibilities have increased to a level which made possible Cloud Services. The disruptive
technology we will talk about here is the Software as a Service. It is a new way to provide softwares
to customers. We will also mention PaaS and IaaS as they form a part of Cloud Services.
Here are some figures to give an idea of how huge is SaaS and how fastit is growing1:
In a research report released by Datamonitor in 2009, the on-demand CRM software
market is estimated to $1.7 billion and is expected to grow at least by 15 to 20%
during next years.
The whole SaaS Industry reached 13.1 Billon in 2009 and is expected to go up to
40.5$ billion in 2014, according to IDC.
Still according to IDC, 76% of U.S. organization will use at least 1 SaaSapplication by
the end of 2009.
By 2011, 25 percent of new business software will be delivered by SaaS, according to
analyst firm Gartner.
Also, Gartner forecast the Growth of SaaS to grow by 26% in 2011.
Now I will start by explaining quickly what is Cloud Computing and SaaS, then I will present
SalesForce.com and what they do. After this I briefly talk about the background prior to thedisruption and then talk about the evolution of the disruption. We will see what have been the
reaction of the victims so far and what lessons we learned from this disruption.

1

N.a, On-Demand CRM Software Research, Facts and Figures, http://www.crmforecast.com/saasresearch.htm
And N.A, CRM SaaS Market, http://www.crmlandmark.com/saasmarket.htm - no other information were
available.

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