Salesforce’s exodus of executives, the cause is the backlash against Marc Benioff, who is strengthening his control?The long-standing “successor problem” is far from being resolved

Executives must defend their team’s performance, apologize and show remorse when they fall short of their goals, people at the meeting said.

“After a few quarters of this, they’re supposed to leave the company,” said the source.

The coronavirus crisis has been a tailwind for Salesforce, but since then, it has revised down its full-year sales forecast from about $31 billion in May to about $30 billion. Stock prices have also fallen, trading at half the price of the same period last year.

Benioff sees the sales team as key to Salesforce’s resurgence.

Benioff sees sales as the company’s biggest growth driver, said the person who attended the quarterly meeting.

“He gets very frustrated when sales aren’t doing well. People are happy and sad about their performance.”

Benioff has always expected high growth from sales executives, according to a former employee who recently left the company. “If you look at Mark’s track record of patiently developing sales executives over the years, you’ll be surprised at the numbers,” the source said.

Salesforce cut hundreds of employees in November 2022. A former sales employee said the bulk of the job cuts were in sales, and those who hadn’t won any major deals in the past six quarters were targeted.

Rumors are circulating within the company that further layoffs will take place in December.

Those who remain on the sales team also have to follow what some insiders have described as “unrealistic new instructions.” For example, having daily face-to-face meetings during the holiday season and following directions to the office (despite Benioff ostensibly saying “Working from home is no different from being productive”).

Some employees speculate that much of this pressure may have something to do with activist investor Starboard Value. That’s because the layoffs followed shortly after it was revealed in October that the company had acquired a large stake in Salesforce. A person familiar with the matter said Starboard has been pushing for cost-cutting measures since first reaching out to several Salesforce executives in the summer of 2022.

One employee said that these changes show that the culture at Salesforce is undergoing a major shift.

Once described as one of the world’s best places to work, the company’s receptive “Ohana” (Hawaiian for “family”) culture has transformed into a culture that relentlessly prioritizes metrics and sales goals. is being replaced with The recent personnel cuts are said to be “part of performance management” within the company, which may be an appropriate expression.

But even in his message to employees following Taylor’s departure, Benioff stressed the importance of the sales team.

“Everyone in the company working together to support our sales team and deliver great results in the fourth quarter, this one-point focus is more important than ever. notes.

Failure of co-CEO structure

Benioff is exerting pressure on sales executives while increasing his control over top executives, according to people close to Benioff.

According to Insider’s internal org chart, 10 top executives overseeing the company’s five main departments (Finance, Operations, Engineering, Human Resources and Marketing) report to Brett Taylor. Benioff’s reports include philanthropic executives, advisory board chairs, and “trust and safety” officers.

But people close to Benioff say the co-CEO arrangement didn’t work out.

“It doesn’t work because they’re straying out of their own lanes and encroaching on each other’s territory,” Benioff said. close to)

Benioff and Taylor also disagreed on the basics of running a business. Taylor cares about profitability, but Benioff is about growth, one source said, adding, “Wall Street has been asking us to significantly improve operating margins, and Brett’s interest has been there. ’” he continues.

This isn’t the first time Salesforce’s co-CEO structure has been at odds.

Former Salesforce co-CEO Keith Block left in 2020 because of a dispute with Benioff, according to a person close to Benioff. The original plan was for Benioff to remain CEO for only 18 months before Brock became sole CEO, but Benioff has been slow to step down. In the end, Benioff asked several of his executives to continue under him instead of Brock.

“It was either Keith or Mark. close to)

What was decisive was that Benioff tried to make Taylor, who was a Benioffist, COO without consulting Brock. In the end, Brock chose to step down rather than become sole CEO.

Successor issue again

Taylor’s departure isn’t nearly as bad as Brock’s. A source close to the pair said Benioff was “really shocked and upset.” Benioff made an impassioned plea to Taylor during the company’s most recent quarterly earnings call.

“Brett, we love you with all our hearts. Your home is here, and we’ll do our best to get you back. Don’t think you’ll make it out alive, it’s impossible.”

Taylor also served as chairman of Twitter’s board before Elon Musk bought it, and he may have burned out trying to run Salesforce while dealing with the acquisition turmoil, Taylor said. said a source close to “The Twitter takeover turmoil seems to have endured more than he expected.”

Taylor’s departure means that Salesforce not only has to find a replacement for him, but eventually a replacement for Benioff. A recently retired former executive complains:

“Just when I thought Benioff’s succession was finally settled, Taylor stepped down. I think it’s going to be really hard to find someone with that level of competence to run Salesforce’s main business.”

Several insiders agree that there aren’t many potential successors at Salesforce for either Benioff or Taylor. Some inside the company speculate that CFO Amy Weaver could succeed Taylor, while others see that as the end of the co-CEO streak.

“Whether Mark will be the sole CEO or I’ll be the chairman and have a separate CEO. No matter what the structure, every candidate is going, ‘Why am I failing so many times? Why am I doing so well?’ do you think?’