Running head: SALESFORCE: GOING GLOBAL AND INCLUSION ANALYSIS 1

Salesforce: Going Global and Inclusion Analysis

Innov8

OGL355: Leading Organizational Innovation and Change

Dr. B

April 22, 2020

Arizona State University

SALESFORCE: GOING GLOBAL AND INCLUSION ANALYSIS 2

Salesforce: Going Global and Inclusion Analysis

Globalization is a key growth strategy for companies wanting to expand their

market and increase their competitive advantage. It carries significant risks and

challenges, but these can be managed through careful environmental analysis and

strategic planning. As a global company with over 60 offices spread throughout North

and South America, Europe, the Middle East, Africa and Asia, Salesforce has a proven

track record of expansion (Salesforce, 2020b). Team Innov8 believes, however, that

Salesforce would benefit from opening yet another location. Here, Innov8 describes the

target location and recommended mode of entry. Additionally, Innov8 examines current

political and economic issues that may affect the expansion, as well as key cultural

differences between this and their worldwide corporate headquarters based in the United

States. Finally, Innov8 recommends actions and attitudes for Salesforce to implement in

order to facilitate its expansion, increase its foothold in the global community, and

strategically strengthen its competitive edge.

Chile

Innov8 discussed options for Salesforce’s future expansion and determined that

Chile is a destination with great potential. The team settled on this location for several

reasons. Firstly, Chile is an extremely tech-friendly location; nicknamed Chilecon Valley,

it is the technology hub of Latin America (InvestChile, 2018), which makes it an

excellent fit for Salesforce’s business model. Secondly, the internet is constantly gaining

ground as a business tool in Chile (Edicom, 2018), which makes it a great opportunity for

a cloud-based customer tracking system like Salesforce. Thirdly, Chile’s affinity for

technology and business has prompted them to create an expedited visa process for new
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companies. Salesforce would benefit from the ease of entry into this market (InvestChile,

2018). Finally, expanding into Chile would strengthen Salesforce’s presence in Latin

America. This expansion would be beneficial for Chile, its businesses, and Salesforce.

Mode of Entry

Salesforce has an established presence in nearly 30 countries (Salesforce, 2020b).

Since the global footprint is already large, and the company has a record of successful

integration with nations around the world, Innov8 has decided that setting up a foreign

subsidiary would be the best mode of entry for Salesforce to establish itself in Chile.

Coulter (2013) states that it is appropriate for companies with previous foreign market

experience to utilize the wholly owned subsidiary mode of entry. This mode requires a

substantial investment of money, time, and other resources to establish, and carries with it

the greatest risk of failure and loss. These drawbacks, however, are offset by the

prospective benefits of retaining significant control over operations and earning higher

returns on the investment (Saylor Academy, 2012).

Establishing a foreign subsidiary is the best option for Salesforce because they

have the necessary foreign market experience to launch and operate successfully, and

they have substantial resources to devote to the Chilean branch. In addition, their top-

notch customization and integration with other technologies favorably positions

Salesforce to become a highly desired service provider in the Chilean Customer

Relationship Management (CRM) market. Salesforce’s interest in and dedication to

improving lives and enriching the world will make them an asset to Chile, and although

Salesforce’s business presence could become quite large there, the environmental impact

on the country would be minimal due to Salesforce’s environmental sustainability and

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renewable resource policies. The relationship between Salesforce and Chile would be

advantageous to both the company and the country. Finally, Chile’s extremely tech-

friendly environment and ease of visa acquisition, as well as Salesforce’s cloud-based

business management acumen, customization, and community orientation create a

complementary synergy between them. For these reasons, Innov8 believes the subsidiary

mode of entry to be most appropriate.

Political and Economic Issues

As with any company who is embarking on an opportunity to internationally

expand a business in another country, it is important to enter that country with a

sensitivity to the current political and economic concerns. This not only fosters a new

business relationship built on trust, but it gives an understanding to both countries that

can only add to the success of the company.

One of the issues Salesforce will need to be aware of is the environmental

concerns Chile is experiencing. The government in Chile is viewed to be weak and

incapable of handling industry pressures. They are not known to conserve

environmentally, especially if that conservation conflicts with interests in the economy,

such as mining and forestry. The air pollution suffers due to smokestack businesses,

automobile emissions, and dust from unpaved streets and roads. “Rain washes some

pollutants out of the sky, but the long, dry summer and the stagnant autumn air often

result in heavy haze” (Bernhardson, 2019). Salesforce has the ability to help improve this

political concern, but it will be a slow transformation as businesses need to be onboard

with the change. Salesforce’s Sustainability Cloud platform allows companies to track
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their environmental data so they can analyze and improve emissions to drive

sustainability (Salesforce, 2020a).

Not all companies are aware or even concerned about the environment. This can

be an issue since Salesforce is passionate about improving it. It will take time and

patience to educate the Chileans on how they can improve in this area and what can be

done to benefit the company and those who live there.

Another issue Salesforce could face is the income inequality. When ranked among

30 of the wealthiest nations in the world, Chile and Mexico equaled in comparison as the

most unequal in pay (Check, 2019). This will be a challenge for Salesforce, but a

challenge that could be beneficial if Chile accepts an international agreement. Salesforce

has been voted by Fortune magazine as one of the best companies to work for (Fortune,

2020). Their culture is built by putting their employees first. Trust and flexibility are what

they believe in and what has been contributed to their positive relationships with their

employees (Kohner, 2017). Equality is very important to Salesforce. So much so that it is

one of their core values. They realize their potential to create a platform that brings about

social change, so this will work to benefit the people in Chile and strengthen their

acceptance of equality in the workplace (Salesforce, 2020c).

Key Cultural Differences Between the U.S. and Chile

Cultural differences can influence the strategies an organization will utilize and

manage within the country where they plan to expand. As Salesforce expands into Chile,

they will need to address three key cultural differences, including individualism,

uncertainty avoidance, and masculinity (Hofstede Insights, 2017). The biggest cultural

difference between the two countries is individualism. The US is an individualistic

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country where self and immediate family comes first, while Chile is a collectivist society

where family and community are most important. For uncertainty avoidance, Chileans

tend to experience more anxiety than Americans about unknowns in the future and, as a

result, have a greater need for rules and structure (Hofstede Insights, 2017). The U.S.

displays an extremely high degree of masculinity, with Americans valuing success and

having a “winner takes all” and “live to work” attitude (Hofstede Insights, 2017, para.

12). Chileans, on the other hand, value “equality, solidarity and quality in their working

lives” (Hofstede Insights, 2017, para. 8). Instead of focusing on their own well-being,

they focus on supporting their team, which coincides with their collectivist mindset.

Actions for Inclusion

Diverse networks work best when everyone is included. To successfully

accomplish this task, organizations must take precautions when entering new markets.

This is especially important as taking proactive steps will help ensure that the new

venture goes as smoothly as possible. The following table gives some examples of what

Salesforce should and shouldn’t do to foster inclusion in Chile.

Actions to Foster Inclusion in Chile

DO's DON'Ts

1. Ask for suggestions  1. Shut out ideas

2. Learn about the other culture 2. Overpower the conversation

3. Accept critical feedback 3. Close yourself off

4. Diversify your network  4. Refuse to learn the language

5. Create a structured work environment 5. Talk too fast

6. Reinforce “Ohana” culture 6. Insult people’s culture

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In reviewing the above list, Team Innov8 feels four of these principles are

especially valuable for Salesforce to consider when striving to create inclusion.

Don’t overpower the conversation. The people of Chile abhor inequality. As a

result of civil and economic inequality, Chile recently experienced protests and riots

among its citizens (Reeves, 2020). Inequality can manifest when people monopolize a

conversation. In this situation, the participants are no longer on equal footing, as the

speaker projects that they are in charge and the others must listen. Such actions by

Salesforce representatives would greatly upset the Chileans and foster exclusion, rather

than inclusion. For this reason, Innov8 suggests Salesforce train their employees to not

overpower the conversation when speaking with Chilean coworkers and customers and to

allow them to speak their minds. 

Don’t refuse to learn the language. According to the United States’ CIA, over

99% of Chileans speak Spanish, and only about 10% speak English, the principal

language of Salesforce (CIA, 2020). For this reason, Salesforce should require employees

to gain at least a working knowledge of Chilean Spanish. As Coulter (2013) mentions,

most Americans “think of English as the only international business language” (p.197)

and are unmotivated to learn other languages. Coulter describes a research report by the

British Council asserting that Americans are falling behind in organizational

competitiveness because they only speak English (Coulter, 2013, p. 197). Having their

employees learn Spanish would not only help Salesforce improve their competitive edge

and foster inclusion with the Chileans, such an action will demonstrate a desire to

welcome and include Chilean coworkers and consumers in discussions and projects and

foster cultural respect between the two nationalities. Speaking the same language will
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have the added benefit of increasing communication and diversity among the team. This

action should be taken before transferring employees, in order to hasten the development

of good relations.

Do reinforce Ohana culture (Kohner, 2017). Salesforce company culture

emphasizes caring for fellow human beings. Despite America being an individualistic

society, Salesforce has a collectivist culture. The Chilean people, as discussed above, are

also collectivist in nature. They care about their families. This is a plus for Salesforce that

should be reinforced as they remind employees that they are a family and should treat

their new family members as such. The Chilean people will respond very positively to

this move. By pushing the Ohana culture, Salesforce will be pushing for inclusion of the

Chilean people. 

Do create a structured work environment. Because Chileans exhibit more

uncertainty avoidance than Americans, as discussed above, Salesforce should look

carefully at how they run their company and restructure it to better suit the Chilean

workers and consumers. This positive effect would be most beneficial if implemented

before the move to Chile, so Chileans could go straight to buying or working with

confidence. 

Acting on these principles will enable Salesforce to foster inclusion with Chileans

and help them feel more like a family as they expand into the country. Salesforce can also

foster trust and respect by adjusting their attitudes, as discussed in the next section.

Attitudes

In diverse global markets, attitudes that foster trust and respect open the door to

developing solid relationships. Using the wrong words or gestures, however, can
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compromise new business connections. The table Innov8 presents below illustrates the

attitudes Salesforce employees should and should not adopt when establishing the

organization in Chile.

Attitudes to Foster Trust and Respect in Chile

DO's DON'Ts

1. Be Optimistic 1. Don’t hate

2. Have humility 2. Don’t judge others

3. Respect others’ beliefs 3. Don’t be negative

4. Be open-minded 4. Don’t assume you are always right

5. Be committed to multilateral human rights  5. Don’t avoid accountability

6. Respect power distance preferences  6. Don’t be ethnocentric/parochialistic

7. Have a geocentric (world-oriented) view 7. Don’t keep knowledge from others

Innov8 believes that Salesforce should focus primarily on attitudes that promote a

geocentric view when dealing with global markets, as discussed by Coulter (2013). A

geocentric attitude eliminates the view of looking at other cultures through one lens, but

instead uses a cross-cultural view, broadening the scope of the market. Three specific

attitudes Innov8 recommends are as follows.

Do have a geocentric view. Respecting others’ beliefs is what separates the U.S

from other countries. It is also why the country is known as the “melting pot.” Innov8

determined that it would be impossible for Salesforce to garner trust and respect from a

global market without understanding and respecting the beliefs of Chileans. This can be
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as simple as understanding and observing a holiday for religious or personal beliefs.

Innov8 recommends that Salesforce take a geocentric view in order to increase respect.

Do have humility. Humility is an attitude that people should adopt in general but

is key in diversified markets. As stated earlier, the U.S. tends to have a “winner takes all”

attitude (Hofstede Insights, 2017, para. 12), which might appear arrogant in the global

market. Chilean attitudes are about comradery and equality. If humility is not

implemented in the existing climate, differences in perception will create a barrier

between the organizations. Therefore, Innov8 recommends Salesforce employees adopt

an attitude of humility towards Chile.

Do commit to multilateral human rights. Innov8 agrees that commitment to

multilateral human rights is an important attitude for Salesforce. Salesforce will need to

make it apparent that they care about more than just the revenue involved but also the

concerns of Chile, especially as Chile is listed as a partner on the U.S State Department’s

Global Equality Fund (U.S. Department of State, 2019). Since Salesforce professes to

value human rights, they should be instilling this attitude in their employees (Salesforce,

2020c). Creating trust and respect with a global organization goes beyond processes and

paperwork; it involves supporting the other's political and economic standpoints. This is

an example of a geocentric attitude.

Conclusion

The decision to enter a new global market is one that impacts a company’s

competitive advantage and should be carefully considered. Team Innov8 believes that it

would be in Salesforce’s best interest to expand into Chile, as doing so will not only

strengthen their competitive edge by accessing a new market, but also further their
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organizational objectives of promoting equality and environmental health in a new region

of the world. Team Innov8 believes this will best be done by establishing a foreign

subsidiary. In order to do this, Salesforce will need to proactively prepare for Chile’s

unique economic and political climates and address cultural differences and attitudes.

This will establish Salesforce’s foothold in Chile, strengthen its social connection to

Chilean citizens, and ensure success in expanding its global community.

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