Workday Podcast: Transforming Banking and Capital Markets

Jim Gahagan: Hello, everyone and welcome to today's banking and capital markets Industry Accelerator podcast. 

Today banking and capital markets organizations expect industry tailored engagement and partnership from their cloud vendor. Organizations want their cloud vendor to be a partner who can guide their move from a legacy ERP to the cloud and help them gain ongoing value to serve their industry needs. 

My name is Jim Gahagan. I'm the senior director of financial services industry solutions marketing here at Workday. And it's my pleasure to welcome you to the podcast. But more importantly, to welcome our two guests to the podcast. I'm joined here today by Jay Rabinowitz from Workday and Tony Alejo from KPMG. Welcome, gentlemen.

So let's start off with Tony. Talk a little bit about yourself and your role at KPMG.

Tony Alejo: Sure. Thank you, Jim. Thank you for having me. I'm a partner at KPMG and have been with the firm for nearly 15 years now. I have the pleasure of leading our financial services practice, specifically within Workday. I have the pleasure of working with some great professionals, some excellent banking and capital markets institutions that we're delivering Workday transformative programs for.

Gahagan: Thanks, Tony and Jay?

Jay Rabinowitz: Hey, thanks for having me. I'm Jay Rabinowitz. I've been at Workday for just a little while now. I lead our industry practice for financial services—so capital markets, banking, and insurance. I spent the early part of my career in consulting, where I spent a lot of time working on ERP systems and financial data. From there, I spent 10 years at Goldman, where I was the CFO for global operations. And then I ran finance transformation. And most recently, I had a stint at Wells Fargo, where I was the CFO for the non-producing revenue businesses.

Gahagan: That's great. So Tony, maybe just kind of set the scene for us and for the rest of the discussion. But can you share with us some of the trends that you're seeing among your clients and banking and capital markets?

Alejo: Sure, some of the important trends that we're starting to see with our clients here, some have persisted, but there are ones that are most relevant and top of mind for me from the discussions that we've been having building up to Rising. Certainly, we've seen a number of those topics of discussion and sessions that we've been having here with clients really center around data. Data, data data… is huge for all of our banking and capital markets institutions. There's a lot of concern around how do we find the balance between all of these source systems that we've invested so much time and effort into over the years—large investments—and harmonize data especially within Workday, and are able to drive some of the reporting. The need for insights and ease of use from a reporting capability standpoint are absolutely top of mind for organizations. The second one is regulatory, which is top of mind for all of our clients, and is a trend that a lot of our clients are focused on.

Gahagan: So as a follow on to that, how do you see the role of technology in these companies now trying to meet these challenges? And what role is technology really playing?

Alejo: Well from my perspective, technology is an enabler. And technology needs to be leveraged to be able to drive the efficiency and the effectiveness needed to turn large sums of data into insights that are actionable for our clients. Meaning that organizations, especially in the office of finance, aren't spending a great deal of time compiling information, reconciling information, but rather consuming information and then being able to take action on that information going forward.

Gahagan: Similar question, Jay. What are some of the challenges and issues that you're seeing among workday customers that you're working with?

Rabinowitz: Yeah, everything Tony said makes complete sense. And it's spot on. The other thing that I would just add is talent. And I'm sure you would agree. Since the pandemic and everything that's been going on, we've seen pretty significant shifts in our workforce as people have left and started to look for new jobs. And then just to kind of piggyback on the technology point, it really is an enabler to everything Tony said, but it does attract talent. The idea of working on new cloud technology, the idea of being relevant in the marketplace, and not working on these legacy systems and learning programming languages that aren't all that relevant anymore, I think is a big plus for our customers and for the market that are thinking about moving to the cloud. You could attract new talent. You could give existing talent new things to do. I think it is another trend that we're hearing a lot about in the market. How do we keep people happy? 

Gahagan: One of the things that’s exciting this week is the announcement of the launch of the Industry Accelerator program from Workday. Jay, I'll toss it to you. If you're in a situation where you have two minutes to talk to someone in an elevator and explain to them, what are industry accelerators? What do you say?

Rabinowitz: Yeah, I’ll break it into three pieces. The first is building depth in our industries and that really comes through a set of use cases. And those use cases will ever evolve. As the market continues to change, as disruptors start to enter, as new regulatory events come, we will continue to add to it. The second is really opening up our ecosystem, which is extremely exciting. Our partners from KPMG, we've given them tenants, we've given them the ability to take those use cases and develop solutions that will help our customers get to value faster. That will help them jumpstart. That'll give them different ways to think about the problems that they have. And that also goes with third party vendors we’re working with. We're opening up the ecosystem, and they're opening up theirs, and we're connecting the dots more seamlessly. And there's a lot of work to do there. And then the third thing I would say is it's about the customer. And it's spending time listening and understanding and making them be a part of the journey. They need to help both our colleagues from KPMG as well as us figure out what it is that we should be spending our time on. What's next? How do they want to shape it so that we can build it the right way?

Gahagan: I think that's a great response because what we're seeing more and more is that the single vendor can't do it all. And it's really that combination of the expertise of boots on the ground and systems integrators. Specialized vendors will be focused on things like tax or tax reporting or integrated as a type of regulatory integrated reporting. Following up on that, Tony. KPMG is one of the inaugural members of the accelerator program for banking and capital markets. What are some of the strengths that you see that KPMG is going to be able to bring to the table as part of that program?

Alejo: Sure. Thank you, Jim. Yeah, building on what Jay just mentioned. We’ll continue to bring solutions to the client, and the value that we bring forward as part of these enhancements through the product. Now, we really think that we can continue to harvest all of the assets that we've been developing through our experiences in working with major banks, major capital markets, and insurance institutions, to be able to take something like FTP that we're working with Glenn Hare on, who's leading the industry accelerators. FTP is a solution that's necessary within the banking industry. And it's one of those areas that we're really excited about. What you see in the marketplace is very disparate solutions around how to address that funds transfer pricing requirement. And so we're pleased to be included as an inaugural member. And we look forward to all the hard work that's now going to come forward, especially when we can bring those solutions to our clients because it's a real need in the marketplace.

Gahagan: Yeah, I think that's a good point. Because funds transfer pricing is an interesting animal in that every bank needs it, and every bank has it in some way, shape, or form. Many of them have built it themselves. And I think working with a partner like yourselves will help bring that technology into the Workday platform. And banks may keep their old FTP system and not change. But the importance of being able to integrate into the overall Workday environment I think is critical.

Alejo: Yeah. And just to build on that, Jim, this is from my perspective the next step--the next step in the evolution to demonstrate to all of the FSI clients that are listening. We collectively as partners and yourselves as Workday are listening to the enhancements that they need. So one really good starting point was average daily balances. We're at 3.0 now, which is fantastic. And now some of the concerns that people had initially about it, such as was it robust enough in order to meet their needs, especially for banks? Those are all gone. It works. And they can move on to focus on other things.

Gahagan: Jay, everyone wants to move to the cloud. We hear it all the time: “I gotta move my systems to the cloud.” Why is this such a need to be able to move to the cloud? Why is it such a need to optimize the entire ecosystem of your environment in the cloud? 

Rabinowitz: That's a big one. So I'll probably start and Tony's going to jump in for sure. There are two things that really come to my mind. The first is the total cost of ownership. And as you think about all of the legacy infrastructure and the technical debt that our companies have built up over time. It's a great opportunity to holistically really analyze, reconcile, and start to eliminate that debt by moving to the cloud. And being in a constantly evolving ecosystem is tremendously helpful for our customers. I'm sure that also comes with an opportunity to rethink and constantly assess your processes and update them without having to kind of re-integrate and re-implement every time. The other thing that I think is really cool about it, and then I'll hand it over to Tony, is there's a lot of independence in the cloud. As a finance user, we’ve spent all those years very dependent on our colleagues and technology to get anything done. But the independence that our finance professionals get by moving to the cloud, by working in newer technology, the ability to really be independent, I think is another really huge advantage.

Gahagan: That's great. Tony, similar question. What are you seeing with your clients and the need that will need to leverage the entire ecosystem even once they get to the cloud?

Alejo: Our point of view is certainly similar to what Jay just mentioned, in terms of thinking more broadly about the opportunity and how to make sure that this isn't just a “tech slam.” And so, from our perspective, we see value as the opportunity. It also takes into consideration the holistic picture of data, governance, controls, reporting, and insights. And we have a toolkit and a framework that we use at KPMG called Powered Enterprise. It helps us look at all of the layers of an operating model, including people skills and talent. To go back to a point you made before Jay, we need to be thinking about moving forward and future proofing process areas within finance, especially for financial services institutions, so they're attracting and retaining some of that best talent. And you do that best from our perspective when you're thinking holistically across all the layers of an operating model.

Gahagan: That's really true. And the other thing is, you guys have been really on the leading edge in terms of implementations for us. And certainly, you're coming off of a very successful go-live at a large financial institution, which is a full-blown general ledger transformation. And on top of that, we added the Accounting Center there. And, there's millions and millions of transactions from the clients’ loan system that are coming. What do you think made that project so successful?

Alejo: For us, it was great sponsorship from the client. We all have been part of big transformative programs over the course of our careers. And you really can't put a number or value on having strong executive sponsorship to drive decision making, to begin with leading practices, and be very firm about who we want to be. We want to be not just better with a new system, that's a new shiny toy, but rather, we want to set ourselves up to be the best when it comes to our functions and finances. The key to that was absolutely having some strong senior executive sponsorship. But then in addition to that, we also were working hand in hand with your teams at Workday, because the Accounting Center, for example, was still relatively new. And that collaboration, I would say, is the second major item of working together with Workday and our client to address the details of integrating major loan and deposit systems into the Accounting Center. And having the richness of that data persist and be available through drill down is really powerful. They're seeing the value and the benefit of all the hard work that we put in through a very collaborative effort.

Gahagan: Yeah, and I just think that's a really good example of what industry accelerators are all about. It's harnessing the power of the expertise of a systems integrator who's on the ground doing the implementation, and working with us with, as you said, on a product that was relatively new. And it helps us learn. I think both companies and the client can get tremendous benefit out of that overall ecosystem of the three of us working together, and where appropriate, other independent software vendors become part of the equation as well.

Alejo: And just to build on that, Jim. I agree with your point about “harness,” but I would say harness and harvest. We're taking all these learnings and carrying them forward to other banking institutions because they'll have similar requirements around their loan systems or deposit systems that we've already paved the path to get to get it connected. 

Rabinowitz: That is like that middle layer of opening up the ecosystem and having our colleagues from KPMG get a jumpstart. Show our customers the art of the possible. Get it off the ground before they even land and say, “Hey, here's something that's 50-60% baked.” It could be 30% baked depending upon where they are. But you're not starting from zero, which is a huge benefit. It's a really powerful opportunity.

Gahagan: We're coming close to the close of this, but I’ll give you guys a couple of minutes to think about it. Any last notes or your last learnings that you want to give to our listeners?

Rabinowitz: Yeah, as we think about the accelerator program, I would just share that we're just getting started. And we'll continue to learn and evolve together. There are many components of the Workday infrastructure ecosystem that we haven't touched yet, in terms of opening up to our partners and creating these accelerator programs. The opportunity is huge. And as we do this, and as we do it through the lens of an end-to-end process, it's really going to be very enlightening. It's going to help us think about what to build, how to build it, and what our partners could build. It should just be tremendously beneficial to our customers. And then just to kind of finish off on data, which we spent a lot of time on. Things like FTP and ADB, and instrument level balancing, the transparency that we now have and could create through the accounting center process and through Workday Prism, it's really exceptional. And as we harness and harvest that data—stealing from Tony—the use cases are just going to be plentiful, and we're going to be able to do a lot of really great stuff.

Gahagan: That's great. Tony, any last parting comments?

Alejo: Yeah, thank you, Jim. The last parting comments that I would offer to clients and prospects is go out and explore. Reach out to us, reach out to partners, and reach out to Workday. We can bring forward and demonstrate to you some of the starting points, like Jay was saying, to the extent that perhaps you're already a customer, and this was an implementation that happened before the Accounting Center. Let's have a dialogue or have a dialogue with your partners, and explore the Industry Accelerators, because we're just getting started. But the baseline of what's there already is actually very rich, and it's only going to continue to get better.

Gahagan: That's fantastic. Well, I thank both of you for joining us today on the podcast. Again, for our listeners, we've been talking about banking and capital market industry accelerators with Tony Alejo from KPMG and Jay Rabinowitz from Workday. So don't forget to follow us wherever you listen to your favorite podcast. And remember, you can find our entire podcast catalog at workday.com/podcast. I'm your host, Jim Gahagan. And I hope you have an excellent work day.