Saurabh Gupta — HFS Research[00:11]
Welcome, welcome everyone to today’s edition of HFS Unfiltered videocasts. My name is Saurabh, and I lead HFS Global Research and Advisory Services, and I’ll be your host today. This is a special episode because it’s going to be one of many videocasts that we are planning to host in the next few months to bring what we call the OneEcosystem concept to life. And I’m extremely pleased to be joined today by IBM’s Jason and Indira from Salesforce — two formidable companies in their own right. But the conversation that we want to have today is: when IBM and Salesforce join hands, what kind of new outcomes and new value can they create? So welcome, Indira and Jason. Thanks for joining. Before I turn to you guys and ask some tough questions, let me just spend 30 seconds on why we are having this conversation. I fundamentally believe that there is no single organization today — even large firms like IBM or Salesforce — who can be everything to anyone. We can’t find new sources of value by just looking inwards, because we are living in a world which has no boundaries; even industry lines are blurring today. And as we move and lurch from one uncertain world to whatever is coming next, we at HFS believe that effective enterprises will need to have collaboration and connection points across their ecosystem of partners if they want to remain relevant to both their current and future customers. And that’s really what we call the OneEcosystem, which is, in our mind, the next horizon for value creation, where we venture beyond the four walls of our organization and start to collaborate with like-minded partners who have a shared vision and shared objectives of anticipating customer needs. And with that, let’s start with quick intros. Indira and Jason, maybe just name, rank and serial number, but more importantly, if you can also give me your take on why you think this ecosystem approach I was just outlining is necessary in today’s world. Maybe we’ll start with you, Indira.
Indira Gillingham — Vice President, Worldwide Alliances and Channels, Salesforce[02:44]
Perfect. Thank you, Saurabh, and thanks for having Salesforce here today. My title is vice president in our Worldwide Alliances and Channels organization. Essentially, I have responsibility for all of our consulting partners, and they span from large global agencies and global systems integrators like IBM, to the full gamut of regional SIs, including those that I like to call born into the Salesforce ecosystem. My primary responsibility is to help drive go-to-market strategies with our partners and to drive growth and ultimately success for our mutual customers. This is a topic that’s very near and dear to my heart, because if you look at the history of what Salesforce has done, we’ve built an AppExchange with that very notion in mind — that to be truly successful, you need best-in-class solutions. And so it’s a relevant topic, and one that is now being driven by Web 3.0 technologies that we can get into later in this conversation.
Saurabh Gupta — HFS Research[03:40]
Fantastic. Jason?
Jason Kelley — General Manager, Ecosystem and Strategic Partners, IBM Consulting[03:40]
Well, great to be here with both you and Saurabh. Jason Kelley, and I’m a general manager for all of our ecosystem and strategic partners across IBM Consulting. And I just have to tell you, I enjoy working across all of our teams — from all the technology that we bring to the table, to our research, as well as our consulting skills. We know they can’t stand alone in anyone’s solution, meaning the solutions of the past where there was one player. As you’ve said, Saurabh, that doesn’t exist now. And it’s not just because the market’s demanding it; it’s because the market is trying to overcome challenges that aren’t single-threaded. And you pick the solution du jour, or the challenge du jour, if you will. So that’s why I think this is a great conversation that we’re having, because it applies to solving the big challenges that we have. And hopefully Indira and I have planted some seeds that now you can help sprout here, Saurabh.
Saurabh Gupta — HFS Research[04:50]
Well, let me ask you a fundamental question, and maybe Indira, you can start this. Give me an example — either a client example or a value example — of what you’ve been able to achieve with a partnership with IBM, or a service provider like IBM, which you think you would have struggled to deliver by Salesforce by itself. Give us an example that brings this ecosystem to life, that will help us make this conversation somewhat real.
Indira Gillingham — Vice President, Worldwide Alliances and Channels, Salesforce[05:48]
Yeah. Well, let me first start by saying IBM is a storied, iconic brand in tech, and their history of innovation and transformation is truly remarkable. So the breadth and depth of offerings they bring to the table is truly unique. When I look at what IBM can do for us, and do for customers, I zone in on two things. Number one is the experience they have in end-to-end business capabilities, and number two, the expertise they bring to intelligent workflow. Both are very relevant in digital transformation. And so when we look at how that plays out with a customer, there’s one that comes to my mind that I’ll call out. A large financial institution, where Salesforce and IBM partnered to co-create a solution, and we actually leveraged the power of one of the large acquisitions that IBM made a couple of years ago called Red Hat. We essentially built two best-of-breed capabilities and solutions that were enabled, of course, by best-in-class professional services. What we did for this customer is to make it easier for them to securely connect, to compose and automate business processes, to modernize applications at scale — which is a problem statement they were trying to solve for as part of their own digital transformation. And then the second thing we did was we leveraged one of the acquisitions that we made with MuleSoft to build a runtime fabric on OpenShift, and essentially productized support for this customer. So what they were able to do as a result of that is create common tooling to run, manage and deploy MuleSoft workloads at scale, both on-prem and in the cloud depending on the workload. And that’s just something that we would not have been able to do without our partnership with IBM.
Saurabh Gupta — HFS Research[08:00]
No, that’s a great example. And you brought something interesting. Jason, I wanted to ask you — Indira was talking about Red Hat, which is part of IBM’s own ecosystem, and MuleSoft, which is part of Salesforce’s ecosystem. Both of you are huge organizations. And while we are talking about this ecosystem where both of you are coming together, how are you creating an internal ecosystem? Because IBM is a complicated organization, to put it mildly. How do you make this internal ecosystem work, and what are you doing to get there?
Jason Kelley — General Manager, Ecosystem and Strategic Partners, IBM Consulting[08:45]
So, Saurabh, I like the way you say complicated; I’m not really sure how to take it. You’re right, it’s an ecosystem of capability that sits within IBM, and with a partner. And what you have to be able to do is, first, two steps. First, convene the right players — and that word right has big air quotes around it, but the right players are the ones who are really going to address the outcome that the client is looking for. Not because it’s the app of the day, or because someone has to close a quarter and sell 10 more of these widgets. It’s because the client has a need, an outcome — an outcome that could be staged. In the first phase they need X, then they need Y, then they need Z. So that’s not prioritization, that’s selection. That’s selection saying we’re going to use MuleSoft first on this, and we’re going to use this cloud and this cloud, and we’ll make it open so that we can connect it with OpenShift, and we use Red Hat there so that we have an open platform, and we’re going to start with a hybrid cloud approach. I’m just repeating the same thing Indira said, the same example, so we don’t move all over the place. But that type of selection of what’s needed, based on what outcome you’re getting, greatly simplifies what you call complicated — which it is, a complicated organization anywhere you go. So if we focus on the client and the client outcome, it greatly simplifies how that ecosystem is employed.
Indira Gillingham — Vice President, Worldwide Alliances and Channels, Salesforce[10:07]
I was just going to tack on to what Jason said, and maybe just say humans are complex organisms, and therefore, when you have complex organisms, you have inherent complexity built in. But when I think about this — I love history, I’m a student of history — I look at tech history. If you go back a couple of decades, we had middleware, and middleware was supposed to be the connector across different systems. Then you had service-oriented architecture, and that was going to be the panacea for the problems that middleware couldn’t solve. And so now we’re in the composable enterprise, driven by Web 3.0 technology. And all of a sudden we alleviate some of the commercial aspects of bringing best-of-breed solutions together, and we’re able to create what we’re calling the ecosystem approach, where we can have best-in-class solutions that meet the specific needs of the industry or sector or vertical. And we do it in a way that allows for the solutions to be stitched together and takes away the commercial aspects of challenges that an organization may have in terms of procuring, maintaining, and so on and so forth. And that’s the value that IBM can help with as well. But when I think about what we’re doing at Salesforce, first and foremost, I would say we are a platform company. And when you think about where platforms differentiate themselves, and what an ecosystem is — an ecosystem is apps, and then the users that use those apps. So by definition, the value of the platform increases exponentially when you’re able to create a central gravity. That’s the business we’re in. We’re in the business of the customer at the center of everything that we do. And so creating an open, extensible, best-in-class and creative ecosystem is really what we’re trying to enable at Salesforce.
Saurabh Gupta — HFS Research[12:52]
So it’s more about the why than the what or the how. I think a lot of ecosystem conversations end up becoming about how you’re collaborating or what you’re collaborating on. But if you can get the why right, the purpose right, then I think the other things will flow. So tell us what’s exciting — what does the future look like for this ecosystem of Salesforce plus IBM? What are you both excited about, what the future holds for your clients, or for your mutual clients?
Jason Kelley — General Manager, Ecosystem and Strategic Partners, IBM Consulting[13:21]
I’ll tell you what I think is most exciting, and I said the word — it’s modernization, because that doesn’t stop. There’s no endpoint to that; you don’t claim victory. But people understand that when we say you need to modernize, what that means is they’re going to evolve the outcomes they’re getting. And when I think about the buzzword of the day, GenAI — which is just another type of AI — they think, well, where do I get some of my best returns about being smarter? Oh, with my customer. And when you say customer, it’s hard not to say CRM without thinking Salesforce. So when I think about AI, our capability, IBM watsonx — watsonx.ai, watsonx.data, and then governance, all three of those pillars — you start to say, well, let’s figure out how we get new outcomes from what we already have. We’re working with Salesforce, or have been looking at that, and we want to pull Salesforce and IBM together and get to smarter outcomes using AI. And they’re asking us that, Saurabh. That’s what’s exciting to me. I’ll take a buzzword any day if they’re going to like it, and that’s going to cause them to ask us the questions that lead to smarter outcomes. Sign me up. That’s what’s exciting in the market right now.
Indira Gillingham — Vice President, Worldwide Alliances and Channels, Salesforce[14:40]
The things that I’m most excited by are also the things that keep me up at night. Number one is speed. So how do we jointly drive faster speed to value? And it’s underpinned by the fact that the technology is moving at such a fast pace. The second part of what keeps me up at night is adoption. How do we unlock this pace of innovation in a way that is minimally invasive to our customers, and they’re able to not only absorb the innovation but embrace it, and then are able to capitalize on it so that it drives their top-line growth or operational efficiencies, whatever might be the case? So it’s ultimately outcomes. And for me, that’s what’s exciting about just what we’re experiencing in tech in this day and age.
Saurabh Gupta — HFS Research[15:24]
Jason, is there anything keeping you awake at night?
Jason Kelley — General Manager, Ecosystem and Strategic Partners, IBM Consulting[15:24]
Well, that’s where I was going to go with that. I told you what excites me; what’s keeping me awake at night is the ability for organizations to change as fast as they want to move. So this is another, softer point of that, which says it’s not just technology — it is the business process, the business function, the business design. And I think a lot of what keeps me up is how can we have organizations change at the rate and pace that they need to in order to have their ecosystems worked out. You know, I was sitting on stage with CSIS in Washington, DC. And as we were talking, they were talking about this thought of how to empower cloud — and I should say the Center for Strategic and International Studies, CSIS. So they have this paper that they’re releasing soon that talks about getting all of the players, such as us — IBM, Salesforce, Oracle, SAP — all working together on behalf of the US federal government, because the US federal government has all of us there, and they have every flavor of cloud. So how do we make that happen? And listening to them — the reason I brought it up — this topic came up: what keeps you awake? And everyone uniformly said change. Change in the budget cycles, change in implementation cycles, change in requirements that would allow me to sit with Indira and jointly solution something, versus playing us off of each other in some vendor process. So I do think that business process, business design, and changing as quickly as we need to change to really employ this ecosystem, is something that does keep me awake at night.
Saurabh Gupta — HFS Research[17:37]
Yeah, we all know change is going to happen, but we all fear change. It’s one of those aspects of human behavior. But look, this has been a fantastic conversation. I think what you guys have shown today, with some good client examples and how you are managing your own ecosystems, is that if we have to find new sources of value — if we have to solve for some of the complicated use cases Indira mentioned, or for some of the purpose-driven initiatives around ESG and sustainability — we’ve got to come together. We’ve got to bring people together and work on it collectively. That’s how we’ll create new sources of value. And I thank both of you for being so insightful and for sharing your candid views. I think if Salesforce and IBM can join hands, then multiple organizations should take your example, and instead of always competing with each other, let’s bring people together, because we can solve for more of the issues than we can solve individually. So thank you both for joining me today.
