Workday CEO outlines plans to take on ERP giants, Oracle and SAP

Workday CEO outlines plans to take on ERP giants, Oracle and SAP

Expanded product offering and acquisition of Adaptive Insights key

Aneel Bhusri (Workday)

Aneel Bhusri (Workday)

Credit: Workday

Workday is transitioning from an HR and business finance software suite into a full enterprise resource planning (ERP) platform as it aims to compete with industry heavyweights Oracle and SAP.

The cloud SaaS vendor hopes that its recent acquisition of Adaptive Insights will help bolster its growing portfolio of enterprise applications by adding business planning to its suite of HR, financials, procurement and expenses capabilities.

At the annual Workday Rising conference in Vienna, Aneel Bhusri, Workday's co-founder and CEO, explained how this makes them a threat to the established ERP vendors.

"It will play a critical role," he said. "If I had to do it all over again, frankly, Workday would have gone into planning before it went into the core financial ERP applications, because the CFO's office today is going through the transition from on-premise to cloud for planning first in many cases and the transactional piece second.

"What it allows us to do is if a company is not ready to move to the ERP in the cloud, but they've moved HR, they've moved planning, we're very well positioned to be that ERP solution when they decide to move, so planning is absolutely critical.

"Every company starts their year and starts their cycle with planning. It's at the core of everything and it's actually becoming more important over time. It really positions us well to win the rest of the ERP business once we're a planning vendor," he said.

Adapting plans

Adaptive Insights had planned to go public before Workday swooped in to buy the cloud-based analytics, planning and collaboration company for $1.55 billion two days before its scheduled IPO.

When the acquisition was announced in June, Petros Dermetzis, Workday's chief product officer claimed in a blogpost that the acquisition would "fast-track our financial planning roadmap by two-plus years, delivering customers new, advanced modelling capabilities and more, powered by the Adaptive Insights Business Planning Cloud."

Workday will now replace its existing Workday Planning product with the Adaptive Insights Business Planning Cloud, while continuing to support existing customers, Bhusri explained.

"While Workday had recognised that planning was the key component of our overall enterprise solution, we came to the conclusion that our own offering was two-to-three years behind the leaders in the marketplace, companies such as Adaptive," he said.

"Over time we'll weave Adaptive into the core platform like everything else that we have. One security model, one user experience and that power of one philosophy that works so well for our customers."

Bhusri - who was a senior vice president at PeopleSoft before it was acquired by Oracle - and Bogan are two old friends and emphasised that trust and a shared cultural focus on the customer during their keynote address.

They were also both born in the cloud, which Workday believes gives it an advantage over its competitors Oracle and SAP, who are making the move while dealing with a vast legacy estate.

"Workday and Adaptive Insights came together to give you a world class planning capability," said Bogan. "Like Workday, Adaptive Insights is cloud-native and we share the vision that cloud will transform the way we consume and deliver business applications."

Workday had also once been interested in acquiring the planning software vendor Anaplan, which recently went public, with Bhusri telling Computerworld UK in 2016 that: "Candidly, they have never been a great partner and we ended up getting into the space because we could not make a partnership with them and others work.”

Gaining faith

The market leaders will be tough to topple but Workday believes its expanded product offering and strong reputation with customers give it a good shot.

Workday built its reputation on its HR applications and the expansion means it has to prove it is capable of also delivering market-leading financial applications.

The addition of Adaptive Insight's performance-based financing capabilities could help convince customers that Workday could provide a full ERP suite.

Adaptive Insights was cofounded by a financial services veteran with an economics degree from Stanford in Rob Hull, who came up with the idea after experiencing his own frustrations as a CFO looking for a software-as-a-service product that could help with the financial planning process.

Despite these credentials, some customers may need further convincing.

Nigel Rogers, the global head of HR systems at FTSE 100 investment company Standard Life Aberdeen, told Computerworld UK that while he welcomed the addition of Adaptive Insights’ capabilities, he had some concerns that Workday could forget what has made it a success.

"I would rather Workday concentrated on getting the standard HR functionality that we use into the best possible state, rather than going off to do something else," he said.

"Even Workday Finance was something I hadn't anticipated when we bought the product. In terms of ERP, I know Workday are talking about the large datasets and perhaps replacing business intelligence software.

"Maybe that's appropriate for their huge customers but for the vast majority of Workday's customers at the medium and small end it’s not something that I think will ever be very important for us."

Workday Finance trajectory

Workday's previous record for expanding into new software will make it optimistic about its current plans. The Workday Financial Management product that was launched in 2007 has been steadily gaining traction.

A growing number of multinational giants including insurance broker Aon are deploying the application to increase financial data transparency for all accounting and reporting needs of the global business. Bhusri said that the financial and planning aspects of the business are now growing faster than the HR customer base.

He will also hope to build a growing body of evidence of successful deployments, although customers are often reluctant to speak publicly about their vendor relationships.

It was therefore no surprise to see Workday tout the successful transition of European intercity bus company Flixmobility from the Oracle Fusion human capital management (HCM) system to Workday earlier this year.

Kerstin Rothermel, vice president, human resources, said the company made the move after searching for a "flexible, agile, and state-of-the-art HR system. After going live on Workday in record time, we’re already seeing that self-service is reducing admin time for our HR staff so they can focus on their core business.

"All employees gain an intuitive user experience that does not require training, so they can request holidays, submit an expense report, or do their time-tracking without support."

Workday will hope similar success stories from its ERP customers will convince others to follow suit.

Cultural competition

On the conference stage in Vienna, Workday also announced that it customers are now running its suite of applications in the public cloud for the first time on Amazon Web Services, a recent target for the bile of Oracle co-founder Larry Ellison.

They now have their first companies live in North America and will also make it available to customers in Germany next year, with further regions to follow based on customer demand.

"Workday is fully committed to driving scale, high availability, flexibility, and an amazing cloud ERP platform for all of our customers – both on AWS and in our own data centres – for the long term," said David Clarke, Workday's senior vice president of technology development.

Oracle has publicly dismissed the challenge on its website by emphasising the breadth of its cloud services and its advantage in multi-layer cloud security, embedded social collaboration and flexible cloud, but the public comparison acknowledges that there’s competition.

The focus on employees is another way in which Workday wants to distinguish itself from Oracle.

Bushri called this the company's foremost value and can point to Workday's top spot on the Great Place to Work (GPTW) Institute's list of the best workplaces in the UK to back up his claim.

"We like to have fun," he said. "If you don't want to have fun, go work for our competitors."

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