Best of breed solutions are starting to offer better integration than large incumbent software providers whose strength in the past was their offer of one-stop shopping. That’s one of our takeaways from comments made by Box CEO Aaron Levie at a pre-event briefing prior to his company’s user conference which kicked off in San Francisco this morning.
Ever since software was invented, companies have debated endlessly whether they were best served holistically by one or two large vendors who could meet most of their needs – or whether they were better off buying best of breed solutions from point providers. And in truth, the bias has swung between the two. Cloud computing initially saw a shift back to incumbency as vendors like Salesforce and Oracle went on a SaaS acquisition spree to build out sales, marketing, and HCM clouds.
One of the articles of faith in this debate is that best of breed providers might provide more specific capabilities but a homogenous vendor would provide a more integrated solution making life easier for CIOs and their internal customers.
However, many large enterprise customers have experienced a very different reality as Which-50 has reported in the past. Big marketing or sales clouds are rarely built from the ground up. They are instead amalgamations of acquisitions that need to be plugged together which involves both technological and cultural integration.
Teams thrown together artificially after an acquisition often find themselves struggling to gel under a unified approach. Founders, no longer in control of their own destiny after the acquisition sometimes bristle under the corporate strictures of their new overlords, while other key members – critically from engineering, for instance – become a flight risk when the cultures fail to gel.
Best of breed companies who obsess around the customer experience, on the other hand, have the same or even a stronger incentive to make the collaboration work but suffer none (or far fewer) of the cultural or organisational overheads typically found inside large incumbent businesses built on acquisitions.
Box sits firmly in the best of breed camp. Its chief product officer Jeetu Patel argues that the ecosystem is the product, and the company works closely with partners it also considers best of breed such as Slack, Zoom, and Okta.
While carefully avoiding the use of the word suite (because Box has started offering its own) Levie told Which-50, “The incumbent model brings lots technology together and sells it as one thing.”
It’s a business model and a strategy based on distribution powers, he says.
“So what that is basically saying is I have a customer relationship, I’m going to shove more technology into that customer relationship. The user experience is not the premium. And so as a vendor, you don’t really need a high degree of interoperability because distribution is your strength,” he’s said.
“If you think about companies like Box, and Slack and Zoom and Okta our strength is product experience. That’s why we exist, we are doing something better than the incumbent. Given our premium is on product experience, then you expect the premium also to be on the integration and the seamlessness.”
He offered as a contrast the Skype/Microsoft Teams experience to that of Box and Zoom.
“Do you believe that Skype and Microsoft Teams is providing a better experience than Zoom and Slack? The answer is no in my opinion because I think that Skype only works half the time. I’m going to bet on the world’s best communication tool with Slack and the world’s best video tool, which is Zoom. And I’m going to bet that those experiences iterate at a much faster pace.”
The roll call of industry leaders at the Box conference suggests that the company is leveraging its best of breed status to build an up-sized influence in the industry. IBM’s CEO Ginny Rometty and Adobe’s Shantanu Narayan joined traditional Box partners by Okta’s Todd McKinnon and Zoom’s founder and CEO Eric Yuan on the conference run sheet.
Speaking later at the BoxWorks19 conference Levie used his keynote to reaffirm the company’s vision of its role in the industry.
“People are going to want to share and collaborate and work on information on any device at any time, at any location, anywhere around the world, in a very secure way, in a way that you can trust.”
This would be done in a way that keeps data private and secure, and greater control is provided to the user, he said.
The 14-year-old company which is a leader in the collaboration software space has 95,000 customers and says 69 per cent of the Fortune 500 companies use its software.
“So many people around the world are really thinking about how they going to transform the way they work, and the way they operate in the cloud,” he told attendees.