Workday VIBE Launches to Address Diversity and Spur Growth

In a time where Value Inclusion, Belonging, and Equity (VIBE) is more important than ever, HR leaders are struggling with creating strategies not only to diversify, but to keep these plans and policies intact in future years.  Many companies have recently made belonging and diversity commitments, yet retaining diverse talent continues to be a roadblock, indicating a broader challenge.

The two possible reasons for efforts to fail are – lack of validated external benchmarks and the absence of a structured process for internal gap identification.  If organizations cover these two areas, they will have a clearer picture of where they truly stand and be in a position to properly prioritize the key areas requiring improvement, rather than taking a shotgun approach and unnecessarily investing in all of them.

Enter Workday

Workday has continued to do well, not only in financial performance, but also in adding functionality like VIBE Central and VIBE Index.

VIBE Central claims to bring all diversity- and inclusion-related data into one centralized place in Workday Human Capital Management (HCM), enabling organizations to set goals and then monitor progress against those goals. Businesses can assess, measure, benchmark, and manage diversity and inclusion by the dimensions of their choice, such as race/ethnicity and gender.  For example, VIBE Central could surface that 10% of women in the organization have been promoted in the last three years; in addition, benchmark data could show that promotions for women are well below the median percentile for peer companies within their industry.

The VIBE Index claims to empower HR leaders to set a strategy and create a tailored plan aimed at driving positive outcomes. It will measure the relative performance and outcomes of an organization’s efforts across talent acquisition, talent development, leadership development, employee experience, and workplace culture to deliver a heat map that identifies the highest opportunity for positive change, as well as a VIBE Index score for overall workplace equity.

• VIBE Central will be available in September 2020 at no additional cost to Workday HCM customers. Workday is offering a promotion through February 28, 2021 to assist the first 300 Workday HCM customers with best practices guidance and configuration support.
• The VIBE Index services offering will leverage Workday Prism Analytics and become generally available to customers in the first quarter of calendar year 2021.

Workday measures its success not just by sales, but through successful deployment and production phases, as customers measure their own success by the solutions they are able to deploy and realize value from during production.  With Workday looking to timely meet customer demand for these solutions, they will have plenty of incentive to maintain their self-proclaimed 97% customer satisfaction rate as they look to capitalize in this rapidly developing growth area.

However, before your organization jumps headfirst into adopting the VIBE solutions, you should use this as an opportunity to assess your overall Workday relationship and commercial deal structure.

Beware of Bundling SKUs Into One Subscription Fee

Be careful of Workday using this sales opportunity as a means of securing an early renewal and providing a bundled price.  We have seen Workday proposals and executed order forms that have multiple solution SKUs listed but only include pricing for the entire bundle.  There is no line item pricing and therefore no pricing transparency.  The concerns with this type of pricing are as follows:

• It is extremely challenging-to-impossible to break out the pricing for each SKU to determine pricing competitiveness;
• If you have future growth, you will need to purchase incremental FSEs (Full-Service Equivalent workers) for the entire bundle and not by line item; and
• If you ever want to remove SKUs in the future, you will not be able to validate the accuracy of the new pricing because you have no visibility as to how Workday is allocating the bundled pricing across each line item.

If adding VIBE Index, be sure to obtain line item pricing and include this level of detail in the order form.

Re-Evaluating FSE Worker Categories

Whether you are adding VIBE or other Workday solutions, be sure to review and validate your FSE worker categories and counts.  Solution expansion may result in a new set of worker classification categories that would be using these new solutions that is different from those workers factored in your original subscription. You will need to review any new workers that will now be using Workday and group them by role or classification, such as field workers, or seasonal workers for the holidays.

Remember that if you have workers that do not easily fit into one of the worker categories, you can request Workday modify the definition of a Workday category or even create a new category with a custom definition that addresses your unique workers.  You will just need to clearly articulate why these workers are different and do not fit within the defined worker categories and the applicable percentage that should be assigned to them based on the level of value they provide to your organization.

Re-Assess the Value of Your New Deal

Before entering any negotiation with Workday, you should look at your current Workday subscription and determine actual value realization from all solutions, identify any pain points, and evaluate the competitiveness of your pricing and commercial terms.  All of this information is critical in obtaining the most value from your Workday investment.

Expanding your footprint is very strategic for Workday as they are able to obtain a greater slice of the applications running your business and increase vendor lock-in.  Any value loss identified in your current subscription should be addressed as a prerequisite for expanding your solution footprint, as your negotiation leverage will only decrease as you add more Workday solutions.

You need to make the most of each negotiation opportunity.  You do not need to take a scorched earth approach to negotiations by fighting for every little concession, but you should maximize your leverage to ensure you are securing a fair and competitive deal that will enable your organization to extract as much value from your Workday investment as possible.  Adding VIBE to your Workday footprint presents this type of opportunity.

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