What’s in a name? Many businesses still associate Workday almost exclusively with human resources software, but the cloud software company is slowly winning converts in finance, living up to the second part of its mission statement.
More than 135 companies have now signed up for its financial management applications, according to a senior executive. At least 50 are up and running. Wins include media disruptor Netflix, travel site TripAdvisor, commercial real estate manager Cushman & Wakefield, and health-club chain Life Time Fitness.
Most of these accounts already use Workday’s payroll and human capital management systems, and hope to drive even more operational efficiency by connecting them. Life Time Fitness, as an example, shaved at least two days off the company’s monthly close, said John Hugo, senior vice president and corporate controller. “The efficiency is really coming into play,” he said.
According to Workday, businesses that use its financial software together with its HR and payroll management applications are speeding quarterly and annual closes an average of 20% to 25%. They also report tighter supplier management efficiencies: reducing operational expenses for this area an average of 1% to 2%.
“It’s always about talent and cost, connected with how much revenue a person can drive,” said Mike Stankey, Workday’s president and COO, told Fortune. “Our strength at Workday is unifying that picture, so people can get an answer with real-time data across all three of those areas.”
For perspective, Workday’s total customer count is 925 companies. It has a big upselling job ahead.
For the past three years, however, its satisfaction rate has been 97%, which explains its ability to poach marquee Oracle accounts like ING Bank Netherlands. “We put a heavy emphasis on building long-term relationships. … Our customers need to renew with us to make our business model work,” Stankey said.
For its fiscal year ended Jan. 31, 2015, Workday recorded revenue of almost $790 million, up about 65% from the prior year. Its operating loss was $215.7 million. That translated into a net loss of $1.35 per basic and diluted share.
“In the year ahead, we will focus on strategic initiatives including continued investment in our financial management product, growth of our presence in the education and government industries, and expansion of the business globally,” said Workday co-founder and CEO Aneel Bhusri, commenting on the results.
Indeed, as part of its update for investors, Workday revealed it appointed former PeopleSoft co-president Phil Wilmington (most recently at cloud financial software company Tidemark) to build its sales presence in fast-growing markets such as Germany and Japan. You’ll also hear Workday talk up its success among manufacturers and materials-intensive businesses. High-profile references already include Flextronics, Hewlett-Packard, Philips Electronics, and Unilever.
“Even a manufacturing is spending 30% to 50% [of all expenses] on people,” Stankey said. “There hasn’t been as much science and discipline applied to the optimization of the human capital supply chain. So, large-sized organizations and medium-sized organizations are now changing their spend, their investment in IT for the optimization of people. We’ve benefitted from that greatly.”
In early April, Workday delivered two new products with widespread appeal.
The first, a predictive analytics dashboard called Workday Talent Insights, identifies which employees are underperforming or, conversely, which top performers might present retention risks.
“If I can predict with a high level of certainty who might leave and, as importantly, if I can prescribe actions to keep them in place, suddenly I have a very valuable piece of insight that I can offer my customers,” Stankey said.
The other offering, Workday PSA (Professional Services Automation) is meant to help managers make more informed decisions about which employees to assign to certain projects. That could be based on everything from geographic location to skills and hourly billing rates to how effectively someone has worked with other members of the team in the past. Alternatively, the application could alert qualified employees about potential new roles—another twist on retention.
“If you know, as an employee, that you might have interesting opportunities, you might be more inclined to stay with a company,” Stankey said.
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