Microsoft-Workday Partnership Reveals New Growth Strategy

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Earlier this week Microsoft and Workday, an enterprise software solutions company that specialises in human resource and financial management, announced their strategic partnership. Through the partnership Workday aims to connect productivity tools in Office 365 with Workday’s finance and HR applications.

At first look it does looks a bit more like a regular partnership that we all come across on a day to day basis, but Microsoft’s CEO Satya Nadella took his time to appear on a video, telling the world about the partnership and how the two applications can work together to simplify daily tasks and actions across business processes to empower teams to better collaborate.

Launch the YouTube Video Here

Microsoft has been pushing steadily into the enterprise segment, and the list of Software-as-a-Service (SaaS) offerings from the company’s stable is growing each day. The role of Windows is dwindling in Microsoft’s portfolio due to the state of personal computer sales around the world, the company wriggled itself out of the mobile hardware business by selling off part of its Nokia assets, and is now pushing double time to become a cloud service provider.

In addition to its cloud infrastructure business, Microsoft Azure, the company has been steadily building its productivity tools – applications like Office 365, Skype, cloud email and more, which are designed to increase office productivity.

The company is slowly building these software applications and pushing them into the enterprise segment. We’ve been using Microsoft Office in our offices for years, and without Powerpoint many of us can’t even think of creating a presentation.

So the company does have a history with applications created for commercial consumption. It is a huge market and Microsoft has every reason to be in it. But what is happening now is that the company is further expanding its position within the market by offering these applications on the cloud.

Just a few weeks ago, Microsoft pulled the rug from under Salesforce’s feet and snagged one of their top clients, HP Inc., signing them up for their Microsoft Dynamics software, a CRM tool that directly competes with that of Salesforce.

Within the business process management sector, Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP) are the two major segments, worth billions of dollars each.

Global CRM market size and market share of vendors

Image Credit: Forbes

Global ERP market size estimate 2014-2020

Source: Allied Market Research

Microsoft already has its own Microsoft Dynamics for CRM/ERP, but it still a long way from competing with Salesforce on an even scale. But the recent signup of HP Inc. has made it clear that Microsoft is looking to further its expertise in the segment and improve its Dynamics offering. Now, by bringing in Workday, a specialist in human resource and financial management, to tie in with Microsoft’s Office applications,  Microsoft is going a step further in that direction.

The old Microsoft would have probably waited to build its own tools and let a few years go by in the process, but the new Microsoft seems to be so confident that it doesn’t shy away from a partnership with a company that has a competing product, as long as it is capable of helping it expand its user base.

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Featured Image Credit: GreatResponder