Home

In mid September, the Massachusetts Technology Leadership Council recognized Salesforce Commerce Cloud CTO Wayne Whitcomb as CTO of the Year. Wayne, a co-founder of Demandware (acquired by Salesforce in 2016) has been on the front lines of two of the most profoundly transformative innovations of the 21st century: cloud computing and digital commerce.

Here he takes a look back, and shares his unique perspective on the next great disruption in tech. He also explains what the tech industry can learn from Tesla.

Lisa Lee: First, congratulations on being recognized by the MassTLC as CTO of the year.

Wayne Whitcomb: Thank you. I’m proud to lead a great team that has helped build this company into the leading player in cloud commerce. We truly wouldn’t be where we are today without their dedication to building great products and supporting our customers’ success

Go back to 2004 and tell us about the founding of Demandware.  Ecommerce was barely ten years old and cloud computing was nascent. What kind of business problems were you trying to solve for retailers?

WW: I had worked with VCs locally in Boston so I had connections with that community.  At the time, Stephan Schambach, who founded Intershop and expanded into the U.S. with ecommerce but retrenched back into Germany after the dotcom bust, was constantly thinking about doing something different with the delivery of ecommerce.

He didn’t know how, but knew that prepackaged and homegrown solutions were a real challenge for retailers. Once we got onto the topic of the problems for retailers, and the technology, and what the technology might do, that’s really where it started. My original involvement was to develop an operating model and an architectural approach on how it might be done. Along with cofounders Ulrike Mueller and David Boyle, we created the initial prototype and secured the first round of investment to start Demandware.

The official date was August 4, 2004. Our first customer was Zabar’s, a famous gourmet market and deli in New York City. They continue to grow their business with us today. From there we were able to win the trust of other early customers like Gardener’s Supply primarily through the shared success model. They knew that we were in it together with them. Retail brands were looking at how they could do more in ecommerce, and focus on the things that differentiated them and helped them connect with their consumers versus infrastructure and dealing with technology. So the idea resonated with them enough for them to take the leap of faith with us and be very successful on the platform.

So was that really the business problem that you were trying to solve? Is it that these retailers, by and large, they’re not technologists?

WW: Before Demandware, retailers were spending 80 percent of their time on infrastructure-like problems that were common to every other branded retailer, and 20 percent on what differentiated them. And we’ve flipped that upside down. So now, they can spend 80 percent of their time on what differentiates their brand. We took the heavy lifting and lightened the technology burden and focus on their customers.

We focused, and continue to focus, on security, availability and performance, which allows our customers to work on their business, their marketing, and connecting with consumers.

We understood early on that only when you have control of both the software application and the supporting infrastructure could you really create a true SaaS offering. We had control of the ecommerce application. We had control of what we wanted to do with the infrastructure. We could combine that into an engineered solution — as came to be known as cloud computing — and bring that to market to the benefit of our customers.

We followed in the path of Salesforce, because Salesforce was founded in ’99. We, in 2004. So they had a five-year head start on us. But us and they proved the benefit of the SaaS model to their customers, primarily business-to-business customers at that time. We wanted to do the same thing, but in an area important to retailers.

You mentioned Salesforce. They were the pioneer in establishing the cloud business model and really validated the concept.

WW: Absolutely. Remember that the concept of ‘always on, always fast, always secure’ was a new world in 2004. It’s not like you can send a planned maintenance schedule out to your consumers and say, “I’m going to be offline as an ecommerce site on these times.” No! People expect it to always be available. And that 24/7 notion was something people were grappling with back in the early 2000s. And we knew when we were going into this area where there was a lot of pain, but a lot of opportunity related to the market.

If we could invest in solving these difficult problems for the retail brands, we believed there was a huge opportunity. Providing agility to our customers and giving them peace of time on platform reliability.

It certainly was differentiated at the time. There were so many skeptics, which is also like any other disruptive innovation. You could have nine out of ten people that will tell you that it’s impossible. They said people will never accept it, it won’t be trusted. It has to be hosted on my site with my software and my people. And that was a long road to actually convince through successes of our early customers — our brave customers and their trust — to gain that momentum.

The other thing that we knew at the time was that the challenge of integrating backoffice services behind the customer’s firewall would become less of an issue over time. But we believed heavily in the promise of cloud and how more of those services would be expressed through other cloud platforms. So integration would move from being a disadvantage to a very strong advantage for us.

And this is what turned out to be true over time. It was so much easier to integrate between cloud platforms than it ever would be in packaged applications behind the firewall on premise.

Was there one big customer in the early days that you recall as being the one that helped validate the approach and helped Demandware secure the trust of other large retailers?

WW: Like anything, it’s a long journey of adding ever larger customers that put their trust in you as did the previous customers. And it was important to have customers building  referenceability. Our shared success model was critically important to develop this partnership with our customers. It was in the DNA of the company to worry about our customers’ success and how they were growing. This focus on our customers’ success drove how we prioritized investments and responded when challenges surfaced. One example, in 2009 we had a very large customer in Europe that really challenged us to scale. They were doing more than a billion euros in gross merchandise value, and really pushed us from the volume perspective. The beauty of the model is that all our customers benefitted from the improvements and innovations we made for that one customer. This is one of the key advantages of true cloud platforms.

A current example is Adidas, who is a fantastic customer. They have challenged us and we have partnered closely with them on important innovations and capabilities to grow their business on an international basis. So to look at the journey of all of the customers and their success, I think it’s amazing. I take a lot of pride in that.

Cloud has been so transformative.  What are some of the biggest changes or surprises that you’ve seen in cloud in your time in this business? And can you foresee another technology that will be just as transformative?

WW: One of the things that amazed me was how quickly public cloud — primarily Amazon AWS — came on and was adopted in the industry. It was transformative in a broad-based way. Many, many companies were able to use it initially as a development tool and then brought it into more mission critical production facing areas.

As far as new things that are coming, I think artificial intelligence, like Salesforce Einstein, that is the next new revolution or transformation that is really taking hold. AI is enabled by cloud and the data collected and insight gained. All of the signals — as we would talk about it technically — that we can pick up from interactions, and outcomes, and being able to then apply that intelligence to both commerce — from a personalization standpoint to help the consumer — and insight on which the retail brand can make actionable. But I think we all know that we’re just scratching the surface of where this will touch all of our lives going forward. Not only in the business sector, but also our personal lives.

Will AI separate winners from losers going forward, in the same way that cloud has?

WW: For sure. The predictive capability applied at scale was just not possible with prior technologies. This predictive intelligence will help businesses really focus on their priorities, recognize trends that are important to them, and allow them to focus on their customers and their customers’ customers. I think that it also makes it more personal and relevant to individual users.

In the past you would have to do market segmentation in the past and try to create generic roles on how you would connect with groups of people. And now, you can recognize each individual as their own person and create things that really build loyalty and delight between the user and the consumer and the brand.

Do you see that trajectory happening even faster or as fast as it happened with cloud?

WW: I think that AI is faster, actually, than cloud. I think cloud was an important prerequisite to having this all take place. Businesses that ignore using AI to build a loyal relationship with their customers will lose out to those that do. If you’re operating in a silo, there’s no way to gain those learnings.

Now that cloud is in place, all of these additional technological transformations like AI can take off. The main focus for businesses looking to leverage AI will be regulation, and compliance, and privacy for users. So maintaining all of those trust aspects. But I think that — AI — and using the power of that insight is going to be exponential as compared to the adoption rate of cloud.

Legacy licensed software companies just can’t gain benefit without having the connection to the data. So again, going back to cloud as an enabler. You need to be part of a cloud company to be able to bring those benefits of AI to market.

Are there any industries that have not embraced cloud? And if there are, what are you hearing? Why haven’t they? What’s going to be the thing that pushes them over the edge?

WW: I think cloud adoption is really driven where there’s a lot of innovation and demand for frequent change, the companies in those industries tend to adopt cloud and the constant innovation that comes from cloud more quickly.

Ultimately, everybody will end up adopting cloud analogous to an electric utility as we’ve always talked about in the past. To be able to consume compute and connectivity capabilities of cloud as a utility is a great thing for a business. You can simply leverage those like you leverage electricity that’s delivered to your home.

It will be adopted by almost all industries as every business needs to be able to connect to other businesses. Even the most stalwart of industries will be driven to cloud in order to connect to their suppliers, partners and customers.

So you’re taking on a new role at Salesforce as an advisor to Salesforce co-founder Parker Harris,  What are some of the things that you’re going to be focusing on?

WW: I’m going to focus on how to connect with and bring the power of Salesforce to Commerce Cloud and our customers. Our customers can gain value by other services and clouds that Salesforce offers. We can leverage the technologies and the talent in Salesforce more broadly and bring those capabilities into Commerce Cloud along with all the other clouds to our customers.

I am excited to be able to work with Parker’s team and contribute my experiences with commerce and B2C more generally to help shape what we can create in the future for our customers.

You’re a huge car enthusiast. I can’t wrap this up without talking about your Tesla and the parallels between your car and Commerce Cloud business model.

WW: I have a Tesla Model S and I really enjoy it. I was drawn to it because I’m very passionate about automotive applications and performance and racing. And what I saw with Tesla, I love the patterns that were very similar to what we were doing in cloud and ecommerce.

Tesla owners get automatic software upgrades for the car, which enable new features and capabilities like autopilot and new capabilities related to the display. I don’t have to go back to the dealer. They just happen.

The other thing is you can see the power of the model, where all of the information that gets collected by the car as you’re driving — whether in autopilot or not — is gathered and aggregated back to Tesla so that they can learn more on what those improvements could be made. So again, much like cloud, one of the big benefits is that you can see how the product is being used, where it’s effective, and be able to use that information to define new features and capabilities.

And of course, in this new AI-enabled world Tesla can realize the promise of truly autonomous driving and make that possible. This can only be done through the insight of gathering all this data, and they have a tremendous head start on that. The same way that Salesforce has a tremendous head start helping our customers leverage the power of their data and turning that information into growing their business.

Driving a Tesla is transformative. And when I get back into a ‘normal’ car, it’s just not the same. Just like cloud and AI, there is no going back. It’s just not the same.