Beyond SaaS: Navigating the Agentic AI Frontier with Workday

How are advanced AI models and agents fundamentally reshaping enterprise SaaS, workforce dynamics, and the very definition of business value? 

‍

Get the answers at The Six Five Summit: AI Unleashed! We are privileged to feature Aneel Bhusri, Executive Chairman and Co-Founder at Workday, with a keynote on the implications and strategic future of AI beyond traditional SaaS boundaries. He joins host Patrick Moorhead for a deep dive into the practical implications and strategic future of AI beyond traditional SaaS boundaries.

‍

Key takeaways include:

‍

🔹Agentic AI's Workforce Transformation: Explore the practical implications of AI agents on job roles and necessary skills within enterprises, alongside Workday's platform evolution to manage this profound shift.

‍

🔹Workday's Differentiated Agent Strategy: Aneel dives into Workday's technical execution and key innovations in Agentic AI, focusing on how they help customers quantify the ROI of agent-driven capabilities in HR and finance.

‍

🔹Scaling Enterprise AI: Governance & Security: Understand the critical challenges of scaling enterprise AI, particularly in data governance, infrastructure, and robust security, with strategic advice for secure and efficient advanced AI leverage.

‍

🔹The Future of Enterprise Apps in an AI-Centric World: Gain insights into the competitive landscape, future market shifts driven by AI, and Workday's strategic positioning for 'the next big thing' to maintain leadership.

‍

Learn more at Workday.

‍

Watch the full video at Six Five Media, and be sure to subscribe to our YouTube channel, so you never miss an episode.

‍

IMPORTANT: Note to Uploader: VIDEO EMBED - added by uploader.

‍

Or listen to the audio here:

‍

‍

Patrick Moorhead: Six Five Summit is back. It is day two and we are in our sixth year here and we are unsurprisingly talking about AI pretty much 24 by 7. Previous years have been about building the initial POCs, the experiments, but now enterprises are starting to scale and surprise, we have agents. And I'm very excited to announce Aneel, who's the executive chairman and founder of Workday, to talk about agentic AI frontier beyond SaaS. Aneel, welcome to the show.

‍

Aneel Bhusri: Thank you. It's great to be here, Patrick.

‍

Patrick Moorhead: I love to have discussions with founders who grew their companies, public companies, large companies, but are still doing it. I absolutely love that and applaud your ability to go from tiny to growth and staying power.

‍

Aneel Bhusri: I love it. That's nice of you to say. I will die at this company and so will my co-founder, Dave. We've been together for 30 years and this company is our life's work and I just want to make sure that it does well during this transition from. It's not really a transition, but this move from cloud to AI.

‍

Patrick Moorhead: Yeah, it's incredible. I love the story, I love the passion. Even though I have a much smaller company than you do, I'm still. People ask me, when are you going to leave? When are you going to leave? I'm like, well, why would I ever leave? I love what I do. My name is on the masthead of this company and I want to just keep grinding until I don't anymore. But hey, let's, let's dive in here. You know, it's funny, a year and a half ago, you know, we were all talking about LLMs, right? That was going to be the big thing and you know, they still are. But when it comes to actual actions that companies have to take, it really is all about agents. And with this reshuffling here, you know, work 2.0 is really about, okay, this is the group I'm in, this is the role that I serve. But AI really gives the ability to kind of reshape the entire workforce. And we're seeing this today. Question is, what are the most immediate implications for job roles and skill sets required within enterprise? I mean, you see all of this at Workday.

‍

Aneel Bhusri: So I say the first thing is the cloud was all about moving to a new platform and business process automation. AI is about roles and skills and that, that has some, you know, repercussions for, for humans that are, that are in the, in the workforce. But the idea of an agent should think of it as a digital employee and you know, that that is when I think about the different stages of technology, I think about the mainframe to client, server to web to cloud. And everybody thinks that AI is next, but AI is actually not next. AI is built on cloud.

‍

Patrick Moorhead: Yeah.

‍

Aneel Bhusri: So you need to have the data set to create these agents that will do, you know, do work. And an agent effectively is a digital employee who's going to be managed by an HR system. That's the way we see it. They got to get onboarded, off, boarded. They have to need to have the right credentials, the right security privileges. That's how agents are going to work. And I do think that Genai was a bit of a head fake for the enterprise. We all got excited about it, but generating content for job descriptions or whatever else we did in the enterprise wasn't that exciting. It was very exciting in the consumer world, but in the enterprise world the agentic revolution is everything. It really is everything.

‍

Patrick Moorhead: Yeah, it really is. And I'm curious what are the kind of the, you know, I think everybody has grasped this high level impact what it, what it can do. You know, a call I listened to this morning talked about, hey, we're not, we don't bring out these products without having an ROI that are, that our alpha customers tell us they have. But what are the most practical implications for the jobs and the skill sets inside of these companies?

‍

Aneel Bhusri: Well, you mentioned ROI and I think people have lost sight of that. Every technology wave that's happened is based on an ROI or a total cost of ownership that is better than the previous technology. It can't be AI for AI's sake. We actually have to prove case by case that this technology has payback for the customer or it's really not worth doing. And, and I think I, I think we're very focused on that. I wish the whole industry would get focused on that rather than just the sexiness of AI. 

‍

So this is hard for me to talk about because I, I see where it's going, but the reality is low level, white collar jobs. Things like accounts payable and payroll processing can be done by agents and it's up to the, it's up to the customer. In our case, our customers decide how quickly they want to roll it out. Can you take those individuals and move them up, up the stack and have them do more meaningful work? But a lot of the work that gets done will be done by agents in basic business process applications, tasks. There's just, there's just really, literally, Patrick, there's no way around it.

‍

Patrick Moorhead: Yeah, I love the way that you go down not only ROI, but also the reality of what's going to happen. And a lot of people try to gloss over the reality. What I like to say is I actually was part of a dot com in the dot com boom and I was part of the bust and it reshaped certain industries and certain jobs. And the way I like to describe this next wave is kind of the sea of cubes that really weren't touched in, in any of any of the previous waves. What we did is we found a way to electronically change what had been paper. Okay, this paper gets put in an envelope or email to somebody. But yeah I'm definitely aligned with you here. I want to talk about your, your agent strategy. What are some of the innovations and some of the way you differentiate from other companies here in the market?

‍

Aneel Bhusri: So, you know, our heritage when Dave and I started the company was around HR and finance. And in particular we wanted to be a system of record for both, you know, for both of those. Both those systems. So as you apply it to the world of HR, if you believe an agent is a digital employee who's going to, who's going to manage that digital employer for you, who's going to onboard it, offboard it, give it security privileges, know what data can see, what it can't see, naturally it's the HR system. So the first thing we set our eyes on was building an agent system of record, which has been underway for a while and will be in production by the end of this year. And basically that will look at digital employees in a similar way that we look to human employees. 

‍

You can't have agents running around the organization in a chaotic way where you don't know what profiles they have, what security privileges they have, where they are in the org chart. All those things come back to an HR system. And so we put the digital employee in the HR system and create this agent system of record. And then we focus in on the agents that could be most meaningful. And I'm a big believer in painkillers versus vitamins. Where's the pain? Where's the pain? Where can we help our customers the most? So a couple of the most popular agents from, from our customer perspective is the business process optimized one where the agent looks at the existing implementation, looks at the process, and recommends a better way to do those processes. 

‍

My favorite one is the financial audit agent. If you think about a financial audit, they get done in a very short amount of time, after every quarter. You know, the, the way an audit works, you can only Sample a subset of transactions and you hope that they get it right. Well, with an AI financial audit agent, they'll be able to sample all transactions. And I'm not just saying this replaces auditors. I just think it's a great tool for auditors to make sure that their work is right. And as a, As a former CEO, current chairman, and having to sign all those 10K and 10Q disclosures, I would love to have an, an AI agent on financial audit. That just gave me comfort that, that we covered everything.

‍

Patrick Moorhead: Yeah, you know, I, I like the, the idea of onboarding an agent and having them as an employee, particularly at the epicenter of a system that already does this. I think that there, there is a, a baked in advantage. And I know you're focused on HR in finance, but you could hypothetically extend that to other M's in the, in the enterprise. So I think I need to go off and research that.

‍

Aneel Bhusri: Well, I, I hope that other companies like a Salesforce or an Adobe or any other application company that's not in the HR business says, hey, we want, we want your help to manage our agents. Because you don't want to, you don't want a sales agent or a marketing agent again, running, running wild in the organization. You want to tie to an org structure, just like the marketing and sales people that are doing the work right now that are humans. Right. They have to fit into an org structure, they have to fit into security and identity profile. So why shouldn't the agents doing that work do the same thing?

‍

Patrick Moorhead: Exactly. Are you helping your customers calculate ROI or kind of leaving up to the, you know, chief data officer, the chief CIO officer or digital transformation officer.

‍

Aneel Bhusri: We, we are, and I, and I would say that from what I've learned, I, I, I spoke in front of 50 CIOs a couple weeks ago at the Gartner Research Board. I do think the CIOs are the gateway for a lot of the AI work. They understand the technology, they have the budget, they're going to decide what parts of the business they're going to apply it to. And so we're trying to work with them to understand what they're trying to solve and how we can help them solve it. And a big part of that is what's the business case? I'll just keep coming back to that. And some of the industry analysts will just say, no technology, you gotta get the technology in there. But honestly, if there's no ROI or business case, technology is not useful. And that's the way workday was built. We didn't succeed in the cloud because people just wanted to go to the cloud. We had a better ROI. And if a solution that we're building doesn't have a great ROI for a customer, they shouldn't deploy it, right? I think they will, but maybe it doesn't work for every customer.

‍

Patrick Moorhead: It is music to my ears. The first slide when I'm talking to a room of CIOs is ROI. And you know, I worked at Big Ten, Big Tech for over 20 years. I was a corporate executive. And, you know, knowing how these things operate inside of an organization, in the end, board, CEO, business unit leaders, they want to know what the payback is and are less enthralled by, ooh, we have this tech of the day. So it really is music to my ears here. There are still some impediments to AI adoption. I was at the original Sam Altman Microsoft announcement about two years ago in Seattle. And aside from the whiz bang things that I tried to put myself in the shoes of a cio, you know what's going to be hard here? And it was governance and it was data management, right? It's hard enough to get the data right in the silos of the systems of record, okay, and then activate it. But with LLMs and agents, it has to cut data, has to cut, cut across those estates. Are you helping customers in the silo? Of course you are with HR and finance, but what are you doing across there? And let's see, even inside those, to help them get their data estates ready to turn on these incredible new features and capabilities.

‍

Aneel Bhusri: Well, you nail it in the description. You got to get the data right. You nailed it, Patrick. I think the first and foremost thing is to recognize that enterprise organizations, they can just have clean data. They don't have to take data from the consumer Internet, they can just have clean data. It might take longer for them to get real results out of the LLMs, but they won't get hallucinations because it's their data. And the way we see all of enterprise data is the customer's data. And if they're kind enough to share their data with us so we can give back the results to them on an aggregated basis, we're grateful. And most customers do that. But I think the first thing is to have a data policy. That is what kind of data is allowed into the mix to drive the LLMs. And if you start taking risks with that data, well, you know, crap in, crap out. You got to be really, really careful with what data goes into the LLM models that you really want to build?

‍

Patrick Moorhead: Yeah, and listen, I know every M says their data is the most important, but you span HR, which is how. How much am I paying somebody? How much was their bonus? What's their age, or some physical challenges they might have. And then on the finance side, I mean, that's about as sensitive as it gets. And those need to be, obviously, those need to be secure as well. And we've seen a lot of people reverse engineer a prompt and figure out how much money it's not just a CEO because that's public, but it's everybody else who's not, not, you know, on the, on the 10 form. So, yeah, security. Are you helping customers with security at all?

‍

Aneel Bhusri: Yes, our system is very secure. And as an HR system and a finance system, we embrace and welcome all the privacy laws too. Yeah, that data has to be, has to be carefully protected. And so when you think about those issues around HR, that's why you don't want to let in external data. You just want to use your own data. And for a Fortune 500 company, they have plenty of data to do whatever they need to do for a large language model. And if they let us aggregate it, the results get even better. But if they don't, it's still good. So I do think we're at this point where we really have to be clear about clean data and not so clean data and really bad data. And we're just not in the business of dealing with anything other than absolutely clean data. And because our systems are. Every customer is running the same system at workday and HR and finance. It's the same business model, it's the same version. That's the beauty of the cloud. The data is, is in a format that is canonical and that everyone can use and that's hugely powerful to avoid some of the pitfalls of, of, you know, hallucinations and other problems with it with AI. Yeah, that's probably said too much there, but I feel strongly about clean data.

‍

Patrick Moorhead: No, I appreciate that. I don't think anybody would disagree. I mean, especially with the sensitivity of the data that you handle. It's been a great conversation. I want to end future forward look here, kind of beyond your current road map. What is, and it's funny. LLMs, big agents, big what. What is the next big thing that you're strategically positioning your company for? You know, beyond the, beyond the current buzz that we're looking at today?

‍

Aneel Bhusri: Well, I, I think the natural next step for Workday is to organize the agents into workflows. And I don't know if that's called a super agent, but it's not just agents fitting in your organization, but it's actually orchestration of agents into a super agent that does a lot of the work that frankly, humans don't want to do. And I think that's the real next step. I don't actually think that's that far away, actually. So we're working really hard on some of the orchestration technologies to do that.

‍

Patrick Moorhead: Yeah. And it's good to see some standards forming, you know, a, to a right agent to agent. And so, you know, it doesn't have to be only your agents can, can speak that. MCP is another one. That, that's pretty exciting. So this is, this is great stuff. Hey, I just, I want to thank you so much. Thank you. Coming on the show here, this is great. It makes me want to go back and learn more about what you're doing, particularly that last one. I have a pretty good sense for, for what you're doing there, but I can imagine. And I don't think it's that far off either because we actually are seeing the standards and the technology to make this stuff happen.

‍

Aneel Bhusri: Can I leave you one last thought?

‍

Patrick Moorhead: Please.

‍

Aneel Bhusri: These master agents that might orchestrate all these other agents, the idea of a maybe not a Terminator kind of event, but something like that, it's greater than zero. So everybody watching and listening just needs to recognize that this technology can get out of hand and out of control. And we all have to control it to make sure, you know, bad stuff doesn't happen. Because, because it could. And we've seen it, we've seen it already with some of the code. Code development technologies where the AI takes on a person of its own. And I'm old enough to not just talk about the Polyianis Great stuff, but we also have to be very cognizant of the risks with this technology and manage it, manage it appropriately. Yeah.

‍

Patrick Moorhead: The higher, the higher the return, the higher the risk. As, as, as we move forward, I don't think, you know, we. There will be some event that will happen that, that will unfortunately put the, put the, put the focus on that. But sage words to end this on. Thanks again.

‍

Aneel Bhusri: Thank you, Patrick. That was really fun to be with you.

‍

Patrick Moorhead: So thanks for joining us here. Day two opener of the Six Five Summit in its sixth year. We're talking AI, of course, how to make it real, deliver real ROI. Stay connected with us on social media. Explore the conversations at sixfivemedia.com. More insights coming up next.

‍

Disclaimer: The Six Five Summit is for information and entertainment purposes only. Over the course of this webcast, we may talk about companies that are publicly traded, and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors, and we ask that you do not treat us as such.

‍