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When I first talk to prospective customers about Salesforce.com, I talk about their corporate philanthropy. Salesforce.com donates their CRM database to nonprofits. I tell them that through my interactions with the Salesforce Foundation, and what I’ve heard of Salesforce.com’s founder Marc Benioff’s philosophy, they are committed to continuing this philanthropy. I also tell them that they reserve the right to change their giving at any time. Customers have so far been willing to accept the risk of patronage because the benefits are so great. But I thought it was time I found out a bit more about the philosophy behind the giving, to see what Benioff was really thinking, so I purchased and read his 2004 book, Compassionate Capitalism.

Benioff founded Salesforce.com and from day one was thinking about corporate philanthropy. In the book he talks about what makes Saleforce.com’s style of corporate giving different and interesting.

While at Oracle, Benioff was in charge of a philanthropy project to give away $10 million in computer hardware. He found it a frustrating experience because while the generosity was there, he could not leverage the full assets of the company–staff time, marketing resources, etc. The project and the concept of philanthropy wasn’t ingrained in the organization–it was a well-meaning project, but one outside the daily experience of the company.

Benioff left Oracle and started Salesforce.com in the mid 1990’s. He wanted to embed the culture of service from the start, so that philanthropic projects wouldn’t be tacked on to the corporation but integrated into how business was done, and therefore be much more effective.

Not only did he start a corporate foundation when most dot com CEOs couldn’t be bothered with the idea, he set goals for corporate philanthropy that were truly audacious:

1. 1% of the company’s equity would be donated to worthy projects
2. 1% of the company’s product donated to nonprofits for their use
3. 1% of paid employee time participating in service projects

I’m going to focus on product donation area, as it’s very near and dear to me. (I’ve also benefited from the equity donation as well…) Let’s look at some stats. Currently Salesforce.com has about 500,000 users on their system. The corporation’s stated goal is to donate 1% of those seats to nonprofits, amounting to 5,000 user licenses. That’s a lot of licenses to give away. Especially when you remember that they’re not giving away pressed CDs of software, they are giving away access to a hosted CRM system, with full support, and incurring ongoing costs.

The Salesforce Foundation manages the product donation process. In the last year they’ve doubled the number of nonprofits who have been donated Salesforce.com CRM to a total of 1000. Each nonprofit is given a donation of 10 licenses, so they have donated about 10,000 licenses–2% of their current user base, and a full 100% over their organizational target for product donation. Wow.

But they haven’t stopped giving. And they have plans to keep on giving the product away. Obviously that can’t continue indefinitely, but the message is clear–it’s about making a difference, not about staying within rigid limits.

As a Salesforce.com implementer for nonprofits, I’m a bit conflicted at the popularity of the Salesforce.com donation program. It’s great that it is available as a tool for nonprofits that are doing great work in the world. But I always want to have the option for my nonprofits to get Salesforce.com donated. The recent acceleration of nonprofits taking advantage of the donation does make me worry that the doors will close at some point. I hope that Salesforce.com will find innovative ways to continue to expand the program without incurring a level of expense where it’s continuation becomes an undue burden. I know that the folks at the Foundation are trying their damnedest to keep getting the product into the hands of nonprofits, even if that means taking on unreal workloads.

I will always worry about access to Salesforce.com’s CRM donation getting harder in the future, I’m not very worried yet, and I hope that more and more paying customers make the switch to Salesforce.com so that the 1% product donation target continues to increase. I also hope Marc continues to love the fact that he’s reached, and shot right on past, the product donation goal thanks to the tireless work of the people at the Foundation.

My concern that this great deal will go away is not just because it’s own popularity may bring it down. I always talk to potential customers about things that could end the donation for them–financial problems at Salesforce.com or with the economy in general, merger with another company, earthquake–they are in San Francisco… While I can’t do much about an earthquake (east coast data centers?), or the economy in general (no more “fiscal conservatives” in office, please…), a Salesforce.com merger with another, bigger company is a real scenario we’ve discussed in our staff meetings. If Oracle/Google/Microsoft bought Salesforce.com would the donation program go away?

After reading Marc’s book, I feel more confident that the donation program would continue in some form after a merger. Benioff has worked hard, and from day one, to embedded service and philanthropy into the organization. It would be hard for a buyer of Salesforce.com to come in and tell the staff that service was no longer a part of their culture, that they were ending the donation program, and that they no longer would have access to paid time off for volunteering. It’s that much a part of their organization.

I’m not naive. I understand that mergers destroy the culture of at least one of the two corporations merging. So I’m still afraid of a merger. But Microsoft has an extensive community affairs department, and I’ve been on the receiving end of many of their grants, so if they purchased Salesforce.com, I couldn’t see them killing the program right away. And Google wouldn’t want to tarnish it’s great image. I suspect most would-be acquirers would have some incentive to keep the program going for at least a couple years. So, I am optimistic.

The Salesforce.com experience with philanthropy, at least from the outside, seems to be a mirror of their experience in business. It’s been underpinned by one key value–don’t be afraid to try new things. That’s what the Internet revolution has been all about. And right now you’re rightly thinking that the flip side of that coin is a willingness to accept some sub-optimal results every once in a while. Their product donation program is truly innovative. So innovative, that it’s actually pretty hard for potential clients to get their head’s around. They are used to getting things donated, not services. Part of my proposal process includes a bit of an education of the risks and benefits of this innovative donation.

So it’s innovative, but early on it faced some big challenges. The biggest of which, I think, was that nonprofits who were getting Salesforce.com donation weren’t being successful in getting it up and running. Anyone who has been involved in a CRM project will tell you that they’re tough to get right. Faced with the challenge of low install rates, the Foundation did not end their giving program on the grounds that Nonprofits couldn’t handle CRM, they started to invest more heavily in solutions. They started working with partners to build a community of consultants who know what it means to work with nonprofits on CRM projects. I’m happy to be a part of that community, and have felt greatly support by the Foundation.

They also invested heavily in building a nonprofit-specific template that turns the blank slate of a Salesforce.com product donation into somethings that looks an awful lot like CRM for nonprofits. Nonprofits still could benefit from the services of a consultant, but the new template sure makes the “buying” decision for nonprofits easier, and it can save them a ton of work and up-front consulting cost. And it makes all of us consultants more efficient, so we can crank out more Salesforce.com implementation for nonprofits.

Another side benefit of the template is that now our nonprofit consulting community is speaking the same language in regards to sf.com structure–all the groups we work with are starting with the same base template, so we’ll be able to share more stuff–code, best practices, and experiences.

As you’ve no doubt figured out, I’m a big fan of Salesforce.com. I’m a fan of the developers and product people who’ve put together such compelling technology. I’m a huge fan of the philanthropic model, which is truly innovative and is rubbing off on a surprisingly large number of Salesforce.com corporate partners. I’m a fan of all the folks I’ve interacted with at the Foundation and company, as they’ve all been really nice folks.

I enjoyed Benioff’s book. It was nice to put a framework to what I’ve seen practiced out in the real world. It didn’t really surprise me at all, but was concise in pulling the main points of the philosophy together. I recommend it, especially to all the CEO’s out there who don’t have effective giving programs!