Accelerating the Digital Finance Journey: A Four-Step Framework for Value Creation

There’s a new way of doing business. 

We call it the enterprise management cloud, and it’s an approach Workday has been taking to show how organizations focused on their digital futures can think beyond enterprise resource planning (ERP).

Traditionally, ERP has been centered around highly customized legacy systems that can make upgrades a time-consuming, costly process. Focused on the future of finance, Workday has developed an end-to-end cloud approach that enables the evolution to a more agile, integrated platform that allows organizations to keep up with the pace of change—in business and in the global marketplace. 

The enterprise management cloud is focused on the new value drivers of today: people, capabilities, intangibles. 

How Do We Know?

Since Workday went public in 2012, we have experienced robust annual growth. During that time, we’ve expanded to serve more than 9,000 enterprise customers across 170 countries while also keeping general and administrative (G&A) costs as a percentage of revenue at 6%. To achieve this track record, we’ve had to remain agile like a startup but scale aggressively like a large enterprise. We did so by using Workday Financial Management, Workday Accounting Center, Workday Prism Analytics, Workday Adaptive Planning, and Workday Spend Management to support our hypergrowth.

Since its inception, Workday has run its finance operations in the cloud, where scaling the number of users and supporting the growth in transaction volume comes easily—and where we can create a finance organization built for change without sacrificing rapid decision-making or agility. To achieve this, we’ve created a four-step framework for digital finance that’s based on the principles of design thinking, insight, collaboration, and innovation. 

But it’s not just an idea we talk about. At Workday, we’re using this framework ourselves to put finance at the heart of business strategy. Recently, I had the opportunity to share this framework with CFOs and senior finance leaders from across Europe at the CIMA CFO Strategy and Innovation Summit in Poland.

Use Design Thinking to Accelerate Finance Digitization

At Workday, we’re aiming to eliminate the friction from processes wherever and whenever possible, working across teams to test and validate our assumptions. We also use empathy and technology to address the various challenges our teams face, and we continuously reflect on how to optimize for all our customers, whether they’re internal or external. Our vision and ultimate goal is to get to a zero-day close. 

Workday has a use case in Europe that’s worth a look.

Poland has very specific reporting requirements, including language and the need for a local bank’s foreign exchange rates. With a tailored approach, Workday has eliminated the need for a local vendor to provide local bookkeeping services by using custom reports, Workday Prism Analytics, and Workday Accounting Center to comply with all the relevant Polish requirements. We can run a local statutory trial balance, including all local statutory foreign exchange and other adjustment journals, from Workday’s statutory book using our multi-book functionality for capturing local as opposed to U.S. generally accepted accounting principles (GAAP). 

We’re estimating this approach will significantly reduce our in-house resource time by one month and save thousands of dollars in third-party vendor fees. Next, we’re taking a look at how we might be able to use the same functionality in other countries with similar requirements—such as the Czech Republic, France, and Germany—and transform that local compliance cycle into a proactive rather than a reactive process.

Put Insight at the Core of Every Decision

Having the insights you need to make the best decisions is the foundation for any company that wants to compete in today's ever-changing economy and to realize the benefits of rapid access to data and analytics.

In a recent webcast, I described how we use Workday Accounting Center and Workday Prism Analytics to ingest a significant amount of information from our E-Trade stock compensation program and perform our manual checks and processes automatically. Our technology delivers journal entries enhanced with appropriate data attributes, the legal entity, cost centers, and accounts—accelerating a process that used to take my team two and a half days to a matter of hours.

Foster Close Collaboration Between Finance and IT

The stock administration use case is just one of the 75 automation use cases we’ve developed in conjunction with the Workday on Workday (WoW) IT team for Workday Prism Analytics, using 15 different data sources across our entire finance function. WoW IT’s mission is to ensure that Workday’s applications are run in the best way possible, and also serves as an innovation lab, a tester of new products, and a sounding board on IT strategy.  

To drive innovation in finance, we’ve given our finance team ownership of the finance data model, including the accounting rules, mappings, calculations, and metrics. Doing this enables finance to manage and enrich that data to run their own reports, analytics, and planning models—and it’s absolutely been a game changer for us. We don’t rely on IT to deliver that anymore, freeing them up to focus on more strategic technology projects.  

Embrace Continuous Learning and Innovation

Most importantly, we’ve emphasized giving our finance teams new experiences and learning opportunities, with a focus on digital literacy and technology skills. It’s one of the best ways we’ve found to not only grow our people’s skill base, but also retain the talent we’ll need in the future. But don’t take our word for it. Our recent CFO Indicator survey of more than 250 CFOs around the globe shows that an overwhelming majority of finance leaders plan to provide people with opportunities to expand their skills and learn new ones as part of their efforts to meet future organizational needs.

At Workday, my finance team is motivated to think out of the box to find opportunities to remove friction from processes and add value to the business. 

The Bottom Line

We live our four-step framework for digital finance acceleration every day—and we have the ROI to show for it. Over the past eight years, we’ve increased our operational efficiency by nearly 60%, avoiding more than $6 million annually in G&A costs during a period of 41% compound annual growth rates. Those figures are even more notable given that when we acquired Peakon and Scout RFP, we integrated them into our systems and processes within weeks.

Over the past two years, our finance teams have either adopted or are in the process of adopting nearly 98% of all new features we’ve released in our office of the CFO solution. We’re proud to be the first and best customer of Workday. 

At the end of the day, the framework means finance can spend less time on transactional activities and more time on high-value business building, including advancing its role in building a data-driven enterprise. And while finance automation in most businesses is still in the early stages, the future is approaching much faster than we all probably realize. The more organizations can integrate accounting automation now, the better position they and their finance teams will be to become that strategic partner for the CEO and the business in the years ahead.