What a difference a year makes! Roughly around this time in 2022, Dreamforce was making its proper post-Pandemic comeback. There had been a very limited, small scale gathering in 2021, but last year saw the return of the Ohana to the streets of San Francisco en masse.
It was a conference that saw a lot of celebrating as regular attendees caught up with one another in the flesh for the first time in years. The mood was celebratory with a strong sense of ‘we’re back’ running through the corridors of the Moscone Center; co-CEOs Marc Benioff and Bret Taylor were goofing around with bunny ears on their heads (you sort of had to be there..); no-one used the term ‘generative AI’; and Twitter was still taken seriously as a company.
A lot has changed since then. Taylor is gone, his departure coming as a complete surprise to everyone. The firm has come under pressure from activist shareholders demanding changes to the way the company was run. A painful tranche of layoffs happened around the world. San Francisco itself has come under fire for lapsing further into what many have dubbed a ‘doom loop’ as the city’s homeless and substance abuse problems have become worse. Oh, and generative AI happened - did you spot that one? - with Salesforce now an AI firm and Dreamforce is an AI conference.
Plus ça change
So what can the 40,000 delegates descending on Dreamforce 2023 expect this week? A lot looks reassuringly familiar - an event combining tech, philanthropy, sustainability, ethics etc etc. There are some Dreamforce regulars on show, such as environmentalist Jane Goodall through the Foo Fighters to show veteran Will.I.Am.
But everything that is familiar is also changed, with sessions and keynotes and discussions all viewed through the prism of generative AI. This is a ”modern Salesforce”, as Benioff put it in the firm’s most recent earnings call, built around four pillars - CRM, AI, Data and Trust.
Those latest earnings also reflected something else - a post-‘activist investor crisis’ that has seen this modern version of the company in the throes of both short and long term transformation. This is a Salesforce that talks openly of the importance of profit margins and profitability alongside its more familiar mantra of growth. It’s a slimmed-down, seemingly more operationally-efficient version of the company that was here a year ago. The non-GAAP profit margin of 31% reported last month is higher than the 30% that activists were demanding, and has been delivered ahead of Salesforce’s own timescales. That this has happened in such a short period of time is reflective of some strong fiscal control on the part of Chief Financial Officer Amy Weaver and her team.
As part of that, this is a Salesforce that has re-thought much of its real estate strategy. The Tower still dominates the San Francisco skyline, but there’s been a divesting of property assets elsewhere. That might be argued to have fed into the wider ‘doom and gloom’ commentary about businesses abandoning the city and adding to the so-called ‘doom loop’. In fact, the current AI frenzy is fuelling an influx of business back into the city and pointing to a property revival as start-ups snap up office space.
And offices matter once more. Salesforce 2023, in marked contrast to what was being said a few years ago, wants its people back in its offices, particularly those who work in sales. That’s true of the wider tech sector as a whole as the ‘new normal’ starts to look a lot like the ‘old normal’ with more flexibility built in. Frankly, it’s deja vu all over again!
You might apply that last notion to Salesforce itself. For all that this ‘modern’ Salesforce looks new and fresher, it’s being built by tapping into some familiar management faces, with the return to the fold from the likes of Kendall Collins as Chief Business Officer, Miguel Milano as Chief Revenue Officer and Ariel Kelman as Chief Marketing Officer. This is a hugely experienced management line-up, experienced both in the enterprise tech industry, but also in Salesforce itself.
That’s reflected nowhere more powerfully than in the appointment of Brian Millham as Chief Operating Officer. I said last year that Millham, Salesforce employee number 13 back in 1999 when the company was founded, was someone with Salesforce DNA in his veins - ‘Cut him and he’d bleed CRM’, as one company exec put it to me. With Taylor gone, Millham’s role over the past year has become ever more important. He’s not a co-CEO in title, but with reportedly over 80% of operational functions reporting into him, that might be viewed mostly as an honorific deferred. Whatever the case, his impact over the past 12 months has been significant and his worldview is an important one to understand as we think about how this ‘modern’ Salesforce will evolve.
Into an AI world
And evolve it will. As noted above, Benioff, Weaver and Millham have executed a major operational transformation since Dreamforce 2022, but that’s not the end of the story. While Benioff expresses the hope that the pain of a major layoff program is “one and done” and behind the company now, there are still more ways that the firm will adapt to meet an ongoing macro-economic crisis as well as the opportunities of a generative AI world.
One of the challenges of this week’s Dreamforce is going to be how the company strikes the elusive balance between its own generative AI tech vision and the realities of customer adoption. There’s a lot of interest among the customer base about the potential of generative AI in core enterprise functions, such as Sales and Support, but there’s also a lot of entirely reasonable wariness about the speed with which the wider gen AI hype cycle has spun up.
To be fair to Salesforce here, while its own strategic pivot to generative AI has been fulsome, company execs have been careful to acknowledge the ethical and trust issues that are clearly in evidence among the Ohana and beyond about the speedy rise to ‘core agenda item’ of this technology. Trust has been a core Salesforce value for decades, but perhaps it’s never been more important to be front and center than right now.
There are a lot of sessions at Dreamforce this week that tackle these issues head on and while these won’t result in definitive answers to some difficult questions, they will be making an important contribution to necessary debate around these topics. The hope must be that many of the attendees return home to their organizations on Friday with increased understanding and thus better able to meet the demands of C-Suite execs who want to know that their generative AI strategy is and why it hasn’t happened yet like they think it has in other companies!
So while there will be a huge level of generative evangelism coming via the keynotes and from high profile speakers like Sam Altman, I think that this year the real success of Dreamforce will be measured in the Ohana developing a pragmatic understanding of what this tech can do for their companies - and what it can’t (yet). There will be powerful use cases on show of what trailblazing organizations are already putting into practice, but it’s early days.
That can’t be said enough. For its part Salesforce has, of course, been an AI veteran, with Einstein long an established fixture and enabler in the company’s cloud pantheon. But the wider generative AI buzz since March has been ever louder across the months and if many delegates feel a tad giddy at this point, that’s entirely understandable. It’s going to be really interesting to hear from the people standing in line for the thousands of sessions taking place this week what their view is.
Flying over to San Francisco on Sunday, I was on what a former exec used to term ‘The Dreamforce Bus’, alluding to the fact that almost every seat on the plane was filled with people en route to the conference. Eavesdropping on a few of the conversations going on around me, I’d say the prevailing sentiments were as follows - curious, excited, cautious, nervous, enthusiastic…but mostly curious. That’s as it should be. And satisfying at least part of that curiosity will count as a big win for Salesforce this week.
'Doom loop' narrative
One last personal observation. There’s been a lot of fuss in certain circles about comments Benioff is quoted to have made to local media about this potentially being the last Dreamforce to be held in San Francisco due to the ‘doom loop’ narrative. I rather suspect that questions about this will dominate certain members of my profession this week, which is unfortunate (and will rapidly become rather tedious).
The reality is that while the city’s problems are more openly on show than I’ve ever seen them - the retail apocalypse is shockingly striking! - Dreamforce and San Francisco go together in my mind, having attended from the very first event through to this week’s. I’m not alone in that view. My cab driver on the way in from the airport last night was hugely excited about the prospects for the local economy this week and very dismissive of other events that have decamped to the fleshpots of Las Vegas or the Magic Kingdom in Florida.
Let’s be positive. Salesforce is very active in trying to address the social problems that all too many people in the city face. Assuming that the AI start-up influx continues and that these are themselves modern firms that share the Salesforce ethos that business is the greatest enabler for change, the potential for regeneration must offer some grounds for optimism. It would be nice to think that by the time Dreamforce 2024 comes around, things are better for San Francisco and all its occupants.
Still, that’s all for another day! For now, it’s Dreamforce 2023. This is the first article in our dedicated Dreamforce event hub, which formally goes live on Tuesday. As in previous years, we’ll be reporting from the ground on the highlights of this year’s conference all week. So, with that in mind, let’s get underway. See you on the other side!