In a flurry of activity at the end of last year, Salesforce announced that co-CEO Bret Taylor was stepping down. Shortly thereafter, Slack co-founder and CEO Stewart Butterfield announced his exit. We would soon learn that his replacement would be Lidiane Jones, who at the time was GM of Commerce Cloud, Marketing Cloud and Experience Cloud at Salesforce.
While Jones was running essentially the entire B2C business with that title, she was relatively unknown in the industry. Yet she brought with her a deep background that included more than a dozen years at Microsoft and almost four years at Sonos, all of which helped her build a keen understanding of software and product development.
To be sure, she was walking into a difficult situation replacing a beloved founder-CEO, while trying to find ways to bridge the gap between Salesforce and Slack. At the same time those executives were leaving, Salesforce as a company was dealing with a slew of activist investors. One of their primary complaints was a lack of integration between the core Salesforce products and the company’s expensive acquisitions over the last several years.
Of those, Slack was by far the most expensive at a whopping $28 billion. The hope was to bring the platform into the fold and have it be the communications layer across the entire Salesforce family of products. Salesforce has to this point done some integrations between the two platforms but not enough to satisfy critics.
At the same time, Jones still must protect the independence of Slack because it can’t be perceived as being so tightly integrated into Salesforce that it can’t operate outside of the ecosystem.
Nobody claimed the job was going to be easy.
TechCrunch+ sat down with Jones recently at the Salesforce offices in Boston to discuss how her transition is going so far and what challenges she faces as she dives into job.
Welcome aboard
Not long before Jones took over as CEO, The Information ran an expose suggesting that the relationship between the two companies was damaged. The report also stated that Marc Benioff and Butterfield butted heads, the deal was Taylor’s baby, and with Taylor and Butterfield gone, Benioff was less interested in it, a point that Jones disputes now.
Jones, on the other hand, painted a glowing picture of her tenure so far, one that belies the report. Everyone has supported her, from employees to fellow executives, and the company has backed her fully. If that is the case, it will surely mark one of the first transitions from a founder-CEO to a new executive leader that was without hiccups.
She points out, however, that even though the announcement was a surprise to the world, Butterfield’s departure had been planned months in advance, and she says that he helped prepare her for the new position. “As busy as it was, and it was busy for everybody this past quarter, I felt just an incredible amount of support in navigating that, not only from Marc and the ELT (executive leadership team), but the board as well,” she said.
She says Butterfield was helpful throughout and helped smooth the way for her. “The transition was just a lot for all of us. It was certainly a lot of change for our employees going through leadership churn like that. But I’m so grateful for Stewart’s very positive transition,” she said.
Challenges await
No matter how well Butterfield may have prepared her, stepping into this role brought challenges with it. Slack growth has been slowing considerably over the past three quarters, the time period since Salesforce has broken it out; dropping from 46% to 33% to 20% in the most recent quarter reported on Wednesday.
That’s not the direction you want to be going, and she will have to find ways to reverse the trend in the coming quarters. One way to do that will be broader enterprise adoption rather than incremental adoption across certain departments, but that might be easier said than done.
With its primary competitor bundling Microsoft Teams with Office 365, it increases the degree of difficulty, since Microsoft has such a foothold inside large enterprises using Office already. In fact, Microsoft claims 280 million daily users versus around 33 million daily active Slack users, according to a report from Demand Sage. The good news for Jones is that the DAU number has consistently gone up since 2019 when the company had less than 10 million.
Slack, for its part, itself prefers to focus on engagement over DAUs, reporting 2.65 billion actions taken in Slack each day. This includes sending messages, taking Huddles (its quick meeting tool), sharing files, conducting searches, using apps in Slack and reacting with emojis, among other things. What’s more, over a million developers are building tools on top of Slack, according to the company.
Jones is positioning her company as a productivity platform, one that uses integrations into enterprise software to move work across job types and departments rather than a pure communications tool (although it is that, too). “We really are the productivity platform for all users in an organization, and because it’s an open platform, it doesn’t force companies to lock themselves into a particular ecosystem. It can really bring applications, enterprise applications, in the context of their work,” she said.
That involves three main focuses, starting with making automation a more central part of the platform, the ability to curate knowledge across the organization and engaging everyone in an organization. But to achieve that vision, it requires broader enterprise adoption than Slack appears to be getting.
Microsoft rebuilt Teams from the ground up, promises 2x faster performance
Ray Wang, founder and principal analyst at Constellation Research, says while he doesn’t know Jones personally, he understands the challenges she’s facing in taking on this role from a business perspective.
“The intention of Salesforce buying Slack was to create signal intelligence across all their clouds. That way customers can build a better understanding of all the workflows. This requires a lot of integration into the clouds so you can build a business graph,” Wang told TechCrunch+.
The problem, though, is that he doesn’t see enough adoption across the enterprise to achieve that vision, and it could be a significant challenge for Jones, getting companies to more widely use Slack across departments.
“From what we see is that our clients who adopt Slack everywhere will have great intelligence, but we’re not seeing overall adoption outside of dev teams at client sites,” he said. That’s because other departments are more likely to be using Teams and won’t gain that advantage of using Slack across the company.
It’s also hard to break Microsoft’s domination when it comes to enterprise communications tooling, especially when it’s selling to IT executives like the CIO rather than department-focused executives. “The biggest problem is you have two different buyers where the head of sales or the head of the contact center is pushing for a new CRM, which is really different from who is buying Slack,” said Forrester analyst Kate Leggett. Like Wang, she sees solid adoption in engineering and developer groups but less so in other departments where Teams appears to have a leg up. She also sees adoptions in startups and medium-sized companies but less so broadly across larger organizations that Salesforce is targeting.
Can new AI tools create broader adoption?
Jones thinks that the newer generative AI capabilities being added to the platform could help convince customers of the benefits of adopting Slack more widely because it provides a way to unify knowledge across an organization.
Last month the company announced a couple of new generative AI tools for Slack including SlackGPT and EinsteinGPT. The former is a Slack specific bot designed to help users complete tasks across the platform. The latter, announced by Salesforce in March, lets users ask questions specifically about the Salesforce corpus of data.
She says the generative AI prompting method is a natural way people already interact with Slack. Users can now ask Slack to summarize a thread or ask questions about a project or anything like that, but it also can act as a direct integration point with Salesforce.
Slack updates aim to put AI at the center of the user experience
“So we can bring the context not only of your channels and your Canvas and Slack, we can bring the context of all of your applications in Slack. So that allows any one of our partners to be playing in the generative AI experience in Slack. So not only is it better for the customer, it’s going to be significantly more exciting for our partners as well,” she said.
Being able to be both part of Salesforce and separate from it is going to be a huge challenge for her, one she recognizes. “I really started this job with a fresh perspective. How do we deliver great Slack native experiences that bring in Salesforce in it, as opposed to building Salesforce in Slack? I want to make sure that Slack still feels like Slack,” she said.
Wang says the biggest competitor for Slack might not be Teams, but email, and how embedded it is in how we work. “The hard part is getting usage across departments. We always start with the notion of wouldn’t it be nice to get rid of email, but then we realize we file email, we thread email, we can find it easily. So some roles and departments aren’t used to messaging,” he said.
Lidiane in charge
Jones, who grew up in modest circumstances in São Paulo, came to the United States for college with only a rudimentary understanding of English, according to her team. That she has worked her way from that point to leading a major company does not escape her. She says that she tells her kids that it has taken a lot of hard work to get here.
Now she’s just trying to put her own stamp on the job. “I’m not trying to be Stewart; I think every time a leader comes in on the footsteps of any great founder, you have to have your own DNA. And I’ve been very open with the team,” she said.
She talks about forging her own style of trying to offer as much clarity as she can, while striving to be open, transparent and reachable.
“Being clear and being focused and providing clear prioritization of our work has been my main [focus]. And that’s been really helpful in an environment like this where we’re trying to do so much to help our customers, and it’s moving really rapidly. Staying focused is key,” she said.
Social media in general has a way of flattening hierarchies, and Jones says she encourages her team to reach out on Slack with ideas. “I am not a hierarchical person in general, so I always tell my team I’m very casual; just Slack me, but it’s taken a couple months for people to realize it’s really true.”
She says that given her background and upbringing, she is working hard to be a leader who listens to her employees, and Slack offers a platform for that kind of communication. “When you always have to just work really hard to have a voice, I really don’t want to be the person that forces people to have to work really hard to give me their perspective.”
She also recognizes that as an immigrant and a woman of color, she can be a role model to help girls and women looking to grow into leadership roles like the one she has attained, and that a certain responsibility comes with that to help companies think more broadly about what talent looks like.
“So the amount of excitement has been very humbling. And I really just want to make sure that I do it justice by helping to really elevate the perspectives of people that women, immigrants, women of color, that we can actually find great people in a lot of different places,” she said.
Jones is certainly proof of that.
Comment