Workday: End of ERP or Just Well-Timed Hype?

I must agree with James' comments - Workday is simply another tool - and there are enough tools in the marketplace today.  The problem stems when businesses see a tool as being a panacea or silver bullet for all their ills - a situation that is not helped by the multitude of consultancies that make their money implementing ERP solutions and being paid on the basis of whether it went live or not, and not whether it delivered the benefits the original business case promised.

At the end of the day ERP customers reach the "trough of disillusionment" because they haven't addressed the underlying business issues at the root of the problem; poor and illogical processes, untrained or ineffective people, the wrong measures and metrics and more often a complete lack of understanding of the integrated nature of the solution and the required process and data conformance required to deliver quality information into the hands of the decision makers.    An ERP implementation, be it SAP or Workday, that simply replaces a legacy system and doesn't involve a change of processes or behaviours will always get the same, disappointing results.

Articles like this actually do not help the situation because they support an ideology that the problem is not the processes, strategy, people or quality of the data - it's the fact that the business has the wrong tool.  And replacing a tool is always easier than changing minds and behaviours, and thus the business is willing to accept this as the answer, only to be disappointed once again.

IT was touted as the enabler of Business Process Reengineering (BPR).  BPR got a bad wrap because it "delivered" work-force-reduction more than anything for whetever reason. At some point ERP was seen as a facilitator of BPR.  When BPR got a bat wrap ERP distanced itself from the other TLA (three letter acronym). ERP has so far managed to stay in organizations.

Outsourcing has also been seen as another dimension to BPR.  Outsourcing is seen as an enabler of BPR in many instances.

How will "Workday" and Outsourcing affect global organizations? This will be an interesting development.

Today manufacturing outsourcing has become OEM's competitive strategy.  The EMS (Electronics Manufacturing Service Provider) companies are playing a big part in this strategy. The EMS companies are focusing on speed and flexibility (along with low cost manufacturing) as their competitive strength. Instead of implementing one ERP system globally,  the "Workday" technology offers them the ability to build solutions quickly to meet the custoer specific needs. In other words,  "Workday" helps the EMS companies offer the speed and flexibility of a small company whiule at the same time offering the economies of scale of a large global company.

I have to say, the responses to your article serve to underscore the essential problem....unnecessary complexity.  

For example, appears one respondent was on an ERP project team that got more than a bit frustrated with quite a few things,  to include:

"...poor and illogical processes, untrained or ineffective people, wrong measures and metrics ... complete lack of understanding of the integrated nature of the solution .... required process ... data conformance required to deliver quality information into the hands of the decision makers. "

I believe what everyone yearns for (and profits from) is a chance to get back to the basics.....NOT more technology, more reengineering, more data, more integration, more controls, more metrics, more acronyms, more tools, more emails, more meetings.  As hard as eveyone has tried, more complexity just does not work, and truth be known it is not necessary.

"Simplicity is the essence of sophistication." 

If tools like WorkDay give us  a chance to simplify, I'm all for it!

We are a government organization. We just started implementing ERP. After reading this article, now I could say that I am getting more confused by the day whether we have chosen the right product!

It is probably incorrect to say that ERP has failed to deliver. Over a period of time, far too many players came on the scene and the customer is spoilt for choice. There is a mind-blowing choice, be it  in terms of one's budgets, product features or technology. So, its hardly surprising that a new buyer is left befuddled- it is really tough to decide. So, they go for beauty parades. But, at the end of the day, a customer makes up his mind, in most cases, only after he gets absolute certainty that the product supports his current or planned business processes. The real chasm appears during implementation, where the average customer's inability to aprreciate the need to allow sufficient time for the consultants to understand their processes well, build good prototypes and also be able to nominate clear-headed staff from their side to help with the implementation. And in most cases, it is a case of 'bad implementations' getting projected as' bad products'. The business processes, if documented correctly, can get complex even in small businesses. It is only natural that your ERP implementation gets complex. The mistake of over-customisation also makes the implementations difficult to complete and maintain. Upgrades will be much easier and smoother if your ERP has fewer customisation.

The bottomline is: ERP is a business necessity  and should be considered during the early stages of starting a new business, so the system grows in sync with the processes. The real fruits of implementing an ERP would be realised only when the next logical step of data warehousing/BI is taken, which helps the business to be understood from several perspectives ('dimensions'). Most ERP customers do not go thus far and then pine that ERP didn't deliver.

Staff reduction or even significant cost reduction, is not a promise of ERP - but, efficiency is; productivity is;better-informed management decisions are. You would certainly need good folks to make sure that the critical backbone of business is in fine shape.

Re-discovering the value of data over processes

Our vision, from the small-business perspective, is that it's important to re-discover the importance of data. Processes change, business functions change, workflows change, organization breakdown structures change: if you try to heavily automate thes...

I strongly agree with the first comments made by James and Patrick. They are reflecting the hard learned lessons of every electronic information system implementation since the beginning of electronic information technology. I would had the importance of proper project scoping and project management.

The insistence on understanding, clarifying and reengineering processes, and the insistence on clean & useful data reminds me of a user's definition of LAN and WAN technologies: Largely Automate Nonsense and Widely Automated Nonsense, which is what you get when you don't do things properly.

Common trends of all new technologies in the history of information technology are the hype generated by technology inventors and early adopters, the promises of ease of implementation, the promises of great payoffs, the proclamations that the old technology is dead, and people believing the hype and promises.

Here are a few examples. The creators of the first vacuum tube mainframes thought that only four super computers (the ones that used vacuum tubes) would be enough to manage all of Americas accounting. Bill Gates thought that home users would never need more than 1MB of RAM and 10MB hard drives. there were also the promises of structured programming, 4GL langages, object oriented programming, integrated accounting packages, MRP, ERP, GUI's and Windows, etc. All had their promises. They all brought significant improvements, usually more slowly than proclaimed, none of them delivered all their promises and none of them was as easy and cheap to implement.

People just like to believe in quick, easy and cheap fixes and miracles. There is just a refusal to recognize that the world is complex, that humans have limitations in understanding that complexity,  and that large scale change is never easy. Easier maybe, but never truly easy.

Firstly I would like to thank Antonio for his kind comments over at the Livebase site.

I must admit I was disappointed with Dennis Howlett's response to my post, as he decided to personally attack me and the company I work for because of my comments about how ERP is perceived as a major disappointment mainly due to businesses desire to believe that simply purchasing software will make them a better, more profitable business, rather than addressing the real business issues or continuous process improvement and cultural change.

The company I work for is not a "SAP House" as Dennis puts it, but rather is an independent consultancy that is not affiliated with any software vendor, although we do have significant SAP experience in our ranks, including myself.  We aim to bridge the gap from top tier management consultancies like Oliver Wight and A T Kearney down to the standard contractor and technical implementation levels, and we focus almost exclusively on organisations that have already implemented ERP but have not managed to achieve anything like the true value of that investment.   We are closely aligned with the Global Supply Chain Council and focus on optimising a clients business processes, people capabilities, data and technology.   This takes time and is done as a roadmap whereby change is continually implemented at a rate which the business can absorb.  We try to stop organisations from throwing more money at new tools and the associated consultants who are willing to take that money before first taking a step back and evaluating what can be done with their existing people and technology investments.  In a nutshell, we try to add real business value far greater than the amount spent on our services.

Dennis's argument seems to be that we should "give Workday a chance" because it offers new functionality.  He also dismisses ERP as simply "300 year old bean counting practices, and 30 year old technology".  That is ridiculous.   Yes of course ERP systems incorporate General Ledger, AP and AR functionality - but that is because businesses operate that way.  If Workday or any other solution offers a different way of balancing the books, receiving and chasing payment and paying vendors then great - however, if the business continues to follow the same processes but implements a solution that uses a different way then the two are going to be at odds, and frustration will develop.   And this was my point.   It is not what tool you have that makes the difference - its how you do the things you need to do.  The businesses with the best processes will win - not the businesses with the most leading edge technology.  To state that SAP (for example) is just an over-glorified accounting tool also shows significant ignorance of the current state of these tools, or even the state they have been at for the last 5-7 years.  SAP for example contains functionality in the Supply Chain Planning modules alone that can optimise, plan and control multi-national supply networks, plan the distribution to the customer and backflush the requirement all the way to the production line, allow customers to participate in web based CPFR processes, orchestrate the Sales and Operations Planning process, establish exactly how much available to promise goods are available at a point in time, and propose alternatives based on network based business rules, etc, etc.  None of which is based on 300 year old accounting practices Dennis.

So sorry, Mr. Howlett, if the harsh reality offended you, and came across as tired, uninspiring rhetoric, but the point I was making was that pushing new technology as a silver bullet, just because it is new, doesn't help when the core issues are consultants pushing these tools as a panacea for a companys ills, extending the scope of the project through a lack of care and understanding of the real business needs and processes, and of the customers themselves being willing to shell out millions on technology because it is fundamentally easier than taking a holistic look internally and externally at the way it does business and how it could change and improve. 

There is enough technology  ERP in its fullest scope contains more functionality than the average organisation can handle in the next ten years if it poured all of its available manpower into it.  And most of it, if done properly, will bring enormous business benefit and increased value.  I feel qualified enough to state this having worked over the last 15 years on four different continents on 13 different full-lifecycle ERP implementations, and through my current company am helping many more achieve true value from their existing ERP and people investments.

I also very much look forward in the future to helping companys that are at the trough of disillusionment over their Workday implementation as well, when they realise that all of the promises that Workday offered did not materialise just by buying the software and implementing it. 

Regardless of the where it puts the accounting functionality.