Workday begins its work day

PeopleSoft founder Dave Duffield and team officially unwrapped his new company Workday's strategy and first product this morning. Duffield called his company's Enterprise Business Services a new breed of on-demand ERP solutions.
Written by Dan Farber, Inactive

PeopleSoft founder Dave Duffield and team officially unwrapped his new company Workday's strategy and first product this morning. Duffield called his company's Enterprise Business Services a new breed of on-demand ERP solutions.

During the conference call, according to Aneel Bhusri, co-founder of Workday and a long time cohort of Duffield, described what will makes Workday a new breed:

The old breed according to Workday

Designed for business processes of the 1980s and 1990
Difficult to change      
Built for back office/administrative use
Transaction driven      
Focused on legal and compliance tasks    
Built for a single enterprise
Costly to implement, customize, maintain, and upgrade
Choked by lengthy implementations and re-implementation
Difficult to get data in or out
Expanded globally as an afterthought
Legacy systems wrapped with new technology

The new breed according to Workday  

Designed for how business works today
Easy to change as your business changes
Built for the business user
Event driven
Focused on goals and plans
Built for networked, global business
A quick time to value
Simple to use, easy to integrate
Global at the core
Built natively with modern technology

The new breed described above sounds similar to what every other on demand software company, at least from a marketing pitch, claims to be doing, drinking from the chalice of multi-tenant, SOA, Web 2.0, ESB, event driven, etc. 

Bhusri also said that his company won't run into Oracle and SAP in deals in the next 12 to 18 months, but down the road a few years they will compete. He sized up the scenario of going head to head with Oracle and SAP as a "competition of the long-in-the-tooth ERP with new approach we have taken."

It seems a bit naive or bold, especially coming from the PeopleSoft alumni who are running Workday, to think that the long-in-the-tooth ERP vendors cannot deliver similar capabilities. It will be up to Workday to prove that starting with a more modern foundation and no legacy, other than integration with the billions of dollars of legacy of software installed globally in corporations, is a serious competitive advantage. Given the success of salesforce.com, the poster child of on demand upstarts, Workday has a shot becoming an ERP disruptor in a higher end market space than NetSuite.

The first product from the Workday is Human Capital Management, targeting the upper-mid market. The subscription pricing model will per-employee based, and will be announced in January after finishing work with early customers, Bhursi said. Additional products, Financial Management, Resource Management and Revenue Management, will be rolled out beginning in 2007. Currently Workday has 65 employees, including 40 engineers, and is financed primarily by Duffield. At launch, Workday has five customers. 

Three design principles--agility, ease of use and ease of integration--pervade Workday's software, Bhusri said. The application looks more like a consumer Internet site than a traditional ERP application, includes native reporting and analytics and has liberal doses of Web 2.0 technologies such as AJAX, Flex and search, he explained. In addition, Workday is working on integration with Microsoft Office and teaming up with Accenture.

Underneath, Workday has an object management service, user interface server and an enterprise service bus, licensed from Cape Clear, for integrating third-party components. Business services are the core objects, such as organizations and people, and the key business events that happen to those objects, said Stan Swete, Workdday vice pesident of products & technology and a former PeopleSoft executive. "Developer create classes with relationships and methods, and it encapsulates all the objects and data," Swete said. The object model is filled out definitionally in forms, with no coding required. The business services are separate from the object management service, so the user interface can be changed without affecting the business process. "This development approach has way fewer moving peices than the previous generation," Swete said. 

Duffield addressed the question of whether Workday was a reincarnation of PeopleSoft. He said, "Yes and no. It's a brand new set of technologies and technology standards and we will preserve the world class work environment for which PeopleSoft was known."

Enterprise Irregular and investor Jason Wood offer his assessment of Workday's rollout:

I would've liked to see less focus on the buzz jargon that dominates the software industry today and more on how the Workday service offering will fundamentally reshape the way workers live their daily lives. Based on the demo, does it really look like something every individual employee is going to a) feel comfortable using and b) be allowed to use? It's cool that someone can go in and do a reorg of their organization, but why would any $500M-$1B company allow that beyond mid-management level? I would've liked to see more of the demo focus on what Joe Employee's processes are like and how Workday improves them, versus the demo we saw which was in the role of a COO reorganizing his workforce; something not unlike what he would be tasked with in current conventional HR ERP modalities. One thing Dave and Aneel bring is that PeopleSoft rolodex and passion. A lot of people in the software world want a place they can love working for, and getting Workday into the ecosystem will do that. I can't imagine they'll have any trouble staffing for a long time to come. :)  All-in-all I think there are a lot more questions than answers after that presentation, which is to be expected given the nature of the one-hour setup. 

Another Irregular, Thomas Otter, who is chief business solution architect at SAP, gives his personal view with an at least perceived bias in tow. "The combination of a stronger SAP offering with erp2005 and the SaaS guys like SuccessFactors and Authoria mean that this is not the wide open prairies of 1996. There will be considerable mileage in the 'Dave' brand, but I can't help thinking it won't be enough."

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