Road Report: Workday Innovation Summit 2024

Last week was Workday’s annual Innovation Summit, held at the lovely Cavallo Lodge, just north of the Golden Gate Bridge. This is an opportunity for Workday to gather HCM and Financial tech analysts to share their perspectives on how they are innovating and to get feedback from analysts on their direction.

Below is an excerpt of our full article, which was published to our free membership community. To read the full article, join here.

?These are my takeaways from this year’s event (plus a review of their FY24 results):

Leadership changes resulting in real changes. CEO?Carl Eschenbach?is now fully at the helm of Workday, with Aneel Bhusri serving as Executive Chair and focusing on product innovation. They also have a new CIO, new CFO, and new CMO, along with some other new faces. Some of the changes Eschenbach hinted at last year have already come to fruition, such as innovating on their go-to-market approach (see more below), simplifying packaging and pricing (especially for SMBs), focusing more on CIO relationships, and diving deep on specific industries. Eschenbach is also focused heavily on international growth, specifically in EMEA, APAC, and Japan.

Continued growth, but not as fast as before. A few years ago, former CEO Bhusri set a goal of 20% YOY growth until Workday hit $10 billion in revenue. In last year’s article, I mentioned some challenges that could make it difficult to hit this growth number this year, and it appears at least some of them turned into reality as Workday didn’t make 20%. Total FY24 revenues were $7.3 billion, 17% up from FY23 (and a totally respectable growth rate). Subscription revenues were $6.6 billion, an increase of 19% YOY. That said, the total subscription revenue backlog was $20.9 billion, a 27% increase YOY, pointing to a potentially stronger year ahead.

New strategy: Workday as a platform. Collaboration outside of its 4 walls has not necessarily been Workday’s strong suit in the past. With Eschenbach’s leadership, the company is going through a significant go-to-market evolution, largely centered on Workday becoming a platform that others can “build, grow, and deliver” on. That means a much larger partner ecosystem, including building products with partners and building more via Workday Extend. Importantly, this also includes a realistic public and government cloud strategy – something many have been waiting on.?

Trust and responsible AI as differentiators: Throughout the event, the Workday team spent a lot of time telling us how trust is their biggest differentiator with customers and how that impacts their approach to generative AI (GAI). While it is easy to look at this approach with skepticism (and I generally do), Workday shared how they are tackling developing responsible AI through the lenses of principles, practices, people, and policy. Workday commented several times that they see their new HiredScore acquisition aligning with this approach. The team is also careful regarding their GAI investments, focusing on delivering high-value capabilities to customers.

?To read the full article in our free membership community, join here. If you are already a member, you can access the article here.

**********

Disclaimer: Workday is a member of our RedThread Research Tech Consortium, which is a group of 30+ HR Tech vendors that financially support our ability to provide high-quality, unbiased research. We also provide them with speaking and advisory services and report licensing via that relationship. For this event, my travel and expenses were paid by Workday; I received no other meaningful compensation. I was not paid to write up this Road Report summary, which I do for the benefit of our RedThread members. RedThread has no other financial connections with Workday. Workday representatives were allowed to review this document for factual accuracy and to make suggestions and clarifications, but they did not have any final reviewer permissions.