Referring to adverts Oracle has placed in the Wall Street Journal, Aneel Bhusri, CEO Workday launched the most aggressive attack I have ever heard on the company against which Workday has, to date, scored the most success. Among other things, Bhusri said:
I really appreciate that Oracle cares about my opinion...This time they managed to spell my name right.
I will have more to say about this later but this remark came at the end of Workday's annual technology summit. This is an annual event, now in its fifth year, during which Workday corrals a small group of analysts to pick over the company's full technology stack. There is always plenty of lively interaction. This year was no different with the company not only reprising its 10 year technology story, which it considers a key differentiator, but also giving us glimpses (under NDA) into what the future holds.
Financials as the lynchpin
While Workday continues to pack out its HR solution, highlighting the recent ADP partnership as a key part of extending Workday's global reach, this year there was a greater emphasis upon the financial products and the forthcoming Workday Planning.
In doing so, we are starting to see that Workday is readying itself to not only be the back office system of record that has been dominated by SAP and Oracle for the last 20 years, but also the platform from which companies can start to think about using the data HR and finance professionals consume to include many other data.
Of itself this might sound 'meh' but there are two important sides to this.
First, in many HR related functions such as recruiting, companies that use Workday can start to think about ingesting data from services like LinkedIn as part of the recruitment process. Second, forward thinking companies that are reviewing their business models can start to consider Workday Planning as a form of 'headless' approach that allows them to apply any data source to stand alone, ad hoc planning and, potentially, what-if scenario planning.
In those scenarios, Workday is no longer acting as a system of record - although it can be - but as the conduit through which any data that's needed for business decisions starts to flow.
This is the early stage of thinking around this topic, but it provides a fresh entry point for Workday Financials. This is important across multiple dimensions.
Bhusri makes no secret of the fact he wants to see Workday own both HR and financials in the customer base. This is a tough ask because as most readers know, financials is an extremely sticky application. So far, Workday has scored modest success, with 160 plus customers of which 90 are live. It needs additional entry points and Planning is one such.
If Workday can develop a compelling story around financial data reaching the whole of an organization in the context of data that preserves its integrity for both compliance and operational purposes then it becomes an attractive proposition inside the CFO office in ways that legacy applications cannot complete. Workday Planning is the way in which the company might achieve that purpose, but it is Workday's ability to scale without the need for expensive hardware and its attendant costs that cliches the deal. Then there is the control issue.
We are starting to see the decomposition of core financial data inside operational units for many purposes, planning being one. But the moment you do that outside the controls afforded by the financial platform, there is always the risk of not knowing whether the resultant outputs are rooted in an objective reality. And let's not talk about bi-directional data flows!
Based upon what we are told today, Workday doesn't have that problem because it starts from the perspective that all forms of analysis are an integral part of its offering. So even though it is positioned as a system of record, Workday can become a central part of systems for engagement, which might include numerous data sources, benchmarking, CRM, logistics and SCM generated data. It might - and I say this speculatively - include MRP data.
Forks in the road
Tantalizing though that prospect sounds, in order to play on the global stage, Workday has plenty of work ahead of it in sales tax/VAT compliance alone. It also has plenty of work to verticalize for the industries in which it already plays.
In short, Workday has massive opportunity ahead of it but has important decisions to make about where it places its development bets but without losing the focus that has helped its success.
So for example, Workday has made strides in expense handling, something that was far from optimal several years ago but which is now on par with Concur by virtue of Workday making expense handling available on mobile devices. It claims to have captured 20 Concur accounts, but more to the point, it is yet another potential entry point for winning the whole financials enchilada.
At this point I have to be careful not to get over enthusiastic. I need to get a much deeper dive into Workday Planning and the accompanying spreadsheet friendly Worksheets before I can express with certainty that the theory I am seeing unfold is a practical reality. Here is the problem all of us in the room acknowledge:
— Holger Mueller (@holgermu) December 9, 2015
Keeping that dragon under control is a key part of what happens next. I also need to be clear about how these offerings compare with the more modern Tableau offerings which is currently sweeping through the enterprise ranks.
Modern architecture wins
All these questions aside, Workday is rapidly turning into the powerhouse I imagined it would become back in 2012. The technology decisions it took years ago are bearing tangible fruit. For example, the company has replatformed without disrupting any applications. Customers may not care about this aspect but it means that Workday has a unique advantage. Workday can take advantage of any new technologies without hitting its customers with re-implementation costs. This is a very big deal because not only do customers get the advantage of continuous delivery, Workday can also concentrate on bearing down upon performance bottlenecks. In another example, Workday reuses code designed for one industry in another where there are enough similarities for it to make sense. Here's the detail:
This leaves open one important issue. Workday is not offering an open platform upon which developers can build. The logic here is that it does not want to open up its solution in which a way that third parties have to refactor every time Workday makes a code change. I get it but I'm not quite buying it. If developers can cope with DevOps style continuous delivery against platforms like Salesforce and Facebook then why not Workday? That's a discussion for another day.
Into the marketing trenches
Workday has always marketed on the basis of superior technology in the form of its specific SaaS/cloud architecture. This matters to large company CIOs. Bhusri believes this has led the company to a 'golden age' for Workday. Having arrived at this point, Bhusri believes the time is right to start taking the marketing fight to Workday's competitors.
Cynics might argue that this is a reaction to spoilers put out by the competition. Regardless, what better way to kick that particular ball into play than with a bunch of gossipy analysts? It sure got my attention.
To my point, Bhusri was not short on delivering some interesting quotes. Here's my personal selection:
There's demand for getting off SAP systems...We've met with potential customers who'd prefer to leave SAP with the plant floor and move the rest...We're not running this for Wall Street, we're in this for the long run...I'm amazed at the number of implementations that are still running on 25 year old technology.
Fighting talk? You bet and afterwards, I remarked to Bhusri that I was amazed at how aggressive his words appear.
We've probably been too conservative in the past and that's not necessarily a bad thing but I think we need to learn from Marc (Benioff, CEO Salesforce.) His calls are on a different level to most of the others.
I'm not wholly convinced though I give Bhusri credit for speaking out in such a matter of fact manner. In my view, Workday has plenty of other marketing levers it can pull that build upon the technology story without getting snippy with the competition. As always in these things, Bhusri calculates enough steps ahead to provide assurance that he knows how to play the long game.
The road ahead
And when you stand back and look at what tech summit was all about then there you have it in a nutshell. But no analysis would be complete without exploring the things that matter to the CEO beyond the rhetoric. Here Bhusri was more circumspect:
There is definitely a Workday way of doing things and it's vital that even as we grow super fast that we carry everyone with us. I am concerned that we do a better job, especially with the young ones, and so we've put leadership growth plans in place which I expect will help nurture the next generation.
This is good news. Workday has done well by creating an environment of its own that largely grew out of the core team the company hired in from ex-PeopleSoft folk. But there comes a point where every company needs to infuse the values that matter into the business such that those who come next understand what the company stands for. Acting now to put programs in place that help deepen 'the bench' represent the hallmarks of a company that is about to embark on the next phase of its development.
As always, it will be interesting to see how this plays out.
Endnote - for a blow by blow account of the day, check out Holger Mueller's Storify that expands on topics I have not covered in this analysis and which adds additional color to proceedings.
Disclosure: Workday, SAP and Oracle are premier partners at time of writing. Workday covered most of my travel and expense to attend Tech Summit
Images via the author