The Total Economic Impact™ Of Salesforce For Manufacturing

Revenue Growth

Evidence and data. The most financially significant benefit that the interviewees’ organizations experienced was the increase in topline revenue measured after the Salesforce investment. Interviewees shared several ways that Salesforce helped improve their sales organizations and sales outcomes, including the following:

• Customer lifecycle management enabled the recovery of lost revenues and a better customer experience. Manufacturers must stay connected to their customers throughout their lifecycle to ensure customers get value out of using the asset. This includes parts, service contracts, extended warranty, and special commercial contracts. Before Salesforce, the interviewees’ organizations struggled to have visibility across the customer lifecycle. One downside of this was shared by the enterprise architect at an equipment manufacturer, who noted that the organization was losing parts revenue because customers were going to off-brand suppliers. With Salesforce, they were able to look at customer behavior and identify where this was the case. They shared: “We have a list that shows there are customers that have a machine but have not bought anything from us in the last year. That’s a red flag because every customer that has one of our machines should be spending at least $5,000 on parts throughout the year. All in all, it’s a 6% [of revenues] range of lost revenue identified that we could capture in the future year.” The organization used these insights to connect with these customers and re-establish purchasing behaviors for machine parts.
  
  Beyond recapturing lost revenue, another positive benefit of uncovering this purchasing behavior was that the organization was able to improve its customer experience by making sure customers were purchasing the manufacturer’s parts. The enterprise architect went on to say: “We found that the customers that we identified were buying counterfeit parts and were having issues with the reliability of the counterfeit parts. They were actually spending the same amount because the parts were lower quality. Now the customers end up happier because they realized they were not getting a better deal — they were just getting the ability to buy the parts more often because they break.”

• They created unified global sales processes and a global coaching framework with insights that enabled tailored coaching for sales reps. Salesforce’s reporting capabilities enabled sales managers to have a more granular understanding of their reps’ performance. Using these insights, managers were able to have higher-quality coaching conversations with sales reps and monitor how well they were adhering to sales processes and methodologies. A standardized sales process contributed to better reporting and made quota attainment easier.
  
  The chief revenue officer at a chemicals manufacturer said: “Salesforce is a great platform to bring to life the methodologies and processes that you want your salespeople to follow. If reps follow the right processes, if they’re using the methodologies to sell, you’re going to generate revenue and then you can manage areas that are underperforming.”
  
  They went on to say: “The key was process first, tools second. We mapped out our sales process before we implemented Salesforce to make sure that we were implementing a global set of standards that salespeople would follow. We trained all the salespeople on it and had an entire management coaching framework so that managers could coach in a standard way around the world. And Salesforce was the platform that allowed us to really bring that to life.”
• Sales reps were more productive with accurate, timely, and complete customer profiles. In the prior environments, sales reps struggled to find relevant customer information because it was decentralized and informally managed. They spent time searching for information from colleagues and validating the accuracy of the information they found. When the sales organizations adopted Salesforce as their formal CRM, they had a single source of truth for all customer interactions and were able to readily surface data from the ERP system, including orders, invoices, and service contracts. Furthermore, field reps and technicians who were previously disconnected for much of the day were able to access and update customer information in a mobile app. As a result, interviewees noted that their sales teams were more productive and better informed when speaking with customers.
  
  The VP of digital transformation at a climate technology products manufacturer shared: “We know the data is up to date and we know what actions and tasks are assigned. And even when we don’t have connectivity, now we have the mobile app and can get information updated. All these factors are increasing the sales team’s productivity.”
  
  The senior manager of IT business strategy at an auto and engineered parts manufacturer shared: “The teams here have the data that they need at their fingertips. They know where it’s at, they know how to get to it, they’re not fumbling around through network drives or flash drives or piles of paperwork. They’re working much more effectively now through these systems that we’ve transformed for them.”
• Reporting and insights based on trusted data empowered informed decision-making. The previous environments left sales leaders with “garbage in, garbage out” insights that were likely to be inaccurate or incomplete. Leaders were wary of relying on this information for decision-making or for confidently forming a sales strategy. With Salesforce, they improved data quality by automatically capturing customer and interaction data in real time, providing the organization with insights based on higher-quality data inputs that were readily available in reports, dashboards, and data visualizations. The VP of digital transformation at a climate technology products manufacturer shared: [With Salesforce reporting capabilities] I can make sure that the strategic objectives that I have committed to are in the green. By looking at this data month over month, year over year, opportunity by opportunity, we’re able to make data-driven decisions, which directly translates to the sales team’s productivity.”
• Visibility into the global pipeline helped sales prioritize. Before adopting Salesforce technology and processes in their sales organizations, the interviewees’ sales reps and leaders lacked a holistic view of opportunities. This made it challenging to collaborate and forecast revenue; it also put the organizations at a greater risk of losing valuable contracts. Reps often duplicated efforts by chasing the same customer or completely ignored prospects that fell off their radars.
  
  The chief revenue officer at a chemicals manufacturer shared: “[Before Salesforce] we had no consolidated picture of the opportunities that we couldn’t afford to lose. So, the first benefit was getting a real-time global picture of all the opportunities that we’re chasing around the world and which of those were likely to give us the greatest amount of revenue growth and margin growth impact in the business.”
  
  The VP of digital transformation at a climate technology products manufacturer shared: “In our organization we say, ‘If it is not in Salesforce, it’s not an opportunity.’ Our sales leaders are looking at activity through the lens of Salesforce.com. In the old world, the loudest [customer] used to get the most attention. But now we’re able to prioritize better and identify the 10 opportunities that have to get done and prioritize our limited resources.”

• The organizations were able to measure their successes. The previous environments’ disparate sales processes and methodologies made it impossible to measure large global sales departments. The manufacturing companies faced the well-known challenge: “You can’t improve what you can’t measure.” Interviewees noted that Salesforce enabled their organizations to measure the impact of changes to their sales methodologies and global efforts more accurately and robustly. The chief revenue officer at a chemicals manufacturer shared: “We have several metrics that fall into three categories: creating pipeline, winning and converting opportunities, and customer retention and growth. And in all three of those categories, Salesforce has really helped us quantify the improvements. It wasn’t just because of the tool, but because we had the tool and the initiatives that we implemented to drive better, healthier pipeline, better opportunity conversion rates, and better long-range customer renewals and upsell opportunities. Because of the tool, we were able to measure that we made significant improvements in each of those areas.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• The composite organization generates $2.3 billion in annual revenues before the Salesforce investment.
• After the Salesforce investment, the organization implements new sales methodologies and processes with Salesforce as the supporting technology. The adoption of these processes, a single view of the customer, and robust reporting enable more sales production. The organization measures an increase to topline growth directly impacted by Salesforce of 1%, 3%, and 5% Years 1, 2, and 3, respectively.
• The organization has a profit margin of 10%.

Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:

• The volume of revenue created will depend on the size of an organization.
• The effectiveness of change management for reps adopting the new technology and processes to support using Salesforce and the extent to which Salesforce technology and sales processes drive greater sales efficacy.
• Margins in the prior environment and the type of manufacturer.

Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $14.8 million.

Customer Outreach And Reporting Automation Savings

Evidence and data. Salesforce had an impact on automating sales processes and providing uplift for the sales reps. Interviewees shared several ways that Salesforce helped improve their sales reps’ productivity:

• Daily reporting using generative AI saved reps 35 to 45 minutes per day. Interviewees shared that in their prior environments, reps consolidated their daily activity and summarized it for their manager; this took from 35 to 45 minutes per day for the rep and manager to prepare and review. With Salesforce, they improved the visibility between sales and sales management by keeping the relevant information in dashboards and autogenerated reports. The enterprise architect at an equipment manufacturer said: “Instead of making a salesperson spend time keeping track of tasks, emails, and events and then writing recap emails at the end of every day, let’s automate all that using Salesforce AI. Let’s have it grab all their tasks and their emails and summarize the highlights of it and then automatically add that to a report.”
• Streamlining customer outreach with automated emails saved reps hours per day. Interviewees shared that their sales reps spent a significant amount of their time crafting communications with clients and prospects, with each email taking 20 minutes to tailor with a personal touch. After the investment in Salesforce, the sales reps used templates and automation to streamline their communications. The templates enabled the sales reps to review a draft email instead of writing one from scratch, saving them hours per day. The enterprise architect at an equipment manufacturer shared: “Our goal is to make it feel like a rep just spent 25 minutes writing an email when really it’s just a matter of clicking the button. It’s generated, and then a salesperson skims over to verify that it feels right and then clicks send. So, it takes a 20-minute custom email and turns it into a 2-minute activity, which is a really big, powerful thing.”
• The speed of information transfer between sales reps accelerated. In their prior environments, the reliance on paper-based processes and a culture of tribal knowledge meant that sales reps had to search for information in multiple systems and across coworkers. This meant delays in action and frequently resulted in duplicative efforts by salespeople. The chief revenue officer at a chemicals manufacturer said: “Salespeople now have access to real-time information about who’s working with which account anywhere in the world. Otherwise, they had to send a bunch of emails and wait and go into a black hole and keep pinging somebody.” After the Salesforce investment, interviewees noted that there were obvious productivity gains from better visibility and the availability of real-time information about who was working on which accounts. The chief revenue officer at a chemicals manufacturer shared: “We finally have a single source of truth of what’s going on around the world with big customers. Now we’re not chasing people down or waiting to get information because somebody’s on an airplane. We’ve seen productivity gains.”
• Modern technology tools improved the sales rep employee experience. Research shows that employees are more likely to be engaged when they have the information, tools, and technology they need to do their jobs.⁶ Engaged employees are more likely to create better customer experiences and have longer tenure with their employer. A culture of engaged employees may also create an environment that is easier to staff and attracts higher-quality candidates. Interviewees noted that introducing Salesforce provided sales reps with the information and tools they needed to do their job; this resulted in an improved employee experience. The CIO of a chemicals and materials manufacturer said: “We’ve grown a lot on our sales side, and every single person has commented on our modern technology and how it makes their job easier. That’s been awesome. Now our sales team has been telling us that they’re able to hire better because of the tools we put in place.”
• A single source of truth accelerated the time to value for sales leaders. Losing sales members with extensive tribal knowledge of the business created black holes in the interviewees’ sales organizations. New leaders and sales reps faced steep learning curves to become proficient in their new roles. By keeping customer information in Salesforce, new employees were able to accelerate their time to proficiency and begin adding value to their customers sooner. The VP of digital transformation at a climate technology products manufacturer said: “In the past, when we lost a sales leader, it would take six to eight months for that new person to know the customers, where they are, what they have purchased. My head of business in India gave a powerful example where he recently lost somebody and in three weeks the new leader was up and running and was meeting customers because he knew everything, because it was in Salesforce.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• The composite organization has 350 sales reps. Adoption of Salesforce is rolled out across the organization over the three years, resulting in adoption rates by reps of 25%, 50%, and 90% in Years 1, 2, and 3, respectively.
• The reps using Salesforce save 420 hours per year by automating customer outreach emails.
• The reps using Salesforce save a further 70 hours a year by automating daily internal reports.
• The average fully burdened hourly cost for a sales rep is $65.

Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:

• The number and type of processes automated.
• The number of sales reps performing the tasks.
• The average fully burdened cost of sales reps. The mix of roles, location of the employees, and employee seniority will all factor into the average fully burdened cost of the rep performing the tasks.
• The effectiveness of change management for reps adopting the new technology and processes that support using Salesforce.

Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $12.5 million.

Service And Support Team Efficiencies

Evidence and data. The previous benefit quantifies the impact of process automation on the sales team. This benefit captures the impact that Salesforce had on interviewees’ service and support personnel. Interviewees shared several ways that Salesforce empowered front-office personnel:

• The service organization could scale to meet growing customer service needs. Interviewees noted that before Salesforce, their service and support teams relied on a shared email inbox or a single telephone line to manage customer service requests. These processes were error-prone, hard to scale, didn’t connect the issue data with a customer’s account, and lacked reporting or insights capabilities. With Salesforce, the interviewees’ organizations moved to a case-based environment and added additional channels like chat and text, which enabled agents to handle 3x more cases. Interviewees noted that without Salesforce, they would have needed to double the number of service agents to support their customer service needs.
• The customer service experience improved by aligning people and processes. Interviewees noted that their customers were frequently frustrated by the low-tech service department. Inefficiencies and disjointed experiences created a poor customer experience. The enterprise architect at an equipment manufacturer said: “We scaled from having a phone number and a shared inbox. You’d have one email come in and you’d have three people start to try and address it. Customers were getting frustrated. They don’t like it when it feels like nothing’s coordinated.” With Salesforce and a case-based service department, the organizations’ service departments were able to follow consistent service processes, reduce manual rework, and provide a more modern service experience to their customers.
• Service departments decreased their average handle time and improved their first call resolution rates. In prior environments, customer service requests were handled on a first-in/first-out basis. With Salesforce, the interviewees’ service organizations were able to aggregate requests and add automation using AI and machine learning. As a result, the relevant information would surface to the service agent. Using Salesforce as the single source of truth for customer information, service agents were able to easily see a customer’s history of cases, products purchased, and maintenance performed. With this information, agents could provide more informed advice, recommend the right action, or easily escalate the issue through the appropriate channel. Interviewees’ organizations also had a much better way to track typical call center metrics and could track improvements. The enterprise architect at an equipment manufacturer shared: “As we’ve been improving how we use Service Cloud, we’ve seen a decrease in overall average handle time.”
• Product teams used trend analytics to identify common problems and resolve issues at the source. Insights provided through Salesforce revealed the root causes of service cases. As a result, overall service volumes for identified product issues were reduced and cases deflected.
  
  The VP of digital transformation at a climate technology product manufacturer said: “We were able to take the service data and feed it into our product management. What are the things that are bothering customers? How can we add improvements to our products so that we can serve our customers better?”
  
  The enterprise architect at an equipment manufacturer shared: “One of the big benefits of Service Cloud is having traceability and trackability into cases. We started to report on cases and found two parts that we needed to address because we were having a high volume of related issues. We reduced our overall service cases by identifying bugs in our software as well as hardware things that we needed to change to improve our reliability.”
• Service and support staff were able to prioritize strategic initiatives. In addition to the added capacity for sales agents, internal support staff roles also realized lifts from Salesforce. The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “We’re becoming more collaborative. We’re operating from a single customer record instead of everybody having their own version and trying to maintain it on the network. We’re reducing the number of attachments that our organization is using, which is freeing up space and allowing us to have more time to be effective. We’re having more time to deal with the high-priority and complex issues that are coming to us from our customers, our distributors, and our OEMs.”
• Growing order volumes did not require hiring additional headcount to support order processing. Interviewees noted that Salesforce and the processes put in place to support the adoption of the platform created a data environment that was less prone to error, more streamlined, and more consistent. As a result, manual efforts around data entry, quality assurance, and document review were reduced. The CIO of a chemicals and materials manufacturer shared: “We have a whole support team that processes our orders and looks for mistakes like ‘This is a truck delivery, but we didn’t charge shipping.’ And that department kept growing and growing along with the number of orders. And now our order volume is still growing but we were able to not hire anyone. That’s been a really visible benefit from using Salesforce.”
• Customer service CSAT scores improved. With Salesforce, the interviewees’ organizations were able to improve their ability to measure customer satisfaction with automated surveys and more sophisticated KPI measurements. The improvements to the customer service processes resulted in higher CSAT scores. The enterprise architect at an equipment manufacturer said: “We have an email survey that goes out for cases that aren’t [conducted] over the phone. We reviewed the results of the survey and normally, we sit at 4.5 out of 5, which is good, on average. But we ended up with a 5 out of 5 for last December, which was awesome.”
• Service and support team personnel provided value sooner due to faster employee onboarding. In the prior environments, new hires faced a steep onboarding process that focused on learning the nuances of paper-based processes and switching between multiple point solutions. With the investment in Salesforce, the organizations were able to help capture institutional knowledge from seasoned employees and reduce the number of systems that new employees needed to learn, which accelerated their time to productivity.

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• The composite organization has 270 service and support team members; this excludes sales reps and field service technicians. Salesforce is rolled out across the organization over the three years, resulting in adoption rates by the service and support team members of 25%, 50%, and 90% in Years 1, 2, and 3, respectively.
• The additional efficiency and capacity created by Salesforce enables the organization to grow without adding additional headcount. Without the Salesforce investment, the organization would have needed to hire 25% more headcount to support the growing organization.
• The average fully burdened annual cost of a service and support team resource is $81,000.

Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:

• The number and type of processes automated.
• The number of service and support team members performing the tasks.
• The average fully burdened annual cost of service and support team resources. The mix of roles, location of the employees, and employee seniority will all factor into the average fully burdened annual cost of the resource performing the tasks.
• The effectiveness of change management for service and support team adoption of the new technology and processes that support using Salesforce.

Results. To account for these risks, Forrester adjusted this benefit downward by 15%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $638,000.

Field Service Team Efficiencies

Evidence and data. Manufacturing organizations’ customer needs are often complex and varied, requiring a range of expertise and skills across several hybrid touchpoints. As a result, customer service is evolving to include many personas outside the contact center, such as field service.⁷ Interviewees shared several ways that Salesforce impacted their field service operations, including the following:

• Interviewees used Salesforce to scale their field service department to meet growing demand without hiring headcount. The interviewees noted that the demand for field service is constantly increasing. However, because field service technicians are expensive resources and in high demand, the manufacturing companies needed technology to make their existing technician force more efficient rather than hiring more personnel. The enterprise architect at an equipment manufacturer said: “As machines in the field get older, they break down more. If you think about a car, if the car is one year old, you’re probably not going to have a lot go wrong and it’s under warranty. Once you hit five years, you’re going to have more stuff going wrong; and once you’re at 10 years, your engine or transmission might go out. So, we have an exponentially increasing number of machines in the field and as they get older, more issues happen.”
• Augmented reality (AR) and virtual reality (VR) improved field agent capacity. Salesforce enabled the auto and engineered parts manufacturer to deploy AR and VR technology to provide remote assistance to field service technicians, allowing them to see what the technician is seeing in real time and guide them through complex repairs or installations. The senior manager of IT business strategy shared: “Within the next two months we are going to enable visual remote assistance. Technicians will send out a magic link to our customers and then be able to have a video conference call or see their desktop to help them through filing a warranty claim. If they have a cellphone, the dealer can take the technician with them, and the technician can see the engine that’s being repaired. They can use augmented reality to document where the technician needs to focus. It’s almost like being in the shop on site; they’re just doing it remotely so we can reach more customers this way.”
• A single source of truth improved the success of field service visits. Field service technicians caught in the field with inaccurate information created expensive inefficiencies. For example, a technician that traveled several hours to service an asset in a rural area needed to bring the correct parts and tools to effectively complete the service. Before Salesforce, there was a risk that the information related to the case or asset was incomplete, which increased the likelihood that the technician would fail to come prepared. With Salesforce, interviewees noted that technicians had the right information and customer history to properly prepare for and execute the required service.
  
  The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “Our data is far more accurate because we have a single source and we’re able to remove a lot of the redundant data and human error that was being introduced.”
  
  The chief revenue officer at a chemicals manufacturer said: “[Salesforce helps with] reducing the time to solve [an issue] because we can prepare the service rep so that they’re equipped to do the job effectively, which lowers the time on-site and increases the number of services visits a technician can perform.”
• Interviewees connected field services with IoT. IoT sensors and enabling technologies allow machines to report diagnostic information back to the manufacturer, increasing the chances of completing maintenance tasks successfully on the first visit as well as providing pre-emptive service to fix an asset before it fails. The VP of digital transformation at a climate technology products manufacturer said: “We not only attend to phone calls; we also manage alerts coming in from supermarkets as we monitor their cold aisles. We get millions of alarms coming from all over the world. Before, we used to funnel alerts to service people. But now, using Salesforce, we are able to aggregate and add automation to provide the right information and context to service people. We are able to provide the right information to the agent, reduce headcount, and at the end of the day, it’s an opex saving for us.”
• Trend analytics improved products and training. Analytics of field service trends, technician behavior, and service KPIs enabled the interviewees’ organizations to make informed decisions on technician training and product enhancements. The chief revenue officer at a chemicals manufacturer said: “We can track the downtime, the nature of the visits, the trending issues. We’re able to evaluate based on the trending of types of visits if an issue is a training problem or a product problem.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• The composite organization has 255 field service technicians. Salesforce is rolled out across the organization over the three years, resulting in adoption rates by the field service technicians of 25%, 50%, and 90% in Years 1, 2, and 3, respectively.
• Salesforce provides technicians with relevant, complete, and timely information related to each field service case. This enables the field service technicians to work with greater efficiency and reduce rework. Each service technician using Salesforce avoids 54 hours of rework per year.
• The average fully burdened hourly cost of a field service technician is $39.

Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:

• The existence of a field service department. The business model of a manufacturer may not include field service, in which case this benefit would not be quantified.
• The number of field service technicians.
• The average fully burdened cost of service technicians. The type of technician, location of the employees, and employee seniority will all factor into the average fully burdened cost of a technician.
• The effectiveness of change management for field service team adoption of the new technology and processes that support using Salesforce.

Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $638,000.

Technology Savings

Evidence and data. The interviewee’s organizations had legacy point solution tools with siloed systems and disconnected data. Processes were paper heavy, and spreadsheets were the most common source of customer information. After investing in Salesforce, the interviewees’ organizations began to decommission their legacy integrations, consolidate maintenance efforts, replace spreadsheet-based processes, and reduce their technology bloat. With case and customer data within a single platform, manual reporting was replaced by Salesforce-generated reporting capabilities. Interviewees shared several ways that Salesforce impacted their IT environment, including:

• Decommissioned legacy integrations. In the legacy environments, the manufacturing organizations built integrations to connect their ERP systems to front-end point solutions. These integrations were costly to build and maintain, especially for manufacturing organizations with multiple ERP systems. With Salesforce, the interviewees were able to decommission legacy ERP integrations and replace them with Salesforce connectors. The integrations through Salesforce were easier to maintain and build. The CIO of a chemicals and materials manufacturer said: “We were spending over a million dollars a year for our ERP integration, and it wasn’t a very sophisticated product. But with Salesforce, we don’t have to host servers and it has a lot of out-of-the-box functionality that we take advantage of.”
• Consolidated point solutions. As manufacturing companies grew through acquisition and business units found their own technology solutions to solve discrete problems, interviewees found that technology purchases abounded. IT teams managed increasing technology bloat and decentralized purchasing decisions for point solutions. After the Salesforce investment, the global CRM and consistent processes enabled IT to begin decommissioning point solutions and consolidating tech bloat. The chief revenue officer at a chemicals manufacturer shared: “We had multiple instances of Salesforce and a few homegrown CRM applications. We had disparate and homegrown service database tracking applications. Some were built on Lotus Notes, some were built on SharePoint. We put in Salesforce, and it was a total global rip and replace.”
• Avoided hardware refreshes. Interviewees noted that moving to a SaaS solution enabled them to reduce their capital expenses for hardware purchases. The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “We are removing redundant legacy systems. We’re reducing the technical debt of those systems because we’re using a cloud-based system that is running in a browser. We don’t have to maintain our mainframes and large legacy server systems. We’re reducing our spend on hardware because Salesforce can be run on a tablet or a lower-end PC. We don’t need to spend money on RAM, video cards, or high-end processors.”
• Digitized spreadsheet-based processes. Moving away from paper-based processes improved productivity, reduced human error, and provided a lift for IT. The senior manager of IT business strategy said: “We have a trophy case of the spreadsheets that we have killed off. We’ve got about 20 different business processes previously handled through spreadsheets that we’ve been able to move into Salesforce. We’re using Flow and Process Builder within Salesforce to automate processes. We have automated purchase order reviews and compliance user reviews. We automated the manufacturing cloud business plan that was built in a spreadsheet. And we are continuing to identify more and more business operations done through either email or spreadsheets, and we can eliminate them by using products like Quip or other Salesforce products.”
• Accelerated experimentation and focused energy on innovation. Technical debt and the inflexibility of existing applications slowed the rate of innovation. Interviewees noted that the Salesforce declarative architecture unlocked the ability to innovate and create applications that would have been constrained in their prior environments. The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “It simply boils down to how easy it is to develop applications on Salesforce. Our ERP has a framework language, and it takes an entire team of six to eight people [to support it]. If they were to develop the same types of applications that we’ve developed in Salesforce, they would still be working on requests from two or three years ago. It takes approximately one to three months for them to conceive an idea, develop it, test it, and issue it to production. Availability is an issue. Now with my team, I have a Salesforce architect, developer, and help desk analyst. The architect and the Salesforce developer working together can develop and deploy an application in Salesforce within minutes, if not hours, depending on the complexity of it.”

Modeling and assumptions. Based on the interviews, Forrester assumes the following about the composite organization:

• The composite’s legacy environment run cost is $1.2 million. The legacy environment includes point solution licensing, on-premises infrastructure refresh costs, and labor costs for solution maintenance.

Risks. Forrester recognizes that these results may not be representative of all experiences. The impact of this benefit will vary depending on the following:

• Hidden technical debt may increase the run costs of the legacy program.
• An organization’s ability to effectively consolidate and decommission legacy technology will depend on company culture, appetite for risk, and levels of change management to ensure the adoption of the Salesforce platform and processes.

Results. To account for these risks, Forrester adjusted this benefit downward by 10%, yielding a three-year, risk-adjusted total PV (discounted at 10%) of $798,000.

Unquantified Benefits

Interviewees mentioned the following additional benefits that their organizations experienced but were not quantified for this study:

• Forecasting and inventory management benefits. Manufacturing Cloud uses an industry-specific framework that includes demand planning and inventory management features that go beyond the standard Salesforce forecasting capabilities. Interviewees using the forecasting features noted that they were able to better predict order demand, lower inventory positions, and lower carrying costs as a result of better forecasting.
  
  The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “Our OEM team has taken a very extensive and expansive spreadsheet that has been used for 25 years and replicated all the functionality and visuals into Manufacturing Cloud. Now we have this centralized view of our forecasting, our demand planning for all the OEMs and all the products that we offer to our customers.”
  
  The enterprise architect at an equipment manufacturer said: “We’re doing purchasing forecasting powered by elements of Einstein Discovery to take our historical usage of an item and then extrapolate out what we think we’re going to use next month, the following month, and the one after.”
  
  The CIO of a materials and chemicals manufacturer said: “Salesforce is helping our purchasing team be smarter and keep less inventory on hand. Because we can better forecast, we can lean on our supply chain vendors more to just do everything better. Our inventory is down 25% of what we used to hold because we didn’t know if we’d need it or not.”
  
  The chief revenue officer at a chemicals manufacturer said: “Because the pipeline is much more accurate, later-stage opportunities have a higher probability of closing and production can do demand planning better.”
• Warranty processing benefits. Service functions specific to Manufacturing Cloud include a warranty solution that coexists with field service. Interviewees noted that customers were happier with the new warranty process, could complete their claims more easily, and could receive payment for their claims more quickly. AI-powered automations improved employee productivity and increased the number of claims processed each year.
  
  The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “In nine months, we implemented a totally new warranty system on Salesforce. After it was used for about a year, we did some feedback sessions and our customers told us that they were very happy with the new system. They were able to complete the warranty claim easier and quicker, saving them time. But they were also getting paid within 24 hours after the automated system processing. The last customer sentiment score went from 20% to the mid-80s. The customer sentiment score increased by 166%.”
  
  They went on to describe the impact of the new warranty system on their team: “We did some additional surveys and found that we were processing 65% of the incoming claims through automated rule sets. We estimated the amount of time that was saved by this system was over 600 hours of manual workload because it would take about 3 minutes to manually process each claim. When we started manually, we were doing about 3,500 claims per year. With the Salesforce warranty system, we’re now processing over 8,000 claims.”

Flexibility

The value of flexibility is unique to each customer. There are multiple scenarios in which a manufacturer might implement Salesforce and later realize additional uses and business opportunities, including:

• The ability to take advantage of Salesforce’s robust partner ecosystem to adapt quickly to changing business needs. Interviewees noted that the AppExchange partner ecosystem offers solution extensibility to partners with extensive industry expertise that can help them focus on differentiating experiences, reducing time to market, and helping achieve success in complex scenarios.
• The option to adopt Manufacturing Cloud’s industry-specific capabilities. The manufacturers interviewed for this study used a mix of Salesforce products, both individually packaged and bundled. During their tenure as Salesforce customers, they participated in the product development and beta testing of Manufacturing Cloud, a vertical CRM for manufacturers looking to implement Salesforce with out-of-the-box industry-specific capabilities. In addition to core Salesforce CRM functionalities, Manufacturing Cloud has prepackaged forecasting, warranty management, and industry best practices. Manufacturers with existing Salesforce deployments or new implementations may realize faster time to market when implementing out-of-the-box Manufacturing Cloud capabilities.
• The ability to build out AI use cases. With the rise in generative AI capabilities, Salesforce customers are amplifying the value of their CRM with use cases powered by AI. Interviewees noted that expanding their adoption of Einstein and Salesforce AI capabilities is part of their continuing investment in Salesforce and is expected to empower even greater automation and productivity improvements in the future. The enterprise architect at an equipment manufacturer said: “One of our goals for 2024 is to drive more efficiency through automations that we’re building out on the sales side with generative AI.”

• The ability to further amplify ROI with more investment in the Salesforce platform. Salesforce is best suited for enterprises that view Salesforce as a strategic partner to their customer transformation efforts.⁸ Because of its large and growing platform, manufacturers can add additional functionality without adding a new vendor into their tech stack or introducing complex integration needs. The senior manager of IT business strategy at an auto and engineered parts manufacturer said: “In the future, we’re looking at adding Commerce Cloud, MuleSoft, and expanding into the Heroku platform, so we’ll be able to create more real-time applications for our teams, completely revamp our e-commerce platform, and offer our customers a more personalized experience.”
• The ability to improve relationship management with resellers and partner seller enablement. Manufacturers have extensive relationships with distributors, resellers, partners, and supply chain vendors. Interviewees noted that future investments might include connecting with their ecosystem stakeholders. The chief revenue officer at a chemicals manufacturer said: “We might bring distributor agents into our Salesforce instance if they are a high enough tier. We could have them follow our selling process so that we could know their opportunities are at the same level of management and criteria and confidence as the ones our direct reps are working. [This would create] better relationship management with our highest-tier distributors and resellers.”

Flexibility would also be quantified when evaluated as part of a specific project (described in more detail in Appendix A).