By Mark Nittler on Financial Management
We talk a lot in our industry about how consumer technologies drive innovation in enterprise technologies. My own favorite example of this is Worktags, just one of our inspirations from the consumer world. Worktags play a supporting role in how our customers will leverage innovations we announced today for Financial Management in Workday 18, as they did in many of the 17 updates that came before it. That's why Worktags deserve their very own blog post as to what they are and why they're special.
Worktags are keywords assigned to business events, so our customers can aggregate, report, and analyze their business information within Workday. One example: An employee fills out a purchase order (an event), which can be assigned any number of tags, such as the name of the person making the purchase and the project it's for. A tag could also be a department, customer, product, supplier, or subsidiary, while other types of events include a generated invoice, a submitted expense, or a payment received. The ability to tag these businesses attributes to events—either at the time they occur or a later date if needed—is the building block in providing our Financial Management customers with a complete, multi-dimensional picture of their operations. The first image below is an example of an invoice event, with the associated Worktags, while the second image demonstrates the ability to analyze tagged information.
The story of Worktags began about seven years ago. We at Workday were working on new software designed to address the limitations of financial management systems sold by ERP vendors. It turns out that the source of many of traditional software's challenges was found in the design at the very heart of those systems—the way transaction data was modeled. The origin of much of the pain is the code block, which is intended to provide a consistent way of identifying data needed to create journal entries from business events.
Today, this code block is at the root of the most challenging problems of traditional financial systems. A limited number of fields are available, enough to create accounting but woefully inadequate to provide a multi-dimensional management view of a business. Once the code block is established it becomes like concrete, brittle and very difficult to change. This works for accounting data (how often do you change your natural account number?) but again, it falls far short of the agility needed by a dynamic company. Additionally, code block comes in one size per company; everyone in the organization faces the same set of codes. If the services and marketing departments analyze spend and revenue differently, tough, "you can have any color as long as it's black." So businesspeople using traditional ERP financials have turned to ad hoc analysis using spreadsheets, or in some cases to purchasing and deploying very expensive business intelligence systems.
We knew there had to be a better way. Best of all, we had the advantage of being able to start from scratch to solve this problem, rather than try to "re-engineer" software designed under the constraints of the 1980s. You became very careful of how much data your software could manage when a gigabyte of memory cost $200,000, as it did in 1980. (Today that gigabyte costs less than $1, allowing for systems designed this century to take a very different, much more data-rich approach). While we knew we could build a modern financial management system that would affordably store more types of transactional data in memory for easy access, we needed a way to organize it for customers.
That's when we became intrigued with the concept of tagging in the consumer world. We recognized tagging as something that comes naturally to people as a way to categorize "stuff" so they can find it again, and got to work to see if we could apply it to the enterprise cloud. The result was Worktags, a way to categorize business "stuff."
Worktags have been core to Workday Financial Management ever since. Our customers are not bound by the constraints of the traditional code block—they can configure many types of Worktags and easily change them as business needs evolve. Different departments can use different sets of tags—services may want to understand spend or revenue by facility or by customer, while marketing is looking to analyze spend by campaign, product, or region—so they can create management reports and analyses that are relevant to them, directly from their core financial management application. And while our use of tagging was inspired by the consumer world, we recognized that the casual nature of social tagging was not appropriate for managing the financial information of an enterprise. Worktags are a hybrid that include the consumer concept of tagging with the necessary controls of enterprise systems. In fact, we sometimes refer to them as an "agile code block." The result is that multi-dimensionality is inherent and organic in the data itself, delivering business intelligence straight from the source.
So as you can see, Worktags really deserved a blog of their own. Inspired by the consumer world and executed for the enterprise, these innovative tags play a big role in the world of modern financial management.
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AltaFlux Corporation is a global HCM cloud consulting partner based in Troy, Michigan. We empower organizations by streamlining, transforming, and optimizing key human capital management (HCM) processes with industry-leading HCM cloud solutions like SAP SuccessFactors, Benefitfocus, WorkForce Software and Dell Boomi.