Workday Rising — Building From the Inside Out

This is the second in a three-part post on Workday. In this installment, I'll begin to discuss and analyze Workdays' current procurement capabilities as well as highlight some themes that differentiate their overall procurement philosophy from their legacy ERP brethren. Look for additional detail and commentary in the final post in this series next week.

When it comes to approaching corporate procurement automation, Workday has given quite a bit of thought to how employees actually need to interact with a procurement system. In fact, I'd argue, the application at this stage is built more around the actual user than it is built around the procurement/sourcing organization. This has both positives and negatives. On the positive side, the overall workflow and requisitioning process appears quite straightforward (though it lacks some of the functional depth of others such as the ability to easily tap into a supplier network at this stage or search for items via a tag-cloud concept like Coupa). Still, Workday knows where it needs to go, and is quickly adding capabilities like punch-out -- and I suspect they'll develop multiple answers around supplier enablement and tapping into supplier networks as well.

On the negative side at this stage, the application puts greater emphasis on the worker herself rather than procurement's ability to tightly control and monitor a closed-loop spending process -- one that starts with up-front spend capture, analysis and negotiation and then progresses to supplier enablement, catalog management, requisitioning, invoicing (and the broader concept of electronic invoice presentment and payment) and finally contract management and contract compliance. They'll get there, but right now the only real core functionality that exists is smack in the middle of the process (except for some limited downstream collaboration, compliance and invoicing capabilities). However, starting from the core and building out is often easier than starting at either extreme. Workday will get there. How quickly? I reckon they'll surpass the capabilities of Peoplesoft release 9.0 (and potentially 9.1) sometime in 2009, maybe sooner.

PeopleSoft, by the way, is the fair comparison here. At this point, Workday does not appear to be gunning for the Oracle iProcurements and SAP SRMs of the world from a full operational and shop-floor level procurement perspective. And like PeopleSoft, Workday has invested quite a bit in the services procurement area already. The current release, for example, provides roughly half to two-thirds of what best-of-breed providers such as Click, Fieldglass and IQNavigator offer today. In this regard, Workday allows for the tracking of contract workers (based on hours and rates) and the ability to consume (receive) deliverables based on timesheets. It also lets companies track milestone-based agreements, not to mention providing services-specific sourcing and requisitioning workflow and capabilities. All in all, pretty impressive for a first services procurement release, but looking at who built it, we should not be surprised.

- Jason Busch

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