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Feb 17, 2023 (The Expresswire) -- Salesforce Services Market | Outlook 2023-2029 | Pre and Post-COVID Research is Covered, Report Information | existing 128 Pages ReportSalesforce Services Market segmentation and trends, Key players and market share, Salesforce Services Market drivers and challenges, Salesforce Services Market opportunities and threats, Future outlook and projections, a research report focusing on this market would typically provide analysis and insights on various aspects of the market This evaluation offers a thorough examination of the worldwide and regional segments of the ""Salesforce Services Market. Tables contain information on deal volume, revenue, growth rates, and market share for the past and next periods. The research offers a thorough evaluation of the key participants in the international industry.

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Salesforce has added new fields for gender identity and pronoun data across its product line, to help customers be more inclusive when it comes to collecting and using personal data.

The firm has launched two new fields across the Lead, Contact and Person Account objects on Salesforce. This opt-in addition lets customers and their users select, identify and capture pronoun options like he/him, she/her, they/them, and gender identity options like male, female, non-binary. Both fields also offer a ‘not listed’ option.

The fields are part of Salesforce’s core objects, which means they are populated through most of its products and available by default. 

Organizations from airlines to hotels, restaurants to government agencies and healthcare companies all need this type of personal data to be able to serve their customers accurately. Standardizing the fields removes the need for admins to create custom versions, so companies can capture more accurate customer data in a more efficient way. 

However, there is no pressure on customers to use the fields, as Salesforce's Chief Ethical and Humane Use Officer, Paula Goldman, explains:

We understand this data can be sensitive, so we've designed it with a walkthrough process for admins setting this up. There's guidance that says you don't always need to be collecting this data. In fact, there are some times when it may not be as appropriate to collect this data. Then admins would choose to include it or not include it, as they're setting up various instances of Salesforce.

Collaboration 

Salesforce worked in close contact with its Inclusive Language Steering Committee to develop the gender inclusive features. This included members of Outforce, the company’s LGBTQ+ employee resource group, and Out and Equal, an Oakland-based organization working on LGBTQ+ workplace equality. 

Working in collaboration with relevant groups is a standard approach at Salesforce’s Office of Ethical and Humane Use. One of its core pillars is ethics and inclusion in Salesforce products, so the Office works hard to ensure the products the firm delivers are inclusive and accessible to all. Goldman says:

A core way we do that is knowing that I as an individual and my team, we don't have all the answers, and nor necessarily do the teams that are working on these specific products. Participation and gaining insight from folks that live these experiences directly is very important. That's why we worked both with our Employee Resource Group to understand first of all - what's the problem; second - what's the right solution, what's the right language to learn, which of these terms are the most important to address. 

Similarly with outside experts, if our whole goal is inclusion in our product, then we need to be inclusive in the processes that lead to these outcomes as well. We need to be bringing in this expertise and designing based on that expertise.

Using the right identifiers is a key part of building trust with users, but the standard options in data systems and CRM tools don’t always capture peoples’ full identity, or make it simple to do so. By making these new fields available, firms can use the gender inclusive features they prefer, and if they don’t need or want to collect gender-related data, they can bypass the features. Goldman notes:

For airlines or hotels or restaurants, which are giving personalized experiences to their customers, they don't want to be making a mistake on sensitive data like this. They want to be giving the correct experiences to their customers and serving them well. If they were to make an error on something like this, you can imagine how that would break trust.

Conversely, when people feel included, they’re more likely to trust the company they're interacting with. Goldman adds:

Study after study shows that when people trust companies, they're willing to share more data. That in turn feeds a more accurate and trusted personalized experience with the company, which feeds the sort of data they're willing to share.

At a time when first-party data is so crucial for companies wanting to serve and market in different segments, this model creates a virtuous loop where they're going to have more customer loyalty and trust, and be able to better serve their customers. 

Ethical

The new identity fields are part of Salesforce’s ongoing efforts to develop and promote ethical and inclusive technology. The firm had already made updates to its technical language in 2021 to address implicit bias and increase racial inclusivity. Goldman says:

We spent a long time remediating language in our code and our product around racial terms, like master and slave or blacklist and whitelist, and replacing those with more inclusive terms.

Ethics and inclusivity are embedded across product development at the company, she adds. For example, in the area of Artificial Intelligence, Salesforce aims to ensure that the data sets it’s using to train models are representative of the populations it’s serving and as free from bias as possible. 

The firm also puts intentional defaults in its products to make them as inclusive as possible. During the pandemic, one of the products it was developing for vaccination campaigns offered default pick lists associated with that product type. Goldman adds:

We decided that we shouldn't make an address field mandatory for people that wanted to sign up for vaccine. Why? Because if you are unhoused, that might exclude you from getting access to the thing that you're signing up for. Oftentimes it's these small design decisions that can make a world of difference in how inclusive products are when they launch and are used in the world.

My take

A positive move. 

February 08, 2023, 07:08 PM EST

Third Point joins other activist investors with stakes in Salesforce – potentially threatening co-founder and CEO Marc Benioff’s position with the vendor.

A fifth activist investor, Third Point, has taken a stake in enterprise applications vendor Salesforce, potentially threatening co-founder and CEO Marc Benioff’s position with the vendor.

New York-based Third Point, led by CEO and founder Dan Loeb, joins Starboard Value, ValueAct Capital Partners, Elliott Investment Management and Jeff Ubben’s Inclusive Capital as an activist investor taking share of the San Francisco-based vendor, according to The Wall Street Journal.

Third Point has taken stakes in Campbell Soup, Walt Disney Co. and Shell before pushing for changes, according to the Journal.

Notably, Third Point took a stake in Intel in 2020 before the chipmaker’s CEO Bob Swan stepped down and was replaced by VMware leader Pat Gelsinger.

[RELATED: Salesforce Board Of Directors: Who’s In, Who’s Out, Who Stays After Elliott Stake] 

CRN has reached out to Third Point and Salesforce for comment.

Although the end goals of the activist investors aren’t publicly known yet, along with Third Point’s history of CEO changes, Elliott Management has a history of taking publicly traded companies private.

Elliott Management recently made headlines for its role in Citrix going private and merging with data applications vendor Tibco. The activist investors could potentially push Salesforce to make more job cuts or divest one or multiple subsidiaries – which include Slack, MuleSoft and Tableau.

Gerry Szatvanyi, CEO of OSF Digital, a Québec-based Salesforce partner, told CRN in an interview that he has been happy with the company’s leadership.

“I’m pretty confident in the leadership with Salesforce,” Szatvanyi said. “I’m very confident that they are going to drive through this transformation quite well. So they still have my vote of confidence, hands down.”

OSF has experienced some of the slowdown in business discussed by Salesforce and other vendors, Szatvanyi said. But he still expects north of 20 percent growth in business from 2022 to 2023.

In January, OSF even announced the purchase of U.S.-based Salesforce partner Original Shift as part of OSF’s growth strategy.

“I would say demand, it’s still pretty healthy,” Szatvanyi said. “We see a lot of desire, on our customers’ side, to better use the technology that they already have. (To) better integrate between different (Salesforce) clouds, gain more efficiencies, drive higher return on the technology that they already have.”

He continued: “Salesforce is at the center of everything that we are doing.”

The activist investors come as Salesforce – and other tech vendors – contend with moderated customer demand for digital tools after a surge at the height of the pandemic. In January, Salesforce announced layoffs for about 7,000 employees.

The company also seen the departure of key leaders Bret Taylor, Benioff’s former co-CEO, and Slack CEO Stewart Butterfield.

Salesforce’s total market value in 2022 went from $250.3 billion at the start of the year to $132.6 billion by year’s end.

The activists appear to have had a hand in changes coming to Salesforce’s board of directors. Salesforce will have three new board of directors members come March 1 – and lose two longtime members.

Salesforce (CRM) shares rose as much as 3.4% Thursday after activist shareholder Third Point LLC reportedly took a stake in the embattled business software giant.

Dan Loeb's Third Point LLC is at least the fifth activist firm to make a significant investment in the company recently, joining Elliott Investment Management, Starboard Value, ValueAct Capital Partners, and Inclusive Capital. The size of Third Point's investment and its intentions could not be confirmed.

Shares of Salesforce plunged 48% last year, mirroring investors' broader distaste for technology stocks but also reflecting the company's financial challenges and concerns about its leadership.

Salesforce in November reported its fiscal 2023 third-quarter profit fell 55% from the same period the prior year, with rising expenses outpacing a 14% revenue increase.

In January, the company announced plans to cut 10% of its workforce, totaling about 8,000 jobs, and reduce office space in a large restructuring—the company's first in its 23 years of existence—that could cost as much as $2 billion. The company will announce its full-year earnings results March 1.

• Some Salesforce employees have been offered a "Prompt Exit Package" instead of a layoff, with less severance.
• If they refuse, they will put on a PIP, sources say, a common step before termination in the industry.
• Employees say the company is ratcheting up performance expectations as activist investors invade.

Salesforce has increased performance pressure on some employees as it executes its plan to reduce its workforce by 10%, multiple current and former employees tell Insider. Workers aren't sure if performance-related terminations are part of that 10%, they say.

The company is planning to introduce new performance metrics for engineers and has already forced some salespeople to choose between a 30-day performance improvement plan (PIP) or a severance option called a "Prompt Exit Package," according to several current and former Salesforce employees. PIPs are commonly used in the tech industry as a step prior to firing someone. The PEP, on the other hand, is basically voluntarily quitting, but Salesforce offers two months of severance with it, according to an email viewed by Insider. 

"The company is pushing hard for productivity tracking and metrics on all facets," one employee told Insider. 

"Performance pressure and return to office became big themes," a former employee, who was laid off from Salesforce in February, said of their last few months with the company. 

One new metric Salesforce is planning to use to evaluate engineer productivity, the person said, is code check-ins, a controversial practice some say incentivizes quantity over quality and reduces trust between teams. A code check-in is when a developer makes a set of changes to a codebase.

The heightened focus on performance comes as the software giant works to shed 10% of its workforce, or some 7,000 people, after a two-year hiring spree. Salesforce increased its workforce from 57,000 to 73,000 in 2021, according to its annual report. 

The company notified some employees on January 4 that their jobs were being eliminated, and sent another round of notifications on February 2. Insider has reported that more than 4,000 people have likely been laid off so far, but Salesforce has not confirmed how many more employees it has actually cut, leaving its remaining workforce anxious for their jobs. 

Meanwhile, activist investors have been mobbing Salesforce, which has seen its market value shrink in half since its peak in 2021. Five such investors have revealed significant stakes since October, including Starboard Value and the feared Elliott Management, which is said to be mounting an effort to replace some board members, Reuters reports. Other activist investors include Mason Morfit's ValueAct, Jeff Ubben's Inclusive Capital, and Dan Loeb's Third Point Capital LLC, which just last week disclosed a stake. 

Activist investors typically want their targets to trim expenses and focus on more profitable businesses, rather than pursuing growth at all costs. Starboard first approached Salesforce this summer, spoke with some of its executives and pushed for cost-cutting measures. Salesforce cut a few hundred salespeople in November, a person familiar with the matter told Insider, and the company told Insider the cuts were made for "accountability," implying that performance was a consideration.

Employees worry that so much activist attention will result in more performance pressure or further layoffs which, insiders say, the company has already contemplated. Sources say there's been internal talk on whether to cut an additional 10% of staff later this year.

One Slack message sent by an employee after the first round of layoffs in January said that Salesforce has a goal to reach 25% operating margin by the 2026 fiscal year and asked execs at the time if the target was a factor in layoffs.

Meanwhile CEO Marc Benioff has also repeatedly mentioned productivity to employees when discussing the cuts. "We don't have the same level of performance and productivity that we had in 2020 before the pandemic. We do not," he said during an all-hands meeting in January after the first notices went out.

Less severance than those laid off

Workers who spoke to Insider are concerned that the company's increased focus on performance could mean more people will be targeted for a PEP, leaving them with less severance than their colleagues who were simply laid off.

Laid-off workers will be offered a minimum severance of five month's pay and possibly more based on tenure as well as other benefits like company-sponsored COBRA, Benioff wrote in a January email to employees announcing the restructuring.

But employees who have been targeted for a PEP are offered eight weeks of severance and company-sponsored healthcare benefits under COBRA. 

Employees are given two business days to elect the PEP option, according to an internal email viewed by Insider. If they don't choose the PEP, employees will then be allowed to view the 30-day PIP plan, which they then have to start within 3 days of declining the PEP offer. 

Around Thanksgiving, the company offered some sales employees who had been deemed underperforming in certain areas, such as annual contract value and pipeline generation, the option to start a 30-day PIP or accept the PEP and immediately leave the company. In some cases, the company has presented employees with PEP offers in the same week it has executed mass layoffs, employees told Insider.

Four Salesforce employees who spoke to Insider, including two who had been offered a PEP, said the option to choose between PEP or PIP feels like a way of pushing employees out of their jobs. 

"It's a shady optics play," said one person who was given a PIP or PEP offer last month. "From an outside perspective, it looks like these people quit."

They also said they felt like Salesforce had set some salespeople up to fail, saying the company expected them to hit unachievable quotas that bested their results during a pandemic-fueled boom for cloud software, even though the economy is weakening and post-pandemic demand is waning. 

"The markets we all work in are only so big," a recently laid-off Salesforce sales executive said.

It is unclear how many engineering employees have been affected by the new performance management system, or if PEP offers are being made outside of sales teams.

Changing a hard-to-fire culture

A former Salesforce executive who left the company in accurate months told Insider that a push to accelerate the company's PIP system began in the fall. A common complaint held by Salesforce managers over the last decade has been that the system made it too difficult to fire underperforming employees, even if they were regularly labeled as such despite multiple changes in managers or roles.

The new performance management system implemented in the fall was designed to address those complaints, the former executive said, noting that it was "literally impossible" to manage anyone out of the company, including legitimately 'terrible' performers. 

"This is a classic enterprise performance improvement plan, but faster," they said of the company's new system. 

The sales employees who spoke to Insider say that plan has not worked out in practice, and has left the door open for colleagues they consider to be strong performers to be pushed out of the company. 

Salesforce did not respond to a request for comment.

Are you a Salesforce employee or do you have insight to share? Contact Ashley Stewart by sending a secure message from a nonwork device via Signal (+1-425-344-8242) or via email (astewart@insider.com). Contact Ellen Thomas via email (ethomas@insider.com) or send a secure message from a nonwork device on Signal: (+1-646-847-9416).

© Provided by Axios Login

Salesforce is adding fields to its core products that allow for more options when it comes to gender and pronouns.

How it works: Salesforce is adding two new fields across its software wherever people are referenced, one to include pronouns and another for gender identity.

• The changes mean administrators don't need to add custom fields and opens up the potential for more standard data reporting across a wider range of gender identities.
• Salesforce worked with its inclusive language steering committee, including members of its own LGBTQ+ employee resource group, as well as with Out & Equal, a national nonprofit that specializes in LGBTQ+ inclusion.

Yes, but: Salesforce isn't requiring customers to collect such data, and indeed notes there may be instances where capturing data on gender isn't necessary or appropriate.

What they're saying: "At the end of the day, this is about more than inclusive language," Salesforce chief ethical and humane use officer Paula Goldman said in a statement to Axios. "It’s about giving businesses the tools to better understand and serve their diverse customer base."

Salesforce is looking at new ways to cut costs as activist investors continue to put pressure on the company. Today, Insider was reporting that the company is implementing much stricter performance measurements for engineering, with some salespeople being put under pressure to quit or succumb to harsh performance policies of their own. This is consistent with what sources have been telling TechCrunch.

This could include performance reviews based on the quantity of code produced for engineers, a flawed way to measure engineering productivity, which encourages quantity over quality. While salespeople are being put between a rock and a hard place, being asked to choose between signing a strict one-month performance improvement plan or taking an exit package.

When asked about this, Salesforce responded with this comment: “Our performance management process drives accountability and rewards excellence.” The company did not elaborate or answer follow-up questions regarding the timing or details of this policy.

TechCrunch has also been hearing that the company is mandating a return to the office, and according to a Salesforce spokesperson, it’s now up to the managers to decide. “Our hybrid approach empowers leaders to make decisions for their teams about which jobs need to be in the office or remote.”

That’s an interesting attitude shift for a company has been promoting the idea of the “all digital, work-from-anywhere workplace” since the pandemic hit in 2020, something they call the Digital HQ. It’s a big part of why the CRM leader spent almost $28 billion to buy Slack in 2020.

But neither is it surprising since CEO and chair Marc Benioff practically telegraphed this at the end of last year, suggesting that folks working from home weren’t as productive.

All of this is probably related to the fact that activist investors — including Elliott Management, Starboard Value, ValueAct and Inclusive Capital — have been circling the company, undoubtedly putting tons of pressure on Benioff to increase productivity and cut costs. These firms are a big part of the reason Salesforce announced that it was cutting 10% of its workforce in January, a process that has been handled badly with layoff notices coming in dribs and drabs, leaving workers anxious and uncertain.

Ray Wang, founder and principal analyst at Constellation Research, blames Boston Consulting Group, which he says was brought in at the behest of the activists to deal with the cuts and implement new performance review policies. “From what we know, BCG made some significant recommendations on how salespeople and developers should be measured to Boost productivity,” Wang told TechCrunch. Update: BCG denies being responsible for the performance review policies.

Wang says that whether you think this approach is a good idea or not depends on your perspective. “If I was an investor, I would advocate for this approach, but if I was the owner-founder, I would want something less harsh and more nuanced,” he said.

Wang isn’t a fan of how the activists have handled this, calling them “vulture firms.” While he does agree with their assertion that Salesforce overpaid for bad acquisitions, he believes these firms lack an understanding of how to run a company like Salesforce, and they are ultimately doing more harm than good.

“The vulture firms do not have a good understanding of the investment levels in R&D that are needed for innovation to continue, nor did they understand what level of marketing spend Salesforce needs to remain top of mind for execs,” Wang said.

“They don’t add any value. They come in to just make money on the arbitrage and they leave the firms more damaged than when they were before they were taken over,” he said.