Friday, November 16, 2018

Paul Greenberg of The 56 Group: Being Transformational in Business Goes Beyond Disruptive Technology

There was a lot of big news in the CRM space this week.  Zoho announced a major upgrade to their CRM platform, as did Zendesk.  But the biggest news came by way of SAP’s $8 billion acquisition of survey and analytics platform Qualtrics.  And rightfully so, because that’s some serious money.

It was obvious that SAP CEO Bill McDermott was enthusiastic about the purchase and referred to it as being a transformational moment for the company. Which got my buddy and CRM thought leader Paul Greenberg (aka the Godfather of CRM) fired up to discuss the topic for our CRM Playaz video podcast. But while we focused on whether we felt McDermott was right about the deal being transformational, we went beyond that and started thinking about what it really means to be transformational in business today, and what are good examples out there to follow.

Below is an edited transcript of a portion of our conversation.  To hear the full convo, check out the video or click on the embedded SoundCloud player below.

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Paul Greenberg of The 56 Group: Business Transformation Goes Beyond Disruptive TechnologyPaul Greenberg: It’s [The SAP-Qualtrics deal] not transformational. Look, it takes so much more than acquiring tech. For a transformation to come at a level that leads you into the marketplace.  To be honest, given the Salesforce is the obvious target of everybody in this.

Small Business Trends:  The Exact Target, huh?

Paul Greenberg:  Yeah. But I will tell you, and then I want to get your thoughts on this. But here is the thing, the power of Salesforce has never been in the amount of tech it provides. It’s been in the company that they are, and how they present themselves to the market, and how the market adopts and accepts them, right? Their externalization in the culture has been the critical factor of difference. When somebody says not “I want to buy your technology because I love your technology.” ‘Cause there are technologies that do compete with Salesforce just fine.

Small Business Trends:  Yeah.

Paul Greenberg:  And will beat them just as much as not. But, what they’ve got is when somebody gets involved with Salesforce they say “I wanna be part of that!” Right? “I want to be part of that.” And that’s transformational. Because the company becomes, as [Marc] Benioff actually publicly said, “a force for change.” The company itself becomes a force for change. That is where he is aimed at, and that’s how it’s worked that well.

You know, Qualtrics is an acquisition by a company that is on the rise that I’m cautiously still optimistic about. They haven’t made what I would call a bad acquisition for a long time. I think he’s [SAP CEO Bill McDermott] done really well with this. And Qualtrics is a good acquisition, it’s just not an acquisition that is changing everything. It’s just not that kinda thing. It’s a survey to a powerful analytics. I’m again, oversimplifying it.

Small Business Trends:  Right.Paul Greenberg:  But it is just that. So, good for SAP. Yes, congratulations, and yes this will fill a hole, and yes this is gonna improve your capabilities to fight it out in the marketplace.  And at the same time, fill out your ecosystem in a better way, but it doesn’t check every box you need to be truly transformational.

So what about your thinking on it?

Small Business Trends:  I’m like you. When I think of transformational or I think of game-changer, on its own I don’t see it as that. I think it’s like you said. SAP has made a lot of really good acquisitions of the last couple of years. They are all pieces to the puzzle, but I don’t think the puzzle is complete yet. I think it is a good, necessary piece.

When you think about, like you said, they have the analytical piece to go with the survey piece. That adds a certain kind of data to the operational data that SAP has in spades. So this adds another kind of data and a way to analyze it.  I think the thing that maybe still is something they have to figure on. In particular, when you’re looking at Salesforce and Adobe, I’ll put Adobe in there too. From a marketing and experience cloud, particularly Adobe, not only do they have the tools to analyze the data, but they have the tools to do something. Create the content, create the experiences that leverage the data in real-time fashion. More so than what I see right now that SAP has with the Qualtrics edition.

Especially when you talk about a B2C perspective, like you said, in B2B Callidus [Cloud] acquisition really helps out. And being able to bring this in, with what Callidus has and what some of the other pieces. I think from a B2B perspective? That really is a significant piece of the puzzle. But that other B2C, how do you take this data and create the experiences and content in real time and analyze it in real time, you know? I think there is still some work to be done on that end.

But like you said, I think it’s a good piece. Do I see it on its own as transformational? No. Maybe if they get a couple of other things in there, and stitch them together the right way, maybe it is. But I don’t see it as that as of today.

Paul Greenberg:  Well to your point actually, in terms of creating what I always call “consumable experiences”, Adobe is the only one who really do that well. Sales force doesn’t do it either, really. Nobody does, other than Adobe. I mean there are others who do it, I shouldn’t say that, but-

Small Business Trends:  At the scale of Adobe.

Paul Greenberg:  Nobody does it at that scale. In fact, even Adobe didn’t do it until fairly recently. They claimed it, but they do it.

The other side on transformation, it’s a company issue, not a technology issue. Companies are what’s transformed, not technology. Technology is a piec of transformation. The power of transformation comes when that kind of aspect…Transformation is..

You said something really interesting, Bill McDermott was really jazzed and excited, which is emotional right? And Bill McDermott has no problem being emotional about things. He is emotional about things all the time. But it’s emotional, that’s the point! The actual point! He’s excited about it.

Again, I don’t necessarily agree with him, that it being transformational. He is probably right to be somewhat offended about the equivalent, you know-

Small Business Trends: Oh yea, the Survey Monkey comparison thing, yeah.

Paul Greenberg: Yeah, because that meant that the CNBC reporter’s really not doing much homework.

But, everything … That’s part of your company. That’s part of who you are. It’s part of what I used to call it “a company like me”, right? There is literally a 65 page study done on “a company like me.” It wasn’t called exactly that, but it was literally close to those words. 65 page academic study done by, I can’t remember the name of the people. For that matter, I can’t remember where they did … Southern California, I think. But two people did a study on that, and they were finding on the different things that people do, and they anthropomorphize companies, right? How they attach their emotions and how they give companies human characteristics and things like that.

Again, it goes to the point that if you’re gonna be transformative, you have to reach a level where people’s emotions are being moved, are being changed. You can’t do that with just technology. You do that with the actual interaction of the company, the purpose of the company, the actions of the company, they way people perceive the company, the way they choose to act in conjunction with that company, et cetera, et cetera. There’s a million articles out on that one, a lot of it.

And Salesforce did that in Dreamforce, which it’s not actually. To some extent, to a large extent in the human eyes themselves, as a result. I thought it was one of the most important keynotes Marc Benioff ever gave.

Small Business Trends:  Yeah

Paul Greenberg:  That’s how you transform. And thats the battle that SAP has to wage. Microsoft was doing some great things. Microsoft just announced a non-profit accelerator. Right? I’m just digging in now, and I’m really excited about it. It really looks good. And it’s again, one of those things that’s not just technology. There’s a bit of an incubator involved, there’s social good involved, there’s a number of other things involved. But they’ve basically designed to get some good done, to do some good, and to humanize the company, and at the same time, build out things that will benefit Microsoft. ‘Cause that’s how familiar with the-

Small Business Trends:  Yeah. Well, they’re all still in business, even if they are able to do good and do business. That’s like a win-win. Why wouldn’t you want to do that? Like you said, Salesforce, I mean at Dreamforce, we were sitting right next to each other.  The first 10 to 15 minutes of Benioff’s keynote, I was like “Man, I feel like I’m in church!”. I thought the next step was “an I would like to announce my candidacy…” (Laughs)

Paul Greenberg:  (Laughs) 2020?

Small Business Trends:  But people were right there with him. I mean it was really a complete departure from his previous keynotes, at least that segment of it. But it was one that I think pretty much set the stage for the whole conference. And made the rest of the keynote in particular, people were focused on everything he said. Because like you said, he kinda captured their attention early on and was able to transfer it from his statements that had absolutely nothing to do with Salesforce. But he was actually able to take the connection he made with the audience and transition it back into the things that Salesforce was doing.

Paul Greenberg:  You know what, I will tell you one thing. It’s a small thing, but I think it was almost key to how that speech was so different from anything else.  In the past, and every other keynote ever, aside from the product announcements which were moved into their respective cloud keynotes.

With the exception of Philanthropy Cloud, which was very wise, you know. And then Einstein Voice, right? But what he did… in the past, what he did in every other keynote we’ve attended, there’s been a segment where he invites a chosen charity or non-profit.  He brings them up, and then he gets them to talk, and then gives money to them from a mobile app, and we’re all done. But it’s just a segment of the discussion. There was none of that this time. This time the whole discussion was Salesforce as an actual force for social good. Not “we are aligned with this force for social good, we ARE a force for social good.” Right? That aligns with his discussions on I think it was also CNBC. Might of been err…Who knows? Could of been Bloomberg, could of been Reuters, I don’t know.

Small Business Trends:  (Laughs)

Paul Greenberg:  But why he bought Time Magazine, where he said “Business is a force for change”. And somebody else asked him, “Are you gonna run for office?”, and he said “Why? I don’t need to run for office”.  Business is a force for change, right?

And Salesforce is his mantra. And he’s getting people interested. That is what you’ve gotta do. Now, to SAP’s credit, even though they don’t highlight this much, well they did a bit in Barcelona. If you go back in the past, when they would talk … They do social good. SAP does a lot, actually. Their focus is more on sustainability, I’d say if I had to pick something.

Several years ago, they did a thing on carbon footprint reduction, and they had built an app around it, and it was a good one. This is good tech, and it actually helped reduce their carbon footprint, but the way they positioned it at the time, was around the benefit t your business, for profitability and blah, blah, blah, blah, right? Stupid!

Small Business Trends:  (Laughs)

Paul Greenberg:  Stupid, right? Because that is not what anyone wants to hear. Then it’s just another thing they’re doing to make money.  So this time, they talked about their adherence to the 17 U.N. Sustainability Goals, they put in terms of actual social good. Meaning they did the right thing. For them, the irony is that’s not just positioning. They do mean it, and I know that. In fact, the other thing, the carbon footprint, even though they meant it, they just were awkward in the way they did it, and it came out completely wrong. This came out right.

They are making progress in terms of thinking about it, but they… If they think Qualtrics is the transformative point, they are missing the point.

Small Business Trends:  Yeah. I think maybe the first step into being transformational is what you’re saying about Bill McDermott and his enthusiasm and passion. Right now, I’m just taking it for what I saw. The enthusiasm and passion is for the deal, and the potential that this deal has in terms of building out their platform. As opposed to, what you talked about with Marc Benioff. It’s not just about the platform, it’s about the ability to be a change agent. To look at… I hate to quote J-Z or anything, but …

Paul Greenberg:  (Laughs)

Small Business Trends:  He had that quote, “I’m not a businessman; I’m a business, man.” I think there is the emphasis on “We’re not a change agent.” We’re not just about change from a business perspective, we’re about change because we are a business that can make that change happen.

Paul Greenberg:  Right!

Small Business Trends:  I think that may be the first step of being transformational.  It’s seeing beyond “here’s what we’re looking to do, down here from a technology standpoint,” and saying that’s transformational.  Now, maybe that will help you to become transformational, if you are able to take the big picture view and apply it, and leverage your technology and platform to do it. But right now, like you said, SAP has made a lot of great acquisitions. Tying it together, and creating kind of a canvas that tells the story and…. creates that opportunity to be viewed as a transformational, is part of being transformational. Because you can’t transform people if they don’t see you as being an agent for transformation.

This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.

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