Workday was one of the most eagerly awaited Silicon Valley initial public offerings – and in the wake of the controversy following Facebook’s flotation, a lot of attention was paid to the fate of its stock on the first day of trading.
In the event, the Software-as-a-Service provider of human capital management applications saw the value of its stock soar, jumping 72% from an initial price of $28 per share.
“HR is still the main business,” Swete explains when asked about the company’s growing presence in the finance market. “The original plan was to build out through HCM into financials, but the speed at which HR took off means that we moved more quickly into selling payroll in the US and Canada.”
The aim is to “make a real go” of selling its financial applications to large public companies with about 10,000 users – and even as many as 40,000, he says.
Outside of the US and Canada, however, it is unclear when the supplier’s payroll offerings will appear, although apparently conversations are “on-going”. “Our attitude is that we will build our payroll into other locales when appropriate and we do integration into local payroll providers for now,” Swete says.
But HCM remains front and centre for the company and Workday continues to rattle incumbent providers SAP and Oracle.
“We’d like to claim to be the most brilliant company and predicting the wave, but really the timing just worked out,” says Swete about being on the front line of the conflict. “Attitudes have shifted and SaaS has become an acceptable option for HCM, to the extent that it’s now the leading option. You have to thanks the likes of Salesforce.com for pioneering with SaaS and enabling us to point to the scale of SaaS implementations.”
Nonetheless, it’s worth noting that Salesforce.com has made a number of incursions into Workday’s territory of late with its Work.com offering, although Swete attests that the two are coming at HR from different angles.
Swete also points out that the average HR director has been less than enthusiastic about their HR systems in the past. “HRDs are not so much focused on the technology as on the product that we are able to put in front of them,” he argues. “What they value the most is access to more information globally.”
A key problem to date has been that HR systems are often implemented locally, which means that global or distributed organisations are unable to obtain an overall view of their business.
As to what HR directors are looking for right now, he believes that top of the list is analytics functionality built into their applications in order to make information more meaningful. But there is also a lot of interest in how best to employ mobile devices, and tablets in particular, as well as in social networking.
Of course, the HCM front line has also seen increased competition from its key incumbents, with SAP buying SuccessFactors and Oracle adding Taleo to its Fusion HCM range. But Swete insists that the sector has benefited from the increased interest generated by Oracle and SAP’s move into the space.
Instead Swete believes that cloud-based conversations need to start focusing on business value rather than “whether it’s a box with an X on it”.
With Oracle’s Fusion HCM offerings, meanwhile, “it seems like there are a lot of early deals that are going with a hosted option”, which may or may not be a true cloud offering. As to how customers take to it will depend on whether they want to “receive frequent updates or whether it’s still the traditional year-on-year release cycle”, Swete claims.
So now that Workday has finally gone public and both Oracle and SAP place more and more sales and marketing effort behind their offerings, it seems that the sector is only set to heat up even further.