Workdays ERP-Like Beta Gets Web 2.0

By Renee Boucher Ferguson  |  Posted 2007-08-21

Workdays ERP-Like Beta Gets Web 2.0


Workdays ERP

-Like Software Gains Financials Beta">Workday, with the beta release Aug. 20 of applications like payables, receivables and general ledger, now offers a more complete suite of ERP-like software that includes Human Capital Management and core finance and accounting software.

Workday, pitched as the "un-ERP" (enterprise resource planning) company that produces ERP-related software, in its latest financial software release has added Web 2.0 tools like tagging to deliver information based on users and events.

Started in March 2005 by PeopleSoft co-founder Dave Duffield, Workday says it expects its approach to ERP software development—model-based development that includes the newer Web 2.0 features—to differentiate it from the groundswell of on-demand software coming or on the market now. Industry analysts say its too soon to tell, but from the looks of it, Workday could be on to something.

Workdays development strategy is based on the idea that by modeling software based on three areas—resources, people and events—rather than credits and journals as found in traditional ERP, the company will be able to provide a different user experience.

Click here to read more about Workdays launch and strategy.

At the same time, by adding functions like business intelligence and GRC (governance, risk and compliance) features natively, it gives users the ability to avoid using data warehousing to pull data out of the system, because it is, theoretically, smart enough to know up front in what ways a salesperson, or a budgeting person or the CEO, needs to know information.

"Were offering something quite different than ERP—its the first system really built for the modern era," said Mark Nittler, vice president of Applications at Workday, based in Walnut Creek, Calif. "Little things like the Internet, like Sarbanes-Oxley, have significantly impacted business and changed business. Except ERP. We are the first company since the world became flat."

According to Nittler, where Workday differs from other ERP companies is their focus on accounting, an approach that omits information about economic events. What Workday wants to do, he said, is redefine the way corporate finances are handled by starting with a set of processes that define much more of what a chief financial officer is interested in, going beyond accounting and quarterly reporting to areas like resource management and revenue management.

Workday says its assumptions are that business is about commerce and the whole business—not just the accounting department—wants good information about the business.

"We want to support employees on the perimeter of the organization—not just the ones that close the books," Nittler said. "The real data is what happens in a business event. Its defining who, what, where, when and why. This is the place where we really break tradition with ERP and change completely the way we identify information in the system."

"Workday talks about definitional services [with which] you can define what you want the software to do using a Visio-like tool," said AMR Research analyst Bruce Richardson. "Its brand-new, so it looks like the right idea."

While Workday has announced the beta of its financial applications, the real story, according to Richardson, is the platform that forms the underpinnings of all Workdays applications.

"The financials applications are built on an event-driven object management system that manages and deploys worktags to ensure optimal reuse of financial and other data based on the data consumer: CFO versus marketing, internal customer versus reseller, and so on," Richardson wrote in an Aug. 17 research note. "The worktags could be by account, campaign, channel, cost center, company, customer, department, facility, group, industry, product, program, project, region, supplier, supervisor, territory or the link. Its a very clever idea that is linked into the model-based software design."

But there is plenty of competition looming on the horizon. While there arent a lot of on-demand ERP contenders aside from NetSuite, SAP is set to release its "A1S" suite Sept. 19, software that is reportedly on-demand and model-driven. Microsoft will release its multitenant CRM (customer relationship management) software later in 2007. While its CRM is not a full ERP suite (yet), Microsoft has been dabbling with role-based development and could turn an eye to on-demand financials and HCM.

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The Dave Factor

Quite different from ERP

The way Workday identifies information in its software is by using the very Web 2.0 concept of tagging, letting different parts of the organization can tag events as they see fit. Workday takes things a step further by building native BI and governance capabilities into the worktags, functionality that provides the tags with agility and control.

The idea, essentially, is that Workday builds its software around events, not processes, with workers as part of the system, according to Nittler. "We can connect workers to events and provide much better controls in the platform," he said.

Regardiing financials, Nittler said the Workday platform covers three areas finance needs: ERP transaction processing, BI and governance, and risk and control.

But, according to Joshua Greenbaum, principal of Enterprise Applications Consulting, Workday is pitching potentially revolutionary ideas to a fairly conservative bunch. "At the end of the day, particularly when it comes to CFOs and controllers, cool technology—even as significant as model-driven [technology]—isnt whats going to sell," Greenbaum said. "It has to be reliable; the kind of thing you bet the company on. Fundamentally, you still have to talk about functionality, and it has to be very, very market-leading to be fundamentally different."

The Dave factor

Its no secret that Workday, as a relative startup with really only an HCM suite under its belt, has received the attention that it has because of its founder, Duffield, the touchy-feely leader of PeopleSoft who started an animal shelter after his retirement in 1999.

Because of Duffields influence, Workday has been able to attract a fairly impressive talent pool: About 80 percent of the companys employees are former PeopleSofters.

"Workday has two things going for it. One is that they [offer the] on-demand idea with ERP. The jurys still out on that; no ones made a real effort," said Paul Greenberg, president of IT research company The 56 Group. "The other thing that distinguishes them is they are PeopleSoft on demand. Thats not a small thing. Dave Duffields reputation has a lot to do with [Workdays] visibility."

While the actual uptick for Workdays software has been slow, according to AMRs Richardson, the company has several high-profile customers displayed prominently on its Web site. Those include, the standard-bearer for on-demand CRM software, and RightNow Technologies, another on-demand company that provides what it refers to as Customer Experience Management software.

Those two customers were not available for comment to the press, according to Workdays public relations department.

While Duffields reputation has carried the company thus far, it remains to be seen if it will be enough to propel the company into the ranks of true competitors with the likes of SAP, Oracle and Microsoft—ERP giants that are each working on their own on-demand initiatives.

"Workday is not a slam-dunk despite their stellar team," Greenbaum said. "With all due respect to Dave Duffield, his last great play was last century. Under Dave Duffield in 1999, PeopleSoft started to drift."

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