Microsoft Build 2026 produced two announcements that, read together, describe something more interesting than the usual conference launch cadence: a plausible scenario in which enterprise AI stack decisions made in the next 12 months could become significantly harder to reverse. The operative word is "could". Several pieces of the announced architecture are not fully shipping yet. But the direction is clear.

The News

Microsoft delivered two related announcements at Build 2026.

The first came from Jay Parikh, EVP of CoreAI: the model is not the differentiator; the system governing it is. Microsoft's answer is a six-step loop. Agents are built in GitHub, contextualized with Microsoft IQ, which grounds them in enterprise data from Microsoft 365, core business systems, knowledge bases, and the web, run in Foundry, governed via Agent 365, and continuously improved through a hill-climbing optimization cycle. Agent 365, combined with Entra, Purview, and Defender, catalogues every agent in the estate, regardless of where it was built, and lets IT enforce policy across all of them.

The second came from Mustafa Suleyman, CEO of Microsoft AI: seven new MAI models built from scratch, with no distillation from third-party models. MAI-Thinking-1, the flagship reasoning model at 35 billion active parameters, benchmarks at parity with Anthropic's Claude Sonnet 4.6 on software engineering tasks at significantly lower per-token cost. MAI-Code-1-Flash is integrated natively into GitHub Copilot. MAI-Transcribe-1.5 claims leading accuracy across 43 languages at five times the speed of competing models. Image and voice models complete the family.

Alongside the models, Microsoft introduced Frontier Tuning: enterprises can train MAI models on their own workflow data using reinforcement learning environments. The model stays in the customer's Azure tenant, is trained on their operational traces, and owned by them. Microsoft's cited example: a model tuned to McKinsey's standards matched GPT-5.5 performance at roughly ten times lower cost.

The Bigger Picture

These announcements arrive midway through one of the more competitive contests in enterprise software: the race to become the orchestration layer for AI agents at scale.

Every major platform vendor has staked a claim. Salesforce closed its Q1 2027 with Agentforce at more than $1.2 billion ARR, up 205% year-over-year. ServiceNow repositioned at Knowledge 2026 as the AI Control Tower for Business Reinvention, an orchestration layer governing every agent, model, and action across the enterprise regardless of origin. SAP's Sapphire 2026 introduced the Autonomous Enterprise vision, with Joule orchestrating more than 200 agents across finance, procurement, supply chain, HCM, and CX. I wrote about this before here and here. Futurum Research, assessing the field days after Build 2026, identified Microsoft, Salesforce, and ServiceNow as the three early leaders, with orchestration and governance increasingly determining who wins.

The contest runs on two battlegrounds: interface control, which platform surfaces agents to users, and orchestration, which layer coordinates agents across systems and governs their behavior. Microsoft's Build 2026 argument is that it holds the strongest hand on both, because of one asset its competitors lack at the same scale: identity infrastructure. Azure runs in 95% of Fortune 500 environments. Entra is already the identity backbone across those estates. Governance-by-default, because it runs at the identity layer, is architecturally stronger than governance bolted on afterward.

ServiceNow's counter is strong. Its AI Control Tower is explicitly vendor-agnostic, covering AWS, GCP, Azure, SAP, Oracle, and Workday from a single policy point. The acquisitions of Armis and Veza give it a capability to map AI agent identities alongside human identities in a unified access graph that most of the market lacks today. And it combines control plane arguments with domain knowledge. SAP takes a different position altogether by not claiming to be the identity layer, but the authoritative business context layer, with Anthropic's Claude embedded in Joule for reasoning across HR, procurement, and supply chain. In brief, SAP is all about domain knowledge.

In summary, there are 3 main camps. Vendors that say that the systems and domain knowledge are key, others that claim independence and the group that positions itself in between, claiming both capabilities.

The MAI model launch adds to the equation in two ways. Since April 2026, when Microsoft and OpenAI amended their partnership to end Microsoft's exclusive IP license, Microsoft has had the freedom to develop its own Azure models. Build 2026 marks the first major shipment of that strategy. And it puts a native model option inside a platform that already governs identity, compliance, and access, at benchmarked parity, and at lower cost. One analyst framed it sharply: Microsoft is not ending OpenAI's presence, it is making that presence look optional. The same shift applies to Anthropic.

My PoV and Analysis

The Frontier Tuning architecture is the most underappreciated part of the announcement. Microsoft's marketing says "no vendor lock-in" because your model weights stay in your tenant. That is technically correct and commercially misleading at the same time. A model trained on your institutional workflow traces, tuned to your decision patterns, is deeply embedded in your operational context. That makes it incredibly sticky, creating, you guess correctly, lock-in. Migration does not mean exporting a file; it means retraining from scratch on a different platform. For most enterprises, that cost never gets budgeted. None of that makes it a bad decision. Institutional specialization is precisely what makes the model valuable. But buyers should know what they are choosing. The McKinsey benchmark Microsoft cites is an interesting data point, but not an independently audited one.

The identity-layer governance argument is solid, with one qualification. Entra's governance of human identities is mature. Governance of AI agent identities, like service principals, managed identities, tool-calling permissions at multi-agent complexity, etc., is newer and less proven. Agent 365 is GA, but its depth against real multi-vendor agent estates running across Azure, GCP, and on-premise systems has not been tested at production scale. ServiceNow can fairly argue that its AI Control Tower, designed from the ground up for agent governance rather than extended from human identity management, is currently better suited to that specific problem.

The timing question is important, too. Salesforce has 29,000+ and growing Agentforce deals. ServiceNow is offering AI Control Tower free for a year as a market stimulus. SAP shipped Joule Work with MCP and Agent-to-Agent protocol support. These are platforms in production motion. Microsoft's architecture is more comprehensive than any single competitor, but in some of its more important pieces, it is still catching up on deployment velocity.

On the models: MAI-Thinking-1 at Sonnet 4.6 parity is strong, and building it without third-party distillation is importatnt for enterprise IP hygiene. But benchmarks are a snapshot. Anthropic has shipped Claude Opus 4.6, 4.7, and 4.8 since the start of 2026 alone. Parity today does not guarantee parity in six months. And it is parity to Anthropic’s mid-tier model.

What Build 2026 consolidates is a combined structural position no other titan holds: the identity layer, the developer platform, the productivity offerings, and now owned models across all primary modalities. SAP has process depth and models but not the identity layer. Salesforce has CRM data depth and interface momentum but no developer platform or owned models. ServiceNow has governance credibility and IT workflow depth but no productivity solution and no owned models. Microsoft now has all four.

Whether the Frontier Tuning plus identity governance combination creates the kind of enterprise AI commitment that changes stack consolidation decisions over the next 18 months is the open question. If it does, the most exposed competitors are ServiceNow, whose governance position gets squeezed by an identity-native argument, and the model vendors Anthropic and OpenAI, whose enterprise contracts require a deliberate additional procurement choice rather than sitting as the obvious default.

Neither is displaced. Both face a changed market dynamic.

The platform decision and the model decision used to be separable. They may not be for much longer.

Recently, while on the ground in Austin, Texas, attending ZohoDay 2026, I had the pleasure of sitting down with Vaibhav Dani, the CEO of Map Communications. In the enterprise software ecosystem, we talk endlessly about digital transformation, but it is always refreshing to ground those lofty concepts in reality by speaking directly with the leaders navigating these complex implementations.

Our conversation touched on a surprisingly common, yet notoriously difficult challenge: harmonizing a homegrown operational tech stack with off-the-shelf enterprise software. Map Communications’ journey with the Zoho ecosystem provides a masterclass in pragmatic architecture, the age-old "buy versus build" dilemma, and the foundational data hygiene required to actually make artificial intelligence work.

TL;DR  

If you do not want to read this, here’s the full length video interview.

Everybody else, please read on.

The Business Context: Bespoke Service at Scale  

To understand their technology strategy, you first have to understand their business. Map Communications is a nationwide, employee-owned (ESOP) virtual receptionist and bespoke answering service operating across the US, Canada, and the UK. They serve a wide array of clients, ranging from legal firms and SMBs to large enterprises in various industries.

Because their core service is highly specialized, Map relies on its own proprietary, homegrown software lineup to manage day-to-day operations and real-time answering services. However, when it comes to managing the customer lifecycle from the moment a prospect lands on their website to the execution of contracts and ongoing support, they rely on the Zoho suite.

The Age-Old Dilemma: Buy vs. Build  

As businesses grow and their processes add complexity, leadership is inevitably faced with a choice: do we build custom modules into our core software or do we buy an off-the-shelf solution?

Dani approaches this with a highly disciplined decision framework. Map evaluated their requirements and realized that building tools to manage vendor and customer contracts or constructing a native quoting tool that would expose their internal APIs simply wasn't a valuable use of their development capacity.

Instead, they followed the Pareto principle and applied an 80/20 rule. As Dani rightly pointed out, "If 80 percent of the requirements are met, we'll be fine because no system would have 100 percent software requirements". Chasing those elusive final 20 percent now often results in over-engineered, heavily customized systems that become a nightmare to manage and support later. By accepting the solid 80 percent requirements fit that tools like Zoho Contracts and Zoho CRM offered, Map Communications avoids unnecessary technical debt while keeping their internal developers focused on their core, proprietary service offerings, the very ones that differentiate Map Communications.

Decluttering the Stack and the "Evil" of Copy-Paste  

One of my core theses as an industry analyst and consultant is that the "copy and paste" of data is the root of all evil, well, at least much of it, in enterprise software. Dani wholeheartedly agrees. When data is manually moved or fragmented across multiple systems, automations break, billing mishaps occur, and the customer experience suffers.

Still, it is often necessary,

Map Communications deliberately architected a separation between their real-time operations and their CRM environment. They utilize Zoho Data Bridge to move data smoothly into Zoho CRM, Zoho Desk, and Zoho Analytics asynchronously, ensuring they don't burden their live, day-to-day answering systems with heavy real-time external integration calls.

Furthermore, they are looking to Zoho Social to centralize their marketing technology, aggregating Google Ads, LinkedIn profiles, and Trustpilot reviews into a single pane of glass. The goal is clear: declutter the system. By minimizing the number of distinct data silos, Map establishes an authoritative data source, a single source of truth.

This isn't just about clean reporting. As Dani wisely noted, the highly anticipated "agentic AI" that every vendor is currently hyping is practically useless without properly governed, centralized data. If your AI doesn't know which system holds the truth, it cannot act effectively on your behalf.

Knowing When to Ask for Help  

Another trait of a mature organization is knowing when to raise a hand and ask for help. Map Communications’ journey with Zoho began around 2021, and they initially worked directly with Zoho's professional services teams, who worked tirelessly across time zones to pull off a complex legacy migration.

However, as they acquired more businesses and faced tighter integration timelines, they didn't hesitate to bring in specialized external implementation partners, like Workflow Academy, to accelerate the process.

As a consultant myself, I always appreciate a leader who recognizes the value of an outside perspective. External partners bring cross-platform experience. They have seen migrations from Salesforce, Zendesk, or Freshdesk, and can help organizations avoid costly architectural mistakes early on. At the end of the day, this is mostly cheaper than running into a sequence of snafus. The key, according to Dani, is ensuring that the vendor provides thorough documentation and cross-training so the internal team isn't left in the dark when it's time for the next iteration.

Past the Honeymoon Stage: Looking to the Future  

Map Communications is well past the "honeymoon stage" with their CRM vendor, entering that mature, long-term marriage phase where continuous improvement is the name of the game. And so far, this marriage seems to be a happy one.

But no software relationship is perfect. When asked for the one missing feature he desperately wants to get from Zoho, Dani didn't hesitate: a unified single sign-on that allows C-suite executives to toggle seamlessly between their multiple, distinct Zoho instances without having to constantly log in and out.

Consider the pressure publicly applied, Zoho!

Ultimately, Map Communications proves that a successful CRM strategy isn't about buying the most expensive system on the market. It’s about rigorous data governance, pragmatic vendor selection, avoiding scope creep, and relentlessly focusing on communicating value to the customer.

Three Key Takeaways for Pragmatic Tech Leaders  

As we wrap up this insightful conversation, a few core themes stand out that any organization evaluating their software architecture should take to heart.

Embrace the 80/20 Rule: Chasing a system that perfectly fulfills 100 percent of your business requirements will lead to over-engineering, scope creep, and bloated budgets. If an off-the-shelf solution meets 80 percent of your needs, accept it, work around the remaining 20 percent, and avoid building costly, complex custom systems on top of it.

Clean Data Precedes AI: The industry is still not stopping to buzz about agentic AI, but as Dani correctly highlighted, AI is completely dependent on having an authoritative, decluttered data source, a single source of truth. Eliminating manual workarounds because copy-pasting of data across systems is truly evil, and harmonizing your core tech stack are absolute prerequisites for any future AI success.

Demand Knowledge Transfer from Partners: Recognizing when you need external help for complex software migrations is a sign of mature leadership. It is a strength, not a weakness. However, when you do bring in outside consultants or vendor implementation teams, you must mandate thorough documentation and cross-training. Your internal team needs to be fully empowered to manage, fix, and iteratively improve the system long after the consultants have rolled off the project.I am already looking forward to checking back in with Dani in the course of the next year to see how Map Communication’s preparations for agentic AI going forward and eventually help the company.

During ZohoDay 2026 in Austin, I had the opportunity to sit down and chat with Tony Thomas, the head of Zoho US. Tony has been in this role for just over a year, navigating an economic and technological landscape that got ever more complex. Our conversation covered everything from shifting macroeconomic realities and Zoho’s upward trajectory into the mid- and enterprise market, to the fundamental ways generative and agentic artificial intelligence are challenging the traditional economics of software implementation. With software pricing already being under pressure, it is more than likely that implementation costs are next. I said it before, the time-and-material billing that SI’s are still favoring is probably going the way of the Dodos.

What became abundantly clear during this conversation was that Zoho continues to forge its own contrarian path, adapting to market pressures by continuing to rethink how software value is delivered. One could even say that Zoho’s thinking gets validated by current developments.

TL;DR  

If you prefer watching the interview to reading, find the full video here.

The Macroeconomic Squeeze on the SMB  

The software market does not exist in a vacuum, and the broader economic climate over the past year or so has been challenging for businesses. Historically, SMB segment has been Zoho’s mainstay. However, Tony noted that especially this demographic is facing severe headwinds. Tony pointed to the K-shaped economy, where large enterprises continue to see gains while smaller businesses and large segments of the populace are struggling or being left behind.

Small businesses have "taken it on the chin", battered by general economic uncertainty and the specter of tariffs, casting doubt on the speed of their recovery. Consequently, while Zoho is still acquiring new SMB customers who are actively seeking better value, the existing customer base at the lower end of the market is undeniably feeling a squeeze. Zoho’s way of delivering value helps these companies.

Moving Upmarket: From Products to Solutions  

In spite of these uncertainties, Zoho has continued its push upmarket, finding significant traction in the mid-market and enterprise tiers. But succeeding in this space requires a fundamental structural shift in how a vendor engages with its buyers.

As Tony explains, small businesses generally lack the budget and time for lengthy software deployments; they demand products that work out of the box. With growing size, however, businesses don't buy out-of-the-box products; they buy solutions instead. These larger organizations demand software that is tailored, verticalized, and aligned with their strategic differentiators, in other words, requires an implementation project. For Zoho, this means adopting a heavier-touch engagement model by investing the time to deeply understand a customer’s specific business requirements and customize their offerings, whether directly or through partners.

Currently, Zoho’s sweet spot in the US is definitively the mid-market rather than the top-tier, Fortune 500 enterprises, which remain tethered to legacy incumbents. Mid-sized businesses of increasing size, however, are coming to Zoho seeking integrated, cost-effective architectures infused with modern AI capabilities.

The Vanishing UI and the AppOS Strategy, and Fixing the Disturbed Value Equation  

With the combination of generative AI and no-code and low-code environments, we can see what I call the disturbed value equation. A company might purchase a highly capable software platform at a low licensing cost, only to watch the total cost of ownership balloon drastically due to massive implementation and systems integration fees that can get avoided by adopting these technologies, either directly in the software or by system integrators. This chasm of low subscription costs and comparatively high implementation costs reduces the software's perceived upfront value drastically.

When pressed on how Zoho plans to correct this imbalance, Tony acknowledged the intense pricing pressure surrounding implementations and pointed out a new emerging reality: as customers are increasingly required to pay for advanced AI and intelligence layers, their tolerance for bloated implementation fees is vanishing.

Zoho’s answer is to use AI to compress the cost and time of these deployments, starting from the early stages of the implementation projects. Tony shared that Zoho’s solution teams are already using AI to record customer calls and automatically generate system specifications. While this AI-driven efficiency is currently most effective in the mid-market, bypassing the sluggish steering committees of massive enterprises, it represents a clear path toward restoring the value equation. By bringing implementation costs down, Zoho aims to free up customer budgets for high-value intelligence features. I am looking forward to these specifications being used 

Coupled with this is the rise of generative AI and no-code tools, which are democratizing app development. I challenged Tony on how this "DIY" capability impacts Zoho’s business model. He countered that while users will undoubtedly experiment with building their own apps, companies will quickly hit a wall of chaos. True enterprise applications require strict governance, security, and deep integration with core company data.

On top of this, we are currently witnessing a Titanic battle between different vendors to dominate AI orchestration layers and the access to the user who increasingly bypass traditional software interfaces in favor of interacting with data through chat platforms like Teams or Slack.

To manage this, Zoho is positioning its AppOS architecture as the foundational platform. Zoho intends to be the bedrock, providing the essential, compliance-heavy core applications like finance and ERP that are simply too risky to vibe-code from scratch. On top of this secure foundation, Zoho will empower customers to build dynamic, context-specific AI applications, ensuring the core data remains governed and trusted.

Looking Ahead  

Zoho operates distinctly differently from its peers in the CRM and enterprise spaces. To thrive in this new era, the company is transitioning from a product-centric, best-of-breed mentality to a holistic model combining platform, product, and deep, customer-centric intelligence. Helping customers navigate the K-shaped economy while fundamentally disrupting the cost of enterprise software implementation is no small feat, but Zoho's philosophy makes it a vendor well worth watching.

Three Main Learnings for Enterprise Software Buyers  

The Value Equation is Shifting from Implementation to Intelligence: Historically, a massive portion of a software budget went toward implementation and IT consulting fees. Today, the real differentiator is artificial intelligence and advanced analytics. If buyers spend their entire budget on getting the software up and running, they won't have the resources left to invest in the intelligence layers that actually drive competitive advantage.

Vibe-Coding Requires a Foundation of Strict Governance: Generative AI and no-code tools are allowing end-users to build custom apps quickly. However, doing this in isolation creates shadow IT chaos. For mission-critical systems involving financial compliance, data security, and legal requirements, organizations cannot rely on ad-hoc DIY apps. They need a heavily governed core platform that safely manages the data while allowing for flexible edge applications.

The Application UI is Evolving, Not Disappearing: The market is seeing a push toward headless apps and conversational UIs, where users interact with business applications via platforms like Cliq, Slack or Teams rather than logging into dedicated software frames. However, complex tasks like data analysis or chart visualization will still require traditional interfaces. The future is probably multi-modal, not exclusively conversational.

What to Look for When Evaluating Enterprise Software  

When you are assessing new enterprise software platforms, keep these criteria front and center to ensure long-term viability and value:

Vendor-Driven Implementation Efficiencies: Ask the vendor how they are actively driving implementation costs down. Look for vendors who use AI to compress deployment times and cost, so you can invest your budget into value-add intelligence rather than the plumbing.

Platform Architecture: Evaluate the software's underlying architecture. Does it offer a robust, secure, and compliant cross application foundation for core business data, while simultaneously providing safe, integrated AI and no-code tools for your teams to build customized workflows on top?

Omnichannel User Experiences: Don't get locked into software that only offers one way to work. Ensure the vendor supports traditional and modern work interfaces and offers frictionless orchestration layers.

Pre-Built Compliance and Certifications: Evaluate the vendor's commitment to keeping up with regulatory compliance. You want a vendor that absorbs the cost of updating rules, tax codes, and security certifications so your internal IT team doesn't have to constantly rebuild workflows to stay compliant.

ZohoDay 2026 is in the books, and it has again been an intense two days of information and discussions, starting off with some impressive statistics. In time for its 30^th anniversary, Zoho crossed the milestones of one million paying customers and an eye watering 150 million users. All this while not having raised a single dollar of external capital or buying technology or users. The company stays fiercely independent and continues to grow very profitably since it crossed the threshold of an annual revenue of $1bn back in November 2022.

If I wanted to boil this event down to a few key messages, it would be value, independence, platform, and, of course, AI. 

The conference in a nutshell: Value is the result of the smart use of automation with AI that works on top of the corporate system of record, powered by a platform that is built on an independently owned stack. This is also the secret sauce of Zoho, a philosophy that the company follows since its inception. 

And here is how Zoho brings this to work. 

Zoho owns and continuously improves its stack

Coming from the angle of sovereignty, Zoho extends this thought of independence to its customers now in an answer to Raju Vegesna’s not so rhetoric question “what will happen if someone can pull the plug?” on any of your essential systems. All of the sudden, the thought of local deployments or hybrid deployments with cloud apps operating on local data becomes very interesting, valuable, again. It is mitigating risk. According to Vegesna, clients of different sizes are asking for this model. Another part of this equation is the ability to mitigate risk while keeping control as Zoho Corp’s Chief Strategy Officer Vijay Sundaram maintains. Apart from being a business and deployment model, he argues that SaaS brought an institutionalized risk reallocation from the customer to the vendor. 

Customer Risk under a SaaS Model; source Zoho

Part of the price of this reallocation for the customer is ceding control to the vendor, which in turn can become a risk in itself. 

On top of this, the move to more use of AI and agentic systems, along with the proliferation of no-code and low-code systems, which moves control back to customers, is increasing their risk exposure, with all its associated security, compliance, operational and customization risks, as more and more business logic is built by the customer again.

Using its own stack, from hardware to AI, with what Sundaram dubs “the magnificence of the mundane”, the corporate systems of record, at its heart, Zoho offers customers control while moving less risk back to the customer.

The value of being able to mitigate risk, that is hard to quantify comes on top of the value that Zoho offers through owning its stack, therefore being sovereign itself and in control of (most of) its own risk.

Platform play

Zoho regards itself as a technology vendor rather than a business app vendor for quite some time now. Quite rightfully so, as the company builds its own hard- and software stack and as part of it, its own application IaaS and PaaS, to stick to SaaS terms. The problem is that this led to a sprawl of business apps and corresponding fragmentation on the data level, that even a middleware cannot keep up with; not even talking about shadow IT and shadow AI.

The consequence is a chaos of apps, inconsistently connected by various middlewares, these days with an army of (unreliable) agents on top of them. As an example, businesses have deployed 275 according to the 2025 Zylo SaaS Management Index. 

Enterprise software, current state, with agents; source: Zoho

Zoho intends to fix this by using a page from Apple’s iOS platform book. This way, the company wants to be able to not only keep the infrastructure layer clean but also leverage its already existing application foundation by streamlining it. Zoho calls this AppOS. AppOS is intended to have applications built within it, on a shared data foundation, using common business and process models, built-in workflows and automations, etc. In simple terms, AppOS contains everything that is needed to build and run applications and that is not domain specific. It gets enriched by domain specific platforms on which the various apps are built. 

With AppOS, Zoho wants to bridge the gap between the increasing proliferation of apps that gets fueled by AI code generation and the business need to maintain structure. It shall do so by providing a common data structure, a consistent business context and, last but not least, by enforcing standards. According to Mani Vembu, CEO of the Zoho Division of Zoho Corp., transitioning to AppOS will be a seamless experience for customers.

And then there is AI

Let me start with that I found it refreshing that AI was not a centerpiece of the presentations. Actually, Zoho caught some analyst flak for not pushing an AI story aggressively. 

Which they responded to with a strong counter argument. Most vendors bolt AI on top of an unreliable data infrastructure. Zoho wants to do it right and first lay the data foundation and with that what Zoho calls the “unified business context”. This unified business context is built of the combination of designed and discovered information, structured and unstructured data. Based on this context, AI will become more reliable. In addition, it enables Zoho  to offer own foundational LLMs and MoE models that are both, more reliable, more performing, and cheaper to run. Why? Because context, private data and specialized models always outperform generic data that is fed into massive models. With that approach, Zoho puts intelligence in front of the models, thereby avoiding the need for what I’d call “commodity inferences”. Plus, own models enable Zoho to allow for custom training and custom deployment of specialized models. As also a recent HBR report stated, the competitive advantage that businesses have, lies in context, not in the model, in particular not if businesses use the same models. This ties back to the unified business context of AppOS. Plus, inference will become expensive again, when the major LLM vendors switch from an investment mode to a value extraction mode to turn profitable. Combined with an emerging own agent ecosystem, Zoho again can promise to offer customers a high value.

My take

Zoho shows a remarkably consistent strategy that centers around “maniacally focusing on value”, monetary as well as less tangible value like the ability to control or balance risk. 

Given all the economic and regulatory uncertainty that we see these days, this strategy of maniacally focusing on value by the smart use of automation with AI that works on top of the corporate system of record, powered by a platform that is built on an independently owned stack, puts Zoho in a sweet spot. The combination of data, context, and sovereignty ensures this.

Of course, there are companies that can compete with Zoho on the breadth, width and depth of functionality, but not very many. Looking at Zoho’s overall capabilities, there is only Microsoft. Looking at business applications only, we can add Oracle and SAP, maybe ServiceNow soon. In a world that increasingly swings back to – and needs to swing back to – suite thinking, Zoho punches well above its weight. This is not to say that specialists have an important place in the software industry, but consistent and contextual data will become ever more important. 

Are there challenges ahead? Sure as! Zoho has big ambitions, enhancing its software, building out its AI, not to mention getting a deeper foothold in the ERP market, which is a topic that I didn’t cover at all here. And then, there is the topic of implementation cost. The better the price to value ratio of Zoho software becomes, and I’d consider it market leading, the more implementation cost matter. They can outstrip the licensing cost by an order of magnitude. 

Zoho’s Chief Scientist Sridhar Vembu cited examples of how efficient software development with the help of AI code generation has become. One of them has been a compiler that two developers could create in 2 – 3 days instead of the 3 months that it would likely take human engineers. This kind of value needs to hit the customer implementation, and fast. 

On top, as also Jon Reed alluded to in his excellent take on ZohoDay 2026, it still needs to be proven that AppOS delivers on flexible customizing while avoiding technical debt.

In closing, as Raju Vegesna said in his speech, customers license not software but peace of mind and not the software, but customer satisfaction is an enterprise software vendor’s ultimate moat.

I tend to agree. And Zoho is well on the way down that route.

Zoho aspires to deliver the operating system for businesses with the goal of driving customers' margins by unifying business operations on one single technology platform. The most important part for delivering this vision is Zoho One. 

Zoho One is Zoho's premier bundle of business applications. Currently, Zoho One consists of around 55 applications that support sales, marketing, email and collaboration, helpdesk and customer support, finance, HR, analytics, and business processes. Of these, customers use on average 22. 

Zoho One can be licensed as an all-in-one platform but also be part of a journey that starts at first licensing one application, then more and then moving to Zoho One directly or via licensing one of the other suites (such as CRM+, Projects+, Finance+, or Workplace, and others).

The most used applications in Zoho One are CRM, Analytics, Books, Meeting, and Workdrive.

At the time of writing this, Zoho One has around 75,000 customers, which makes it Zoho's most popular product. The largest customer has around 32,000 employees. Customers are distributed worldwide in more than 160 countries, with the highest numbers in the United States and the European Union. 

Organizations that have implemented Zoho One are from a variety of industries, although the top five industries are the high tech, professional services, Real Estate and Construction, Retail, and Banking/Financial Services/Insurance industries.

On November 18, 2025, Zoho announced many enhancements to the suite. The enhancements are focusing around three key areas:

·       Experience

·       Integrations

·       Intelligence

The biggest enhancement in the experience category is that Zoho essentially removes the boundaries between the 55 apps that are part of the suite with a concept that the company calls “spaces”. The objective of spaces is to unify parts of the overall user experience and thereby increase user productivity. A space groups a number of apps that are relevant for one or more purposes via a horizontal toolbar. It provides users with apps that are necessary to achieve business objectives in one single place. Spaces can be personal, e.g. for increasing one’s individual productivity, organizational, or departmental. Zoho delivers a number of customizable spaces. Customers can create their own spaces to better serve their needs and processes. 

Similar to this, boards remove analytical boundaries between the apps. A board is essentially a dashboard that can work across data from different applications. A good example for this are tasks, that can live in different applications and that can be brought into one single UI that allows contextual filtering via a board.

Similar to the boards, and to further facilitate the navigation and use across Zoho One, Zoho implemented an action panel and a quick navigation option, with the action panel aggregating action items across apps and the quick navigation speeding up navigation across applications.

Last, but not least, Zoho added Vani to Zoho One. Vani is a visual team space that enables teams to collaborate on documents and tasks.

On the integration side, Zoho now offers a view into all Zoho-to-Zoho integrations in one spot and offers to unify application-specific portals into one single portal that offers a central workplace across them. This portal covers Zoho applications, external applications, and custom-built applications. In addition, Zoho offers what the company calls pragmatic integrations. Pragmatic integrations allow to centrally configure integrations across Zoho One to external services, with domain verification being the first example. Last, but not least, Zoho introduces “outcome-based” integrations, which are basically cross-application workflows. With outcome-based integrations, customers can create cross-application workflows via a Zoho-provided wizard. This wizard takes care of the backend integrations while customers can concentrate on achieving the outcomes they want to see. This gets supported by an MCP server that exposes around 200 Zoho and third party apps ready to act as agents and MCP clients. 

In addition, Zoho unifies intelligence across Zoho One. AI capabilities across the apps are now available via Zoho One. Zia Hubs got enhanced to get its own space in Zoho One and supplementary workflows that make company data utilized. Zoho’s Ask Zia will soon be available in the bottom toolbar, allowing prompt-based searches across apps and providing contextual intelligence to guide decision making. 

Last, but not least, Zoho added a number of more technical enhancements, ranging from enabling customer-defined encryption, directory stores, cloud LDAP, cloud RADIUS and more. 

Analysis  

Zoho positions Zoho One as the operating system for businesses. While this is a bold statement, it was already largely true before this release. Still, since 2023, Zoho One has evolved a lot in terms of breadth and depth of its functional coverage without Zoho making much fanfare about it. The increasing number of customers (75,000, up from around 40,000 in 2023) and the fact that customers on average use 22 of its applications now are testament to the suite’s success. Zoho One certainly hits a sweet spot, also with its attractive pricing.

Want to know more? Read my full report here.

Do you remember the uproar that Microsoft CEO Satya Nadella recently created about the death of SaaS? Although this is obviously some hyperbolic BS, there is a grain of truth in there.

Not the death of a business model, but something that is hidden somewhat deeper. It is about the eternal struggle between suites and best of breed software, which is in its third iteration – at least – since I am in the CRM world.

The grain of truth lies in the potential change of the way that business and other applications actually are built. When I look at ERP and CRM systems, I see software stacks that often are twenty years old, or even older. Look at S/4HANA. It still has a lot of R/3 inside although there are many new parts. Or Salesforce, which essentially dates back to the early noughts. SugarCRM has a fairly old core, too, even posterchild Zoho has software that dates back twenty years. The list goes on and on. Essentially, all these systems have morphed from fairly specialized solutions into monolithic giants.

Mind you, this is not all bad, as these systems are often incredibly powerful.

However, there are some challenges with it. I admit that, although I am a suite guy myself. These challenges are often around speed of innovation and, by definition, a degree of incompleteness. Requirements change faster than any software product vendor can implement them. And even if they successfully implement them, the software stack becomes increasingly more complex and harder to enhance and to maintain.

Harder to maintain not only for the vendor but also for the customer, even with the help of knowledgeable systems integrators. Additionally, there is always a functional gap, albeit sometimes only a perceived one. So, custom code and integration to specialized software stay a need. This need simply cannot be overcome by packaged applications.

The result is a big system of which often only a small percentage of the delivered – or custom developed – code is actually in use by customers.

There have been numerous attempts at changing this. We had COM and DCOM in the Microsoft world as well as similar technologies already last millennium, we have seen microservices and composable architectures. Hasso Plattner, the founder of SAP already in the early 2000s formulated a vision of an ERP that is entirely built on composable modules that get connected by workflows. SAP Business by Design was built following on this idea but didn’t achieve this vision.

In short, none of the attempts at solving the problem of bloating software systems actually solved this problem.

And now, we have a new technology with generative and agentic AI systems. This makes me ask a deceivingly simple question.

Do agentic AI systems solve the bloated applications issue?

During a recent CRMKonvo that I had with Bob Stutz, one of the most knowledgeable and influential persons in the CRM industry, Bob suggested that the technology clearly has the potential to achieve this. Vendors, however, need a mindset of solving actual business problems based on data. Bob is quite vocal about platforms having outlived their usefulness as they resemble band aids that are applied on top of other band aids. What is needed instead, are what he calls “focused applications” that push information to the user instead of making them pull it.

The consequence that Bob draws from this is that packaged applications, and especially platform-based applications, are reaching their end of life and need to be replaced by focused applications that are built with the help of – or even by – generative AI specifically to the users’ needs.

To quite an extent, I do agree, as I am talking about smart applications for quite a while now. I consider smart applications as applications that take work away from the users and adapt to changing user needs, based on data and use. Do we have them yet? No. Do we have the necessary bits and pieces, aka technology? Largely, yes.

So, on the outset, smart, or focused applications, look like a promising way to avoid application bloat. I also believe that agentic AI will play a major role in the way that these applications are built and delivered.

However!

Agentic systems, digital agents, can’t deliver this yet. There is some work to be done to make sure that they do not “stray off their reservation”. Agents inherently are probabilistic. This means that agents, and in consequence, agentic systems need to become more deterministic, i.e., correct, accurate, and reliable. Furthermore, the agents that make up the system need to interact in order to collaborate on a task. That requires three main ingredients, a protocol, common metadata and shared data. The protocol is a contract on how to interact plus a planning and orchestration entity to manage the agent collaboration. Metadata that supports business semantics and data require a joint access layer, let’s call it a (business) data cloud or a data fabric, or even a graph.

Combined, these ingredients form nothing else than a platform, but a platform with a twist. Ultimately, this is a (meta) data management platform with generative AI-based analytics and (no code / low code) development environment, combined with a telemetry system.

Thinking (or dreaming, if you like) this to an end, this platform can be used by vendors to create productized applications, and by consultancies or customers themselves to build highly specific applications. The more decentralized the application development becomes, the more focused the applications will be, and the less bloat there probably is. As the development itself is highly AI supported in this scenario, the development costs will become marginal. There are already technology vendors that consider a productivity increase of developers by a factor of 100 achievable. This productivity increase applies not only to developers in enterprise software vendor firms but to all others, which may fuel a technology change away from prebuilt solutions and back to custom applications.

So, to answer the question … in theory it’s possible, in practice, it will still take some time. There will need to be some governance around it to avoid another Lotus Notes graveyard of unused applications.

And, if it happens, the enterprise software world may very well get upended. Do I see this as very likely? No. Why not? There are at least three reasons.

Firstly, too many processes that run supported by software do actually not differentiate a business, i.e., makes an advantage that is enough to warrant a custom implementation. Second, what I call gravitational forces. Companies invested far too much into their systems to do a reimplementation anytime soon. Look at core banking systems. They still run on Cobol. A third one is that most businesses do not want to turn into tech companies. They want to use software, not create it.

Still, the world of enterprise software will change. What is your opinion? Custom applications, customizable applications, or anything in between? The judge is still out.

Zoho held its annual ZohoDays outside of Austin in the beautiful Horseshoe Bay resort. While this is a good way away from Austin proper, it also gave the opportunity to have long and good conversations with Zoho execs, customers and fellow analysts outside of the conference and meeting rooms. And guess what, this is exactly what happened. 

Big time kudos to Sandy Lo with her amazing team for organizing this and of course also to all the Zoho execs, including the newly minted Chief Scientist Sridhar Vembu, Zoho’s new CEO Mani Vembu, Tony Thomas, Raju Vegesna, Vijay Sundaram and many more, who all were more than willing to share information and, even more importantly, get feedback. The latter is not something that we analysts take for granted.

Besides the usual – and important – state of the business update by Vijay Sundaram, the event revolved around three main topics

·      AI

·      Enterprise and partner strategy

·      Industry strategy

As Zoho is privately held, we are not given details, nor at liberty to divulge as much as we learned. So, suffice it to say, that Zoho grows healthily in the value chain from unpaid users to customers, to revenue to retention. The company announced having hit the milestone of $1bn US in revenue already in 2022 and is growing healthily in all of these categories while being healthily profitable.

With this out of the way, let’s have a look at the main topics.

Artificial Intelligence

Artificial Intelligence is one of the main reasons for Sridhar Vembu focusing on technology. He was very hands-on before and can do so even more now, especially on the backdrop of DeepSeek showing that after all reasoning is a commodity, combined with the fact that it is hard to discern what LLMs learn or unlearn. This creates unstructured output and therefore the need for humans verifying the output, which drastically reduces the productivity gains ones hopes to see. His solution approach is to look at prompt engineering and RAG as input engineering and to make AI create “machine checkable inferences” on business data, which has a couple of distinct advantages. Business data resides in databases, so it is known how to change or delete it. Second, it can be validated automatically, as it is structured. The validation of structured output is generally a solved problem, too – known as a compiler. Open problems are the question how to generate this structured output in non-programming cases and the then necessary output engineering which returns the appropriate answer outside the scope of programming. I am looking forward to some creative solutions by Zoho. With its contextual intelligence, Zoho already seems on this way. 

Having said this, Zoho can’t stay out of the agent game. One of the core differences to most other companies is that Zoho comes from a use case angle and looks at AI something that gets invoked in context and is a helper in the background, instead of being pushed to the front where it almost becomes an end instead of a means. A great example for this is Zoho’s own agent Ask Zia, which is imbedded in many, if not most of Zoho’s apps. In combination with Zoho’s already available and steadily growing number of hundreds of contextual AI use cases, this becomes both, a very powerful agent as well as a foundation for the creation for more agents, if they are provided as skills. These skills can only be as good as the underlying data and, going forward, the models that are available to work with. And here, Zoho is in a quite comfortable position. The company owns the complete software stack of its applications and hence can evolve its underlying “database” into a data lakehouse that holds data from structured to unstructured data and has the ability to ingest data from connected apps. Together with its already existing data cleaning technology, the ability to create new agents and the ability to connect to self-hosted as well as externally hosted LLMs, this is a strong value proposition. This is especially true as security and privacy are an integral part of Zoho’s DNA. 

Enterprise and Partner Strategy

Zoho has a firm foothold in the SMB market and for some years now is setting up the structures, processes, and messaging that are needed to better address the enterprise market. The company has already won a good number of enterprise accounts worldwide and across various industries. From a scaling angle, the user numbers in these accounts go into the six digits. Which tells that Zoho’s software scales.

Some learnings include that while many requirements are similar, there are differences by industry and region, and this is where the platform and partner strategies come into play.

Zoho is a platform vendor and starts to position itself as such, as opposed to the current messaging that positions the company as a multi-application vendor. On top of this, and as a realization of not every large business being created equal, Zoho places a domain architecture that is roughly taken from enterprise architecture frameworks on top of this. While this is an interesting positioning that caters to different use cases, it is also a difficult one, as it easily becomes quite technical and complicated. As the platform architecture is described right now, it places many elements that one would expect as part of a platform inside domain platforms that sit on top of a more generic platform. While this makes sense in an overall architecture that offers different customizing and enhancement tools for different applications, It might be easier to understand for customers to only place applications in domains and keep the development tools as part of the general platform. The general platform is needed, anyways. As a consequence, it might be easier to digest to speak of domain specific application families that integrate into each other and with the ones of other families.

Industry Strategy

Zoho regards verticals as a key driver for growth, for both Zoho itself but also for partners. This is based on the realization that there are plenty of underserved verticals and micro verticals that all need tightly integrated applications to build solutions. While the creation of industry solutions requires the creation of industry-specific apps as part of the suite, it also requires the integration with vertical-specific apps. No single vendor can deliver it all. Instead, this requires the ability to extend a horizontal platform to support vertical platforms, or rather solutions. As you could read in the enterprise strategy section above, Zoho has this horizontal platform.

On top of this technological issue, it requires the ability to build an industry solution that actually solves a problem – instead of one that is in search of its problem. A very good approach for this is to co-create solutions with a meaningfully large customer. This ensures two things, first that the solution actually becomes meaningful and not something that is specific to this customer, and second it gives credentials. The challenge is obvious: it is necessary to first convince this charter customer that one is able to create the solution at reasonable cost in a reasonable timeframe. 

This is exactly, what Zoho is doing. Having a reasonable size itself, a strong collaborative culture and, what is more, the technology to do this.

To scale this concept across industries, this ability needs to be made available to partners as well. This is what Zoho is doing as well. By enabling partners to build vertical solutions for smaller or micro verticals, Zoho will be able to scale the own business faster by offering them a sustainable business niche. Part of this is, of course, that partners can be reasonably sure that Zoho will not invade this niche. This is something that other vendors do; and is something that makes the investment decision for partners hard. They simply cannot compete with the ecosystem owner. 

What Zoho does instead, is offer partners the tools to build integrated industry solutions and to make them available to a global audience via the Zoho ecosystem. This way Zoho becomes more successful by making partners successful by making their customers successful. To achieve this, Zoho will make a Vertical Studio available to partners in March. The Vertical Studio will enable partners to build vertical-specific scalable multi-tenant apps that seamlessly integrate with other Zoho apps. Together, these deliver an industry solution.

Outside-in thinking at its best, and a true win-for-all. 

Bringing it all together

Zoho and Zoho customers have told a strong and coherent story during the ZohoDay 2025 event. It is one of the best and credible AI and digital agent story around, especially when combining current execution including the upcoming own LLM, own hosting and strong privacy focus.

Zoho has learned some very interesting lessons from its own endeavor into enterprise and industry territory. The best one being in my mind to “open source” its learning and to make process and tools available to partners, so that they can build industry solutions fast. This way, micro verticals can get developed and partners get what I would call a safe harbor with the promise to carve themselves a niche and owning a specialized domain. This message can only become stronger if Zoho decides to explicitly tell partners which domains Zoho will not actively engage. This increases trust further and makes it easier for partners, ISVs or SIs, to invest into creating IP.

A topic that is of importance in this regard is the one of regional partners. These fit better into the strategy of transnational localism as the global SIs and they bring relevant industry expertise. In addition, they are often more trusted than the global SIs while being able to offer near- and offshoring services that allow them to compete on price if necessary.

What I would call the “weakest link” in this good story is the messaging towards enterprise architecture and enterprise readiness. Not to be taken wrong: Zoho is enterprise ready. However, it is incredibly difficult to put the dimensions ‘SMB vs. enterprise’, ‘business domains’, and ‘industry’ into a short and succinct narrative, let alone an easy-to-consume slide. Do I have the perfect answer? No, I don’t. But I strongly believe that Zoho has the smarts and the arts to create this slide.

It was a good event, with helpful information, and I am glad to see Zoho on a continued trajectory of success. Functionally, there are only few companies that can deliver on a similar or bigger scope, culturally, there is none.

_{Disclosure: Zoho covered all cost for me attending ZohoDay 2025. Still, all points of view expressed in this post are mine and not influenced by Zoho personnel in any way}.

The news

On Monday, July 22, 2024, SAP presented its numbers for Q2 and H1, 2024.

The highlights include:

• Cloud backlog up by 28% (27% in Q1)
• Total revenue up 10% (8% in Q1)
• Cloud and software revenue up 10% (9% in Q1)
• Cloud revenue up 25% (24% in Q1)
• Cloud ERP suite revenue up 33% (31% in Q1)

This in combination with an increasing margin. The total revenue growth and high profitability needs to be seen in the context of the company's still ongoing cloud transformation, with continuously decreasing software license and support revenues.

Obviously, the financial community liked these numbers, as can be seen by the jump of SAP’s share price by more than 5 per cent from about $200 to $212 after releasing the earnings numbers.

According to CEO Christian Klein, a lot of this success can be attributed to SAP’s AI strategy. Klein stated that almost a fifth of all closed deals included premium AI use cases.

A grain of salt in the soup is the employee engagement index that is part of the non-financial outlook. SAP reduced the 2024 target from 76 – 80 per cent in Q1 to 70 – 74 per cent.

The bigger picture

To put this in perspective with cloud juggernaut Salesforce, the total revenue growth is comparable with the Salesforce Q1, 2025 statement. Salesforce’s revenue grew by 11 per cent and the current performance obligation by 10 per cent. Also, in contrast to Salesforce, SAP reiterated and strengthened its outlook instead of painting a more muted picture.

The main competition in the next months and years will happen in the area of AI infused services. There is an increasing skepticism of the cost-value equation offered by generative AI. There is also an increasing awareness of a continuing need for specialized models. In fact, there is a report commissioned by vultr that shows that advanced businesses run on average 175 models and do not rely on a one model fits all strategy. At the same time, investment bank Goldman Sachs asks whether generative AI delivers enough return for its cost.

Consequently, there need to be – and will be – serious efforts in showcasing the value that is offered by AI instead of continuing to build on the continuation of the current generative AI hype. Vendors will increasingly look at delivering high value use cases that actually solve business challenges beyond making this or that more efficient (often on cost of the employee) and/or close capability gaps.

My analysis and point of view

SAP’s revenue numbers basically tell that the company increasingly and profitably transforms itself into a cloud company with a focus on cloud ERP. The cloud ERP revenue growth continues to outpace the overall cloud revenue growth. In fact, cloud ERP makes up 82.2 per cent of the cloud revenue in Q2, 2024, up from 80.6 per cent in Q1. Depending on how the exact – and undisclosed – revenue distribution and allocation is, this means that SAP’s CX business is not big and not a focus. This is something that the SAP CX line of business shares with Microsoft Dynamics CRM. Still, albeit on a lower base, it’s growth should outpace Salesforce’s growth, which is mostly driven by integration and analytics services, plus Slack.

The continuous strength of SAP’s cloud ERP growth is also a sign that the two-pronged strategy of favoring cloud delivery when it comes to innovation and SAP RISE seems to work out.

That customers are willing to buy the company’s “premium AI services” shows that SAP is able to convince its customers that these services offer appropriate value. Apparently, SAP is communicating that it is addressing the right problems. However, not all of these AI solutions will be underpinned by sufficient data that is available to customers to prove this proposition, yet. So, it will remain crucial for SAP to deliver the hard data that shows it. Yes, this challenge is mitigated by SAP’s approach of looking at telemetry data to identify usage patterns and therefore use cases to address. This is one of the core values of SAP’s AI hub. Still, it will remain important to maintain the right balance between services that are part of the core subscription and those ones that warrant an additional fee. Not every customer will appreciate or understand a vendor’s desire to charge a premium for functionality that gets increasingly commoditized. After all, the subscription fee for a solution does also cover its ongoing development and not only the fixing of defects. And these days, many features that make a vendor’s solution attractive, are at least AI infused. Also, many of these features did exist before the current hype, just that they were implemented differently – with differently not necessarily meaning in an inferior way.

The other part that I miss is a stronger emphasis on the support of customer facing processes. SAP has competitive sales and service solutions, with Emarsys, it has a very interesting marketing solution, commerce is on the verge of recovering. Even, probably especially following a strategy that combines industry and customer facing processes, it is time to increase the visible profile of SAP’s CX solution set. After all, to quote Milton Friedman the business of SAP’s customers is business. And to make business, it needs customers. These are engaged using a CX solution set.

Which should make CX quite an important line of business for SAP.

Having said all this, yes, it appears that SAP is indeed on a steamroll and the company is not unlikely to become the biggest business software vendor worldwide once more – major acquisitions of Salesforce pending.

Zoho is well-known as a technology vendor for the SMB market. The company has products that support the whole range from single proprietors to larger companies. This range in itself is remarkable. For some time now, the company is diligently working on moving upmarket and to also support enterprises. This is not in the least, as with a growing customer base, more and more existing customers grow into the enterprise segment.

The transition from SMB to enterprise is far from trivial. Sales models change, messaging, consulting approaches, support infrastructure, even the demand for the size and structure of the ecosystem are different in the enterprise sector.

So, how does Zoho fare? To find out, I had a conversation with Parl Johnson, “Chief Nerd” at Nuvia Smiles. You can find our complete conversation on YouTube.

Nuvia Smiles is a dental implant company and currently has 1,500 Zoho seats. The company has more than 30 locations across the United States. Its specialty is to provide a 24-hour turnaround time to get permanent teeth into the patient’s mouth. This way, they do not have to wait long periods of time to get dental replacements. This requires a very rigorous process and having a lab at every location. Decision making is highly decentralized to support this fast process. The challenge with this degree of decentralization is that there are many disconnected applications and with that also very decentralized data. Nuvia Smiles identified 80 different applications with a scope of consolidation across the 30 locations. While this initially facilitates fast growth, it can become a liability once a certain company size has been reached. Applications and especially data become too siloed to be helpful anymore. Sooner or later, every company needs to establish a central governance framework to be able to ensure compliance and coordinated growth, even the ability to work effectively, or  negotiate favorable prices – in summary, to leverage the economies of scale that being a large company offers.

This need for consolidation across a variety of different applications is what brought Nuvia Smiles to Zoho, after looking at Salesforce and finding that it didn’t meet Nuvia Smile’s requirements or fit into the company’s budget.

The broad implementation scope and the need for fast results that Nuvia Smiles looked at, made it important to work with a partner. This is where a good ecosystem with different partners that have different skill sets – and the possibility to identify them – comes into the picture. Nuvia Smiles identified its first partner during a regional user group event and subsequently another one that could help out with more specialized knowledge via the partner marketplace.

One way to achieve the first successes fast is a focus on data and analytics. It didn’t take Nuvia Smiles long to see first benefits. In the words of Parl Johnson: “I would say it's because of Zoho Analytics and as soon as we started feeding some key metrics into Zoho Analytics, getting results was almost immediate from an analytics perspective. So, we got some benefit out of that right out of the gate and then some of the other benefits were bringing in some less important data, I guess, into Zoho where we can play around with it, where it had previously just been in spreadsheets or other things. And so, you know, we kind of picked off the lowest hanging fruits right out of the gate.”

How to go on from there? One thing that surely is important beyond measure is including the users. Says Johnson “I would say our first attempt at core a process was an absolute failure, and it was largely related to that. the users was a big failure on our part because we came in with a development mentality. We were using an agile methodology. We were using sprint cycles and we were developing but we were developing to the software we were trying to replace, instead of to the actual user experience. We were so focused on the technical parts though that we ended up failing miserably on the user experience.” The team learned from the experience and very successfully started to migrate and consolidate patient processes and the internal communications platform from Slack to Cliq. The latter he considers a big win “because Cliq has a lot more HIPAA-compliance relevant elements to it that helps us be HIPAA compliant in all of our conversations.”

OK, but how about integration? In significant projects and especially in bigger companies, new software finds a lot of legacy software that is needed to perform business processes. While Zoho offers integration and workflow tools, moving away from legacy integrations fast is not always possible. “We knew right off that we needed to have some element of control in the middle between Zoho and many of the apps that we're using. And so, we went ahead and decided we were going to invest in at least a cloud service that would be in charge of doing all that handshaking where it's necessary. Sometimes there are some data that's just simple enough we can just stick it into Zoho, and we're done with it. But a lot of the baggage that came with some of the old systems are things like Zapier and you know "zapping" some data into Zoho and then zapping some data back and there is a lot of moving parts and we're trying to figure out how to migrate those into workflows or Flow itself so we can get off that platform .”

This, in turn, might require quite some documentation and support. Documentation is readily available, but sometimes confusing. Support initially ran into some hiccups but improved as well. Both strike me as ubiquitous challenges across all vendors.

My analysis and point of view

Given all this, one can say that Zoho is well on the way to be a strong enterprise player. For sure, there are things that can be improved, like documentation or the support infrastructure. But then, this is nothing unusual and a challenge that every contender has as well. Is this an excuse? Certainly not! And, judging by what we hear from Nuvia Smiles, Zoho is actively addressing weaknesses, which is also in line with the principles that Zoho’s CEO Sridhar Vembu laid out during the recent Zoholics event in Austin:

• Invest into a full product portfolio with breadth and depth
• Offer attractive bundles that have deep value
• Invest into exceptional service and support
• Improve interoperability with more prebuilt integrations
• Get close to the customer with a strong local partner ecosystem

From a Nuvia Smiles perspective, it appears that Zoho offers a portfolio with more than sufficient breadth and depth, with attractive bundles and a strong local partner ecosystem. Given, that Nuvia Smiles opted for investing into what Parl names “middleman software”, there appears to be scope for additional prebuilt integrations and flows. The other topic that initially seems to have been a cause of frustration for Nuvia Smiles is support. This improved with the growth of Nuvia Smiles’ Zoho footprint. This is a mixed message, as Zoho is still predominantly an SMB player.

So, back to the original question: How does Zoho fare on its way to be a strong player in the enterprise market?

As measured by the own aspirations and the Nuvia Smiles experience, the company is on a good way. Some principles show a high degree of maturity, others are addressed. Something that Parl did not talk about, but which is worthwhile looking at, is the value of the combination of product (bundles) and implementation effort with its consulting rates. I do not say that SIs overcharge – none that I know does – but bigger implementation projects can cause high efforts and cost. These can increase the time to value for customers considerably. This is certainly a dilemma. Still, it is in the best interest of Zoho and its implementation partners, to find a solution out of it. Preconfigured (industry) bundles and so-called consulting solutions may be part of this way. The solution for the deep value challenge may very well lie in the partner ecosystem principle.

In summary: No one is perfect, but it seems that Zoho fares better than many and is certainly ready for enterprise prime time.