Anyone that has attended any sort of Salesforce event is likely to be familiar with the company's unique 1-1-1 philanthropy model, where the cloud company committed has committed to donating or discounting 1% of its product sales to nonprofits, giving employees 1% of their annual company time to volunteering and using 1% of its founding stock to offer grants focused on technology innovation in nonprofits and youth development programmes.
The 1-1-1 model was embedded in Salesforce's culture from very early on and the company launched the Foundation programme to spearhead the principles throughout the organisation and to also spread the word beyond its four walls, to try and persuade other companies to do something similar.
CEO Marc Benioff is deeply passionate about the initiative and although his keynote speeches (which always start with a lengthy introduction to 1-1-1) are often met with an eye-roll from the sceptics, it can't be denied that Foundation is doing some fantastic work.
Salesforce's 1-1-1 model has now translated into $80 million in grants, almost 1 million hours of volunteer service and 25,000 NGOs that use Salesforce to run their business.
Not only this, but Benioff has also been known to take a stand against regulators in the US that have attempted to infringe on the rights of gay people in certain States, as well as make efforts to ensure that women are paid and promoted equally to men within the company. These are things that aren't written into the 1-1-1 commitment, but prove that social responsibility is coming from the top of the organisation and is embedded in the company's culture.
As Salesforce's World Tour kicks off in London today, I finally got the opportunity to sit down with Suzanne DiBianca, Salesforce's very charismatic president, whom is responsible for the Foundation programme. She explained to me how it was important that the philanthropic principles were embedded in the company shortly after its inception in 2000. DiBianca said:
And DiBianca sees these two things as key – getting the principles integrated into your company before you get too large and adopting a belief that it's not just about taking care of your shareholders, but all of your stakeholders.
We started the Foundation right when we started the company. We built what we called a three legged stool – a new technology model (the cloud), a new business model (subscription-based) and the new philanthropy model. The reason that I'm going back that far is that I want you to know it was part of our founding tenets as a company.
I started when there was like 60 people in this small technology start-up, full time in the Foundation. There was a huge investment and real big vision about creating a new type of a company that's focused on stakeholders, not just shareholders.
The driver was that we wanted to create a new kind of a company that made philanthropy, giving back, part of who we were right from the very beginning. Marc [Benioff] had a very different experience when he was a Oracle and he really realised that if you start philanthropy much later in a company, it's very hard to make it part of your culture.
Ensuring it's inextricably linked
Whilst she says that it “is possible” for a large organisation that has been operating without a focus on philanthropy to force a social conscience through the company, this is harder to do the larger you get. DiBianca advises that the earlier on you can do it, the better. And from her experience she finds that doing so when you are under 100 employees in size is the optimum time. She said:
I can tell you that something happens with culture that gets set at about 100 people. I have worked with a number of companies that have implemented it later and they can get people fired up and they can still be a great company. It's just that when you are smaller than that, less than 100 people, and you're forming your culture it becomes inextricably linked to who you are. You couldn't take it out if you wanted to.
DiBianca also said that it almost always has to be a CEO-driven agenda, from the top-down. And this is what she is focusing on now. DiBianca and Salesforce are aggressively targeting companies in their early days, typically ones that are growing but are pre-IPO, to make a pledge to adopt similar principles.
For example, this year they have created the 1% Pledge initiative, which is attempting to get 500 companies to commit to the 1-1-1 model. And it seems to be going well, with already 278 companies signed up. She explained:
In 2000 it was kind of just us. In 2008, before everything came down again, we had a couple of big wins, like Google. But now we are in this big technology boom again, my phone is ringing like crazy. I'm getting calls from Pinterest and from DocuSign. I'm very focused on the people that are going to IPO this year, it's harder to do it when you're series D through F. But the pay-off is huge.
So Yelp and Workday, I got the chance to work with them before their IPOs last year, and cumulatively they generated $120 million in their foundations. It's amazing. We think it should be a part of they way you set up and do business.
I think people are beginning to understand that stakeholder management is the most important thing. Shareholder management is a component of that. And a critical one. But it is not the end-game.
DiBianca was also keen to point out – and rightly so – that even though Foundation is operating purely on adesire to pursue a number of philanthropic endeavours, Salesforce has also found that the 1-1-1 model has delivered business value for the company. Namely, Salesforce is finding that people want to work for it because of the culture the company has created and it has also helped to boost the perception of its brand. DiBianca says:
It's not that we do it for that reason, but I'll tell you where it makes the difference. One is in talent acquisition and retention, especially for developers and executive talent. We get great developers and great engineers, they tell us that they love our company.
The other place that it drives business value is brand value. When we were at Dreamforce last year, our annual user conference, Marc [Benioff] dedicated the first third of the keynote to philanthropy. Amazing. But when we moved into the corporate stuff, one of the first customers that we interviewed on stage was a guy that is the CEO of Whole Foods.
They got up to interview him about the product and he said that he didn't want to answer those questions first; first he wanted to say that he was blown away by the amount of time that Marc took to talk about the philanthropy commitment and said that's why he does business with us. That's an example of brand value - and that's coming from a customer.
Foundation customer – Homeless Link
Shortly after speaking with DiBianca I also got the opportunity to speak to one of the customers of Salesforce Foundation – Homeless Link, a membership body for organisations and individuals working with homeless people across England.
Matt Harrison, director at Homeless Link, explained how six years ago the body had built its own internal client relationship system, which a number of its members were using to record the day-to-day work that they were doing with homeless people to record their journey through services, in an attempt to demonstrate their impact. Harrison said:
We built it ourselves and we were running into issues of availability, scalability, performance and upgrading costs.
Harrison said that he was introduced to Foundation as a way to use the Salesforce platform to port the Homeless Link client relationship system over to improve it, scale it and make it more widely available. And this is exactly what Harrison did and launched the new CRM system on the Salesforce platform in 2010.
Homeless Link has now been able to scale the product because of the Saleforce cloud and now has 7,500 staff across England using the system every day. Also, because of Salesforce's generous Foundation pricing, and the ability to sell it on to its members, Homeless Link has also been able to generate £300,000 profit to date.
Client recording software is about three things. It's about helping our members deliver better services. It helps our members demonstrate the impact, using reporting, dashboards, the up to date information so that they can demonstrate their impact to their funders. It helps us learn about what needs homeless people have and what interventions work to end homelessness. We also run it as a social enterprise, where we have a commercial model of selling our software to our members.
Harrison was also keen to highlight Salesforce's approach to the project, which was about making sure that it could do whatever it could to make it work for Homeless Link – highlighting the extent to which the culture is embedded in Foundation and Salesforce. He said:
Foundation was very supportive. From the outset, when we talked to them about our vision, the conversation with them was telling them what we wanted to achieve eventually and then them looking at ways that they could make it happen. I said to them that even at the charitable discount the price is hard and they said: how much does it need to be to get it to work? It's that sort of conversation.
It's not often I struggle to be sceptical about a conversation with a software company. But this is one of those times. I completely buy into the 1-1-1 vision – it isn't something that Salesforce HAS to do, but it is something that it wants to do. And it's driven right from the top. Kudos to Benioff and DiBianca and the rest of the Saleforce team for its efforts.
I really hope more companies see the benefits that can be gained from philanthropic endeavours and follow Salesforce's lead.