Workday co-president Phil Wilmington decried the trend among enterprise cloud companies touting customer wins without revealing the details behind the deals or whether another rival platform was really uprooted.
Simply put: When gauging cloud customer wins, the details are becoming increasingly important.
"The industry needs to change its focus on who's going live, who's actually using the application and reference-ability," said Wilmington, who also noted that it can be unclear whether a company is using a cloud app or merely being hosted.
In an interview with ZDNet, Wilmington covered a lot of turf, but the customer win wars is perhaps the biggest one. "The focus needs to be on what exactly is going on, how far reaching is the deployment and what's the impact of the business," said Wilmington.
The topic is close to home for Wilmington, given that Oracle on its most recent conference call touted nine wins against Workday. The companies mentioned were Arcadis, Molina Healthcare, CIMIC, Fannie Mae, Genesys, MoneyGram International, Southwestern Energy, BrightSource and California Physicians.
Via JMP Securities analyst Patrick Walravens, Molina Healthcare said it never migrated off of Workday. Instead, Molina migrated Oracle's JD Edwards HCM platform to Fusion HCM. Is that a win? It depends. Workday wasn't uprooted and Oracle kept a customer. "Is a Taleo renewal a cloud win?" asked Wilmington. "We don't count an upgrade or renewal as a win."
Wilmington pointed out that the nine companies mentioned on Oracle's earnings call were all situations where Workday wasn't installed or swapped out for Oracle. The projects lost internal sponsorship via new financing, turnover or other corporate developments. "No one left because there was a switch from Workday on the basis of the product," said Wilmington.
The Oracle comments in question landed via CEO Mark Hurd on March 15. He said:
There's Southwestern Energy. They had Workday and stopped their Workday implementation and now use Oracle. Fannie Mae used Workday, no longer does, and now use Oracle. Arcadis, they used Workday in the US. They went to a global decision for HR, decided on Oracle, and replaced their Workday implementation in the US. MoneyGram started off implementing
Workday, it didn't go well, reevaluated, and now have Oracle HCM cloud as their core HR for their enterprise.
Same thing's true at Molina Healthcare. One of the first implementations at Workday, I think, that was in Asia-Pacific was at CIMIC in Australia. They now stopped their Workday implementation, removed it, and installed Oracle HCM.
Genesys, who is a technology provider here in the Valley, they implemented Workday, stopped, threw it out, and are implementing Oracle HCM. BrightSource switched to Oracle upon a renewal opportunity for HCM with Workday. California Physicians. Safra is giving me the stop.
But, listen, I get all this stuff, I hear all this rhetoric and I'm just trying to give you -- these are real companies that said we're going to stop and we're going to go implement Oracle HCM. That's what I see going in the market. And that's why I continue to read off brand names so we can get away from words and rhetoric and get down to what's really happening.
Surely, the pissing match between Workday and Oracle makes a good story. But there are larger points to ponder. Here's my take:
- The cloud is maturing as is the vendor landscape. As a result, most enterprises are going to have multiple cloud providers.
- Vendors will continue to tout wins without highlighting the asterisks. It's worth noting that Google's Cloud Platform enterprise wins unveiled last week also kept Amazon Web Services in the fold.
- Customers are increasingly more savvy about their purchases.
- Ultimately, there needs to be a little more transparency on customer win claims. In the near future, it will be increasingly commonplace to have an enterprise with cloud services from Oracle, Workday, Salesforce, Google and Amazon Web Services (possibly more). Are all those vendors going to position those customers as zero sum wins?
One of Workday's favorite terms is reference-ability. In other words, customers should be able to provide real details and outline how the implementation and total cost of ownership went. That take from Wilmington makes a ton of sense, but it's going to be tricky to get customers to publicly outline details to competitors in the field.
The good news is that the cloud deployment model has matured so these multiple wins simply illustrate how APIs have made the cloud a team sport. "Workday HR and financials will share data with ServiceNow and certainly Salesforce and on-premises applications from SAP," explained Workday. "There will be customer overlap. My recommendation is to focus on the references and focus on what exactly is going on."
Among other topics covered in my interview with Wilmington:
Does the suite always win? Wilmington said the cloud is going to be a suite light environment. Obviously, Workday thinks HCM and financials tied together with one analytics stack and set of code is a winner, said Wilmington. "There is power in the suite, but every application will have to be evaluated against the best in class," said Wilmington. "I don't think every company will look for one vendor to build everything under the sun, but it will look for natural fits. Companies will look for logical groupings for suites."
Can Workday break into manufacturing customers? Workday was built on the idea that it could become the ERP leader for service-related companies. But executives did note that manufacturing companies could be coming into the pipeline. Wilmington said more companies are coming to Workday as a front end for financials and HCM and then connecting to manufacturing and supply chain systems on the back end. "We're seeing interest and you'll hear more in the next couple of quarters," he said.
The ecosystem. As Workday expands into financials, the role of integrators as a partner channel will continue to be important. About 75 percent to 80 percent of Workday implementations are handled by partners, but the company has an engagement manager to track and ensure quality for deployments. "These implementations will never solely be on PwC or Deloitte because they will always be about the Workday reputation. Our company is responsible for how it goes and we tailor the way the systems integrator should work," said Wilmington.
Customers are savvy buyers now. Wilmington said the cloud conversations with prospective customers revolves around total cost of ownership. That reality shows how the cloud has matured. "There is a focus on the details of ROI and customers want to see the product today," said Wilmington. "Slideware doesn't sell well in this industry and customers don't want to talk about where the cloud is going, but where it is today."
The midmarket. The midmarket is one area where the suite can work well. Wilmington said it's hard to define the midmarket, but generally speaking these enterprises want one platform and user experience. Workday competes with NetSuite and Ultimate in the midmarket. "Smaller doesn't mean less sophisticated," said Wilmington.