How Salesforce leveraged MuleSoft to create a seamless acquisition process

In a series of blogs, we have highlighted the various ways Salesforce is leveraging MuleSoft technology to improve internal processes — like streamlining employee onboarding or enabling the operational shift to API-led connectivity with a C4E. This blog is the next in this series of how Salesforce uses MuleSoft that we will continue to add to over the coming months.

In 2019 alone, the value of global merger and acquisition (M&A) deals amounted to $3.7 trillion. Based on a 2020 Deloitte M&A trends report, dealmakers anticipate M&A activity will continue at an active pace or increase in 2020. In the midst of change, how can a company set itself up for a successful merger?

Why buy versus build?

First, let’s consider why a company would acquire a new technology instead of building it. Buying an existing product instead of building it in-house allows companies to grow market share through rapid entry into new markets or new geographies, expand their supply chain and distribution network, and stay competitive. Additionally, acquisitions provide resources and technical expertise that typically take years to develop internally. Despite the challenges M&A poses — given the criticality for businesses to maintain consistent growth — it has become a key tactic in today’s global business landscape.

The challenges of M&A

Despite the increasing emphasis on M&A, merging companies together poses extreme challenges for businesses. In fact, 70-90% of M&A initiatives fail — most commonly attributed to falling short of expected revenue synergies and gaps in execution or integration. In fact, less than 20% of the organizations in the M&A space achieve their cross-selling goals. How should enterprise leaders build a strategy to prevent falling into the unsuccessful M&A majority?

There are several facets to finding M&A synergies, which traverse technology, business model, and cultural alignment. The acquiring organization needs to consider not only application and infrastructure integration, but also how the business processes and employees will come together. Putting these three components at the center of M&A strategy is the key to ensuring both customers and employees find success among ominous change. Key questions to address when going through a merger:

  • What is our integration plan for both interim and long term operations to meet business requirements?
  • How do we align business models to prevent revenue dips or breakage for either acquired or acquiring organization?
  • How do we ensure cross-org alignment to optimize for employee and customer success?

M&A at Salesforce

Salesforce has acquired over 70 companies since its inception in 1999, and customer experience is top-of-mind when considering M&A opportunities. When identifying acquisition targets, Salesforce evaluates across a few key areas, including whether the target would present an opportunity to drive value for customers as a standalone cloud, provide adjacency opportunities to existing clouds, or acquire talent or intellectual property. Most importantly, Salesforce evaluates the acquisitions alignment with their values of trust, customer success, innovation, and equality. Salesforce’s extensive experience with M&A has allowed the company to build up a number of key learnings to help streamline processes, simplifying the transition with each subsequent deal.

At Salesforce, M&A is run out of the Corporate Development team, a team that quarterbacks the M&A process and works with a departmental lead for each department across the business. While that departmental lead rolls up to their own business unit leader (ex. marketing M&A lead is in the marketing organization) they operate with a dotted line the broader corporate development team. This setup enables cross-organizational alignment and visibility. If an integration activity is working well in one department, the lead can easily share that across other department leads to ensure best practices are being followed.

A key factor in any M&A transaction for Salesforce is customer experience – ensuring every acquisition provides value for customers and enriches the Customer 360.

Bill Schwidder, Senior Director, Corporate Development at Salesforce

The ultimate goal of M&A at Salesforce is full integration into Salesforce systems and processes — and the team has learned over time that a phased approach is required to achieve a successful transition. They have also learned that a successful merger requires a focus on both the end-customer experience and the employee experience. In fact, McKinsey Consulting found that sales and HR are the top two functional areas with the biggest need for improvement in future merger activity.

Streamlining sales processes across organizations

When merging sales processes after M&A, Salesforce’s primary focuses are customer success — providing a seamless customer experience amidst the immense operational changes — and achieving revenue synergies. In order to do that, Salesforce must align teams, accounts, and territories smoothly, which requires accounts from the acquired company’s CRM to be accurately mapped into Salesforce’s master org. Once account mapping is complete, teams can accurately forecast sales and provide real-time visibility between orgs, ultimately leading to a better end-customer experience because data is shared and consistent.

During account mapping, Salesforce consolidates data from Salesforce’s master org and the acquired org’s CRM into a Heroku Postgres database used as a data hub. Heroku Postgres is Salesforce’s SQL database-as-a-service with operational expertise built-in, easy setup, security by default, database forking, credentials, and more. Leveraging Heroku Connect, the Salesforce teams can implement this movement of data from Salesforce with clicks rather than code within minutes. Once the data is consolidated in the data hub, the data can be compared side by side and account mapping and analysis can be done, matching the acquired company’s customer accounts with Salesforce’s customer accounts, one-to-one.

Once account mapping is complete, there are a number of ways Salesforce ensures synergies between sales teams. First, it implemented lead pass, the process of sharing sales leads between organizations, preventing revenue breakage. To accomplish this, Salesforce’s M&A team leveraged MuleSoft integration with Marketing Cloud Automation to share leads between orgs. The integration is built as a reusable template with MuleSoft so Salesforce’s teams can now set up lead pass extremely quickly for future acquisitions.

Salesforce’s M&A team also ensures sales teams at both companies have visibility across Sales Cloud opportunities. Leveraging MuleSoft’s Flow Designer, the M&A team set up a simple, event-driven integration between Salesforce orgs to mirror opportunities. Since this integration is an easily configurable solution, business users can set up a new integration without engaging IT, enabling new M&A opportunity mirroring integrations to be built in just half the time.

Together, these repeatable processes — including account mapping, lead pass, and opportunity mirroring — have led Salesforce to hit revenue targets, create more seamless customer and sales team experiences and are expected to reduce development time for sales processes during future acquisitions to by 25%.

Ensuring a smooth employee transition

One of the main factors in acquiring companies is always the talent that comes with the acquisition. The organizations acquired by Salesforce have each brought with them a diverse range of skillsets. But, during an acquisition can be overwhelming, and ensuring acquired employees feel at home is always top of mind for Salesforce during an acquisition. An average of 33% of employees acquired from startups leave their company within the first year post-M&A, and Salesforce understands that avoiding employee turnover is critical to their success.

To streamline HR processes for M&A, Salesforce starts with an analysis of existing people and processes. Acquired companies have their own internal employee applications (usually between 100-150) that need to be addressed. What employee applications does the acquired company use? Which can be merged with Salesforce’s apps, which should run in parallel, and which should be decommissioned? Additionally, how is the organization structured in comparison to Salesforce? What is the best way to fold in these new employees without disrupting our teams or theirs?

One of the imminent challenges post-acquisition is employee onboarding into Salesforce as quickly and seamlessly as possible, to retain all acquired employees. To address this, Salesforce turned to its own products. First, Salesforce IT teams leveraged MuleSoft to aggregate employee data from the acquired company’s various systems, and build a 360-degree view of the new employees. This “Worker 360 API” could then be leveraged in various projects to improve the employee experience. Salesforce started by building an M&A pre-boarding app. Built on the Salesforce Platform, the app helps with onboarding and provisioning of new M&A employees and adheres to compliance and organizational requirements. From there, Salesforce built an M&A Community for acquired new hires. This community, built on Salesforce Community Cloud, provides a one-stop-shop for all M&A hires to provide resources and communication specific to them.

These two applications together with a 360-degree employee view, not only improve the employee experience but also saved time and money for future acquisitions. Now, all of Salesforce’s acquired employees are onboarded using these tools — saving Salesforce over $1M per acquisition in HR spend alone due to consolidated systems and an employee retention rate of 95% in the first year post-acquisition.

The most important factor in M&A

When developing an M&A strategy, the most important consideration is the people involved: namely your customers and employees. Salesforce achieved success by addressing M&A synergies across three key pillars — streamlining technology and integration, aligning business models, and fostering people and culture. By leveraging their own products, it built efficient, repeatable processes — so that more emphasis could be put on ensuring the success of their customers and employees instead of starting from scratch or spending time on repetitive, manual tasks with every new acquisition. Now, our mergers and acquisitions happen faster and seamlessly and provide an improved experience for both our customers and employees.



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