The public nature of the announcement is certainly marketing for our AI offerings as well, but at this point I think most engineers are just worried there will be additional layoffs, in the event management cannibalizes product for short term stock gains again.
These companies enjoy healthy margins. Unemployed engineers can duplicate the core functionality and offer it for less.
The reason why I don't create a simplified version of the SaaS and sell to customers is that the sales process itself is actually the hard part. You may get some sales from ads or phone calls, but you often need to sell it in person if you want to have enough customers to cover all the expenses. And if you want enterprise customers, the sales process is complex and time consuming
Is there any evidence to support this? It would imply that even their least promising employees would still pose a threat which seems unlikely.
This is still in effect, however the primary competing products at peer rivals is now “foundational ai”, and they need far less people and mostly people of a very specific skill sets of ML research, Inference Scaling, Hardware R&D, AI prompt engineering research. Also the cost to play is 10 billion minimum.
So Salesforce will perform rent seeking as long as their moat allows rather than gamble on foundational ai.
Especially for Enterprise Saas companies like Salesforce/Microsoft/Oracle/etc who know full well that their real competency isn’t actually the software…it’s distribution. Employees aren’t choosing to use those products, they get forced into them by management/IT or literal monopoly.
Sales is everything in B2B software and always has been. Product-led growth in B2B has always been fantasy erotic-fiction outside of chat/notes apps.
Then these new startups get a foot hold, and become the dominant software, grow in size and learn how to B2B sale as well.
Asana, Figma, Miro, Box, Evernote, ClickUp, Basecamp, Zapier, HubSpot, Calendly, Shopify, WordPress
PLG creates the distribution to actually implement Sales effectively and at scale for B2B. Even those companies that originally were purely Sales-led now have a strong PLG component. PLG is far from be a fantasy, but now it's almost a must have motion to build distribution and long term healthy business viability considering also that Enterprise software is living a consumerization moment. Not to mention that the next generations of users and buyers buy and expect software to be different from the past, this is already happening.
This definitely reads more like a “everything is going AWESOME ignore anything else you hear about us” PR-ese.
I read this as messaging to shareholders more than anyone else (and sure some word-spreading about the product).
One ad shows a restaurant seating customers in the rain because they aren't using AI. The other ad shows someone buying clothes that don't match because AI wasn't suggesting them. (They also serve the customer shrimp, which he doesn't like.) Looking at weather forecasts and rescheduling reservations has nothing to do with AI, and I doubt AI can do anything other than write the "we're sorry" message. (Additionally, most restaurants simply ask what food you want before preparing it, so they don't have to worry about feeding you something you don't want.) Meanwhile, choosing matching colors for multiple articles of clothing is at most a satisfiability problem, which again has nothing to do with AI. I also doubt the sales floor staff needs any help with that. There are a fixed number of SKUs and colors. If a customer says "I like this shirt, can you suggest pants", I feel like 98% of adults would be able to competently assist. They also don't get paid very much, so it's unclear what the Salesforce value add is there.
IBM also does a bunch of AI advertising and the gist is that it is being used for air traffic control. Somehow, I doubt that. If AI could replace one pilot on 10% of flights, the airlines would make millions of dollars. They all still have 2, though.
I'd love to see a case study from someone other than the AI vendor. The ideas in the TV commercials aren't even good. Would love to see "well actually we're making a ton of money thanks to these products". The reason we're not seeing it is because it isn't happening.
However, your analysis has one flaw. Our biggest corporate customer is unwilling to give testimonials about our (niche) application, because it represents a competitive advantage for them and they don’t want to educate their competitors.
In theory one could imagine similar mechanisms going on in AI.
There’s other things going on though this will help spin.
There’s no way that productivity metric includes the last 2-4 months.
No way in the world they got 30% gains. 5 maybe realistically
I have doubts that will ever happen, but who knows?
Sales folks are highly-compensated, so even making a few of them redundant (or making existing salespeople more efficient) would be a big win for companies (Salesforce's customers).
Very different from the software dev who gets paid today for revenue that might come in in two years. (Capital cost)
The average person has no idea of how capital sees the world. A worker feels resentful if they get paid less per hour of input, a capitalist feels resentful when they get paid less per dollar of investment. The Marxist viewpoint that they conflict directly is quite wrong: operations costs can be passed on to the consumer, but a capitalist is going to have to negotiate with their investors if they are having trouble with the bang/buck ratio of their investments.
(I'd had a job go really badly. A friend of mine said my problem was "I was only getting paid a fraction of the value that I create", I said "I tried getting paid more than the value I created and it ended in tears")
My trainer at the gym introduced me to
https://patents.google.com/patent/US10245460B2/en?oq=1024546...
which sells for about $250 (worth it if you really use it.) My first instinct is that this product ought to be available for $25 on Temu if there wasn't a patent but I know from experience that if I talked to folks at TRX they'd have a good explanation of why my number is low. (e.g. TRX is in a position to pass costs on)
https://www.prnewswire.com/news-releases/trx-obtains-federal...
https://gofit.net/collections/resistance-tubes-bands
There are plenty of cheaper no-name options on Amazon, but they have the property that the handles snap off during use, risking injury.
A TRX push-up puts less load on the primary path than a conventional push up but is very challenging to all the other muscles that it takes to not flop over when you do it
https://www.youtube.com/watch?v=DNuZWO0if5o
These days I'd trust AMZN less than Temu. At least Temu and sellers on Temu still want to win your trust. AMZN thinks they have it and will still think they have it long after it's lost.
For all the discussion about a soft job market for devs, the fact that the last Trump administration made a tax change that puts a target on our backs comes up rarely but it is part of the explanation.
Being in that field, they can see where LLMs would fail at it.
They can understand that you can’t just replace a sales team with LLMs.
They don’t have that for engineering…
Sales will still happen with dinner and handshakes.
We can get into the nuances of advantageous tax treatment or not, but sales commissions come from somewhere and are essentially transaction costs.
So I'm betting they got 30% gains in e.g. "OCRing" and quote that, ignoring that the OCR part is 1% of an entire process chain.
According to Wikipedia the companies they have purchased since 2023: Airkit.ai, Spiff, Own, PredictSpring, Tenyx.
I’ve seen SFDC hiring managers advertising positions on LinkedIn hiring SWEs as recently as last month
(And it's not true - if you could "replace engineers with AI" we engineers would have already done it and be relaxing while AI does our work)
Sure, but I don't care about these companies - I care about my career and the opportunities available to me in the next 1-5 years. If these opportunities are tainted by false claims about AI capabilities - that is a huge problem to me. It is irrelevant to me whether the company eventually suffers for it, because that doesn't reimburse my "damages" (if they exist).
I agree with you though, and to be clear I absolutely do not believe this is anything but marketing hype - If anyone was actually doing what they claimed we'd be seeing evidence of it. I have yet, to this day, to see any evidence of such claims. If you say "30% productivity" without saying how you measured that and the methods you used, I can instantly call BS and rest easy at night. Lots of similar claims seem the same way.
"outstanding claims require outstanding evidence" or something like that.
I don’t believe that companies would be stupid enough to kneecap their own growth because a SaaS company that has stopped innovating 5 years ago decided they are happy with their current headcount and used AI as an excuse.
Who cares when they'll just float away on a golden parachute to the next company that will overpay them to make terrible decisions. Executives will happily jump at any excuse to lower wages, cut jobs, and pocket the money they saved while raising their prices. Making it harder for people to find work because of layoffs and hiring freezes just means that if AI under-delivers (and it always does), they can just hire on a bunch of new people later at lower wages thanks to the larger pool of people looking for work.
As for the time it saves-Sure, AI saves plenty of time, but in a big company most of the time isn't spent on coding. It's spent on collaboration, code reviews, meetings, debugging, looking at production logs, using internal tools, etc.
Salesforce came into discussion as a CRM solution for us, but the salesman was so arrogant that he was quickly booted out. If first thought it would be nice to develop against a more modern system, but today I am glad we never jumped on that train. And I hear it devolved into the same mess that CRM systems somehow always seem to be.