Workday is making a massive bet on its ability to reinvent the ERP category it has long disdained by jumping into the data-cloud business, rolling out a slew of AI agents, deepening some strategic partnerships, and offering customers a simplified way to consume Workday products.
In a busy, vibrant, and impressive Workday Rising event this week in San Francisco, the 20-year-old enterprise-apps company made its bold future intentions very clear in a market where it is surrounded by competitors, particularly SAP and Oracle — that are much larger and wealthier. Workday intends to:
- not just match but lead those competitors in fusing AI into every facet of its product portfolio across HR and Finance, as well as into every corner of its internal operations;
- double down on its assertion that it has the richest data sets for HR and finance in the world, which in turn can make its AI solutions more powerful and valuable than what any competitor can offer;
- greatly expand its data-management capabilities by entering the data-cloud business and announcing a strategically enhanced partnership with data-cloud pioneer Snowflake;
- compete in the red-hot Agentic AI space with purpose-built agents that address the most-pressing needs around people and money facing its 11,000 customers across the globe;
- extend its platform-level partnership with Microsoft to levels so significant that Microsoft CEO Satya Nadella joined the Rising event via video link for a conversation with Workday cofounder and chairman Aneel Bhusri; and
- launch a new consumption model for customers called Flex Credits that lets those customers scale as they grow and flexibly apply their investments to match their evolving priorities.
That’s a pretty ambitious agenda, but it’s also one for which Workday has no viable alternative because SAP, Workday, and other enterprise-apps vendors are also surging into the Agentic AI space that shows enormous promise for driving strong business outcomes even if some initial customer pilots have been inconclusive.
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And in a move that puzzles me a bit, Workday is packaging all of this product and go-to-market innovation as “ERP for the AI Era.” On the one hand, I can understand that Workday clearly wants to be seen as a full-capability player along the lines of what SAP and Oracle can do. Yet, at the same time, I was scratching my head a bit as I heard president of product and technology Gerrit Kazmaier rolled out this sweeping story because over the years, Workday has at times sought to vigorously distance itself from the ERP world, and at other times has kinda/sorta played footsy with it.
But now, with the business world’s focus having become riveted on AI and the extraordinary improvements — and disruptions — it will certainly have on how businesses operate, Workday needs to show that while its focus remains on HR and Financials, its strength in data and AI allow it to address a vast range of any company’s most-pressing problems.
During Kazmaier’s keynote at Rising, here’s how he described Workday’s company’s new position around ERP:
“For years, we avoided using the term ‘ERP’ but today we are announcing our ability to deliver next-generation ERP that is AI-powered, human-centric, and future-ready,” Kazmaier said.
The primary foundation for being able to make such a move, he said, is Workday’s 20-year history of “data, context, and expertise.” Kazmaier cited examples of Illuminate AI agents (Illuminate is the Workday AI brand) that cut screening time for recruiters by 70%; that have saved Workday itself 45,000 hours in contract-intelligence work; and that has fed up 3,500 hours every quarter for a customer using a BPO agent to optimize processes.
More broadly, in a Workday press release, Kazmaier offered this perspective:
“Too many AI efforts amount to random acts of automation that never scale or deliver real value. The barrier of self-building AI on legacy systems and closed platforms is simply too high. Workday Illuminate is different. With purpose-built AI agents and a single, open enterprise platform, we’re redefining ERP for the AI era – transforming it from a passive system of record into a system of action that drives real outcomes.”
Descriptions of the new agents underpinning this “ERP for the AI era” can be found here, and the Workday Data Cloud overview — including partnerships with Databricks, Salesforce, and Snowflake — is here.
Final Thought
Since Kazmaier’s arrival six months ago after a highly successful few years at Google Cloud and before that at SAP, Workday’s product vision and strategy have been greatly enhanced and accelerated, and the pairing of Kazmaier with cofounder Bhusri atop the Workday product brain trust is formidable.
The Rising event and all the substantive announcements within it reflect a dramatically new direction for the company, one that gives it the confidence to embrace the ERP term in a new and modern way. And with Rob Enslin now Workday’s chief commercial officer after he too was first at SAP and then Google Cloud, customers are sure to benefit from the expanded and intensified competition in the new world of Agentic-AI-powered ERP.
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