Jul 1, 2022
I have had my head down working on some big things since RapidStart CRM growth exploded, and it has been a while since you heard from me. Well, I'm getting back to it with a follow-up chat with Charles Lamanna who recently took over for James Phillips as head of Business Applications for Microsoft. This was my fourth chat with Charles, and it was interesting to back listen to them in order. It really gives you a sense of where Microsoft has come. I managed to catch him in his office having just wrapped up their year-end. Enjoy!
If you want to listen to my chats with Charles in order, The first one was October of 2018, the second one was September of 2019, the third one was March of 2020.
Transcript Below:
Charles:
Hey, this is Charles Lamanna.
Steve:
Charles. Steve Mordue. How are you doing?
Charles:
Good. Great to hear from you, Steve. It's been a long time.
Steve:
It has been a while. Have you got some time for a chat?
Charles:
For you, anytime.
Steve:
I appreciate it. Well, I guess the big news for you obviously is
putting on the big boy hat, huh?
Charles:
Yes. I moved up an extra floor in the Advanta building in the
Microsoft Campus.
Steve:
Oh did you?
Charles:
No, I'm just kidding. But metaphorically speaking at least. Because
for folks that don't know, James Phillips leaving in March of this
year, I kinda stepped in across all aspects of business
applications of Microsoft. And, over the last four years, I've
gotten to know the place, know the people, know the business and
I'm super excited about the opportunity. And I think the future has
never been brighter for business at Microsoft.
Steve:
Well, I never got the feeling that James held you back, or any of
the folks on your team back, but he certainly, we have to give him
a lot of credit for really taking this thing to a whole nother
level. You weren't here before, I don't think, at least with the
business apps, but it was really run by morons before he took over.
And he completely turned that thing around and turned it in a whole
nother business. And now with you taking over, I'm expecting that
to continue. I don't know if there's been some things that have
been in your bag that you've wanted to do that James was keeping
you from, that you're going to pull out, or if you're just going to
continue the path, or what's your thinking now that you've got that
gavel?
Charles:
So definitely not held back. I would say I was super fortunate I
worked for James for, I think seven, eight years in total. So I was
able to learn a bunch and he was without a doubt, the most
supportive manager I've ever had in my career, in terms of both
enabling and clearing paths for what we wanted to do from a vision
and dreaming perspective. And if it weren't for his support, things
like Power Apps would have never gotten off the ground. So,
definitely. And I think as we go to the future, we have this
amazing foundation. I mean, BizApps is a major and key component
and pillar of the Microsoft Cloud.
Charles:
10 years ago, you probably would've thought that impossible. Right.
To have Dynamics and Power Platform alongside Azure and Office. Now
that we're here, let's go take it to the next level. And that's the
push, and it's continuing a lot of the great innovation we've
already done from a data-first, AI-first approach. Kind of
sprinkling in some more collaboration with teams, and really
revisiting the end-user experience, the platform, to go
increasingly modernize and scale it and make sure that all our
components from CRM, to ERP, to Power Platform work great
together.
Steve:
I don't think it could have achieved that status with Dynamics 365
alone. It really took the Power Platform coming into being, I
think, to give it the breadth that it needed to be able to get
there. With Dynamics 365, we didn't have apps for users to do small
things, there was no way it was going to permeate an organization
the way the Power Apps do.
Charles:
Yeah. Yeah, that's right. I say two things are interesting. The
first is, Power Platform has allowed us to help more users and more
customers with business process transformation, which is what
BizApps are all about. Right?
Steve:
Yeah.
Charles:
How do you make your sales processes better, your financial
processes better, and Power Platform really turbocharged that. And
that earned us credibility in a lot of those departments and with a
lot of those users, and we have some great data about every user
who adopts Power Platform is significantly more likely to adopt
Dynamics within the next year or two. So we see that symbiosis
working in a way which is incredibly customer-friendly, and it
helps our business. Second thing is Power Platform has even helped
us reimagine parts of the Dynamics apps themselves. And I think
probably two of the best examples are the connectors, which are key
to the Power Platform.
Charles:
You see the connectors starting to show up inside all these
Dynamics apps, like Customer Insights uses Power Query for data
ingestion, or Viva Sales even connects to Salesforce. So there's
this amazing interoperability that we have, and also enabling the
end-user. Our team built Viva Sales, even though it's not in the
Dynamics or Power Platform brand. But it's this idea of having an
integrated experience in Office for sellers, built on connectors
and built on the Office integration. So it's changed the way you
think about some products, and it's also helped us go expand our
user base.
Steve:
Yeah. I saw I was on a PGI call with that yesterday. Very, very
cool stuff. At the last PAC meeting, I was supposed to be on the
Viva Sales round table, but I'm like, "Yeah, that sounds boring. I
think I'm going to go to this one." And I really, I went to the
wrong one, I missed a good one. But you know where I am, right? I'm
on the platform.
Charles:
Yep.
Steve:
And we're exploding. Our app is continuing to grow on the platform
as a low-cost simpler alternative to Dynamics 365 for companies
that aren't ready for that. And I'm always bugging you about, "Hey,
that cool new feature you guys got in the first-party. When are we
going to get that at the platform level? So ISVs, and people that
are just building their own stuff from scratch, could take
advantage of some of the syncs." We got the Outlook app a while
ago, we've been getting some things. And when I saw Viva Sales,
that was probably my only disappointment was that, at least as I
understand it, it's hardwired to Dynamics or hardwired to
Salesforce. And I get that trying to play those two against each
other, but it's leaving guys like me out in the cold.
Charles:
Well, I'd say for Viva Sales, the intent is to support any CRM, and
I really do mean that generally. And even customers, because there
are customers out there that we talked to today who have homegrown
CRMs, they coded 15 years ago. They have a whole dev team still
working on it. The idea is to support interoperability with your
account records, your lead records, your opportunity records,
standard pipeline data. And to do that in a way which works through
the connector. So today it'll earn V1, it'll only be Dynamics in
Salesforce, but the intent is to make that be a general purpose
adapter. And you could have a RapidStart CRM connector, which shows
up and supports the contacts the way we want, and it would be
connectable. That's not going to happen in the next three months,
but that's the ambition.
Steve:
I can call you in four.
Charles:
I go down and said... What was that, in four Months?
Steve:
I can call you in four months.
Charles:
Yeah. Yes. Yeah. I might not pick up the phone then in four months,
no I'm just kidding. Because even talking about, if people are even
on Seibal. We should be able to support them with their sales.
Because the idea is, you shouldn't have to transform the seller
experience at the same pace that you transform your core CRM, your
core system of record, and that's just the way the world's
moving.
Steve:
Well, I love the idea that one of the challenges that CRM has
always had, of course, is user adoption. It's one more place they
need to go to do something. Outlook app helped with that, getting
data into CRM without them having to actually go to it. It seems
like yet another way for people to engage with their CRM without
actually realizing they're engaging with their CRM.
Charles:
Exactly. Yeah. It's almost like ambient... Yeah for sure. Sorry.
Yeah. I say it's almost like ambient CRM basically. How do you make
it so that, instead of the user goes to your CRM, the CRM goes to
the user where they are. And the outlook app was the beginnings of
that. Some of the Team's integrations we've done are the beginnings
of that. And that Viva Sales and that whole Viva idea is how do you
elevate it? So anywhere you go, your CRM data is accessible without
you having to go to a different user interface.
Steve:
Very cool. Very cool. So I ask you every time we get on a call
about exciting features that are coming up. And in particular,
maybe even some features that have launched, that didn't take off
the way you thought they would and people are just missing
something. We have this problem with our app sometimes, people
don't understand and so they don't move forward, and it would be
perfect for them. And I'm sure there's lots of features and
capabilities that you guys broke a sweat building, and know in your
heart, this would be awesome, but people don't seem to be getting
that. What's a good example of one of those?
Charles:
I'd say a product which we've had a capability, where we've had a
lot of customer usage from a small number of customers, but very
deeply and with huge impact, and we wish were with more customers,
is probably Conversation Intelligence. I'm not sure if you've seen
that around the Sales app, and where that actually will sit in
inside of say a phone call or a meeting and help you generate
action items, and summaries, and coaching, and help you understand
sentiment, and listening and talk ratio. We've used that internally
at Microsoft with great success. So our digital sales reps and the
folks who work our phones, they are diehard fans. We have this
amazing video we released a couple months ago where we actually
went out and interviewed these digital sales reps and their
managers, and they just were going on and on about how great it
is.
Charles:
And that's rare where you hear that about a piece of technology for
a seller. And we have a few other external customers that have gone
through that same journey, where they have a thousand digital reps,
2000 digital reps using this and just in love with it. But it's not
as pervasive as we thought it would be at this point. And it's one
of those things where, it's a product discovery, and easing people
into the capability, because then you got to go out of your way to
enable it and configure it. So we're doing work now to simplify it,
and make it more accessible to more users. And we're doing that
partly through Viva Sales, like conversation intelligence, the
major capability of Viva Sales.
Charles:
And the second thing is also, there's even some culture aspects to
it. Because if you use it, it's generating transcripts and
recordings of a call, and not everyone's necessarily super
comfortable with that. So we're even working about how do you
enable more features without having to record the call, and how do
you enable capabilities without having to get a transcript? Or how
do you make it more natural to say, "Hey, I have a sales co-pilot
thing. Are you okay if I enable it?" So there's a lot of
interesting things, it's never just a technology problem. It's also
a discovery and a, I'd say, change culture management problem.
Steve:
Yeah. I think that's been the challenge with anything AI really. A
lot of people, it seem to think it might be a little too
futuristic. They look at the benefit and think that's really cool,
but they have no idea how to get it. And AI just in general,
doesn't feel that approachable to people, even though in certain
cases, it's extremely approachable. You don't have to do anything,
it's approaching you. So it's a learning curve, you got to wait
until my generation dies off and then you guys will see.
Charles:
I don't have as myopic of you, as you Steve. But I would say that,
the big thing that we have to do is, there's been this evolution of
AI where the AI is going to be something that automates away what
humans do. And what we've realized is, AI is not even remotely
close to being able to do that. But what AI can do, is it can
turbocharge the people that use it. And so what we're trying to do
is, how do we go expose these AI capabilities in a way where you or
anyone else who uses them feels so much more productive. And just
like when you first got the ability to use PC or a spreadsheet,
you're like, "How did I exist before?" We're hoping we'll get to
the point where, once you start using some of these AI assistive
capabilities, like we've done in Conversation Intelligence, you'll
be like, "How did I ever do a customer call before? And I had to
take notes on paper while listening as opposed to having the AI
take notes for me?" Yeah, exactly.
Steve:
I'm terrible about that. I'll be chicken scratching over here while
I'm talking to people, and then we get off the phone I look at and
I can't understand a word I wrote.
Charles:
Yeah. I like post-it notes next to my desk where I'm always writing
stuff down.
Steve:
Yeah. So what else cool's coming on the horizon that we should
be... That sounds like the Conversational Intelligence has been
around. Sounds like Viva Sales is going to really bring that to the
masses, so that one's on a path. What are some other new things
that we should pay attention to that you're able to talk about?
Charles:
Yeah. Another one of my favorite things, which we've started to
reveal some capabilities going back to last Ignite, so November of
2021. And we have some big announcements planned for the second
half of 2022, is the new Contact Center related capabilities inside
of Dynamics Customer Service. We have Omnichannel, we announced
integrated voice, the Nuance acquisition closed, and the Nuance
contact center AI team joined my group to align with customer
service and contact center. So there's a lot of really exciting
innovation happening there. And I'm really excited about the
potential to make it super easy to get a comprehensive customer
engagement story, without having to wire up eight different pieces
of technology and do a ton of different complex integrations. So
that's a place where there's a lot of innovation, there's new
capabilities, Omnichannel, Power Virtual Agent, even the same type
of conversation intelligence applied to support cases, Nuance for
their Gatekeeper, which is identity and authentication verification
based on voice and biometrics.
Charles:
There's a lot of cool stuff in that space. And that's one of the
places where so many of the customers we work with are trying to
improve the customer experience, and to go reduce costs. So I say
that's a place where we've had a lot of exciting announcements over
the last six to nine months, and we have a whole bunch more planned
for the next six to nine months. So I say, stay tuned. And I won't
say more than that to avoid getting in trouble by leaking
information. But I just say, that's a place to really pay close
attention.
Steve:
Who knew call centers could be cool?
Charles:
Yeah, exactly. Who would have thought that I'd be talking about
contact centers, and how it's the next generation or next frontier
of AI applications in 2022.
Steve:
Oh, well. Well I do have to thank you guys for the low-code
advances you've continued to make in that platform. It actually
allowed us to launch a, I think we're the first ones to try this, a
new Service as a Subscription. Which includes awesome includes
deployment, customization, training, everything except development
code, which as you know today in so many of these projects, there's
so little, if any of that.
Charles:
Yeah.
Steve:
Just a few years ago, if you tried to offer something like this, it
really would be little more than a support agreement. But now,
we're deploying, we're building, we're customizing, we're building
entire things for customers all on a monthly subscription. It's an
interesting concept, and hopefully I don't go broke, but...
Charles:
But you know what, it's fascinating. I literally was talking about
this with the Power Platform team this morning. About a future
where we'll have more partners who are able to sell a comprehensive
service agreement, which includes the cloud hosting licenses, but
also some incremental custom development and also ongoing
maintenance and support. And it'll be almost this whole new
industry, which will push a lot of innovation to the edges of the
ecosystem, right?
Steve:
Yep.
Charles:
Not built by Microsoft, built by partners who really understand
particular regions, particular industries, or particular segments.
Like y'all are targeting a space where we're not trying to go take
Dynamics, CRM, and go bring it down there. You can go build a
world-class experience on top of our platform and provide a very
much all-in-one, which exactly serves the needs of that audience
and that market. And we can stay focused on building the super
horizontal platform, which has great performance, great usability,
incredible power, those types of things.
Steve:
Yeah, it sounds great. I'm glad that we had the same idea you guys
did. I'll let you know, in a few months, if it was a smart one.
Time will tell.
Charles:
Yes. Yeah.
Steve:
So, how are the rest of the team doing? It seems like some folks
have moved around a little bit in the org, who's moved where?
Charles:
Yeah. So one of the big things we've been really focused on the
engineering side, for the engineering organization, is bringing
together strength from a product perspective that target the same
type of user. And for example, we have a new customer experience
platform team underneath Lori Lamkin, who leads all of our Dynamic
Sales apps. So the Core Sales and Viva Sales, as well as commerce,
as well as marketing, as well as customer insights. And it's very
much focused on revenue generation, customer journeys, customer
experiences. And what's great is by bringing those assets together,
we have a great answer for B2B customers, as well as B2C. Like if
you want to have self service, no touch eCommerce experience with
lightweight telesales, you can do that all with those sets of
applications. If you want to do a high relationship, high touch B2B
sales process, you can do all of that. You're not going to use
commerce, but you're probably going to use customer insights and
sales, and maybe a little bit of account-based marketing.
So we brought together these things, which are solving similar problems under a single leader. And that way the engineering teams can go back and forth between these different places to finish out full end-to-end customer journeys. And so that's a big area that we've spent a lot of time on, and that's a place where it's really the biggest and fastest growing category for us in the Dynamics 365 application portfolio. So that's one interesting example. Jeff Comstock, folks may know him. He's been around Dynamics 365 for a while. He continues customer service, he leads omnichannel, he's done some of this great expansion around the contact center for us. Ray Smith leads our supply chain team. So that includes things like more supply chain.
Steve:
So Ray moved?
Charles:
Yeah, yeah, yeah. He by way of acquisition to SAP then moved. He
worked in Dynamic Sales for a bit, where people may have known him.
And now the supply chain, and really helping us be this new data
driven, AI powered, supply chain story for core supply chain
execution. Then we also had some exciting announcements around
process advisor and the minor acquisition to help turbocharge that.
Or Georg Glantschnig who leads our finance room of the house. And
basically we call the room of the house, is the collection of
products which focus on serving the CFO and the finance department.
And that includes the Suplari acquisition, which we had done a
couple years ago, as well as the Core Dynamics, 365 finance, HR,
and project operations products.
Charles:
So you can see how we started to build these critical paths around
particular departments and particular lines of businesses with our
products. And in addition to that, we also of course have Power
Platform to support all of it. So it's amazing to see these things
come together and converge. And we've been on this incredible run
of innovation around Dynamics. I was counting it earlier this year,
29 different products in Dynamics, and really coalesced around
these specific areas where we have a lot of energy, and also very
well understood. I'd say synergies between the products that we
have. So I'd say exciting times. Very exciting times.
Steve:
Customers are starting to understand it better also. Business
Applications was the same thing for a long time. Then it spent the
last five years reinventing itself every month, and new things
exploding out of Advanta. And I think a lot of customers were
having trouble just keeping up with... It's like little whackamole
for them. And it takes a little time for customers to absorb what's
happening, and what it's for, or what it does, and then to adopt
it. And we're seeing that now. We used to have to go out and
promote Power Apps to people who didn't understand what this was,
or why it was. And now it's the opposite. They always come to us,
looking for Power Apps, looking at those sorts of things. So that
understanding seems to have finally permeated down to the customer
level. But boy, it took a while.
Charles:
Yeah. It warms my heart. And I would say one of my favorite books
is by Jim Collins, 'Good to great.' I always recommend it to folks
on my team to read it. And he talks about this idea of the
flywheel. It takes time to get a flywheel spinning, for the first
period of time it looks like it's barely moving, but then
eventually it's going super fast and it's just a blur. And you need
to be consistent, and convicted, and believe in the strategy and
the approach. And what's amazing about BizApps is for the last four
years, we've been on the same mission, the same vision, the same
ambition. And we just spend all the folks in advance at turning
that flywheel, turning that flywheel. And it's started to reach
that blur phase where it's spinning so fast, you can't even see
it.
Charles:
And this, this all started years and years ago with a ton of work,
but we're really at that magical moment where customers know what
Power Platform is. Customers know that Microsoft gets customer
experience and customer engagement. They know that Microsoft can
help them optimize their supply chain. And what the good news is
once that thing is going, it really builds upon itself, and I think
it'll only continue that momentum further. And my favorite story
is, I used to always do these executive briefings at Microsoft
where we have executives come in from our customers to Redmond and
we have a briefing center. It's very nice. And I would always say,
let me talk about Power Apps and low-code.
Charles:
And everybody gives me a blank stare like, "What the heck is Power
Apps? What the heck is low-code?" I go in those meetings now, and
people know what Power Apps is, and they know the low-code
strategy. And the only question is, "how?". Not, "should I?" Or
"if?" "How do I do it with you, Microsoft?" And so different from
three years ago. So anyway, so you're exactly right. A long winded
answer, but I'd say it's exciting to see all of these things come
together, and the benefits of just consistently repeating a message
that resonates with customers.
Steve:
I would say at least three quarters of my customer calls today,
they're bringing up right out of the gate, "We don't want any
development. We want to do everything low-code, no code." So this
is coming from the customer side where we used to have to explain
to them what low-code, no code meant. Now they're coming demanding,
"I only want low-code, no code." I think that they've come to this
realization that, while low-code, no code might not be easy enough
for your mom to do, it doesn't require a developer, and code does
require developer. And once you've got this little blob of code in
your environment, it's a black box for you. And so they don't want
any of these black boxes. They want everything to be
accessible.
Steve:
Use your knowledge to build us something complex out of low-code,
but then I can still go back in there later and manipulate it,
adjust it myself, or our team. So they have absolutely bought into
that. And I know we originally, a lot of us partners were concerned
early on that this was going to reduce the workload for partners,
while our workload is more than it has ever been. Although the
developers on the bench don't stay as busy as they used to. We've
completely pivoted the team from developer heavy to now, we haven't
even got a good title for them. A citizen developer doesn't sound
right. We tell customers that, but citizen developers is what we've
got so...
Charles:
This guy we found on the street, or gal found on the street, we
just asked them to start building out. But no, it makes sense.
There is almost this new role which is, it's not just pure coding
expertise, it's technical development concept expertise. But even
more importantly is business process and solution expertise. And
that fusion of those two skill sets, that's the magic. That's what
makes it special, because you understand it.
Steve:
Yeah. The challenge that we have with this brand new model that we
just launched, because, first of all, being the first one out there
is not always good because people have no idea what you're talking
about. They're trying to compare it to other things. But we've got
this little caveat that it's all you can eat, everything, except
development code. And trying to define what that is hasn't been
easy, and you get these customers coming in, "Oh, we're going to
need a lot of customization. So this isn't going to work for us."
And so you may need a lot of customizations, but you don't need any
"development code".
Charles:
Yeah.
Steve:
And getting them to grasp that development code and customization
are not synonymous, not even close.
Charles:
Exactly.
Steve:
Development code is a very small component today of customization.
And once I think that they understand that, then we'll probably see
more partners coming into a model like this. Because it makes a lot
of sense for customers, makes a lot of sense for partners.
Charles:
Yeah. And if you go look at building solutions that last a decade,
this is to your point, code is this little black box opaque thing,
which is hard to maintain over time. If it's no code, low-code,
it's easy to open it up and reconfigure as business requirements
change. And it's how you build solutions that last. And I think
we're getting to the phase with business software where customers
are expecting to make long term technology bets. You're not going
to replace your CRM every five years from now on. It's like
building manufacturing plants and warehouses. These are big
investments that you need to be able to amortize over a long time,
to justify. And so I think to your point, no code doesn't mean no
flexibility, no customization, also doesn't mean no agility. It
just means you're doing it in a different way. Couldn't say it
better myself.
Steve:
All right. Cool. Hey, listen, I'm going to let you go. I really
appreciate you taking the time out of your day here when I caught
you, to chat with me about this stuff, always fun talking to you
Charles. I'm going to call you in four months and ask you about
Viva Sales for the platform.
Charles:
Sounds good. Sounds good.
Steve:
I've got you on record there.
Charles:
So really appreciate you taking the time, giving me a ring, Steve.
Hope you have a great rest of the summer.
Steve:
All right, man. Have a good one.
Charles:
Yep. You too.