The Workday Innovation Summit last week ended with a very nice sit-down dinner. I was intrigued by the Synchronicity Strings Trio playing the violin, viola and cello. Trio? I checked their site, and they offer quartets, duos and solos as well to fit in with the size of the venue and the subtlety you want for the music to not drown out table conversation. I thought it was a fitting recap to a couple of days where it was all about exploring new verticals, new AI use cases, new channels and new geographies – a new sense of flexibility to react to a rapidly changing world. As Doug Robinson, Co-President, (and superb MC for the Summit) put it in a side conversation with me, Workday has been “opening our aperture”. He was too polite to say it, but the goal of the Summit was also to widen the horizons of the analysts in the audience.
Matt Brandt, SVP Global Partners expressed the broader focus in his own poignant way. His military training has disciplined him to present 3 and only 3 bullets on any topic. But he broke with tradition and presented 4 pillars for his vision of the next-gen ecosystem– Connect, Compose, Built on Workday and Embed. I am interviewing him for a Burning Platform episode this week and you will hear more about these definitions.
However, the most change was evident from the commentary by Carl Eschenbach, the new CEO (Aneel Bhusri has moved to the Executive Chairman role). While being respectful of the culture and momentum he has inherited, he talked about how in his 16 months, they have brought in a new CMO, CFO and CIO. They also have new go to market leaders in Europe and APJ and new execs around services, revenue and sales operations. They have also promoted plenty from within including the new Chief Product Officer, Dave Somers. Many CEOs use their first year to do a “world tour” and learn the organization. It is impressive to see how Carl, helped by his years on the Workday board, has hit the ground running.
I was especially impressed by how many young execs led sessions including Athena Karp, CEO of HiredScore, recently acquired by Workday, Shane Luke who presented on their version of LLMs and other AI technology and by Ryan Basilio on outbound integration via its Extend Platform. Not just young, all incredibly smart and articulate.
I heard about countries and verticals I have not heard about in previous Summits – Japan, Federal Government, CPQ and Subscription billing for the services sector and more.
Aneel Bhusri made a cameo appearance and in a q&a contrasted “We had this advantage with the emergence of cloud (computing) and we could wipe the slate clean in terms of starting a company. I think it is different with AI. I think the incumbents, whether its Google or Microsoft or Amazon or Workday, or Salesforce, we have that huge data advantage”
He is absolutely right, even machines at large vendors like SAP and Oracle cannot be trained by the majority of their customer data since it is locked up in their on-prem applications in data centers they cannot access. However, most of the data of the cloud vendors applies to the SG&A portion of a customer’s P&L – accounting, hcm, procurement, call center data. There is a much bigger and higher payback opportunity with COGS and Revenue line items but that operational and customer data is unique to industries and countries. The best way to access that data is to build transaction processing capabilities which generate that data.
Which is why I hope Workday continues to recruit unique domain expertise and build applications which reflect vertical depth and unique localizations for countries. There was talk during the Summit about becoming a “Platform company”. A platform is essential for customer and partner extensions but Workday’s key differentiators are that it is respected as an application vendor (you won’t believe how many customers over the years have told me they wished Workday would extend applications to their industry or country). And one which is culturally fun and easy to work with. It would be a shame to lose those unique advantages.
Fortuitously, the application competition is currently weak or distracted by the AI noise and not building modern transaction capability. SAP has formidable vertical and global strengths but the majority of their management focus in on preserving their ERP franchise - moving the ECC customer base to S/4HANA. Oracle is fixated on moving up the hyperscaler ladder away from its distant positioning behind AWS, Azure, Alibaba and Google. Besides, it spent tens of billions on Retek, Primavera and many other vertical plays earlier in the century and more recently with Cerner but those reflect business processes from a different generation of corporations. It had an opportunity to localize NetSuite for so many emerging countries and has not done so. Infor verticals still position Baan, Lawson and Intentia functionality it acquired – again decades-old processes. Salesforce has plenty of application assets but they compete for management attention needed to yield better from the nearly $50 billion it spent on tools like Slack, Tableau and Mulesoft. Lots of vendors talk about being focused on the services economy but when you ask them about the exciting trend of “servitization” – post-sales monitoring, maintenance and outcome based subscription contracts in aviation, mining, shipping and many other asset intensive sectors – they will beg off “ we are not into manufacturing”. Manufacturing? They would have to invest in digital twins, IoT, field service, more sophisticated CPQ and other functionality but that would additionally make them more competitive in their incumbent markets.
Workday has a massive opportunity to bring contemporary functionality and architecture to so many markets. A couple of times, Carl hedged and said their biggest challenge is prioritization. He is right, of course, but many of these markets are attracting new players like Zoho which could end up with a huge headstart. The risk is Workday will continue with its core finance and HCM focus in primarily English-speaking counties and try and merely “spray paint” vertical and country localizations.
Which brings me to us analysts also widening our horizons. We have to accept part of the blame that after 25 years of cloud applications, 75% of the country/industry grid is blank when it comes to cloud application choice (and as a result we have shockingly limited AI trainable data in the enterprise compared to the consumer web). Paul Greenberg recently interviewed me about how analysts should also be evolving with changing markets. Watch our conversation here. Unfortunately, we are still imprisoned in market categories like ERP and CRM we helped define at Gartner in the 90s and ossified tools like Magic Quadrants and Waves. We should be leading vendors and customers into edge applications, high-growth economies and high-impact AI use cases.
Rapidly and dramatically.
Talking of analysts, he is not considered one, but I want to call out “Silent James” who calls himself a “visual notetaker”. He created 8 session illustrations during the Summit. It is fascinating how he listens, synthesizes, then colorfully and real-time summarizes key themes from each session – “your ideas become productive art”. As Paul and I had discussed, modern analysts create plenty of video and social media content, we advise, we write blogs and books. We are a far cry from how my content was delivered as a Gartner analyst. Yet, few of us have James’ unique skills. We need to keep evolving, not just in the markets we define but also in how we present our perspectives to the market.
Net-net – the time is opportune for Workday to spread its wings. It has an enviable choice of new markets to develop. It is truly an exciting time for Carl and the Workday family.
Time to “unleash the beast”
