Stop Trying to Build the Next Salesforce and Build User Value Instead
When business applications began shifting to the cloud in the early to mid-2000s, it changed the way software was consumed but not its ultimate goal. At the end of the day, vendors were building applications they wanted lines of business users to live in, just through their browser versus the desktop.
It was the ultimate software vanity game -- how can we make our applications stickier and get sales, accounting, marketing and customer support users to live in them? Step one was offering a bunch of compliance and security features that secured IT signoff. Step two was providing reporting that management loved, so they mandated usage among their teams. Salesforce was Siebel, just in the cloud. The same thing happened in business intelligence, ERP, customer support and other areas.
But, then 2007 happened with the launch of the iPhone. Once mobile apps began changing the way consumers viewed software -- making it easy for people to download an app for free, and if they didn't derive value from it, delete it -- business application vendors took notice. Quickly, the days of centralized IT purchases and top-down mandating of software faded, except for wall-to-wall implementations or in large, regulated businesses. Instead, business users were adopting applications department by department with a free trial and a quick swipe of their credit card and stopping the trial or subscription if they didn't derive value.
If client-server was the 1.0 of software and SaaS is 2.0, then smartphones ushered in third-generation software apps that put the power in the hands of the user and not IT. Dropbox, Slack and other similar applications have experienced rapid growth thanks to this model of freemium individual usage, land and expand among departments, leading to enterprise adoption.
But, even in the 3.0 era of software driven by the iPhone, building a vanity application was still possible. I already gave Slack as one example, but you would be hard-pressed to find organizations that use only Slack and not Gmail, Zoom, Asana, InVision and other collaboration or project management tools, too. So, business users might be at an age where they have more control over usage but are still at the mercy of having to use a lot of tools to get the job done.
The age of user productivity over application vanity
We're in the throes of another shift in the way applications are designed and consumed, and it is about to give the user even more power. Four major trends are driving this shift:
1. Data-driven organizations and the rise of machine learning. Companies now understand the need to build data-rich systems that can learn user and customer behaviors over time, driving automation and even low-level decision-making or recommendations. The key to making this data as rich as it needs to be is having applications that operate less as central usage silos, and instead, help facilitate the flow of data between applications.
2. The APIficiation of software. The need for more connected applications and less SaaS silos has led to an explosion of API development, making integrations less complicated and more seamless for even the smallest of organizations. Stripe gets 100 million API calls per day, and while it is a unique case in the payments space, enterprise apps are using the same model to make their applications more extensible.
3. The "relationship era" in customer management. The days of a single salesperson being the start, middle and end of the customer relationship are over. Customers deal with marketing, sales, customer support, customer success, finance and even a social media team, meaning that everyone is a brand ambassador and they need to know where that relationship stands at any given time. Everyone touches relationships and data can't just live or be siloed in CRM and marketing automation systems, but should be shared between them and other systems.
4. Productivity is king. Because in business, user experience is predicated on job success so professionals are more likely to embrace applications that make them productive. For most jobs, that means applications that automate the mundane and allow people to live in the productivity tools they use on an everyday basis. So, it becomes less about getting customers to go to your SaaS application and more about whether you can automate the flow of data between your application and productivity apps like G Suite, Office 365 and others.
To be a successful entrepreneur in the "age of productivity," founders must check their egos at the door and focus on individual user productivity as the key metric of the value you bring. Other metrics will be a bigger and bigger distraction to what you need to do to build a great product, a great suite and a long-lasting company your investors, your customers and the market writ large will love.