SAP Watch

May 22 2008   11:20AM GMT

Workday’s HCM deals: Some thoughts

JackDanahy Jack Danahy Profile: JackDanahy

The IT industry is abuzz with talk of Workday’s recent Software as a Service (SaaS) deals at Chiquita and Flextronics. While I’m glad that Workday is having its day in the sun — after all, I have Workday founder Dave Duffield to thank for Cornell’s Duffield Hall, where I passed many pleasant hours — I’m uneasy about these deals for a number of reasons.

The market has gotten hold of the idea that Chiquita bought 25,000 subscriptions, and Flextronics bought 200,000. This notion has spread through the IT media and brought Workday accolades for signing the biggest SaaS deals in history. Workday itself doesn’t manifestly make these claims (in Chiquita’s case, Workday merely said that it was implementing human capital management applications “across the organization”), but hasn’t done anything to clarify the situation either. Claiming that Workday will be used “for” 200,000 employees, as many news organizations have done, is a dereliction of journalistic responsibility, because that “for” can be fudged to mean that Human Capital Management (HCM) addresses the needs of 200,000 employees. However, what the market is more interested in is the number of actual end users.

I’ve always thought that HCM is at least as important as Customer Relationship Management (CRM), but I’m frankly skeptical that all the employees in an organization would use it. Sure, if HCM underlies a self-service HR intranet, it could extend to everyone at a company. Everyone would be issued a user name and password to enter the system. But is this part of what Chiquita and Flextronics have bought? It’s impossible to learn much about either of these deals, because the companies aren’t talking. That’s strange in itself, because CIOs who have converted to SaaS tend to make very enthusiastic interviewees — like converts who are eager to spread the SaaS word.

For me, Flextronics’ and Chiquita’s silence clouds Workday’s recent success. I want to know what Workday sold to Flextronics and Chiquita, and how many workers will have subscriptions to the solution. I want to know not because I’m a skeptic, but because I’m a reporter at heart and want to know whether these deals are actually the biggest SaaS deals of our time, so that I can compare them fairly to SAP deals and Salesforce.com deals. I also want to know whether HCM has gone beyond the self-service portal in these instances, and for this purpose I’d like both companies (and Workday) to be more clear. I thought obfuscation was an old on-site software provider trick; it is really is a brand new SaaS day, it would be nice to see more open practices.

Demir Barlas, Site Editor

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