From CRM to ERP to productivity vendor? How Zoho Workplace fits into their future of work - and their stance against work surveillance

Jon Reed Profile picture for user jreed September 17, 2020
Zoho shook up some more enterprise software categories with their recent Zoho Workplace announcements. During recent interviews, I pursued how these moves fit into Zoho's stance against work surveillance - and why this debate matters to a remote workforce.


It was only last year, but it seems like another world when I shared Zoho leadership's views on whether they are an ERP vendor - or want to be one (Zoho in focus - edges and obstacles as Zoho sneaks up on ERP and CRM players).

Fast forward into the pandemic economy - and remote work surge. No one wished these circumstances on anyone, but they do play into themes Zoho has already embraced, including their vision of rural work revival, where the "topsoil of talent" that left rural areas returns - to help bring life to the topsoil itself.

Doesn't sound too bad right about now, does it? (See Zoho CEO Sridhar Vembu's diginomica piece, Will a cloud-based rural revival be jump-started by today's remote work surge?)

Digital teamwork tools need context

Most of the tools in Zoho Workplace have been popular with Zoho customers for a while (some were launched as early as 2007). But last week, Zoho doubled down on Workplace, with an emphasis on nine "tightly mingled" productivity applications. My colleague Phil Wainewright issued his analysis in Zoho Workplace challenges digital teamwork giants with a fully integrated platform.

Workplace finds Zoho in unintentional disruptor mode again, pursuing a different approach to collaboration than the so-called giants - including a more compelling take on data privacy. The pricing is also Zoho-style - $3 per user per month for the entry-level Standard version, though you can also get access to Workplace via a broader Zoho One subscription.

Zoho argues that too many of these so-called "teamwork" tools lack context. Zoho believes their platform can provide that. As Wainewright wrote:

Zoho's key differentiation is that it offers business applications as part of the same stack as its digital teamwork capabilities. Crucially, this makes it much easier to present all relevant content to users in the midst of their work processes.

Wainewright quotes Zoho's Chief Evangelist Raju Vegesna:

Ideally, you should also bring in the business context. When you receive that email, you should know whether that email is from a customer or an employee or a partner. That is only possible when the context is attached to the collaboration and other tools out there.

The privacy implications of productivity tools - a work surveillance debate

Remote work ratchets up the need for context: good luck leaning into the next cubicle for clarification. But while I'm a big remote/flexible work advocate, I do believe remote work forces a management confrontation. On the desirable side: figure out how to manage by outcome.

On the other, unpleasant side: KPI culture gone wrong. Employers remotely tracking their employees - and hounding them with volume metrics ("You only competed 50 calls today; I see you left the team meeting 30 minutes early; your video camera was off for 3 hours today.") I believe the proper phrase for this management style is work surveillance. It is an unwelcome fact of life for too many remote workers.

Given that Zoho takes a firm stand on data privacy, I wanted to know: how does that extend into their views on work surveillance? Could Zoho customers potentially misuse Workplace tools in this manner?

I've already laid out Zoho's data privacy imperative in Zoho takes their B2B data privacy stand - "We will not be part of this industry practice." But will it pay off? In sum:

  • Zoho removed all ad trackers and third-party cookie-dependent tools from their sites and clouds. If that means losing access to near-ubiquitous services like Google Analytics, so be it. They must build the equivalent tools themselves.
  • Zoho doesn't use public cloud services. To live up to their data privacy customer pledge, they manage all customer data in their own data centers.

This also means Zoho doesn't use third-party AI tooling from the likes of Google, Amazon, etc. Their approach to AI is truly in-house. This raises questions on how Zoho trains their AI, given their internal limits on AI data and tooling. It's an interesting topic we've discussed with Zoho, and will return to. But for now, how does Zoho see their privacy stance impacting their Workplace apps? Will Zoho put another stake in the ground against work surveillance habits? During our recent talk with Vegesna, he responded:

We have taken the surveillance part very seriously. Let me give you an example. With our team members from other regions, they speak in local languages, like our team from China, our team from Japan, from Brazil - they speak their own languages.

Typically, what companies do is they copy the email content in Google Translate, and then try to make it work that way. But what you don't realize is: this information is leaving your system and going to some other system out there, where if you look at the terms of service, it's not very friendly.

Zoho addressed this in their Zoho way. Vegesna:

To actually solve this, we had to create our own translate engine. And that's the only way to solve it.

Zoho's translate engine now supports about fourteen different languages; there is also a grammar and spellcheck feature to support email composition - eliminating the need for third party tools there also. Across any team workflow, there are a surprising number of such tools in play. Vegesna says the privacy implications must be confronted:

In none of these cases do we go to Google or any of the Translate engines. That also means you're not passing your information outside the system. We have to take these extra steps to protect any information from going to surveillance systems.

But if you take those steps, you also need to educate on why. Vegesna made that case on diginomica in Consumer privacy breaches are in the news. But who's spying on you at work? Vegesna told us that this educational process includes Zoho's own employees:

What we have done internally is educate employees on why this is important - telling them what we are doing to protect their information. Taking the permission of the user before sharing something becomes critical. Even when you are publishing something internally.

Privacy Trojan horses are everywhere: even the simplest of uses, like a Google Font, can bring unknowing data sharing into play:

There are probably thousands of vendors that already do that without thinking twice. All of this is information given to surveillance companies, and it is important for companies to start thinking about it. They have to commit to their employees about their own privacy policies.

My take

Coping with pandemic times put these issues on the front burner. Messages out of context are confusing; too many enterprise applications don't allow for team discussions in the context of transactions (or analytics).

The enterprise old-schooler in me always agrees with collaboration in context. That was a big part of what the first wave of enterprise messaging got wrong - and the problem persists. I'm sure many smaller companies will welcome the one-stop-shop approach Zoho takes here. There aren't too many vendors that can make that claim in the productivity space, with the obvious exception of Microsoft (and, as their PR reps will tell you, Google).

As Zoho moves upmarket, they will encounter different expectations. I call these expectations platform-over-suite. A larger company might choose Zoho as a platform, but choose to integrate with a different HR or CRM provider. If Zoho wants those platform commitments, they'll need to make those external integrations easy - while addressing their privacy standards. Zoho doesn't want to fall into the "suite trap" of providing it all. That won't carry with larger companies. During our Zoho Workplace demos, I was encouraged to see examples of external integrations. Other elements bigger companies will expect include:

  • enterprise-grade security - already in Zoho's wheelhouse
  • industry-specific editions and functions (along with expert partners to help build out verticals)

As for the work surveillance theme, Zoho has a set of guiding principles that serve them here. However, in the case of work surveillance, I'd like to see Zoho go further, and take steps to make their customers aware of the power of these tools as a double-edged sword. Just last week, I was hearing anecdotes on Twitter about employees who are being remotely monitored by these types of teamwork tools. Even if you aren't sharing data, you can still be tracked and KPI'd into submission. No, you can't change how customers run their businesses - but education is core to Zoho's mission.

I see room for education here. Let's shine a light on the customers who have figured out how to use this tech to expand their workforces - and build a virtual community around them. Do that, and serving customers gets a whole lot easier. The best way to expose management-by-tool-tracking is to show how these tools can support a different vision altogether.

I referred to Zoho as an unintentional disruptor. I say "unintentional" because I don't believe Zoho's leadership walks around thinking about whose apple cart they can overturn next. I don't think they suddenly decided to elbow into the productivity Magic Quadrant by pushing Workplace. Rather, I think Zoho is fixed on how they can serve customers while pursuing their Zohoness - a quality they protect from investor expectations by keeping the company privately held.

Whether that's in line with what companies need right now - well, that remains to be seen. But for Zoho, these aren't winner-take-all markets anyhow. They are playing a different game - one worth watching.

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