Workday COO Mike Stankey claims his firm has a three- to five-year tech lead on Oracle and SAP because the cloud is "more than a destination and a pricing model."
Workday reported yet another double-digit gain late Wednesday, with a 74% year-over-year increase for the company's second quarter ended July 31. It also beat Wall Street estimates and raised its forecasts yet again.
Mind you, the eight-year-old, cloud-based human capital management (HCM) and financials app vendor expects to reach $760 million in revenue this year. That's a tiny fraction of the size of Oracle and SAP, but that hasn't stopped these larger rivals from calling out wins against Workday. Oracle CEO Larry Ellison even cited Workday, along with Salesforce.com, as one of the "modern" cloud apps companies his company is competing against.
Workday COO Mike Stankey doesn't mind the attention. "I thank them for every mention, because each time we get called out, our website traffic goes up," he told InformationWeek during a one-on-one interview last week in New York.
Stankey came to Workday five years ago from venture capital firm Greylock Partners (where he and now Workday CEO and co-founder Aneel Bhusri were both partners). Previously Stankey was chairman and CEO of PolyServe, a storage virtualization firm sold to HP in 2007. And for nine years, Stankey worked for PeopleSoft, the company co-founded by Workday chairman and co-founder Dave Duffield.
Stankey is clearly an insider, and the word from the company is that he's going to take on a more visible role as a company leader. He's certainly not shy about making Workday's case. Read on to hear his confident reasoning as to why Fortune 500 companies will soon be choosing Workday financials as well as Workday HCM.
InformationWeek: What's your role at Workday, and how does that differ from CEO Aneel Bhusri's?
Mike Stankey: I help the teams that acquire customers and make them happy. Aneel is the smart, flashy product and company strategist, and he deserves all of the credit that he receives. I try to work in the background, lead operations, and make this stuff come true.
IW: One of Workday's emerging stories is Workday Financials, which is supposed to follow in the footsteps of the HCM app and start serving Fortune-500-plus companies. How's progress?
Stankey: We've exceeded the performance goals we laid out, and we now have our first, official Fortune 500 Financials customer in UNUM [the insurance and benefits management firm]. We also have Cushman & Wakefield [real estate management], which is a private company based here in New York, but one at large scale. Other large public companies that are in production using Workday Financials to close their books include Netflix and Lifetime Fitness, both of which are multibillion-dollar companies.
These are proof points that the market has been waiting for, and the product continues to advance in terms of scalability, functionality, and, as importantly, localization as required by large companies operating in different countries.
IW: Are there new performance goals, given that you've surpassed the old ones?
Stankey: We just keep stretching it. We're going for larger and larger organizations, and the functionality for financials tends to be added for new industry directions. Banks, for example, you need average daily balance. Healthcare organizations require intricacies around inventory management, lot traceability, and controlled substance tracking.
We're building all of that out as we go to penetrate these industries. We previously addressed people-intensive industries including software and technology, education and government, and business services, and we're adding the banking functionality with Workday 23, which we'll announce in early September.
IW: Workday is getting attention from Oracle and SAP these days, and they're always quick to point out that you're not as strong outside of North America. How quickly are you closing that gap?
Stankey: We're still 90% or more US, but we're gaining rapidly now in Europe and Asia. The only reason they talk about us is that they're worried about us and we're starting to beat them. That has happened with increasing frequency in Europe. We've announced Philips Electronics, which has 125,000 employees, as an in-production customer for Workday HCM, and we're running there alongside SAP, which runs their supply chain.
We also have Primark, with 45,000 employees, out of Ireland; Sanofi, the French pharmaceutical company with 120,000 employees; and GlaxoSmithKline, out of the UK. These are all in-production Workday HCM customers that are running SAP or Oracle in other parts of their businesses, so those vendors are worried about us. Our Financials application will mature first in the US, but we're entering the UK, The Netherlands, and Australia, and then we'll expand into other countries.
IW: According to Oracle and SAP, they're constantly beating Workday in competitive deals. Are they slowing you down now that they've shifted so much attention to the cloud?
Stankey: It's tough to compete with claims. You have to compete with products and successful customers. I can go across almost any industry and point to successful customers running our products at scale with a very broad footprint. What are usually claimed by Oracle and SAP are fragments of a
Doug Henschen is Executive Editor of InformationWeek, where he covers the intersection of enterprise applications with information management, business intelligence, big data and analytics. He previously served as editor in chief of Intelligent Enterprise, editor in chief of ... View Full Bio
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