Innovation, Co-Creation, and Design Thinking How Salesforce's Ignite Team Accelerates Enterprise Digital Transformation B5928-PDF-EnG

B5928
Date: October 1, 2018
S A R A L. B E C KM AN
Innovation, Co-Creation, and Design Thinking: How

Salesforce’s Ignite Team Accelerates Enterprise Digital
Transformation
The biggest challenge was to get Salesforce to

step back and stop selling for a second. Given the
immense pressures of delivering quarterly—if not
monthly—deal cycles to support a subscription-
based business model, Ignite’s approach
encountered the antibodies of the dominant
culture, which was a very successful one. So far,
we’ve proven that our approach can deliver results,
but we still have to show we can make this model
work at scale.
—J ASON W ILD , S ENIOR V ICE P RESIDENT ,

S TRATEGIC I NNOVATION , A ND
G LOBAL L EADER OF I GNITE
For the Ignite leadership team at Salesforce, the end of 2015 was a time for celebration and
contemplation. On one hand, the group had overcome significant obstacles related to its unique
position within the company and early questions about the value of its work. As a result, Ignite
had gone from facing internal and external resistance to being in high demand. On the other
hand, Ignite’s leadership knew the team would need to do more than just follow the same growth
path in order to succeed in the long term.
Ignite began when a few of Salesforce’s key customers started asking its founder and CEO, Marc
Benioff, for strategic—rather than just technical—guidance. Benioff spearheaded the formation
of a design-thinking and innovation team within Salesforce in 2012, starting with one person—
Senior Lecturer Sara L. Beckman prepared this case study, with assistance from Case Writer Elizabeth Whalen, as the
basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation.
Copyright © 2018 by The Regents of the University of California. All rights reserved. No part of this publication may
be reproduced, stored, or transmitted in any form or by any means without the express written permission of the
Berkeley Haas Case Series.
This document is authorized for use only in Rohit Joshi's Innovation through Design Thinking PGP22 at Indian Institute of Management - Shillong from Nov 2023 to May 2024.
SALESFORCE IGNITE 2
Simon Mulcahy, the founder of Ignite—to deliver strategic consulting to Salesforce's biggest
customers. In contrast to a typical consulting engagement, which concludes with the solution
pitch, the Ignite team focuses on co-creating alongside customers on bespoke projects, identifying
and prototyping solutions designed to deliver breakthrough business value. Often, Ignite
conducts deep research into each customer’s customers to uncover gaps in user experiences,
products, and services. In a project with a well-known bank, for example, Ignite interviewed
bank executives to understand their goals and pain points, and then interviewed the bank’s
customers to identify gaps in their banking experiences and why they chose any given bank over
others. Sometimes, Ignite's work focuses inside its client’s organization, researching the
experience of that client’s employees and proposing solutions to make their jobs easier or
increase employee engagement.
Although Ignite is part of a broader sales process, it does not explicitly pitch Salesforce products
during its engagements, and customers are under no obligation to buy Salesforce licenses at the
end of an engagement. Rather, the team’s charter is to help customers take a fresh look at the
way they engage with their employees and/or customers and thus uncover opportunities for future
growth, which may involve anything from a simple product update to a radical redesign of their
underlying business model.
Salesforce’s Evolution: Democratizing Software
This collaborative approach to innovation is unique in the software category, but in line with
Salesforce’s core culture. When Benioff originally conceived the idea for Salesforce in 1999, he
wanted to make business software “simpler to use. . .and more democratic, without the
complexities of installation, maintenance, and constant upgrades.” 1 He recognized that the
Internet presented game-changing possibilities and foresaw that it could revolutionize how
businesses built and consumed technology, similar to how Amazon was revolutionizing the
consumer buying experience. He decided to start his business technology revolution with the one
thing he believed was most critical to the long-term success of any company: Customer
Relationship Management (CRM).
Benioff and his co-founders realized very early, however, that his vision for lasting innovation
would require more than a shift in the underlying technology used to deliver software. They
outlined three pillars for what would become Salesforce’s sustainable innovation model: a cloud-
first technology platform, a subscription business model (Software-as-a-Service, or SaaS), and a
commitment to social responsibility known as the “1:1:1” model.2
The cloud technology model that Salesforce pioneered has become well known since 1999,
largely because it is now the backbone of consumer apps on smartphones and other connected
devices. The SaaS business model has become similarly popular in a wide range of business
applications. Companies using SaaS subscribe to the applications they use by paying per-user,
per-month license fees. Companies selling SaaS-based solutions must consistently demonstrate
the value they provide to customers and always work to increase that value because customers
can easily reduce or cancel subscriptions if they are not seeing the results they expect.
1
Behind the Cloud, Marc Benioff and Carlye Adler, Jossey-Bass, 2009, page 3.
2
The 1:1:1 model dedicates 1 percent of Salesforce’s equity, 1 percent of Salesforce’s product and 1 percent of
Salesforce employees’ time back to communities around the world.
SALESFORCE IGNITE 3
The SaaS model was a major departure from traditional CRM and other enterprise business
software models, in which companies paid millions of dollars up front as a capital expense, spent
years to implement, and often had to heavily engage hardware and change-management
consultants. The combination of SaaS and the cloud design of the technology—which allows
companies to modify Salesforce products to meet their unique needs without making large
investments in customization—democratized access to business technology. For the first time,
small- and medium-sized businesses (SMBs) could adopt the same enterprise-level technology as
the giants in their industries. These companies could not previously afford applications like CRM
and were willing to try software from a new company. For SMBs targeting aggressive growth or
trying to break into industries traditionally dominated by large, slow-moving incumbents,
Salesforce was an accelerant for growth and disruption.
The model did have a disadvantage: large companies were less likely to become Salesforce
customers early on. In some cases, they already had CRM systems in which they had invested
tens or even hundreds of millions of dollars. In other cases, they saw working with a new
company as potentially risky.
Over time, Salesforce expanded its technology portfolio beyond CRM to other core business
applications such as service, marketing, and e-commerce; in 2006, Salesforce extended its
underlying architecture and platform to allow customers to rapidly configure and build their own
apps. Salesforce’s roots are in business-to-business (B2B), but in recent years, due to
acquisitions and investments, Salesforce has not only entered the business-to-consumer (B2C)
market but is considered the leader in that market. The Salesforce AppExchange, which is
similar to Apple’s App Store for consumer apps, allows companies to build and sell applications
on the Salesforce platform. The AppExchange also provides a way for Salesforce labs or other
community innovators to provide free, sometimes open-source, packages that extend the
functionality of Salesforce in new ways, which accelerates innovation across the ecosystem.
Today, Salesforce is on track to earn more than $12.6 billion in annual revenues in its current
fiscal year,3 and it works with some of the largest global businesses in the world. While the SMB
market remains critical for Salesforce, just over half its revenue comes from large enterprises—
one of the fastest growing parts of the business. As recently as 2013, nearly two-thirds of
Salesforce’s revenues came from clients with fewer than 3,000 employees, and most deals were
for less than a million dollars.4 Salesforce’s initial successes came mostly in the U.S. market, but
the company now derives approximately 25 percent of its revenues from international markets
and sees significant room for additional growth outside the U.S. (See Exhibit 1 for data on
Salesforce’s revenues.)
Regardless of their size or the parts of the platform they use, Salesforce’s customers have one
thing in common: the option to cancel their subscription at any time. As a result, retaining
customers is essential to Salesforce’s success, and retention depends heavily on customer success
with Salesforce products.
3
Salesforce Investor News: Salesforce Announces Record Fourth Quarter and Full-Year Fiscal 2018 Results,
https://investor.salesforce.com/about-us/investor/investor-news/investor-news-details/2018/Salesforce-Announces-
Record-Fourth-Quarter-and-Full-Year-Fiscal-2018-Results/default.aspx
4
Because Salesforce sells licenses per user, it uses employee count to classify customers, rather than annual revenues
or other measures of company size; employee count indicates the size of the opportunity to Salesforce.
SALESFORCE IGNITE 4
Salesforce’s Customer Focus and Sales Organization
Since Salesforce’s inception, Benioff has led the company to be highly customer focused. He
personally spends time on annual listening tours to talk to Salesforce customers about their
businesses. He asks about what challenges companies and executives are facing in their
industries and how Salesforce might better serve them. Benioff takes what he learns and writes a
V2MOM (pronounced “V2 mom”) for himself that defines his Vision, Values, Methods,
Obstacles, and Measures. Vision defines what he wants to do; values describe, in priority order,
the beliefs guiding the vision. Methods cover the actions necessary to achieve the vision, and
obstacles identify challenges to be acknowledged and overcome. Measures are the desired
results. (See Exhibit 2 for Salesforce’s first V2MOM written in 1999.)
Each year, Benioff shares his V2MOM with Salesforce employees at the annual sales kickoff
meeting and revises it in real time based on employee feedback. Over the next few weeks,
Benioff’s V2MOM cascades through the Salesforce organization; his direct reports write their
V2MOMs based on his, managers write theirs based on those of the executives, and so on.
Within this framework, employees and teams determine how they contribute to the company’s
progress towards Benioff’s vision, based on his understanding of the core challenges facing
Salesforce’s customers.
Even though everyone writes a V2MOM each year that includes specific values, the company’s
overall values remain the same. They are Trust, Growth, Innovation, and Equality, in that order,
meaning, for example, that Salesforce will not sacrifice trust to drive growth.
In parallel with the annual construction of V2MOMs, Salesforce undergoes a reorganization in

February, at the beginning of each fiscal year. Company-wide reorganizations are done only once
a year so as not to overly disrupt the relationship-building activities that are so critical to a sales-
driven culture such as Salesforce’s. In the enterprise software space, relationships can take
quarters or even years to develop and are critical to driving sales.
A large percentage of Salesforce employees are salespeople, known as Account Executives

(AEs). Their compensation is based on the Annual Contract Value (ACV) of net new licenses
sold. ACV measures the value of a sales contract over a twelve-month period. For example, if a
customer commits to a twenty-four-month contract for $120,000, its monthly fee is $5,000, and
thus the ACV recognized by the AE is $60,000. AEs are reshuffled each year, so their
compensation is limited to the first year of each of the transactions they complete because they
may not be involved in the account in subsequent years. Salespeople get most of their income
from ACV-based commissions that are paid quarterly, so they have strong incentives to accelerate
the sales process to make their quarterly targets and to avoid anything that might slow down or
complicate closing the sale.
Salesforce Sets its Sights on Enterprise Clients
By the late 2000s, Benioff's V2MOM included a focus on expanding Salesforce’s presence in the
large-scale enterprise market. The company began hiring new leaders to help make the transition.
Two notable hires were Simon Mulcahy and Keith Block. Through his work at the World
Economic Forum, Mulcahy had built relationships with Chief Innovation and Chief Information
Officers from a wide variety of large enterprises and gained a deep understanding of the evolving
executive agenda at the world’s top companies. Benioff tapped Mulcahy to start the initiative that
ultimately became Ignite. Block, former Executive Vice President of Oracle’s North America
SALESFORCE IGNITE 5
sales and consulting organization, joined Salesforce in June 2013 as President and Vice Chairman
and immediately joined the Board of Directors. He quickly began developing Salesforce’s
enterprise sales capabilities.
Companies such as SAP and Oracle who sell enterprise software to the world’s Fortune 1000
companies historically have had sales teams with deep subject matter expertise who can speak the
language of their customers. For example, an enterprise software seller might have a team
devoted to working with financial services companies that thoroughly understands features
related to security and regulatory compliance. Another sales team might focus on consumer
packaged goods firms with a deep understanding of branding and consumer marketing.
At Salesforce, the original formula for growth depended almost entirely on hiring AEs who knew
Salesforce products and how they worked generally in SMB operations. The AEs focused more
on territories and less on industries than sales teams in more traditional enterprise software
companies did. The scale function at Salesforce was seen as simple and linear: more AEs
equaled more ACV. However, as the company moved to serve larger enterprise customers, it
realized that enterprise software sales required not just more AEs, but also more technical staff,
including Sales Engineers (SEs), Enterprise Architects (EAs), and Business Value (BV) analysts
who could collectively present a compelling case to the customer’s finance team to justify a
multi-million dollar purchase.
To support this new approach, Block created a “big deal” team in 2013, staffed primarily with
salespeople with experience at companies like IBM, Oracle and SAP—companies with long
histories of enterprise sales. “Our sales teams were thinking single-digit millions were big deals,”
explained Teddy Zmrhal, Senior Managing Director of Strategic Innovation, Ignite. At
companies like Oracle, though, big deals were much larger, in part because of the required
hardware purchases. “The big-deals team was saying, ‘Those single-digit millions aren’t big
deals. We can do much bigger deals.’” The ambition level needed to be raised within the
company.
The big-deals mindset and approach, however, did not easily integrate into the Salesforce
environment. Although the new staff had years of experience closing multi-million-dollar deals,
their methods did not immediately increase the size of deals. They also did not help AEs, who
were paid quarterly based on the ACV of net new licenses sold, meet their tightly constrained
commission timelines. By the end of fiscal year 2015, the big-deals team was dissolved. “That
was the last time the salespeople were going to let somebody else take over their accounts,”
Zmrhal observed. Salesforce needed to find a different approach.
The Rise of Design in Software Companies

In parallel with this experimentation with new sales models at Salesforce, the role of design in
Silicon Valley was growing. The purpose was to help companies better address the challenges of
leveraging rapidly evolving technologies to better serve customers. One of the earliest
acquisitions of a design firm by a technology company came in 2004, when manufacturer
Flextronics International5 took a majority stake in frog design, the company that had helped
5
Flextronics International is now known as Flex Ltd.
SALESFORCE IGNITE 6
design Apple’s first Macintosh.6 The acquisition trend accelerated between 2010 and 2013, when
companies including Google and Facebook acquired design agencies. Consulting and financial
services companies followed suit, with Accenture acquiring Fjord in 2013, Capital One buying
Adaptive Path in 2014 and Monsoon in 2015, and Deloitte acquiring Heat in 2016. (See Exhibit
3 for a more complete listing of design-firm acquisitions by technology, consulting, financial
services, and other firms.) According to the Design in Tech Reports by John Maeda, former
Design Partner at venture capital firm Kleiner Perkins Caufield & Byers, companies acquired
almost ninety design agencies between 2004 and 2017, fifty-seven of them between 2015 and
2017.7
Maeda’s arrival at Kleiner Perkins in 2014 was itself a signal that technology companies were
embracing the need for a more customer-centered focus in the creation of their products and
services. Maeda was the first designer to work at a major venture firm on Sand Hill Road, the
Menlo Park, California street often considered the global center of venture capital. Soon after,
other venture firms began hiring design partners as well.
In his first Design in Tech report, published in March 2015, Maeda described the forces driving
these acquisitions. The old way of thinking was that “The solution to every new problem in tech
has been simple: more tech. A better experience was made with a faster CPU or more memory.”
However, as the marginal gains from increases in computing speed fell, tech companies needed a
new way to satisfy customers. That gave way to a new way of thinking, in which design matters
more than computing power.
Companies acquiring design firms have handled integration in various ways. Some choose to
purchase the design firm and leave it to run as before the acquisition, with the only change being
that the earnings now go to the parent company. Others use the acquired firm to create new ways
to work with clients, such as building an app salespeople can use when talking to clients to glean
insights. Still others turn the design firm into a company innovation lab responsible for
developing future products or services, or they convert the design firm into their user experience
(UX) or customer experience (CX) design department. Salesforce found another path—one that
leveraged the company's customer focus, its SaaS model, and its flexible platform.
The Key Elements of Design Thinking

At the core of design thinking is a deep understanding of customers and end users that reveals
latent or unstated needs. Developing this empathy requires going well beyond surveys and data
analytics to include interviewing customers, end users, and other stakeholders in person, carefully
observing them to notice what they leave unsaid. Observations can reveal problems for which
end users have found makeshift solutions and thus present new business opportunities. For
example, most cyclists roll up one of their pant legs to prevent grease stains and to keep their
pants from catching in the gears. A better solution might be a cover for the gear or a mechanism
that doesn’t require grease. Because the cyclists might consider the problem solved, they don’t
mention it as a need in an interview, but observation of cyclist behavior would uncover the need.
This notion builds upon the famous quote from Henry Ford, founder of the Ford Motor Company:
6
Dolan, Kerry, Forbes, “Design, by Contract,” January 24, 2005,
https://www.forbes.com/2005/01/24/cz_kd_0124flextronics.html#526c14353531
7
The 2015 Design in Tech Report is available at https://www.slideshare.net/kleinerperkins/design-in-tech-report-2015
The 2017 and 2018 reports are available at https://designintech.report/
SALESFORCE IGNITE 7
“If I had asked people what they wanted, they would have said a faster horse.” Instead,
understanding the problems customers aim to solve or the outcomes they want to achieve offers
more potential business value than asking them what solutions they would like.
Design thinking is a set of principles and approaches popularized by IDEO and the Hasso Plattner
Institute of Design, but now widely used by companies large and small around the globe. The
approach focuses on gaining customer insight and using it in a highly iterative process of rapid
prototyping and testing to generate solutions for customers. Design thinking generally begins
with developing customer empathy and understanding through observation and interviews. The
information from this work, which is often less structured than simple survey data, is used to
frame and reframe the problem to be solved for the customer or the opportunity to help the
customer.
Frameworks such as customer journey maps, affinity diagramming, and problem statement
matrices are useful in extracting insights from the research and identifying opportunity spaces.
The outcome of these observation and framing phases is an opportunity statement that captures
the user’s problem and emotional state without incorporating a specific solution. For example, “a
frustrated biker needs a way to tie the leg of his pants when biking” is user-centered but suggests
a solution: a different sort of tie. “A frustrated commuter needs a way to prevent damaged pants
when he bikes to work” and “A frustrated commuter needs a way to get to work without worrying
about damaging his outerwear” don’t suggest specific solutions. They also are not so abstract that
designers struggle to know where to begin. For example, “A frustrated commuter needs a way to
travel without worrying about his clothes” may be overly broad. Often the problem statement is
framed as a “how might we?” question such as, “how might we help bicycle commuters minimize
damage to their outerwear?”8
Once the problem space has been framed, the process moves to brainstorming potential solutions,
even those that seem wild or half-developed, from which the design team selects a few ideas to
prototype and test. At this stage, returning to the idea of deep empathy is often helpful because
observing target users interacting with a prototype can yield valuable and potentially unexpected
insights that inform the next iteration of the prototype. Observation may even reveal that the
opportunity statement needs to be revised again. Iteration continues until a prototype or a set of
prototypes emerges as the best option to pursue.
Throughout these stages, design teams may share their findings and ideas with organizational
leadership and other key individuals to gain support. The last stage of design thinking is typically
a pitch to get the resources necessary to make the final prototype or prototypes a reality.
For design-thinking consulting firms, the pitch is the end of their work. For example, a design
consultancy proposing a new chain mechanism that kept the cyclist’s pant leg clean would not be
responsible for identifying potential sources for materials or manufacturing, or even the business
model that would be used to sell and deliver the new mechanism. Rather, the design firm’s client,
in this case probably a bicycle manufacturer, would need to manage all aspects of producing,
pricing, selling and delivering the new mechanism.
8
These statements are taken directly from the examples provided in the WORKdifferently Innovators’ Guidebook,
available at https://www.salesforce.com/content/dam/web/en_us/workdifferently/documents/innovators-guidebook.pdf
SALESFORCE IGNITE 8
Ignite 1.0
While on his annual listening tour in 2011, Benioff began receiving a new kind of feedback from
customers. “You always ask us about us and what we’re doing,” went the refrain. “We want to
know what you’re doing to grow so much and so quickly.” To Benioff, this question translated
into an opportunity for Salesforce to expand its relationships with customers by working with
them in a new way.
Two other trends emerged around this time. First, some customers expressed to Benioff a desire
for Salesforce AEs to take a new approach. These customers wanted conversations with AEs to
change. With the Salesforce portfolio of products constantly expanding, and the flexibility and
robustness of the platform improving, customers were pointing out to Benioff that AEs focused
too much on the features and functions of the latest Salesforce product. These customers wanted
AEs to focus on their evolving needs and, more generally, they were seeking a technology partner
who could help them develop new capabilities and sources of competitive differentiation.
The second trend was that some of the world’s largest companies were making Salesforce their
preferred technology platform for digital transformation. They were making unprecedented
financial commitments to Salesforce and its cloud-first model, and they had equally ambitious
expectations for the business impact of their investments. However, their size and organizational
inertia often hindered their ability to implement the technologies and enact the level of
organizational change needed to successfully transform.
For example, one large U.S.-based bank had purchased so many licenses that it was Salesforce’s
biggest customer, but bank employees weren’t using the licenses. A large U.S. insurer designed
its Salesforce implementation plan in such a way that that the company would not begin realizing
value from its purchase of licenses for four years. Although that time frame was perhaps not
unusual for typical enterprise software, it meant the customer was missing out on the value of
switching to the cloud: the accelerated return on investment. To the extent such enterprise
customers became dissatisfied or frustrated enough to cancel their subscriptions, Salesforce
would lose that revenue. To the extent that other enterprise customers shied away from
Salesforce as a result, the company could also lose the ground it had gained in expanding beyond
SMB customers.
Benioff tasked Mulcahy, Vice President of Solution Engineering at the time, with finding a way
to retain the bank as a customer, and the first iteration of Ignite was born. Mulcahy and his team
worked closely with the bank to improve its implementation. One of the side benefits of this
work was learning about the specific needs of the financial industry, which led to the
development of a cloud dedicated to financial services. Other Ignites followed, many of which
were sourced directly through Benioff, including one for an international non-governmental
organization. The connection to Benioff helped smooth the relationship between Ignite team
members and the AEs, and the successes that followed showed the AEs the value of this new
consultative approach.
The early Ignites were not strongly grounded in design thinking. The Igniters were primarily
“strategy consultants of the creative ilk,” as Zmrhal describes them. Although they employed
journey maps, persona-driven brainstorming, and other design-thinking tools, they were not
deeply trained in design or design research.
“It was more about collaborative innovation,” said Jason Wild, Senior Vice President, Strategic
Innovation, and Global Leader of Ignite. “The idea was the right one, which was, let’s get a
SALESFORCE IGNITE 9
bunch of people in the room from different parts of the business—leaders, subject matter
experts—and focus on something that’s meaningful to all of us. Let’s come up with an
understanding of what problem we’re really trying to solve and a bunch of different solutions.”
The Ignite team worked to align stakeholders in the client organization and did interviews, but
with executives rather than end customers. “We were accepting as true and accurate the input of
those people, regardless of how well they actually knew their own customers,” Wild continued.
“And as we went on, we realized that was important, but we needed to do a lot more in terms of
making sure we were solving the right problems. We needed to connect more directly with the
insights necessary to make sure we had a high level of confidence around the solution. And that
meant customer research.”
Ignite’s First Growth Spurt

Ignite’s early successes showed that Ignite had the potential to strengthen Salesforce’s
relationships with enterprise clients, but much work remained to realize that potential. Wild, who
joined Ignite in July 2013, set as his first priority proving that the Ignite concept merited
additional investment. That meant landing a big deal, one that went beyond retaining an
enterprise customer and supported the sale of additional licenses.
When Wild joined, the Ignite group was a team of eight, most of whom were working on projects
with technology companies in the Bay Area. He, however, was tasked with going to Texas to
meet with the CEO of a large global energy services company. After Wild finished his pitch, the
CEO said, “I have a whole room full of sticky notes down the hall from another design firm. I’m
still trying to figure out what the heck to do with them.” Wild responded by saying, “Well, we
can bring that to life,” meaning Salesforce could translate the ideas into action. But the executive
wanted something else. He explained that a recent headline-grabbing industrial accident had
ultimately been traced back to his company, even though another company had gotten most of the
negative publicity. “He said, ‘If Ignite can help us with this, I’m all in,’” Wild explained.
Wild, representing Ignite, was joined by one AE and a SE on the team. As the scope of the
project became clearer, Wild and the team started talking about the potential deal size. The AE
estimated the Ignite work would result in a deal lasting two to three years and be worth one to
two million dollars a year. Wild, who prior to joining Salesforce had worked at IBM for twelve
years, thought that estimate was far too low. “I said, ‘I think we should start with six years,
eighty million dollars. The AE laughed and almost fell out of his chair. We ended up at four
years, fifty million dollars.”
Despite the success of that deal, some people within Salesforce remained uncertain about Ignite;
they believed the deal was a stroke of luck rather than a proof point. Another big deal that
materialized shortly thereafter helped change their minds. It was with a cable and satellite
television provider.
“That was one of the first ones where we did significant deep research,” Wild said. An Igniter
rode along with installation techs for the company to understand their daily lives and gain a deep,
nuanced understanding of the end users. The insights and prototypes Ignite helped the company
build out to improve the experiences of those techs in the field resulted in a deal exponentially
larger than that initially envisioned by the sales team. The unprecedented size of these
transactions helped the sales organization see the value of Ignite, and that led to Wild hiring
approximately twenty more people starting in late 2013. These new hires were also strategy
consultants, or what Mick Costigan, Innovation Senior Director, Ignite, refers to as “all-around
athletes” who were good at many things but weren’t specifically trained in research or design.
SALESFORCE IGNITE 10
The rapid success was both a blessing and a curse because, while it created credibility for Ignite,
it also set high expectations. “Like with anything, there isn’t one thing that creates an outcome,”
Wild said. With the energy services company, for example, the customer had an urgent need that
helped propel the deal to the closing table. “It also created a little bit of a hole for us in the sense
of, we were told, ‘Great job, now go do twenty-five more of these,’ and it’s just not that easy,’”
Wild elaborated.
At that time, Ignite offered three types of engagements: an Ignite Workshop that typically lasted
a day and was intended to expose a customer’s leadership to design thinking; an Ignite Advisory,
which lasted a few weeks but did not involve significant research with customers’ customers; and
a full Ignite, which took between six and twelve weeks. Over the next year, these mixed
engagement types produced understandably mixed results. When Costigan and others analyzed
the patterns from those engagements, they found Ignite Advisories were not generating
commercial results for Salesforce. “If we didn’t get in there and really understand the customer’s
business, we were just not able to create a compelling vision,” he said.
“When we would do the small and medium versions of Ignite, I always felt like we were
cheating,” Wild added, referring to the Ignite Workshops and Ignite Advisories, respectively.
“We were trying to convince ourselves and convince a client we had an answer and a solution. It
was probably directionally correct, but we were moving really fast. Part of that realization was
that any good innovation—any good transformation project—should be grounded in good
insights and good research.”
The full Ignites were producing the best outcomes for both Salesforce and its customers because
they involved deeply understanding the problems facing the customers’ customers, which lent
credibility to Ignite's recommendations and showed companies a clear way to implement
customer-centric change. Wild realized that doing more full Ignites would require an even more
expanded team; Ignite needed to add people with design agency backgrounds to round out a
group that was already good at gaining executives’ trust.
Overcoming External and Internal Resistance

Refining its offerings was just one of Ignite’s major challenges between 2013 and 2014. At the
time, Ignite was pitching to as many of Salesforce’s key customers as possible. In many cases,
those pitches yielded no results. The energy services executive was not alone in his perceptions
of design thinking. In response to Ignite pitches, other executives raised objections that they
didn’t want “heaven on a whiteboard”—that is, ideas that don’t translate into business value.
Some customers were also skeptical that Ignite would be truly agnostic and not try to pitch
Salesforce products.
To overcome this resistance, Ignite talked to C-suite executives at enterprise companies about
capabilities rather than products, and about customer lifetime value; Ignite focused on what
executives cared most about rather than the newest Salesforce product. It also avoided the term
“design thinking” and used terms like “customer-centered design” or “design-led innovation” to
emphasize Ignite’s action bias. If a customer wants to realize the vision it co-creates with Ignite
and buys Salesforce licenses to do so, Salesforce then turns the vision into reality, often in
partnership with implementation consultants. The customer is not left to do that work on its own,
as it would be at the end of a typical design-consultancy engagement. In addition, Salesforce’s
products are built on a highly flexible platform; designing new apps doesn’t require reconfiguring
code and trying to create a close-enough solution within the constraints of the existing product.
In some cases, the customer agrees to an engagement only to decide against pursuing the co-
created vision and, therefore, against buying any additional Salesforce licenses. Indeed, one
engagement with a large retailer lasted six months from initial discussion to final presentation
and, despite customer enthusiasm for the vision, resulted in no sale. That engagement did help
build the relationship between the retailer and Salesforce, though. Scott Gilbert, Innovation
Senior Director, Ignite, who led the project, explained: “Ignite doesn’t necessarily meet all the
objectives of the company every time, but in that case, it certainly created an atmosphere and
experience and a set of relationships that the account team would never have had access to, had
we not invested.”
Compared to external resistance, internal resistance was far greater. Salesforce AEs didn’t want
to repeat their experiences with the big-deals team, so many avoided Ignite. They often saw the
Ignite process as taking too long, especially as compared to working with SEs, who could make a
prototype in a much shorter time period than Ignite could. The AEs wanted to generate deals
quickly in order to get paid and meet their quotas; because they didn’t distinguish the type of
work Ignite did from that of the SEs, they concluded that Ignite wasn’t worth the wait.
Some AEs didn’t understand the Ignite process. For example, within Wild’s first month at
Salesforce, one AE invited Ignite to a meeting with a client, but the AE simply wanted to have an
hour-long brainstorming session. At the end of the hour, the AE expressed disappointment in the
Ignite concept. Wild then explained the Ignite process and that it goes far beyond brainstorming.
Another related obstacle was that Mulcahy transitioned away from Ignite to develop the financial-
services cloud, leading some people within Salesforce to believe Ignite was no longer an
executive priority.
Ignite’s size and method of working created another problem: once the team’s time was fully
booked, it could be booked for weeks. That led to perceptions that Ignite was difficult to work
with because the team wasn’t readily available in the same way SEs are.
Other salespeople, however, saw Ignite’s potential. One early Ignite project came to the team
because a customer had just purchased $25 million in licenses, and the AE sensed additional
opportunity. Even though Ignite wasn’t specifically targeting that customer, the team took on the
project, in part because it had few other leads to pursue at the time. Ignite considers that project,
which spanned four months and included seventy interviews, one of its most successful early
engagements. The team had support from two senior vice presidents at the customer and buy-in
from the CEO’s direct reports; Ignite also had good access to the organization.
Throughout these projects, Ignite was evaluated based on the ACV it influenced. If Ignite work
led to a deal, the size of that deal was measured by the ACV metric. Early in 2014, Ignite
leadership built a systems diagram illustrating the different elements that made Ignite work and
how Ignite fit into the sales process. (See Exhibit 4.) The diagram showed that the biggest
bottleneck in the system was the lack of enough Igniters to do projects. “We built it around
average ACV per additional head,” Costigan explained. “It showed the history of how many
people we had and the ACV we influenced. Imagine we get a productivity improvement because
we’re better at what we do, more people understand us, and we have more utilization time and
less down time. If you give us this many more people, here’s how much more you can expect us
to do next year.” That diagram helped justify the hiring of approximately twenty more Igniters,
who joined in the spring of 2014.
By the end of 2014, Ignite had accumulated enough successes that word was spreading among
salespeople: if they wanted to land big deals, Ignite could help. “All of a sudden, one sales guy
sees his colleague get a zero put on [the end of] this deal. He asks, ‘Hey, how did you do that?’”
Zmrhal recalled. “The other answers, ‘Oh, I used this group Ignite.’ So, not only the perception
but the power flipped pretty drastically. It went from, ‘Get away from my account’ to ‘Hey, can
you help me out?’”
Ignite Experiments and Grows in Different Ways

Since Ignite’s inception, different parts of the team had taken different approaches to
engagements. Some Igniters worked out of the San Francisco headquarters office and covered
projects in the western half of the U.S. Others worked across the eastern U.S. and didn’t share a
physical space. This presented a unique opportunity to experiment with different approaches to
learn what was most effective.
Additionally, Igniters in the east would often work on multiple projects in parallel rather than on
one larger engagement at a time, which was more typical in the west. Engagements in the east
were often shorter, measured in weeks, and frequently resulted in deals of between $500,000 and
one million dollars. In the east, engagements also tended to focus more sharply on products and
on helping AEs close specific deals. In some ways, the east approach to Ignite was a hybrid of
the typical solution engineering and prototyping method employed at Salesforce and the approach
of the west team, which often included weeks or even months of research and took a less deal-
specific approach.
Interestingly, each team accounted for approximately half the 2015 total Ignite-influenced ACV,
approximately $110 million—up from about $24 million the year before. The east team overall
engaged a larger number of customers seeking help to begin or accelerate their digital
transformation efforts. The west team’s work led to fewer but larger deals.
A third group also emerged from the Ignite efforts. Katherine Von Jan developed the Ignite
Incubator to discover and explore potential future Salesforce products. In keeping with Ignite's
product-agnostic approach, Von Jan had leeway to agree to an engagement even though she had
no idea as to which, if any, of Salesforce’s products might meet the customer's goals. She soon
learned that Salesforce had recently acquired an analytics company. “That product hadn’t
launched yet; it hadn’t even been announced that Salesforce had a product in that space, but I
learned about it and met with the product team,” Von Jan said. “[The client situation] seemed
like a perfect use case for their product, so the team agreed to help.”
Later on, based on observations across a number of Ignite projects, Von Jan’s group started
developing what it believed could be a new Salesforce product. Wild, who was by then leading
Ignite, knew that executive leadership believed product development should be happening
elsewhere in the organization, not within Ignite. He therefore provided cover for the project so
that Von Jan could nurture the work until it was ready to be migrated into the product
organization.
Throughout its early years, Ignite was also doing engagements outside the U.S., largely to help
Salesforce grow its international business. However, Salesforce leadership in those regions
believed it made more sense to have local control over Ignite work rather than have U.S.-based
teams lead the engagements. In 2014, these regions were granted that control, and the U.S. Ignite
team shifted its focus to U.S. engagements.
Finding the Best Path Forward
After Ignite engagements in 2013 and 2014 helped Salesforce secure some of the biggest
enterprise deals in company history, the sales organization started to demand more of Ignite’s
services. As Ignite built a portfolio of successful projects that demonstrated its emphasis on value
creation, customers grew more interested in the possibility of an Ignite engagement. By late
2015, Ignite was in high demand from AEs and external customers alike.
As Ignite’s biggest year came to a close, demand was increasing, and the team needed to grow
more, but first, leadership needed to answer important questions. Despite Ignite’s successes,
members of the leadership team believed changing Ignite could improve results. In late 2015,
Peter Doolan, Executive Vice President of Digital Transformation and Innovation, Wild, Zmrhal,
Costigan, and Steve Thompson, Innovation Partner and Practice Lead, Ignite, were considering
how to meet demand.
As these Igniters gathered in a conference room, they sought advice from Doolan on how to move
forward given his experience in growing enterprise software companies with strategic
investments. They surveyed the San Francisco skyline, including the new Salesforce Tower
nearby, and wondered how best to scale. They contemplated questions such as what kind of
employees to hire, how to organize and develop them, and how to measure Ignite’s impact.
The geographic divide was one issue. Having essentially split headquarters created disparities in
the styles of engagements, and it meant that the Ignite teams didn’t have easy access to each
other’s knowledge and techniques. Furthermore, the enterprise clients Ignite serves are often
global, but depending on which team they worked with, could have different Ignite experiences.
Would this, the Ignite leadership team wondered, create problems as Ignite grew?
Another issue was whether ACV was the right metric to evaluate Ignite’s impact. The quarterly
nature of commissions combined with the fact that ACV includes only the first year of a deal did
not align with the timing or nature of Ignite’s work, which would sometimes lead to a deal
months or even a year after an engagement. In addition, as the teams serving enterprise clients
grew, questions arose about whether ACV accurately reflected everyone’s contribution to a deal.
As Kardyhm Kelly, Innovation Senior Director, Marketing, Ignite, put it: “As you add resources
that do all these different things, all of which might influence the ACV number, people become
less and less convinced of your contribution.”
With Ignite in high demand, qualifying potential engagements became more important. What
would make an ideal Ignite, and how would that be determined? “If we’re going by the theory
that we shouldn’t know the problem we’re solving when Ignite walks into the room, we shouldn’t
know what the deal looks like, either,” Kelly observed. However, Ignite needed to focus on high-
value opportunities in order to continue demonstrating its value to Salesforce. Some Salesforce
customers might want an Ignite but not be ready for one for a variety of reasons, including not yet
having executive buy-in for the concept, not having a clear picture of what Ignite could work on,
or not having a budget for licenses. “Here’s the dilemma: If you have an opportunity that could
potentially become a big opportunity but currently is not a big opportunity, do you qualify them
in or out?” added Harpreet Khurana, Innovation Partner, Ignite.
Continuing to grow ultimately meant adding people, but what was the best way to do so? An
acquisition would certainly present integration challenges, but it could also add new knowledge,
skill sets, and tools that Ignite, which was still primarily staffed with generalists, did not have.
Furthermore, money for hiring people would come from a different source than money for an
acquisition. Finally, was regional control of international Ignite projects the best way to serve
customers? Or, would it be better to have single Ignite entity that served all of Salesforce’s
customers, both domestic and international, using similar methods?
Case Discussion Questions

1. What are the core elements of design-led innovation (also called design thinking or
customer-focused design)?
2. What key challenges did Ignite overcome in its early years? What do those challenges
illustrate about perceptions of design-led innovation?
3. How did Ignite overcome those challenges?
4. What’s required to effectively operationalize design-led innovation?
5. How would you answer the questions facing the Ignite leadership team at the end of
2015?
Exhibit 1 Salesforce’s Revenues
Subscription and support revenues by cloud service offering, in millions

For the Fiscal Year Ended January 31,
2017 2016 2015
Sales Cloud $3,060.6 $2,699.0 $2,443.0
Service Cloud $2,320.7 $1,817.8 $1,320.2
Salesforce Platform $1,441.6 $1,034.7 $745.3
and Other
Marketing Cloud $933.3 $654.1 $505.3
Total $7,756.2 $6,205.6 $5,013.8
Subscription versus services revenue, in thousands

For the Fiscal Year Ended January 31,
2017 2016 2015
Subscription and $7,756,205 $6,205,599 $5,013,764
support
Professional services $635,779 $461,617 $359,822
and other
Total revenues $8,391,984 $6,667,216 $5,373,586
Source: Salesforce Securities and Exchange Commission filings
Exhibit 2 Salesforce’s First V2MOM
From April 12, 1999
Vision
Rapidly create a world-class Internet company/site for sales force automation
Values
o World-class organization
o Time to market
o Functional
o Usability (Amazon quality)
o Value-added partnerships
Methods
o Hire the team
o Finalize product specification and technical architecture
o Rapidly develop the product specification to bet and production stages
o Build partnerships with big e-commerce, content, and hosting companies
o Build a launch plan
o Develop exit strategy: IPO/acquisition
Obstacles
o Developers
o Product manager/business development person
Measures
o Prototype is state-of-the-art
o High-quality functional system
o Partnerships are online and integrated
o Salesforce.com is regarded as leader and visionary
o We are all rich
Source: Salesforce blog: https://www.salesforce.com/blog/2013/04/how-to-create-alignment-within-your-company.html
Exhibit 3 Design Merger and Acquisition Activity
2004 – 2014: 31 total acquisitions
Year Design Firm Acquired By

2004 frog design Flextronics
2007 Doblin Monitor
2009 Bigstock Shutterstock
2010 TAT Rim
2011 Sofa Facebook
2011 Typekit Adobe
2011 Method Globallogic
2011 Helicopter One Kings Lane
2012 Maaike Google
2012 Bolt Peters Facebook
2012 80/20 Square
2012 Cuban Council Google
2012 Behance Adobe
2013 Hot Studio Facebook
2013 Fjord Accenture
2013 Jet Cooper Shopify
2013 Banyan Ranch Deloitte
2013 Hook & Loop Infor
2013 17FEET Google
2013 Hattery Google
2013 Mixel Etsy
2014 Carbon Design Oculus/Facebook
2014 Gecko Design Google
2014 Adaptive Path Capital One
2014 Reactive Accenture
2014 Flow Interactive Deloitte
2014 Optimal Experience PWC
2014 Cynergy Systems KPMG
2014 S&C BCG
2014 Ultravisual Flipboard
2014 Aviary Adobe
2015 – 2017: 57 total acquisitions
Year Design Firm Acquired By

2015 Teehan+Lax Facebook
2015 Spring Studio BBVA
2015 Lunar Design McKinsey
2015 Monsoon Capital One
2015 DesignIt Wipro
2015 Seren Ernst & Young
2015 Mobiento Deloitte
2015 Lapka Airbnb
2015 Catalyst Cooper (consolidation)
2015 Akta Salesforce
2015 Chaotic Moon Accenture
2015 PacificLink Accenture

2015 Farm Design Flex (formerly Flextronics)
2015 Tactel Panasonic Avionics
2015 Fotolia Adobe
2016 Slice of Lime Pivotal
2016 Resource/Ammirati IBM
2016 ecx.io IBM
2016 Aperto IBM
2016 IDEO Kyu Collective (minority stake)
2016 Fahrenheit 212 Capgemini
2016 Heat Deloitte
2016 gravitytank Salesforce
2016 Fake Love New York Times
2016 Karmarama Accenture
2016 Carbon12 McKinsey
2016 Mokriya Nagarro
2016 Uselab Deloitte
2016 Tiny Hearts Shopify
2016 Boltmade Shopify
2016 VeryDay McKinsey
2016 Waybury InVision
2016 Napkin InVision
2016 Silver Flows InVision
2016 Macaw InVision
2016 Muzli InVision
2017 Idean Capgemini
2017 Unity&Variety Salesforce
2017 Sequence Salesforce
2017 Dribbble Tiny
2017 DeviantArt Wix
2017 JWalk Shiseido
2017 The Monkeys and Maud Accenture
2017 Market Gravity Deloitte
2017 Intrepid Accenture
2017 Maya BCG
2017 Clearhead Accenture
2017 Wire Stone Accenture
2017 Acne Deloitte
2017 Cooper Designit/Wipro
2017 Telepathy ServiceNow
2017 Brand.ai InVision
2017 YARD Kyu Collective
2017 Matter Accenture
2017 VLT Labs McKinsey & Co.
2017 TendemSeven Genpact
2017 Rothco Accenture
Source: Design in Tech Report 2017 and Design in Tech Report 2018, by John Maeda, https://designintech.report/
Exhibit 4 Ignite’s Systems Diagram

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B5928

Date: October 1, 2018

Innovation, Co-Creation, and Design Thinking: How

The biggest challenge was to get Salesforce to

—J ASON W ILD , S ENIOR V ICE P RESIDENT ,

Salesforce’s Evolution: Democratizing Software

Salesforce’s Customer Focus and Sales Organization

In parallel with the annual construction of V2MOMs, Salesforce undergoes a reorganization in

A large percentage of Salesforce employees are salespeople, known as Account Executives

Salesforce Sets its Sights on Enterprise Clients

The Rise of Design in Software Companies

The Key Elements of Design Thinking

Ignite’s First Growth Spurt

Overcoming External and Internal Resistance

Ignite Experiments and Grows in Different Ways

Finding the Best Path Forward

Case Discussion Questions

3. How did Ignite overcome those challenges?

4. What’s required to effectively operationalize design-led innovation?

Exhibit 1 Salesforce’s Revenues

Subscription and support revenues by cloud service offering, in millions

Subscription versus services revenue, in thousands

Source: Salesforce Securities and Exchange Commission filings

Exhibit 2 Salesforce’s First V2MOM

From April 12, 1999

Source: Salesforce blog: https://www.salesforce.com/blog/2013/04/how-to-create-alignment-within-your-company.html

Exhibit 3 Design Merger and Acquisition Activity

2004 – 2014: 31 total acquisitions

Year Design Firm Acquired By

2015 – 2017: 57 total acquisitions

Year Design Firm Acquired By

2015 PacificLink Accenture

Exhibit 4 Ignite’s Systems Diagram

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