Have You Reached Your ‘Pivot Point’ On Legacy Software?

In his new book “SAP Nation: a runaway software economy,” Vinnie Mirchandani takes a microscope to the company and its vast ecosystem. In the very first chapter he introduces the idea of the “customer pivot”—that point when a customer of traditional software applications decides to take some kind of substantial alternative route. Mirchandani writes, “History will recognize February 23, 2008, as a pivotal day for technology.”

It was on this day that Flextronics, a $26 billion dollar company, decided that instead of proceeding with the status quo for a global human resources application deployment—requiring installation and ongoing maintenance of software for 160,000 employees worldwide—it would choose a three-year-old company named Workday to deploy HR in the cloud for its global workforce.

Flextronics now has a 200,000-strong workforce in 30 countries, and we are grateful for a long and close relationship with the company. To quote Mike McNamara, the CEO of Flextronics, from Mirchandani’s book: “If I think about the top challenges of a CEO, I think about staying relevant on a continuous basis . . .  as the world changes, and as other competitive challenges happen. And I think the cornerstone of staying relevant is the management of great talent.”

McNamara says the Workday deployment was completed one year ahead of schedule and below budget: “We view Workday as the cornerstone of how we make [talent] deployment work, how we recognize talent, manage talent, and distribute talent to achieve our objectives. This is not a software implementation project. This is about how you run the company.”

Mirchandani calls companies like Flextronics, and people like McNamara, “canaries in the coal-mine,” as they took bold steps to pioneer true business transformations within their organisations. But that was in 2008 and we are now in 2015. Workday just turned 10 and has more than 700 customers worldwide—most of them large enterprises—with many of these headquartered in Europe, including Aviva, Rolls Royce, Travelex, and Unilever. Just like Flextronics, at some point all of our customers reached a pivot point, when they decided that sticking with the status quo for enterprise software applications and deployments was no longer the right approach.

Indeed, I would argue that businesses that do not seriously explore beyond the status quo approach of legacy software deployments are the ones taking the high-risk route. The simple question companies should be asking now is, “Have we reached our pivot point?”