During my recent trip to Silicon Valley, I had the pleasure to meet up with three fascinating companies in the space of enterprise and HR technology. It was my usual visit to reconnect F2F but also understand the direction these companies are going, their roadmaps their strategies. And of course, this year more than ever, it is about understanding how they see (Gen) AI in their products. I met up with Workday, ServiceNow and Microsoft – and they all have (Gen) AI identified to be at the core of their products, but each in their own different ways. That makes it exciting to listen and to understand – and after the in person meetings, I must say that it makes sense to me which direction and adaption they have all taken. All three go different routes, but they have good reasoning behind. If these are correct though and will bring them into the future of HR technology is a question to be answered by the future. As I wrote a few posts back, I believe that we are at a cross-roads when it comes to HR technology. We are at a junction where either the current main players need to reinvent themselves completely or be overtaken by new players. It is a great time to watch and an exciting time to be in the market – however, I hope you are currently not shopping for a new HR core system. It is a difficult time to decide what the future-proof decision will be. I don’t envy you if you are in this position.
Microsoft
But now let’s look at what I have learned. Let me start with Microsoft. They are currently one of the biggest and most active players in the space of (Gen) AI. Their usual surface event this year was more about Gen AI and Co-pilot than anything else (I think they turned to surface devices 40 mins in only). And that speaks to the “all in” that I have also experienced during my visit. Microsoft is bullish about Gen AI and its opportunities. But they have also already learned a lot since the beginning of the year – I believe this is truly contributed by them being in this game early on, but with their open mindset and closeness to the enterprise market. This is what makes the position of Microsoft so interesting. They have not only the technology (OpenAI) but it is paired with an amazing set of enterprise-partnerships and an internal, company-wide growth mindset. You can clearly see how Satya has transformed the thinking and approach of Microsoft and how fundamental this is to their agility in this space.
Now, when I mean they learned, I mean that they are not only focused on Gen AI but at the same time bring in their other strenghts. They know that their customers are worried about data privacy and data security and they know that data, which is at the heart of any successful Gen AI application, is not readily available to be ingested and made use of for Gen AI within companies. And knowing that and being as agile as they are, they made this a product feature as well as new additions to existing products. Data privacy and data security are now at the heart of their enterprise Gen AI applications so that you don’t have to be worried anymore where your data goes and where it might get exposed – or how and where the LLM uses it for their own learning. This is truly a key function in the enterprise market. And in addition, they are deploying additional tools to manage and clean data in your enterprise network and intranet so that it can be used for Gen AI applications. And at the heart of everything lies the MS Graph. In the good and in the bad, because Microsoft is at the heart of the tech infrastructure for most companies, they are in a pole position.
However, of course there is a “but” – and the but is that specifically in the HR space, Microsoft doesn’t really have an idea what use cases make sense or how to apply and integrate Gen AI into the processes and routines. As often in technology: They have a solution and are in need of a problem they can apply it to. Again though, Microsoft being Microsoft, they understand this and are actively engaging with companies to learn and identify the right use cases. It has been great to watch how Microsoft revolutionizes this market with their speed and agility – and I am looking forward to the next few months. Let’s see where we stand in just 6 months from now.
ServiceNow
Let’s then turn to ServiceNow. I had shared my impressions of their K23 conference here, and meeting them in their HQ, my impressions got confirmed. ServiceNow is highly active on Gen AI and this in a truly “platform of platforms” fashion. You can either “bring your own” LLM and connect it to your ServiceNow implementation – or subscribe to their LLM which is more customized and focused on the actual use-cases you might have. And this is also their strength and a differentiator. They have a clear picture of how their customers use their platform and what use cases there are, what use cases bring the most value and how to apply Gen AI to lift that value. This is fascinating to see and amazing how focused and targeted they go after this. I cannot wait till Vancouver is out and the full breadth of their first generation Gen AI application will be available to the wider audience. Being able to test & learn with them on this journey has been a fabulous experience.
Now, besides Gen AI, of course ServiceNow is further refining their product and unfortunately, what I had already mentioned in my K23 post is becoming more and more true. From being the platform of platforms where you can integrate multiple systems across employee or process journeys while keeping the actual underlying systems in charge, ServiceNow is now heavily focusing on being the only platform, the only interface you see as an end-user. This means that any service is to be integrated and overlayed by ServiceNow and then brought back into the actual application where the data or process is run. I don’t think that this is the right approach and I am not sure who is able to follow such approach outside ServiceNow as a company. You would need 100s of ServiceNow developers to make this happen and to keep it going – and what is the value add? Yes, you will have one coherent UX/ UI across all of your systems for end-users. But what is the price you pay? – you have to pay for all systems anyway, you have to get more support and maintenance staff and, and this is one of my main concerns: You lose flexibility and agility. You will never be able to quickly adapt a new feature from any of your underlying systems because you always have to also update your top ServiceNow layer.
I believe that you need to reduce the variance of UX/ UIs you expose your end users to – but I also think that in their private lives people can deal with two or three different Apps and interfaces. Of course, these interfaces must be of high quality and straight forward to be used for end-users. But the difference of approach is that if these interfaces are not where you need them to be, you attack the root-cause and work with the system partner to fix this and improve the UX/ UI. I do not believe in plasters (vs. fixing the root-cause) and placing ServiceNow as the only end-user interface on top of your other applications is a plaster and nothing else.
This is however, not where my concerns with ServiceNow end. As some of you have probably seen, ServiceNow is also entering new territory. They are offering “core” Talent territory solutions in the spaces of Learning, Performance Management, and Skills – and I have not heard any voice saying that they will stop at that. Now, if you want to have a one-platform solution only, you might soon be able to use ServiceNow for most of it in the Talent space – but where I am concerned is that this strategic direction will bring them into difficulties with the likes of SAP/ SuccessFactors or Workday and others. This will ultimately take the direction of a rivalry vs. a partnership between these companies – and the impact of this will be felt by us Experience and HR Tech leaders when suddenly Successfactors or Workday are no longer playing nice with ServiceNow and therefore your integrations deteriorate or require more customization. I understand that ServiceNow is looking to grow in new directions, but as a market observer as well as practitioner I am not confident that this is any good for their main customers.
Workday
And last but not least Workday. I have been quite critical about them and their AI journey recently and was looking forward to a more in-depth conversation in person at their HQ. I was not let down. We spent a good time with Dave Sohigian, Workday CTO, to talk about AI and how Workday thinks about it. I must say that I am encouraged after what I have learned that Workday has understood what is at stake and that they will accelerate in this space with a balanced strategy. I am sure that they will share more during their Workday rising conferences and I will wait to hear from them there. But in essence they are similarly looking into an open eco-system of OpenSource or best of breed LLMs they can use and apply them onto their data. This makes sense from the perspective that it is a controlled application and the data that is used is clean and structured – because it is the data of all Workday customers that opted into sharing as part of the innovation agreement. On the other hand, it is of course a limited set of data even for the size we talk about including 80% of Workday customers. Competitors are more open and are using data sources that might be less structured and more contaminated with bad data. So the question is – and I don’t yet know the answer but am looking forward to it being answered – what is better: Tons of data of good and questionable quality or great, clean data but less. What is better for the performance of these specific AI applications.
And with that, let me close today’s post and thoughts. I am looking forward to the announcements that will come our way from all the Techtember and Techtober conferences and see where the industry is going.
Chief HR Officer 
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