The Salesforce implementation phase can make or break a SaaS platform’s adoption rate and effective use for months and years to come. Resistance to change is to be expected, but companies need their employees to go all-in on understanding the tech, establishing new processes, and eliminating workarounds and legacy behaviors.
Salesforce implementation costs vary widely depending on the size of the implementation partner (if you choose one), your total Salesforce spend, and how many custom features and processes are required. Implementation costs also vary based on whether you are migrating from an existing platform(s) or starting fresh. If you plan to implement an off-the-shelf instance with few customizations, average costs range from 10-30% of your total annual spend. On the other hand, a large company with extensive customization could pay as much as 50% of their annual spend. Integrating multiple disparate systems after a merger or acquisition can drive the price even higher.
Start with Your Salesforce Roadmap
We recommend our clients begin building out a Salesforce roadmap six to nine months before negotiations. This process helps document necessary functionality, gain buy-in from internal stakeholders, and control the direction of negotiations from the beginning.
What if we are an existing company migrating to Salesforce from one or more platforms?
If you are implementing Salesforce to replace existing technology (“lift-and-shift”), the roadmap is more defined at the outset. Many processes are already in place, users have certain expectations about how their work should be done, and stakeholders know what outcomes to expect from these efforts.
A successful implementation should do more than replicate existing processes. Users should expect to adapt processes and habits to fit the new platform and achieve the desired outcomes more efficiently. (If not, why did we switch platforms at all?)
“Lift-and-shift” implementations almost always cost the most, take the longest, and have the most risks involved. Implementation partners must be experts on Salesforce and any legacy platforms.
What if we are a new company or startup with no CRM?
New companies are challenged to build a roadmap with more limited information. Depending on the age and history of the company, it can take weeks or months to really understand what it needs from a technological standpoint. Strategies fluctuate; in many startups, marketing and IT departments do not exist as standalone functions yet.
These companies must define critical needs quickly, but they have one cost-saving advantage—they can build out business processes based on existing Salesforce functionality. There are no “bad habits” to accommodate that require custom development.
Regardless of whether you are implementing Salesforce for the first time or as a replacement, there are five important ways to keep implementation costs down.
5 Steps to Reducing Salesforce Implementation Costs
1. Build your Salesforce Roadmap
Your Salesforce roadmap contains two basic pieces of information: what you plan to buy and when you plan to buy it. It is your guide for negotiating and will become your guide for implementation as well.
In many organizations, one individual serves as the Salesforce “project manager” leading this effort. This person could have any role in the organization, from Salesforce admin to CIO, but is the primary point of contact for the Salesforce rep. This does not stop the rep from reaching out to the C-Suite and VP-level leaders to build better relationships.
The roadmap helps project managers achieve the internal alignment necessary to fend off Salesforce reps who contact multiple organizational stakeholders in hopes of influencing buying decisions. It empowers the Salesforce project manager and stakeholders to present a united front regarding what to buy right now, keeping negotiations focused on costs and business value rather than product.
2. Your Introductory Rates Matter
Your initial negotiations with Salesforce will determine your rates forever. The rate you start with will be the benchmark for all future negotiations, a boon for sales reps who will jump at the chance to sell seats and modules you do not need yet.
Without a clear roadmap that identifies the types of platforms your company needs (Sales Cloud, Marketing Cloud, industry-specific clouds, etc.), the sales rep will take the opportunity to build a roadmap for you that best serves their sales and revenue objectives. To drive first-year revenue as high as possible, it will likely include many features and benefits you need, along with quite a few that you do not.
Features and benefits that are not business-critical as defined in the roadmap inflate your base price, affecting future negotiations. They will also inflate third-party implementation costs, regardless of whether you plan to use all the functionality at the time of implementation or not. Unnecessary features still take time and resources to implement, potentially deterring those resources from more important projects. Many Salesforce implementation firms bill by the hour, so every hour they spend on non-critical functionality is money wasted.
3. Avoid Buying “Shelfware”
“Shelfware” is a term that describes software or licenses a company purchases but never uses. Software becomes shelfware in several ways. Perhaps someone saw a “cool” platform at a trade show, bought it, but never adopted or used it. Some companies buy software licenses at a volume discount rather than for an actual number of users. It is an outcome of classic price psychology—if you buy one, you get one more at 50% off. If you do not need two, is the half-off price as valuable as it looks? Rarely.
Salesforce account reps know how appealing a discount is, especially when they know their points of contact must get buy-in from multiple stakeholders. As mentioned above, Salesforce reps are highly motivated to maximize first-year revenue from new clients. They may drive the conversation by offering a bundled selection of platforms at some discounted rate. There is no rhyme or reason behind these discounts. They can be invented on the spot.
New companies are especially susceptible to paying for shelfware. When business processes are still evolving and companies are still working out best practices, it might make sense to license another platform or add a few more user seats in anticipation of future growth. It is certainly easier to do so in a room with an account rep; project managers must be proactive in sticking to the roadmap and focusing on immediate, defined technological needs.
Companies must be intentional and specific when negotiating quantities, types of licenses, and the associated costs to keep initial spends reasonable, weed out upselling, and avoid wasting resources implementing unnecessary technologies. At the same time, Salesforce customers should take advantage of free trials, proofs of concept, and demonstrations to explore new technologies before buying.
4. Require Clarity on Pricing Structures
Bundled pricing leads to shelfware which leads to wasted time and money. Salesforce has several tricks up its sleeve to create highly variable pricing structures across industries and company sizes. Your company’s annual revenue and annual Salesforce spend also influence pricing, but there is no way of knowing to what degree. There are no “best in class” rates; sales reps are trained to rebut these inquiries.
To avoid unnecessary costs, companies must require itemized pricing. Recently, we are seeing more and more deals that boil down to Salesforce offering X, Y, and Z for one discounted fee. This number does not necessarily represent anything; Salesforce uses a value-based pricing model where prices are set based on your perceived value of the solution.
Third-party rate data can help you better understand whether your rates are comparable to similar companies. Some Salesforce consulting firms have price calculators on their websites, but they are generally built on base rates as listed on the Salesforce website. Firms like TNG compile this data based on years of experience negotiating contracts.
5. Keep it Simple
All SaaS implementation efforts have one thing in common—customizations equal cost.
This simple fact requires stakeholders to think carefully and critically about existing business processes and expected outcomes. The more your business can align processes with Salesforce capabilities out of the box, the lower implementation costs will be.
In many cases, companies fall into the trap of extensive customization. They create technical debt; more custom features require more internal and external resources to support.
Customization is not necessarily a bad thing, but many small- to mid-sized organizations do not need as much custom development as they believe. A thorough business process analysis in the beginning stages can help avoid costly customizations in the future.
Stakeholders and project managers must also take into consideration the employees working with these systems daily, how changes might impact the workflow, and how human elements of change management factor in. End users must be on board with the change; stakeholders must be sure that customization requests solve a business problem rather than accommodating a user’s (or department’s) preferences.
Do I need a third-party Salesforce implementation consultant?
Organizations must decide whether they want to launch the platform themselves, add Salesforce’s implementation and customer success services to their deal, or hire a third-party consultancy. All have pros and cons.
A typical Salesforce implementation process includes business process analysis, data transfer from previous systems, custom development (if applicable), user testing and quality assurance, deployment, and ongoing user training and support. It is a heavy lift, even for large organizations.
If you choose to partner with a vendor, it is critical to find the right vendor for your needs. Large vendors may not provide small companies with the level of service or talent necessary to get the job done. While it makes sense for large companies to evaluate the big-name firms, they should prepare for higher costs with no relative increase in quality.
If you already have a consulting partner like Accenture or Deloitte working with your organization, they are strong choices for Salesforce implementation as well—they understand your business and already have strong relationships with stakeholders. Levering these existing relationships can ease the change management process.
Beyond technical proficiency, third-party firms help you manage the human element. They can help secure buy-in, speed up adoption rates and time to proficiency, and help you design workflows that optimize the use of the platform. They also optimize the use of human resources, allowing internal employees to engage with the process as needed without affecting day-to-day responsibilities.
For those who want to partner with a third party, we advocate for mid-sized implementation firms. They are large enough to provide the critical talent necessary for a successful deployment but small enough to prioritize the client-partner relationship and drive mutual success.
You can search Salesforce’s database of implementation specialists here. Brief pricing information is available below.
Numerous variables affect Salesforce implementation costs. At TNG, we believe companies need a clearly defined roadmap that aligns stakeholder needs and expectations before ever opening discussions with a Salesforce rep. The roadmap drives the negotiation process which ultimately drives implementation costs and time frames.
Working towards a Salesforce negotiation for your organization? Contact us at email@example.com for a free consultation.