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Salesforce CEO Marc Benioff Reveals Success Secrets on Mad Money

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Salesforce CEO Marc Benioff: "The Business of Business Is to Improve the State of the World"

San Francisco, CA – In a recent interview with Jim Cramer on "Mad Money," Salesforce.com CEO Marc Benioff discussed his company’s commitment to stakeholder theory and how it’s shaping the future of business. Benioff, whose company’s stock has skyrocketed 1,000% since Cramer first recommended it, argues that the traditional focus on shareholder value alone is outdated. Instead, he believes companies have a responsibility to consider the impact of their actions on all stakeholders, including employees, customers, partners, and the community.

"The business of business is to improve the state of the world," Benioff asserted, citing Klaus Schwab, founder of the World Economic Forum. "The way to do that is with stakeholder theory."

This theory, Benioff explained, emphasizes the interconnectedness between a company and its various stakeholders. He highlighted his commitment to employees as a prime example: "My number one stakeholders are my employees. I have to do what’s right for them."

Benioff’s dedication to employee welfare became particularly evident during the controversial "religious freedom" law debate in Indiana in 2015. He publicly opposed the law, which would have allowed businesses to discriminate against LGBTQ+ individuals, citing his company’s values and the potential impact on Salesforce’s employees in the state.

"We became the biggest tech employer in Indiana," Benioff said. "When we saw what was going down there, we just said, ‘That’s not okay with us.’"

His stance ignited a wave of similar opposition from other major companies, including Levi Strauss, Cummins Engine, Eli Lilly, Nike, Marriott, and even Walmart. "It wasn’t just Salesforce that said ‘hey, you can’t do this,’" Benioff noted, emphasizing the growing importance of corporate social responsibility.

Beyond his commitment to social causes, Benioff also highlighted Salesforce’s technological innovations, specifically showcasing the company’s new product, the Salesforce Analytics Cloud. Demonstrating the capabilities of the platform on his Apple Watch, Benioff highlighted its ability to provide real-time business intelligence at one’s fingertips.

"I can just hit this button and I hit the Salesforce app and look Jim, I can see my customer service requests, I can see my analytics, everything associated with my business," he said.

Benioff concluded by emphasizing his optimistic view of the future, where companies take a more responsible role in shaping a better world. "The future is CEOs speaking the truth and being advocates for their employees," he said. "That is the future."

Benioff’s interview highlights a significant shift in the business landscape, where societal impact and stakeholder engagement are increasingly prioritized alongside profits. Companies like Salesforce, under Benioff’s leadership, are leading the way, demonstrating that success can be built not just on shareholder value, but on a commitment to a more just and equitable world.

Salesforce CEO Marc Benioff: The Business of Business is Improving the State of the World

In a world increasingly focused on corporate social responsibility, Salesforce CEO Marc Benioff is a vocal advocate for a new model of business leadership. Benioff argues that the business of business is not simply business, but rather improving the state of the world. He emphasizes the importance of stakeholder theory, a concept that broadens traditional shareholder focus to include employees, customers, partners, communities, and the environment. Benioff’s commitment to stakeholder theory shines through in his company’s actions, such as Salesforce’s significant investment in Indiana after acquiring ExactTarget and its outspoken stance against discriminatory legislation, demonstrating that business can be a force for positive change.

Key Takeaways:

  • The business of business is about improving the state of the world: Benioff challenges the traditional notion that businesses are primarily focused on maximizing shareholder profit. He believes businesses have a responsibility to address societal issues and contribute to a better future.
  • Stakeholder theory is a key driver of business success: Benioff argues that focusing solely on shareholders is detrimental to long-term success. Instead, he emphasizes the importance of considering all stakeholders, including employees, customers, partners, and communities.
  • CEOs are advocates for their employees and society: Benioff encourages CEOs to take a stand on issues that affect their employees and communities, highlighting the power of business leaders to influence positive change.
  • Cloud computing is revolutionizing business operations: Benioff demonstrates how Salesforce, a leading cloud computing platform, allows businesses to manage operations efficiently and effectively, regardless of location, using devices like the Apple Watch.

The Rise of Stakeholder Theory

Benioff draws inspiration from Klaus Schwab, founder of the World Economic Forum, who famously said "the business of business is improving the state of the world." This statement encapsulates the central theme of stakeholder theory. Unlike the traditional shareholder-centric approach, which prioritizes maximizing profits for investors, stakeholder theory acknowledges the interconnectedness of businesses with broader society. It encourages companies to consider the interests of all stakeholders, including:

  • Employees: Ensuring fair wages, benefits, and safe working conditions.
  • Customers: Providing high-quality products and services that meet their needs.
  • Partners: Building strong, collaborative relationships with suppliers and distributors.
  • Communities: Contributing to local economic development, supporting social causes, and respecting the environment.

Benioff’s personal commitment to stakeholder theory is deeply rooted in his experience as CEO of Salesforce. He points to the acquisition of ExactTarget in 2013 as a prime example. Despite the large acquisition price ($2.5 billion), Benioff made it clear that Salesforce was committed to retaining jobs in Indiana, defying expectations that the company would simply move operations to other locations. Salesforce’s commitment to Indiana ultimately led to its becoming the largest technology employer in the state, further solidifying Benioff’s commitment to stakeholder theory.

CEOs as Advocates for Change

Benioff’s dedication to stakeholder theory has shaped his approach to social and political issues. He believes that CEOs have a responsibility to speak out against injustice and promote positive change. He cites the controversial Religious Freedom Restoration Act (RFRA) passed in Indiana in 2015, which was widely perceived to discriminate against LGBTQ+ individuals.

“I was gonna send my customers to Indiana, and then they were being told no, you can’t go to this pizza restaurant because you’re gay," Benioff recounts. "That was the igniting of the stakeholder theory.”

Salesforce joined other major companies in publicly condemning the legislation, leading to significant pressure on Indiana’s governor, Mike Pence, to revise the law. Benioff’s bold stance on this issue highlights the growing influence of large corporations in shaping social policy.

This pattern of CEO activism has become more common in recent years, with leaders across industries taking a stand on issues such as racial justice, climate change, and political polarization. CEOs are increasingly viewed as public figures with a platform to advocate for social good.

The Power of Cloud Computing

While discussing his commitment to stakeholder theory, Benioff also showcases the transformative power of cloud computing. He proudly displays his Apple Watch, demonstrating how Salesforce’s cloud platform allows him to manage business operations effectively right from his wrist. “I can just hit this button and I hit the Salesforce app, and look Jim, is it a good day? Well, you can see I’m running my business right from my wrist," he explains.

This anecdote illustrates the fundamental shift in the way businesses operate in the digital age. Cloud computing platforms like Salesforce allow companies to be more agile, adaptable, and scalable, transcending traditional boundaries of location and time.

“What’s on my wrist today is more powerful than the computer that I learned to program on, which is only 10 miles south from here in Burlingame, California,” Benioff marvels.

This statement highlights the incredible advancements in technology over the past few decades. The computing power that was once housed in large, expensive mainframes is now accessible to businesses of all sizes through cloud-based solutions. This accessibility allows even small businesses to operate on a global scale, transforming the landscape of entrepreneurship.

The Future of Business Leadership

Marc Benioff’s leadership philosophy is a testament to the changing nature of business. He challenges conventional wisdom by advocating for a more holistic approach to business practices, embracing the concept of stakeholder theory and leveraging the power of cloud computing to drive innovation and positive change. His vision reflects a future where businesses are not just profit-generating entities but active contributors to a more equitable and sustainable society.

Benioff’s call to action for CEOs to become advocates for their employees and the communities they serve resonates with a growing movement for corporate social responsibility. As businesses continue to navigate a complex and changing world, the principles of stakeholder theory and the transformative power of cloud computing will likely play an increasingly important role in shaping the future of business leadership.

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Alex Kim
Alex Kim
Alex Kim is a financial analyst with expertise in evaluating and interpreting analyst ratings on various stocks.

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