The article below is taken from SaaS Mag Issue 5. To sign up for the next edition here.
Workday‘s chief financial officer, Barbara Larson, knows a thing or two about what it takes to grow a successful SaaS business. With a broad finance background, she’s also got a technology edge to her. Combining her love for numbers and technology has paid off and its undoubtedly benefitted Workday.
“Finance is something I was always drawn to. I’ve always liked math and problem-solving. It’s a natural fit because it just allows me to tackle challenges,” Larson says.
She finished school at University of Arizona and started her career as many finance majors do by working in auditing. After two years of steady work, she resolved to move to the Bay Area and infiltrate the booming tech scene. “There were so many cool things happening in technology, and in Silicon Valley, I just wanted to be a part of it,” she says.
Larson explains that finance gives her an enterprise-wide view of a business, and her position has helped create a significant impact on business outcomes. “I’ve stayed in finance because I feel like it’s one of the only functions that gives you [that].”
“The really fun thing about being at Workday is it’s a company where I’m actually using the product day in and day out. I’m not only using it but I’ve also got the opportunity to influence and shape the products that we use and that we give to our customers. It’s a unique situation to be in, and I feel fortunate. It’s been fun because it gives me the intersection of finance and technology. It’s everchanging, “she says.
Workday, a leader in enterprise cloud applications for finance and human resources, was founded in 2005 by Aneel Bhusri and David Duffield. With over 50% of the Fortune 500 using Workday, the company enjoys a strong reputation for both customer satisfaction and employee satisfaction, as well as continued innovation in cloud technology.
The company recently announced that nearly 1,000 organizations are using its Skills Cloud to more effectively hire, engage, and retain their workforce in the changing world of work.
With a customer community of more than 55 million workers, the company uniquely helps organizations optimize talent. “Workday HCM securely houses worker data — including skills — and makes this data available as part of a connected talent experience, which encompasses learning, recruiting, and performance, among others,” according to a company statement.
“Organizations are more focused than ever on deploying a skills-based people strategy to improve retention, hiring, recruiting, and employee engagement,” said David Somers, group general manager, office of the chief human resource officer, Workday. “Our Skills Cloud provides the foundation to help our customers adopt a strategy for addressing skills and support their move towards a more agile workforce.”
Moving into Management
After a couple of different roles, including a stint at VMware, Barbara Larson joined Workday in 2014 as their Director of Corporate FP&A and G&A Finance. Recently, Larson has held the title of Workday’s Senior Vice President of Accounting, Tax and Treasury, but effective Feb 1, 2022, she was promoted to chief financial officer (CFO). As CFO, Larson will lead the Workday finance functions, in addition to partnering on the Workday Financial Management product and business strategy. “[Earlier in my career] I was trying to choose between staying in my current function and moving up to a manager position or do something different. I talked to a CFO, and his advice to me was ‘put as many tools in your toolbox as possible.’ You’ve got your whole career to be a manager. I think that’s been important, and it’s shaped how I look at my career.”
At that point in her career, it would have been easier for Larson to follow the path she was on and climb the ladder as was intended, but she saw value in broadening her scope and expanding her knowledge base. Larson’s attempts to eschew a more traditional, direct ascent towards management have helped her become a better manager today. The rotations at Workday also gave her broader insight into how best to help her company grow. “I did a two-year rotation where I was the General Manager for our financial management products. So very different than anything I had done in the past. That was an eye-opening experience. And it allowed me to use my practitioner experience and my finance background to help make decisions and drive investment in the product. I wouldn’t have had that opportunity being purely in finance.”
The key to success in any role, according to Larson, is to stay curious. “Build connections and have a comprehensive view of your role, go beyond just the numbers and understand how things work, understand the business. Get familiar with all the different pieces of the business. That’s what’s going to make you a well-rounded finance leader.” Seek out and take advantage of opportunities that will help you develop a more comprehensive view of the business. Only then will you be able to optimize the value you can offer.
“I feel like I’ve been fortunate in my career to have really strong leaders around me that I can look up to. People that encouraged me to get outside my comfort zone, so I try to encourage that for other people too.”
In her experience, you should be intentional when you build your network and make sure you nurture it. Authenticity and lasting relationships are key.
“Networking isn’t just about what you’re trying to get out of it. What you put into your network is what you get out of it. Make sure you work with people that are both internal and external contacts that can give you unbiased feedback, advice and perspective.”
People grow to their potential when the right people surround them. Having a solid network is critical. Professionals need people in their corner who will encourage them to pursue stretch assignments and consider how their short-term decisions will impact and contribute to reaching their long-term goals.
The Impact of SaaS and the Cloud
Very few were prepared for the global pandemic and its effect globally.
“Yet even before the pandemic, a variety of technological, societal, economic and political factors were already percolating and creating a perfect storm for disruption,” Larson has authored on Workday’s blog. “These forces continue to challenge the way organizations think about doing business, raising many questions about what the new normal will look like when the storm settles.”
It is this perfect storm that has enabled SaaS to show its true capabilities. Throughout her career, Larson has seen up-close the impact SaaS is having on big business. The long implementation times and inability to customize software solutions have mostly evaporated. “Workday opened my eyes to the benefits of cloud for finance. I feel like teams can continuously innovate, which means we’re always modernizing and optimizing.”
She also noticed the new freedom that finance executives have due to the simplicity of data extraction and visualization. In the past, she always had to talk to an IT partner if she wanted anything modified, but now it is self-service. “It’s been very different how technology has liberated finance executives, especially around data. It also provides a foundation that empowers finance to access and manage all of that information on their own without having to ask IT for assistance.”
In another recent blog post, Larson shared her thoughts on a Harvard Business Review study that revealed “significant conflicts between finance leaders’ aspirations and how they do their day-to-day work.” In her view, this results from an exponential increase in business data, mixed with emerging analytics capabilities. It has created a massive opportunity for finance to take center stage in the creation of data-driven enterprise.
“The challenge we’re facing is people, you know? This change of pace and the innovations that come with the cloud model create scarcity. There’s a lack of digitally savvy talent in finance right now.”
At Workday, Larson is investing heavily in talent. “We want to be known as a best-in-class destination, where people can realize their full potential, and we’re looking for people that embrace and drive change. We’re making sure that we’re hiring people with a different profile because we’re trying to come up with bold ideas, and having that change mindset is critical.”
For example, Larson explains the end-to-end tax provision service, which is essentially a manual operation relying on excel spreadsheets. At Workday, they believe they can change that with the right people on hand. Larson describes the energy surrounding the potential to revolutionize this manual process. The excitement is contagious. As they interview new candidates for roles at Workday, they are looking for people who might drive innovative automation projects to help alleviate the traditional pressures of this work. “We are looking for people who are interested in new technologies, like machine learning and AI. Also, people who understand how to build algorithms and have that data science mentality. Data is huge right now, so we’re trying to hire that kind of talent.” These people certainly exist, she says, but they are in high demand.
Pushing the Boundaries of Digitization
One area Larson and her team are focused on, is taking complex, highly manual tasks involving operational, external and financial data, and applying Workday solutions to automate as much of those as possible. The goal is to remove as much friction from the process so that her teams have more time to focus on those parts of their work that they truly enjoy, whether that’s finding ways to save costs or improve a process, or analyzing data for strategic insights.
“I think the challenge when you bring in data from external sources is having a common data definition and getting alignment on that. I’m a big fan of finance controlling the financial data model vs. IT. One of the things we’re doing to overcome that is leveraging Workday Accounting Center, which is a new product that Workday has released.”
Workday Accounting Center is built on an analytics platform; it ingests operational data and runs it through an accounting rules engine, and then posts entries. This all allows for quicker reporting and deeper business insights.
“It automates the accounting, but because it’s built on top of an analytics platform, you then have all of the operational data that you use to drive the business available for reporting. And the beauty of that is it all ties directly into your financial statements as well.”
Essentially, this gives all the operational inputs that can inform insight that your business leaders need, while, at the same time, you’ve just automated your accounting. Pushing the boundaries of data, Workday is currently utilizing this tool across different use cases. A number of large banks are already employing Workday Accounting Center to process their loan data and insurance claims. At Workday, it’s also used in accounting for stock-based compensation, investments, and FX hedging. In 2021, it won a CODiE award for best financial management system judged by industry peers.
Opportunities and Trends in the SaaS and Finance Space
“I think it’s all about enabling finance to own and understand the data model,” Larson says of the opportunities that SaaS brings to the finance and accounting world. It again goes back to data—data model dimensions, the capability to run reports in a self-service manner and the ability to model different scenarios. She believes there is a shift in SaaS and that the tools that support the discovery of the “why” behind the numbers and the ability to get such insights across the enterprise are critical.
She knows that machine learning and AI are going to be game changers.
“Machine learning capabilities are the added layer of automation and protection to review and interrogate data. Machine learning makes sure the data is accurate and delivers anomaly detection, even in planning and forecasting,” Larson says.
In terms of trends, she underscores Workday’s building of an intelligent data core and machine learning. For Workday, it’s all its about enterprise management cloud and data-infused applications, as it replaces legacy ERP systems that can no longer keep pace with modern demands. “We think of our cloud as enabling enterprise collaboration and insight that’s supported by this intelligent data core. It fuels machine learning; stitches data from across the organization together; and empowers self-service reporting, analytics, and scenario planning.”
Workday has seen that its customers in both the finance and HR space have embraced machine learning and AI with arms wide open. These technologies help businesses improve the employee experience, develop needed skills, efficiently utilize budgets, streamline planning, solve critical business issues and provide evidence for decisions.
Employees as an Investment
Larson spoke to us at length about employee experience as a significant investment opportunity. “On the HR side, we are continuing to invest in and innovate around the skills data foundation. Skills is the currency now, and we are helping our customers prepare and plan for a skills-based economy by providing a skills-based talent optimization solution.”
“We’re always committed and continue to invest in our user experience. That’s always been fundamental and core to our commitment and trying to provide our customers with a consumer-grade experience is key. We’re expanding our solutions to help customers reset and thrive in the new hybrid work environment.”
In line with their focus on employee experience, Workday recently acquired Peakon, the employee engagement and analytics solution. Larson’s new goal is to enable every CFO to unlock the potential in their people, processes and data. How does she plan on doing this? By fueling very intelligent and efficient operations, delivering trusted business insights and enabling organizational agility with control.
“Empathy has to be at the center of everything because it’s not just about the finance people in the back office using the system,” she says. “It’s all of the ways you engage your workforce with the system as well. So, we have to make sure that their experience working with finance is a good one. We’re very focused on that.”
Moving to a new financial management system or human capital management (HCM) system is a significant initiative. “People probably have scars of implementations passed,” Larson says. However, cloud solutions make for a smoother transition and faster deployments. “I think customers see the value with Workday, and I think a lot of that has to do with the change management and moving from on-premise to cloud; you can’t just have it be a lift and shift. You have to think holistically about how you want to evolve your process.” Those with a change mindset will get the most out of this type of shift. If you are looking to evolve your processes instead of saying, “I want to do everything I’m doing today and do it in the cloud,” you will get the most benefit. The customers seem to be responding well to Workday’s push for change. Workday also assists with making processes that used to take months now take minutes.
“We hear about the flexibility in terms of changing your business model. If you’re acquiring a new company and you need to add a new legal entity, that’s something that can take minutes versus months.”
Larson also highlights how the data model enables enterprise-wide insight and collaboration.
“One thing we hear from customers is how impressed they are with the ease of use. Workday’s consumer-friendly interface is different from other systems.”
Larson explains how Workday’s offering gives customers the ability to be in a financial statement and drill down to transaction-level detail, which she believes is very powerful and differentiating from other solutions.
Coming to the Workday, the one thing that wowed her was the instant consolidations within the company. She was amazed that you could run payroll or post an invoice or journal and immediately see its impact in your financial statements. The update happened in real-time across the entire system. “That was, like, the single-most, ‘wow, I can’t believe this does this’ experience.”
Larson has experienced firsthand the hypergrowth possible when digitization and employee care are turned into priorities. Workday has aggressively scaled over the last few years, doubling revenues to over $4 billion. It seems there is plenty of room for Workday to continue developing its products and service offering and provide more value for its customers. It goes to show that in the world of SaaS, it is not always the initial concept that decides how far a SaaS can scale, but the way the business adapts to the new demands it identifies and the way it prioritizes its people.