Workday 23 – spotlight on financials and verticals

SUMMARY:

Workday 23 hit the streets today. This time the emphasis is on financials with major improvements in reporting and a homing in on vertical functionality. How far has Workday progressed? We assess.

[sws_grey_box box_size=”690″]SUMMARY: Workday 23 hit the streets today. This time the emphasis is on financials with major improvements in reporting and a homing in on vertical functionality. [/sws_grey_box]

Workday worktags
Workday 23 utilizes Worktags

Workday 23 is now with us, providing a much needed update on financials and reporting in particular. Last week I said:

Workday financials is due for as refresh. (Disclosure: Workday has been a consulting client on its financials product and I am due to offer some sense testing for the next release under non-disclosure.) I have no current insight into what that might bring but my best guess is that the company will be looking towards better analytics, fill ins for current functional weakness and scaling up as it seeks to attract the more lucrative financials customers.

That was prescient in ways I had not anticipated.

Earlier in the week, the company gave me a briefing on Workday 23 and specifically Composite Reporting, Workday’s current iteration of how it sees reporting and analysis for operational purposes. What does this mean?

There’s a lot of detail to absorb from Betsy Bland’s post on this topic and the accompanying video walkthrough. The main takeaway is that Workday is attempting to ensure everyone, whether finance heads or line of business managers, are literally on the same page when it comes to the business of reporting and that whatever the reporting need, Workday can provide the information needed for decision taking. Have they achieved that? Let’s step back.

When Workday introduced financials, reporting was by far their weakest part of the story. Although the company had started with a design that baked reporting into the solution, it was constrained by technical limitations that made reporting rudimentary. At the time, Workday was looking at alternatives in a classic build or buy decision. It was very clear almost from the get go that to differentiate, the company had no alternative but to build. At the time I was highly skeptical about Workday’s ability to deliver. Why?

Building a report writer of substance is a massive undertaking. Many accounting vendors have attempted this project only to fail miserably. Workday had a better chance than most because of its original design choices but nothing was assured. Several years later and Workday is getting there but it’s not on par with a Hyperion or BOBJ. That doesn’t matter so much and I’ll explain why.

Verticals strengthened

Early on, Workday understood how to make inroads into certain verticals: high tech was a no brainer as was higher education along with some elements of financial services and professional services. Each of the nine verticals Workday serves have their own reporting requirements, nuances and emphases.

In Workday 23, the company has gone further than I expected. It is for example providing average daily balance reporting to financial services customers. There is a template for revenue recognition for professional services. There are other examples but you will need to run a deep dive to determine whether there is enough in the current release to tempt and whether the Workday 24 and beyond roadmap provides an acceptable level of comfort.

My initial assessment is that if your industry specific use case fits one of the nine vertical molds and you are in the buy cycle, then the answer will be a moderately qualified ‘yes.’ The extent to which you qualify will depend on confidence in Workday’s ability to continue iterating within a timeframe that fits your implementation cycle. From this perch, I draw comfort from the fact Workday is collaborating closely with customers on these topics and continues to demonstrate solid momentum in the functional release cycle.

Horizontally, inter-company eliminations is much stronger than before as is multi-currency handling for group reporting and minority interest calculation management.

Unified approach

Workday is also enhancing reporting by providing hooks to third party data sources. Forget social media nonsense for now. One practical example might be a web service for auto calculating exchange rate differences in a multi-currency environment. You get to choose which you wish to use. Do think about the many kinds of data source that could be input to a services based business for benchmarking purposes. An example here might be demographic data that points to performance.

Talking performance, it is important to understand that Workday tightly integrates people data with that generated by financials. This is a crucial element in building businesses that are performance outcome driven. And…as Workday says – it all comes from a single system of record but with the promise of enhancement for operational purposes and without the need for a massive data warehouse or a slew of spreadsheets.

My take

While Workday has made its bones in the HR space, financials is where the real prizes lay. Workday knows this and is making solid progress towards convincing finance professionals that cloud based financials are not only viable but safe, secure and capable of delivering differentiated value. It is a continuing process but one where the Workday story makes sense for a skeptical world.

I was far from convinced when Workday confidently told me they would have a fit for purpose report writer/generator within 18 months some three years ago. They delivered a credible if basic first iteration within 10 months. Today, they have something much more worthy of consideration.

Workday is very much focused on US-based multi-nationals. Complex reporting requirement handling for international operations isn’t quite there though the company has indicated it will be far more feature complete by the time Workday 25 rolls around. That’s about a year from now.

The branding of ‘Composite Reporting’ is unfortunate. It creates an impression of handling the past where Workday is firmly looking towards managing the future. The analytical elements are impressive on their own for those who understand the Worktag concept. Worktags allow business managers to define their own needs without crippling data integrity and in this release, Workday has started to demonstrate that power in a meaningful way.

There is always more work to do and at the upcoming analyst briefings, I expect to get more detail on this important topic. In short – watch this space.

Disclosure: Workday is a premier partner at time of writing

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