Sustainment organizations and Workday | Deloitte US has been saved
Limited functionality available
Lately, many companies are replacing their legacy ERP systems with Workday. Its financial, HR and planning applications are easy to configure and scale, provide leading-edge features and technological sophistication, and often offer a compelling return on investment. But realizing the full value of Workday on an ongoing basis can be challenging, especially as you implement solutions across multiple business functions.
Once you are living with Workday, new considerations arise in terms of governance, roles, and support processes. When these considerations aren’t managed properly, they may have the potential to create conflict and waste, effectively draining your business case for implementing Workday in the first place. However, when they are actively addressed, they can deliver synergies and cost savings that bolster the long-term value and ROI that Workday delivers. The mechanism through which this result is achieved is the sustainment organization and model.
Sustainment structures that have the capabilities and capacity to achieve synergies and ensure proper governance are essential to optimizing the value offered by Workday. Indeed, this explains why companies often ask us, “Where should sustainment fit within our organization and how should we structure a sustainment organization that helps us capture the full value of our investment in Workday?”
A sustainment organization for Workday has three principal roles:
To fulfill these roles, your sustainment organization needs both capability and capacity. Capabilities can be provided by the membership of sustainment teams, which should encompass IT for its understanding of technical issues and implications, HR, Finance, and other functions supported by the Workday application for their understanding of the functional issues, as well as operational representation. In addition, your sustainment organization needs to have the capacity to manage not only day-to-day demands, but also the anticipated upticks in demand that may occur, such as when bi-annual releases are issued, or when business conditions change.
You have options to ensure your organization has the proper Workday sustainment capabilities and capacity in place.
You can create an in-house sustainment organization and support all Workday application management functions. This may be a good choice when you have strong sustainment capabilities and capacity at hand when high levels of support are needed when there are significant business cycle upticks (such as those associated with quarter-end and year-end activities, open enrollments, performance reviews, etc.), or when the cost of internal resources is low.
Alternatively, you can outsource the sustainment organization and its functions to a provider like Deloitte. This may be a good choice when it's advantageous for you to create more value by focusing its resources on your core line of business, when internal costs are high, or when sustainment capabilities and capacity are not readily available.
Finally, you can take a hybrid approach to sustainment by using a mix of internal and external sustainment providers. This can be a good choice when you want to manage costs by splitting the workload (for instance, handling ongoing maintenance and outsourcing upticks in demand), when you want to lead sustainment without doing the day-to-day work, or when you need access to state-of-the-art expertise and innovation—to develop the internal sustainment capabilities and capacity you need.
As your company adopts and implements new functionality from Workday, new opportunities to share and streamline sustainment may emerge. For instance, when a company that is already on Workday’s HCM application adopts its financial applications, it may not need to build a new sustainment organization from the ground up. Instead, its existing sustainment organization can provide cross-functional support in certain areas like integrations, reporting, and security maintenance. In this way, companies can avoid introducing cross-functional redundancies in Workday sustainment, garner cost savings and other synergies, and focus on adding the new functional roles to the sustainment organization.
In addition to the synergies, the addition of new Workday applications or modules may create a need for governance. One of the benefits of Workday is that it gives business users a greater—and more immediate—degree of control over their information systems. But at the same time, this ability to make changes gives rise to the potential for functional misalignments and other unintended systemic conflicts. For instance, when new cost centers are created in Finance, they should be aligned across Finance, FP&A, and HR.
Your sustainment organization should provide the governance necessary to avoid these conflicts and ensure cross-platform alignment. The areas in which it should exercise governance include:
As your sustainment organization considers where governance is needed, its members should also be sensitive to the fact that too much governance can be just as detrimental as too little. Too much governance can create unnecessary costs and slow down some of the advantages of a dynamic cloud solution.
There are also areas in which governance may not be needed, such as quick break/fix configurations and processes that are unique to the HR function and do not overlap with or involve Finance or IT. However, your sustainment organization should consider these areas carefully to avoid missing connections and crossovers that may not be obvious, especially when new releases and new applications are adopted.
Sustainment organizations and models are not one-size-fits-all. They vary by industry, the size of the workforce, geographical location and footprint, the structure of the company, and the nature of its business units. But companies that use Workday should have a sustainment organization. It’s the most effective way to provide business as usual support, realize the value of Workday on an ongoing basis, capture the synergies available via shared support, and provide the governance needed to ensure alignment across functional and operational boundaries.
The full benefits of investments in Workday appear over time and continue with a properly aligned model and a skilled sustainment organization. It can take several months to stabilize, but the journey does not end after stabilization. Your sustainment organization will play an essential role in more quickly realizing the full potential of your Workday solution.
Shannon Thomas, Deloitte Consulting
Casey Wiedeman, Deloitte Consulting