V2MOM: How SalesForce.com Went From Idea to Billion-Dollar SAAS Company

One area that we spend a lot of time thinking about (and working to improve) is our ability to communicate our company’s direction in a way that aligns everyone.

We use the word “alignment” a lot around the office, and we’ve made a number of changes that have helped us improve in this area, like daily stand-ups (video example here).  Alignment is critical for start-ups and companies going through rapid growth.

In “Behind The Cloud“, Marc Benioff (co-founder of Salesforce.com), shared the V2MOM planning process he and his team used to grow Salesforce.com into the largest SaaS company in the world.

The acronym stands for vision, values, methods, obstacles, and metrics.  The purpose of V2MOM is to create alignment, from the leadership team out to every team member.

Here’s how the V2MOM process works: 

1.  The founders / CEO create a draft of the organization’s V2MOM, summarizing the following:

• Vision: The big picture idea for the next 12 months, which helps clarify what you want to do.

• Values: The main 3-5 values for the company. These act as the principles and beliefs that are most important about the vision. Some folks recommend that you prioritize these.

• Methods: The specific tactics to achieve desired goals, which are the majors steps required to achieve the vision.

• Obstacles: Things that are working against you, which encourages people to openly talk about things that are working against your success.

• Metrics: Key performance indicators, which specifies the actual numerical result(s) that are sought. These are measurable.

2.  Once the V2MOM is complete for the organization, it is broken down by department leaders and articulated for each group in their own V2MOM. The department’s version supports the organization’s V2MOM.

3.  Each individual creates their personal V2MOM which supports their department’s; the personal V2MOM is also used for performance evaluations.

Our company is currently involved in updating our V2MOM for 2013.  One of our goals is to eliminate anxiety and confusion (these are common feelings during times of rapid change). In another post I’ll comment on lessons learned from this process.

By the way, a few years back Salesforce.com invited us to spend some time with them at their HQ.  V2MOM is used everywhere and everyone we spoke to was crystal clear about the top-level V2MOM, their department’s, and their own.  It was pretty cool to see such a large company with so much alignment.

We also learned that Marc had scribbled the first V2MOM on a large American Express envelope, which his co-founder had the presence of mind to save. He framed it and gave it to Marc on the day of their IPO. If you’re interested, here it is:

Salesforce.com’s First V2MOM, 4/12/1999

Vision
Rapidly create a word-class Internet company/site for Sales Force Automation.

Values
1. World-class organization
2. Time to market
3. Functional
4. Usability (Amazon quality)
5. Value-added partnerships

Methods
1. Hire the Team
2. Finalize product specification and technical infrastructure
3. Rapidly develop the product specification to beta and production stages
4. Build partnerships with big e-commerce, content, and hosting companies
5. Build a launch plan
6. Develop exit strategy: IPO/acquisition

Obstacles
1. Developers
2. Product manager/bus dev person

Measures
1. Prototype is state-of-the-art
2. High-quality functional system
3. Partnerships are online and integrated
4. Salesforce.com is regarded as leader and visionary
5. We are all rich

Have you used the V2MOM process?  If so, what have you learned?  If not, do you think it would help?