Oracle Cloud HCM vs. Workday: 5 things to know

Every day at companies around the world, HR decision-makers persuade leadership that it is time to look for a new HCM suite. It’s not a minor decision and requires thorough vetting of multiple vendors, as well as coming to terms with the required financial investment. Maybe the company has grown and the old HCM solution no longer meets their expanding requirements, or perhaps their current HCM technology has not innovated as well as they need.

Whatever the reason, the individual(s) leading this process is now tasked with understanding not just what is important to the company but separating facts from spin. This approach means understanding what the different HCM suites offer, what they lack, and the impact of missing functionality on the business.

Two solutions that many HR leaders consider when choosing an HCM suite are Oracle Fusion Cloud HCM and Workday. Here are five factors every potential customer should consider when shopping for an HCM solution.

1. Leverage the benefits of an innovative and unified platform

Workday has used an ever-evolving list of terminology to describe its platform. Some years ago, it was “The Power of One,” [1] a term that many felt was inaccurate due to Workday’s growing list of acquisitions and third-party integrations, this then became “The Power to Adapt.”[2] Now, Workday has fully embraced its fragmentation having branded itself as a “platform,” meaning that it is fully open to third parties. Workday is not trying to say it is a full suite, but it is offering the partners necessary to create that, or so it claims.[3]

Since 2008, Workday has acquired 18 different companies. However, not all of them are on the same platform. For example, Workday Adaptive Planning [4] and Workday Peakon operate outside the core platform and require integration to function properly.[5]

Oracle Cloud HCM is one natively designed, comprehensive suite for businesses that has everything organizations need to support HR practitioners and employees. It is one consistent and personalized experience, accessible where employees work and how they work. It has one single data model on a scalable technology platform that allows users to seamlessly adopt different areas as their organizational needs change and they grow.

Workday’s cloud strategy is equally fragmented, with leadership having outsourced its cloud innovation through a multi-cloud strategy, leaning on partnerships with Amazon Web Services, Microsoft Azure, and Google Cloud. Workday depends on absorbing and combining the innovations of those partnerships and passing the accumulated innovations onto the customer.[6] Oracle Fusion Cloud Applications are built on Oracle Cloud Infrastructure, embedding security, governance, and data management.

Another key contrast around innovation is uptime and scheduled downtime. Workday’s main platform has 220 hours per year of scheduled downtime, three hours per week, four hours per month, and four hours per quarter.[7] Adaptive Planning has 272 hours.[8] Oracle Fusion Applications have an SLA downtime of only up to 9 hours per quarter, which can lead to far less operational disruption.

2. Evaluate whether your TCO is driving value

Leading industry analysts and Workday customers agree that Workday is often a more expensive product and is generally not well-suited for cost-sensitive customers. In addition to subscription fees and the cost of third-party integrations, customers are typically charged a high cost at renewal. The first year of the renewal term has an uplift based on both an innovation index fee of up to 5% and the Consumer Price Index (CPI), generally for the preceding year. That cost then compounds annually in the second term, which can lead to drastic increases.[9]

If there was any doubt that Workday’s innovation index fee was here to stay, CEO Carl Eschenbach recently emphasized the importance of the fee as a means of monetizing AI functionality.[10] As the next section shows, even that is limited.

Workday has large financial ambitions, and it needs to sell the whole platform to meet those goals. It has a ~$10B incremental ARR opportunity,[11] and a Total Addressable Market (TAM) of $142B. HCM is only $58B of that TAM,[12] so Workday needs to sell its full platform. In May 2023, CEO Carl Eschenbach recently stated that “we’re no longer just talking about HCM deals.”[13] Not only does Workday have big plans, but it also spends big. It spends approximately 29% of its revenue on sales and marketing[14] (versus 16% for Oracle). The talent in its “rock star” marketing campaign certainly wouldn’t work for cheap.[15] In short, Workday needs every dollar it can make…and the customer is funding those ambitions.

Alternatively, Oracle does not currently have its renewal fee tied to the CPI or have an innovation index fee. It provides a unified and complete HCM cloud to drive business value through better user engagement and adoption, streamlined processes, improved productivity, and a lower TCO. Customers have reported productivity improvements as high as 62% and reductions in legacy system maintenance costs of 29%, saving teams time and money.[16]

3. Put the power of generative AI to full use

Workday was quick to talk about generative AI, but much slower to act.

Then co-CEO Carl Eschenbach first discussed preliminary plans for generative AI in March 2023.[17] Workday’s generative AI use cases were clarified at Workday Rising in September 2023, talking about functionality such as job descriptions and employee growth plans. Plans for availability were set for 6-12 months from the event, or between March and September 2024.[18] As of March 2024, Workday confirmed that there were three HCM use cases in an early adopter program as of its 24 R1 release, with none scheduled for general availability until the 24 R2 release or later.[19] Workday subsequently put a fourth HCM use case into early adopter program during its DevCon 2024 event, with no clear plans for general availability.[20]

Given that Workday’s 24 R2 release is scheduled for September 2024, it should just barely make its own timeline.[21]

Meanwhile, Oracle Cloud HCM made a clear announcement regarding its generative AI plans and use cases in June 2023. As of its first release in 2024, Oracle Cloud HCM customers have had access to embedded generative AI functionality that help customers improve decision making and enhance the employee experience. These include knowledgebase articles, job postings, performance feedback and development tips, and review summaries. It also includes many use cases that Workday has not announced on its roadmap, like a candidate experience summary, job category landing pages, and job match explanations.[22]

Overall, Workday only has 25 generative AI use cases on its roadmap, while Oracle Fusion Applications have 50+ embedded use cases.[23]

The innovation comparison is substantial. While Oracle Cloud HCM customers are benefiting from increased productivity, Workday users are made to wait.

4. Deliver a personalized and meaningful experience to every employee

Nothing is more important for an organization than its people who support business innovation, revenue, and adaptability. However, many companies are struggling to attract, support, and retain the people they need due to an inability to address the ongoing skills shortage, combat employee burnout and disengagement, create people-focused leaders, and implement new processes and tools that support managerial and employee productivity and growth.

Employees today expect experiences that support their wellbeing, balance, and belonging. When they feel unsupported or unheard, productivity and retention suffer.

This has given rise to the need for employee experience platforms that give the power to provide personalized experiences from a comprehensive understanding of each employee.

Workday, like many HCM solutions, has employee experience products available. On its website, it talks about various features that could potentially comprise its definition of “employee experience,” but never calls out a clear list of products that would comprise a defined EXP. [24]

In addition to the ambiguous list of products that would potentially comprise Workday’s EXP, there are numerous weaknesses and product gaps. For example:

• Workday Assistant, is functionally just a basic HR chatbot[25] and apart from desktop and mobile functionality is only supported through Microsoft Teams and Slack.[26]  

• Workday Help has less robust service delivery functionality, many customers prefer to integrate with ServiceNow instead.[27]

• Peer-to-peer recognition capabilities are only addressed through a limited feedback and gift card solution built on Workday Extend.[28]

• There is no single solution to fully connect skill development, career mobility, and learning.[29] [30]

Oracle ME, a part of Oracle Cloud HCM, is the only complete employee experience platform that empowers your talent to connect, grow, and thrive. With a full understanding of the needs, aspirations, and the “me” behind every worker, you can design experiences that bring out the best in every person. The platform consists of:

• Oracle Journeys: Drive success by delivering personalized guidance to support employees through professional and personal workflows, such as onboarding, exploring career opportunities, transferring to a new role, or getting married

• Oracle Touchpoints: Provide a continuous engagement and action channel between employees and managers that create meaningful interactions

• Oracle HCM Communicate: Create communications that shape culture and drive behaviors that matter to your organization

• Oracle Connections: Enrich relationships in the workplace by helping people find colleagues, experts, and mentors and share interests and feedback

• Oracle HR Help Desk: Deliver quick, consistent, and intelligent HR services to every employee through a scalable and unified service request management solution

• Digital Assistant for HCM: Provide seamless communication and guidance to all employee questions with conversational AI support through an HR chatbot with multichannel support including Microsoft Teams Slack, Facebook Messenger, WeChat, smart speakers, and more

• Oracle Grow: Empower employees, business leaders, and HR to uncover and develop the skills they need for organizational agility and success

• Oracle Celebrate: Drive peer-to-peer recognition and rewards to help improve engagement and promote cultural values

In contrast to Workday, Oracle ME is natively built into Oracle’s end-to-end HCM solution and uses knowledge from comprehensive workforce data to deliver the right guidance based on an understanding of every individual’s career and personal details. You can also broaden experiences with workflow actions and resources from third-party systems and other Oracle Cloud applications from Financials to Supply Chain to Customer Experience, typically without the assistance of IT.

5. Support every HR process with one complete solution

Workday HCM has many products and features. However, it is what the company does not do that merits attention.

• Workday is primarily a US-based company, with only 25% of its revenue from other countries.[31] This focus reflects in its payroll product, which only supports five countries currently (without partner integration),[32] having failed to fulfill its plans to deliver German payroll in 2023.[33]  Unlike Workday’s five countries, Oracle’s Local Payroll is offered in 14 countries, and International Payroll Core is offered in 46 countries- for a total native availability of 60 countries. Oracle Payroll is a highly configurable solution that is fully unified with Oracle Cloud HCM for efficient, compliant payroll processing across the globe.

• While Workday has recruiting functionality, it lacks a candidate-facing digital assistant[34] and its candidate communication system is SMS-only.[35] Meanwhile, Oracle Recruiting is a robust recruitment platform that unifies recruiting with the rest of the business. This includes a digital assistant that simplifies hiring for candidates and both SMS and email candidate communication.

• Workday does not have all the same controls offered by Oracle Advanced HCM Controls. While it does claim to have audit controls, fraud detection, and some segregation of duties capabilities, these are classified under its Financial Management solution and focus mostly on approval thresholds and preventing unauthorized transactions rather than HCM.[36] Oracle Advanced HCM Controls offers deeper segregation of duties analysis, secure role design, sensitive access certification, and automated HCM configuration and transaction monitoring, in addition to fraud and error detection. The sum of these features allows for addressing data privacy regulations, mitigating insider threats, and quick adaptation to risk and compliance mandates.

• There is also no full health and safety functionality in Workday, customers requiring that would need a third-party integration such as Intelex.[37] Meanwhile, Oracle Workforce Health and Safety is native to Oracle Cloud HCM embedding itself into the daily processes of all employees, promoting a culture of workplace safety, risk mitigation, and reduced costs.

One of the many companies that have realized the value of Oracle Cloud HCM is ArcelorMittal, a global steel giant that is modernizing its recruiting, people management, and other HR resources. As the company digitized and automated more of its global operations, it also saw the need to enhance the education and rebalance the skill sets of its nearly 200,000 employees. After considering other solutions including Workday, ArcelorMittal chose Oracle Cloud HCM because of the platform’s comprehensive, intuitive, enterprise-wide offering that could support all HR efforts without the need for IT. Since implementing Oracle Cloud HCM, the company’s recruiting capabilities have improved and managing employee performance is more streamlined.

Read more on how customers worldwide have used Oracle Cloud HCM to transform their HR.

Want to learn more about Oracle Cloud HCM?

Choosing an HCM platform for your organization is not easy. With everything the workforce needs today, make sure you give your employees a complete, enjoyable, flexible, and intelligent HR system that meets current and future organizational requirements.

Disclaimer: The preceding is intended to outline our general product direction. It is intended for information purposes only and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality and should not be relied upon in making purchasing decisions. The development, release, timing, and pricing of any features or functionality described for Oracle’s products may change and remains at the sole discretion of Oracle Corporation.