Oracle rival Workday justifies its growth investments


Kelsey Mason, analyst at TBR, says Workday’s investments in growth are paying off in the form of geographic diversity and strong adoption of Planning, which added 50 new customers in the quarter, and Financial Management. Workday signed Samsung as a customer in Q2 2016, marking the company’s entrance in South Korea, and experienced a record quarter of Europe-based customer additions for Financial Management.

Though Workday remains committed to an organic growth strategy, acquisitions including those of Platfora and Zaption in the second quarter help Workday rapidly match the portfolio functionality of enterprise-focused competitors. While enterprise penetration maintains its strategic importance, Workday has the opportunity to fill gaps in the midmarket that Oracle’s impending acquisition of NetSuite may create. Though lacking a full ERP suite, Workday will drive portfolio-encompassing deals into the midmarket to quickly capture share of wallet and maintain revenue growth in the high-30 percent range.

Workday addresses enterprise demand for more comprehensive in-app analytics with the acquisition of Platfora

As Workday pushes further up market it faces increasing pressure to help customers use their vast amounts of business data in the face of competition from HCM vendors with database strengths such as Oracle and SAP. While Workday Big Data Analytics allows customers to aggregate third-party data from Hadoop and Workday data, it lacked the ability to perform data discovery or analysis on that data. This demand for more comprehensive analysis spurred Workday’s acquisition of Platfora.

Platfora will make Workday’s HCM and Financial Management offerings more attractive to enterprises, as Platfora can analyze data from open-source solutions like Hadoop and Apache Spark. Workday will fold Platfora’s technology into Workday HCM and Workday Financial Management, in turn creating cross-selling opportunities for Workday Big Data Analytics, which has only 40 customers to date.

Platfora’s current solution primarily performs customer behavior analysis; however, Workday will tailor the technology to fit its strengths in human resources (HR) and financials. Customer behavior analysis can easily become employee behavior analysis, enabling HR managers to run risk or advancement analysis on employees. Similarly Workday can tailor Platfora’s capabilities to perform profitability analysis within Financial Management.

Workday Learning will use persona-specific knowledge to provide unique intelligence

As Workday aims to launch Workday learning in 2H16 with the broadest addressable market possible, the company enlists the help of customers to enhance the solution’s functionality. Workday has talked to over 120 people from 16 customer sites to determine enterprises’ unique requirements for their learning management solution. Workday has tailored Workday Learning to appeal to a range of personas including the recent college graduate and the learning leader to recommend content based on the persona’s needs.

In addition to using customer input to enhance functionality, Workday also acquired the online learning company, Zaption. Companies can use Zaption to embed questions in training videos, making videos more engaging for employees. Built-in analytics allow companies to analyze the results, helping HR managers learn more about their employees. Workday will stop providing Zaption as a stand-alone service on Sept. 30, ahead of the launch of Workday Learning.

Kelsey Mason, analyst at TBR

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