Listening to customers - a Workday and SAP comparison

Den Howlett Profile picture for user gonzodaddy June 10, 2013
Summary:
Recent data on customer enhancements at both Workday and SAP open up an important question: can you realistically compare the two companies? The answer is a qualified less. What's more important though are the insights we get into how different companies respond to their customers.

I'm a great believer in vendors actively demonstrating the extent to which they implement customer requests. It is a good, though not perfect indicator that the company is both listening and capable of delivery.

Last year at Workday Rising, the company made a big noise about the number of customer requests that were implemented into the solution. If memory serves correctly, it was impressive and well north of 30 percent of all requests submitted. Trawling through the last few releases (Workday 17, 18 and 19) I see the company consistently implements a significant number of enhancements coming out of what they call 'brainstorm,' their take on customer interaction. Here are the numbers:

WDAY enhance 2

Regardless of where you think Workday is on the maturity curve, this is an impressive set of totals. The fact Workday is implementing so many customer requests is again impressive. It is something that catches the eye and reinforces the message that Workday puts out:

...the symbiotic nature of the relationship between solution provider and customers as a result of the delivery model. It is not a relationship in which software is shipped and maintenance revenue is collected annually. Rather, as a real SaaS provider we must continuously engage with our customers. We have three product updates a year and no customer is ever left behind. We are actively involved in the communication, testing, planning, and updating for each and every customer. This model of frequent updates also allows us to respond to external impacts and customer feedback. Our current customers have a significant impact in the development of our product roadmap.

Workday talks about this in terms of 'being in the foxhole' with customers. It's a good set of metaphors.

One important thing to note about these stats is that this only reflects the number that made the cut - not the total of requests that were made. Again, my understanding is that Workday tries to get north of 30 percent of the total requests submitted into each release but that will also include long outstanding requests. This is acknowledged in the commentary to the Workday 19 release. (registration required)

What about SAP? Recently I was pinged about a post in the SAP Community Network by Jarret Pazahanick entitled: Disturbing Facts about the SAP HCM Customer Connection Program. He is not a happy camper. According to Pazahanick, customers submitted 152 requests of which six were implemented over a one year period. More telling, he says:

While not part of the program above, I have asked the SuccessFactors analyst relation team multiple times how many of their quarterly changes come from customer requests with either no response or “a lot”. I believe there is a delicate balance of working with customer requests versus working on new functionality customers don’t know they need/want yet it is still not clear to me how well SuccessFactors is doing in the “listening to customers” aspect which is very important.

Ouch! Comments in the thread were largely supportive of Pazahanick's position, including one link to a spreadsheet that appears to clearly demonstrate where SAP didn't deliver on its own 'promise.' There was also a fair degree of cynicism coming out of customer reactions to this initiative.

More to the point Luke Marson says:

If SAP were serious about the program then you'd expect them to deliver a reasonable number of the threshold ideas, which for me is around 30% or more. That's still only 16 ideas, but given the (low) level of technical complexity of some of the issues I don't see why that shouldn't be achievable.

Talking points

Let's step back for a moment. Once you open the kimono for this type of discussion then life can get very complicated very quickly. Let's consider a few points worth remembering.

  • SAP HR is a monster product. It still holds a substantial lead in the marketplace and whatever the problems among customers, there is a LOT of code to maintain - and a lot of functionality that global customers around the world use every day without problem. It would therefore be very surprising if SAP was able to implement all the suggestions that meet the support criteria SAP originally set out.
  • Arbitrary percentages belie complexity. What might seem a small enhancement to one may well turn out out to be a significant undertaking. The vendor is the only one in a position to properly assess the engineering effort needed to achieve a given outcome over a given amount of time. Communications are key so that customers have a clear idea what is going on and why.
  • Workday conducts all its customer communications behind a private community. I've had a sneak peek in the past and I can assure readers that its customers are not afraid to let the company know when things need attention. SAP has a much more public facing community. That's an uncomfortable place to be but one that allows for the all important application of 'sunshine as disinfectant.' The question comes - what action will be taken?
  • Perceptually, Workday is winning minds and hearts. It wont always be that way but for now, the company is on a roll that attracts plenty of positive attention. The kind of stats I've outlined reinforce that perception. SAP is the 'old dog' trying to learn new tricks. It therefore has many more balls in the air than its competition. It could do a much better job of communicating the whys and wherefores so that those who are unhappy are headed off at the pass.
  • Practically speaking, Workday cannot afford to fail its customers or they walk away. That's one of the reasons people like me like the SaaS model. It is something you can walk away from - and people do. SaaS forces a much more customer centric focus which is relatively easy to manage in the early days. It is an open question whether vendors like Workday will be able to maintain that customer request to total delivered over time. My sense is it has to decline at some point.

Verdict

Can the two companies be reasonably compared? Yes and no. Make no mistake: SAP and Workday are direct competitors. Each will make their own pitch and win or lose depending on numerous factors. SAP's scale plays in its favor, Workday's innovation cadence works well for them.

When you start to look at the relative complexities of each solution it becomes apparent that Workday is much better placed to implement and draw attention to its customer focus. SAP can't play catch up because in a lot of cases, there is no catch up to play. But it still has to keep customers happy.

The real difference as I see it is in communication. SAP hasn't won the hearts and minds of customers who were asked to give feedback. Hence the modest set of requests. In turn, SAP hasn't delivered on the basis it originally communicated but then it is not clear why that's the case.

What do you think? Let us know in this poll and in comments:

[poll id="3"]

Disclosure: at the time of writing both SAP and Workday are premier diginomica partners

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