Why it’s important to understand Alight’s new capabilities in Workday services with Appirio acquisition

The Workday service partner ecosystem is relatively small, with fewer than 50 partners to consider for service engagements. Wipro acquired one of the partners, Appirio, in 2016. As well as a Workday practice, Appirio brought Salesforce skills and a crowdsourcing platform, Topcoder. A culture clash and lack of knowledge of the Workday service business exacerbated integration issues. This led to Wipro selling the Workday and Cornerstone OnDemand practice of Appirio to Alight for US $110 million in February 2019. Alight presents a different proposition in the Workday service ecosystem now, so you need to understand its strengthened capabilities as you consider Workday service providers in your RFP process.

Increased breadth of capabilities

Here we outline five things you should consider.

1. Take note of the increased talent pool. Alight increases scale but also important expertise in a growth market that has a talent shortage. Our estimates show that Alight now has the biggest Workday services practice in the industry, with an estimated 1,560 employees. Moreover, it has the highest number (160) of certified Workday Financial Management services analysts. Workday Financial Management services is an emerging growth area that most Workday partners are currently strengthening. With more than 1,000 total Workday certified consultants, Alight holds the number three position, just behind Deloitte and Accenture. We based these statistics on HFS Workday services research in the HFS Blueprint Report: Workday HCM Services 2018 and HFS Top 10 Workday Financials Services 2018 All service providers have continued to invest since we published these reports, but the additional resources Alight has gained from this acquisition remain significant. Numbers do matter in a market where skills are scarce, and your projects can often span several sites and countries.
2. Consider Alight’s enhanced services adjoining Workday. Outside of pure Workday modules, Alight has also gained talent in adjoining areas. It has approximately 30 Cornerstone OnDemand resources, which doubles the size of its small but growing practice; this provides an alternative talent management solution. Alight also acquired Carlson Management Consulting, an Adaptive Insights partner, in February 2019. Adaptive Insights is Workday’s preferred financial planning module that complements its Financial Management solution.
3. Select Alight for Workday consulting, integration, and management services. Alight’s and Appirio’s Workday practices also have synergies in terms of service offerings and asset investments. Appirio has more experience in consulting and implementation services, while Alight adds more experience in ongoing support services and payroll expertise. Moreover, both Alight and Appirio’s Workday services practice have invested heavily in developing proprietary technologies so ask about how these can enhance your Workday deployment experience. For example, Alight proprietary Point of View (POV) Preconfigured Tenant and Operating Procedures and Appirio’s CMC (Cloud Management Center), which is a cloud-based project management system hosted on salesforce.com.
4. Investigate the enhanced delivery capability. Between them, Alight and Appirio have a presence in North America, Europe, Asia Pacific, and Australia, with little overlap. While both entities have their strongest experience in North America, more than half of Alight and Appirio’s individual Workday Human Capital Management (HCM) engagements span more than five countries. Moreover, both Appirio and Alight have predicted strong international services growth for the newer Workday Financial Management services module. Alight has a strong focus on international growth; for example, it acquired the HR consultancy Future Knowledge in Australia in February 2018. Alight is positioning as a global Workday service provider, so you should consider it for international Workday deployment and support services engagements.
5. Note that Alight might be more relevant to your company size now. Alight has strengthened its ability to serve different client sizes by using sales teams with relevant experience to understand specific requirements across enterprise sizes. Alight and Appirio’s Workday practice target client size overlaps, with joint experience of clients with 350 employees through to 400,000 employees. However, actual experience differs; most of Alight’s Workday services business come from enterprises with 3,500 or fewer employees and enterprises of more than 10,000 employees. Appirio’s Workday practice sweet spot has been with enterprises with 3,500 employees to 10,000 employees. So, they now have sales teams focused on three client size segments of:

• 3,500 employees and below
• 3,500 to 10,000 employees
• More than 10,000 employees

Alight’s ability to understand the business issues of different enterprise size clients and their specific IT and HR environments is key to gaining trust with customers. It is also key to delivering a business-aligned Workday service engagement, which is key to achieving real business benefits from your Workday deployment.

Seamless integration is rare in the IT services market

Despite the obvious advantage Alight has gained from this acquisition, it still needs to get a few things right to capitalize on this acquisition:

• Market the additional capabilities to prospective clients. This is an ongoing challenge because Alight’s and Appirio’s Workday practices have historically had a stronger brand in the US than in other regions. Moreover, Appirio, a Wipro company, continues to serve as a Salesforce service expert, which may confuse clients.
• Get the integration right. Alight must be sensitive to its approach to integrating practices. This is especially significant given that the Appirio practice was acquired by Wipro only a few years ago in 2016, so it has already experienced a disruption.
• Retain the talent. Alight tells us that there has been zero attrition in this acquisition. The Appirio resources are likely excited to be part of a recognized Workday leading partner that prioritizes investments in this market. However, Alight must still invest time and effort to retain the best talent from this acquisition.

The Bottom Line: If Alight can handle the integration, this could be an acquisition where the whole is more than the sum of its parts.

Alight customers, Appirio Workday services customers, and prospective customers should note the enhanced Workday service and delivery capabilities highlighted above that Alight has gained by acquiring Appirio’s Workday practice. You need to keep abreast of changes in the ecosystem like this acquisition, which could shake up the competitive landscape and offer a different solution to your enterprise as we describe in this POV. In all RFIs, ensure that you ask about talent numbers, expertise levels, and delivery capabilities. Also, request speaking to a client reference in your industry sector or similar HR or finance transformation journey. Finally, remember that any acquisition is the beginning of the journey for a service provider and it must handle the integration successfully to achieve a 2+2=5 scenario.