Microsoft’s Nadella is banking on LinkedIn data to challenge Salesforce

Satya Nadella

Microsoft is upgrading to its sales software that integrates data from LinkedIn, in an initiative that the company’s chief executive Satya Nadella sees as central to its long-term strategy for building specialised business software. The improvements to Dynamics 365, as the software is called, are a challenge to market leader and represent the first major product initiative to spring from Microsoft’s $26bn acquisition of LinkedIn.

The new features will comb through a salesperson’s email, calendar and LinkedIn relationships to help gauge how warm their relationship is with a potential customer. The system will recommend ways to save an at-risk deal, like calling in a co-worker who is connected to the potential customer on LinkedIn. The enhancements, which will be available this summer, will require Microsoft Dynamics customers to also be LinkedIn customers.

The artificial intelligence capabilities of the software would be central, Nadella told Reuters: “I want to be able to democratise AI so that any customer using these products is able to, in fact, take their own data and load it into AI for themselves,” he said.

While Microsoft is a giant in the market for operating systems and productivity software like Office, it is a small player in sales software. The company ranks fourth – far behind and other rivals Oracle Corp and SAP – with just 4.3 percent of the market in 2015, the most recent year for which figures are available, according to research firm Gartner.

Specialised applications in fields like sales and finance are critical to the company’s future. Nadella bills them as Microsoft’s “third cloud,” the first two being Office 365 for productivity and Azure for computing and databases. His bigger vision is to have all products take advantage of a common set of business data that can be mined for new insights with artificial intelligence. “I think that’s the only way to long-term change this game, because if all we did was replace somebody else’s (sales), or (finance) application, that’s of no value, quite frankly,” he said.