Episode Transcript
Speaker 1 00:00:09 Today I wanna spend a little bit of time on the architecture of employee experience applications. And the reason I'm doing this is it's a slightly geeky conversation, but it's really important because the marketplace is really crowded, really noisy, and really confusing. And I wrote a big article about Workday and ServiceNow over the last couple of days that got a lot of interest and raised a bunch of questions I wanna walk through. So essentially from an architectural standpoint, there are three layers to our employee experience and really our consumer experience all over the world. The first is the productivity tools. And productivity tools are where we spend our days. We have Microsoft Office, we have Microsoft Teams, we have Slack, we have Zoom, we have Workplace by Google, we have Workplace by Facebook, we have WebEx. All of these tools, and there's hundreds and hundreds of them are general purpose communication, content creation, directory and messaging tools.
Speaker 1 00:01:11 And they don't really care what your job is or what your role is or what kind of work you do. They handle general purpose applications. And generally speaking, these are things like finding somebody, communicating with somebody, creating a document or a PowerPoint or a presentation or a video or an audio, sending that to someone else, responding, creating a meeting, joining a meeting, interacting during the meeting, interacting after the meeting, and so forth. And the reason I call them productivity tools is you use them to be productive and some of them are very specialized. You could argue that Asana or a project management tool is kind of a productivity tool, but I would argue that it's not. And the reason I mentioned the first layer is that the general purpose productivity tools are a massively growing market. The reason for that, of course, is we all have mobile devices.
Speaker 1 00:02:06 We've been working from home, we all have computers, and there are, you know, several billion people in the world directly connected to the internet in some fashion who need to do these things. And the providers of these productivity tools are very large companies. Microsoft, Google, maybe Slack will turn into one of these, although I kind of doubt it. Workplace from Facebook would like to be one. Cisco has visions of WebEx becoming one of these. Zoom is trying to become a productivity platform with its apps platform around it. And these vendors are really not application vendors. They wanna solve general purpose problems that we have. And there are many, many surrounding parts of that market. You could argue that Adobe's tools are productivity tools to designers and developers. Atlassian's tools are productivity tools to software engineers. Salesforce is a productivity tool to salespeople. But generally speaking, your employees are spending most of their time in a small number of these tools.
Speaker 1 00:03:08 And most IT departments pick a family, they pick Google, they pick Microsoft, or they pick something else. They don't pick, they don't let you use any tool you want because it makes their security and integration life chaos. The second layer is what I call the journeys the workflows. ServiceNow would call them workflows, Workday would call them journeys, Microsoft would call them power apps or other things like that. But essentially they're multi-step mini applications, usually taking the form of a step-by-step journey or a portal that help you accomplish a task, but you don't use them all day. So for example, I was just resetting my internet cable box that came in from Comcast and I was a little bit afraid it would be impossible to set up, but there was a little step-by-step journey tool they gave me that actually worked extremely well in the tool.
Speaker 1 00:04:02 It went into the application layer and did all sorts of things under the covers that I didn't see. But from my standpoint, it just looked like a nice little journey that stepped me through the process and finished and then I was done with it. And there are hundreds and hundreds of these experiences that go on at work. We call them experiences or we call them journeys, onboarding, hiring, getting promoted, entering your vacation days. You know, there's thousands of these things and most companies have these written down and we know what these are. We call them transactions and we call them journeys. And we want them to be self-service. We want them to be easy, we want them to be AI enabled. It would be nice if you could talk to your computers and do these journeys. So if your productivity layer has a voice interface, chances are your experience layer.
Speaker 1 00:04:49 The second layer will interpret that and manifest it into that experience. So if you're an HR person or an IT person and you're trying to build these second tier applications, they're sort of like mini apps, really, they're journeys. You wanna build them in a tool set that works well with the productivity applications. So you can take advantage of all the work that the productivity vendors are doing. So virtually everybody that is building applications for employees is plugging them in to Microsoft Teams or Slack or Workplace or some other of the productivity tools. And by the way, the relationship between those two layers is still really evolving. If you are in teams, for example, teams has many apps that function around the teams rails. They're called Rails. And you can interact with the journeys or the applications in Microsoft teams without going to the backend application.
Speaker 1 00:05:46 So this intermediate layer is a very interesting area, by the way. The third layer is the application layer. So the third layer are the systems of transaction of E R P of core business function. And those systems are very deeply engineered and highly interconnected. And for the most part they have user experiences of their own, but those user experiences tend to be harder to use. If you looked at Success Factors or Workday or ADP or any of the Oracle core systems, there are hundreds and hundreds and hundreds of transactions that are automated in that third layer. And if you're a power user and you know how to find the menus, you can find 'em all and you probably use 'em, but the average employee doesn't know where everything is. And despite the number of menus and easy interfaces those companies build on top, they're gonna need the second layer of some kind to make it easy for you to find.
Speaker 1 00:06:42 If I'm going through a job transition at my company, I probably have to file a new tax form. I need to tell people about my moving situation. I need to get a new desk, a new office. I need to book travel. I mean, there's like 20 things I need to do. And those are 20 different applications in the third layer that might involve multiple systems and multiple vendors. I don't really want to know what all those are. Somebody could send me a checklist, do this, do this, do this, do this, and the chances are I'll never get it. All right? So the journey in the second layer would stitch all that together and somebody would figure out what all those things are and make it so easy for me that I wouldn't know. Now that second layer, the experience layer or the journey layer depending on what you want to call it, is a really interesting place.
Speaker 1 00:07:28 We used to call that the employee portal. And for many years, really decades, companies have built portals that shield employees from the complexity of the backend systems. Very expensive proposition. I've talked to companies that have spent tens to hundreds of millions of dollars on their employee portals because not only do they have to give you access to transactions, but there are surveys and feedback systems and communications and case management and all sorts of journey oriented applications in that intermediate layer that may or may not reach into the backend systems. The backend systems, by the way, the third layer are data systems. Those are systems of record. So when I change locations in my company, there's a database that knows that I no longer work in California. Now I work in London, and that's an officially updated probably two phase commit type of transaction. The intermediate second layer journey tool may not really care where that final data is stored, but the third set of applications really cares because somebody's gonna use that data for all sorts of compliance things and it might change my pay, et cetera.
Speaker 1 00:08:37 So those three layers work together. Now, the vendor market is struggling with this. If I start at the third layer, all of the core HR and E R P systems, Workday, Oracle, sap, adp, ultimate Software, et cetera, have a lot of experience building those applications and they invest billions of dollars in the transactional nature of those E R P applications. And they work with learning management systems, companies, recruiting and applicant tracking systems companies, integrated talent management systems companies, talent marketplaces, career management tools. I mean there's just a lot of them and every one of them builds their own user interface. That's delightful and interesting and fantastic. But sure enough, somewhere along the lines, as your company grows, you realize, well, our employees really can't log into 25 different systems, so we need something in the middle. So they all end up having to deal with this second intermediate layer.
Speaker 1 00:09:34 By the way, there's a very interesting study done by Okta, O K T A, which is an identity management company, which discovered that amongst the thousands of companies that use Okta, the average large company has more than 70 employee applications, 70, 70 0. So there's a lot of those backend systems and they're not going away. And there will always be new ones and some of them are custom built for your company. The real interesting world though is this intermediate layer because that's really where the action is. And the symptom of the growth is ServiceNow. As I wrote about in that article, ServiceNow is a very interesting, very successful company that started life as an IT service automation company, really case management and knowledge management. And very shrewdly figured out that IT service delivery was a use case of many, many things that went on in companies. Everything from self-service to chatbots to intelligent agents to case management to routing and all the different roles in it.
Speaker 1 00:10:36 And sure enough, one of the things that ServiceNow figured out about six or seven years ago was that HR was another service delivery function in the company that they could automate. So ServiceNow has become very successful and very popular as this intermediate layer. I won't talk too much about the productivity layer at the top because you all use those things and you have your favorite ones, but that journey layer is very, very interesting. And let me talk a little bit about what's going on there. And by the way, this is where Microsoft Viva fits. This is where Workday people experience fits. There are a lot of companies trying to get into this intermediate layer. So there's a couple things that the intermediate layer has to do, and I wrote about this in the employee experience article that I'll link to in the podcast. Number one is they have to have a journey process and a journey experience step by step, step one, step two, step three, step four, they have to verify your identity and get information from the backend system and the front end system that you are who you say you are.
Speaker 1 00:11:34 So you have access to certain information, they have to be able to to link to and get information from the backend. Third level systems. So if I'm a an employee and I don't have the authority to change my own vacation days because for some reason my manager's supposed to do it, because that's what the backend system says, the system of experience needs to know that and it needs to white out that screen so I don't click on it. So there's all sorts of things like that. They need to have identity management, they need to have security. There needs to be a mobile interface in the intermediate layer. There needs to be an intelligent recommendation. If I'm looking for a new course to take when I get promoted into management, well one approach is I can log into the learning management system and I can browse around and find it, or I can log into Workday or SAP or Oracle and I can look for the recommendations.
Speaker 1 00:12:26 Or somebody could build a journey that says, oh, you've been promoted to manager, welcome. Here's a video from the ceo. Here's our new competency model. Here's a few assessments you should take. Here's some people you should meet. Here's the courses you should take. Where are you gonna put that? You could try to put that on the lms, probably won't work. You could try to build a whole system for that. That's probably not worth the effort that belongs in the Journey tool. So the Journey tool has what ServiceNow calls a citizen developer experience where somebody who's not a software engineer could actually build these experiences on behalf of employees, embed them into the systems of productivity and access all these backend systems. Now that's a very complicated layer of software. I just talked to a vendor this week, a company in the UK by the name of Applaud that actually built a plug and play templatized based employee experience, second tier system.
Speaker 1 00:13:23 And it's really cool. Now, they're not a super big company yet, I'm sure they're gonna grow, but what their system does, it's sort of like the wick or square space of employee portals. Those are basically development tools that you don't have to be a developer to use. You can plug and play and move objects around on the screen and build an experience for an employee that makes it really easy for them to do something that isn't easy to do in the backend system either way. I'll give you another example of one of these. One of the applications I found fascinating was during the pandemic, there was a retailer in the uk, actually not a retailer, a hamburger company that had all these hamburger stores all over the city of London and people were worried about taking public transportation to get to their jobs. So they said, why don't we build an application that looks at your physical location and Google Maps looks at the jobs that you're certified to do in the various hamburger stores.
Speaker 1 00:14:19 So goes into the backend system, find that data, look at the schedule that you would like to work, and then find locations in our company that are within walking or bicycling distance from your house, schedule them and then send you the map on how to get there. I mean, that's not an application that's gonna sit in the backend system and it's not an application that's gonna be sitting in Microsoft Teams. That's an intermediate level application. They actually built that in a week they told me, and they used Workplace by Facebook as the uh tool to do that. So there's dozens and dozens of things at that intermediate layer we can't even dream about. And knowing how big the developer and creator market is, this is gonna be massive. The vendors that understand this have to understand that this is not a market of IT people building portals, this is a market of IT people and managers and HR people and team leaders and maybe even supervisors, building journeys that make their jobs easier for their teams.
Speaker 1 00:15:21 So it's gonna be big and it's gonna grow and I think the user experiences are gonna get better and better and better. Now the final topic I want to touch on, cuz I know I've been talking for a long time, is data. There's a big question of what data goes where. So let's suppose I'm this employee and I want to move to a new location and I'm logging in and I'm filling out all these forms and bam, it breaks. I can't figure out what to do. A little survey pops up, I fill out the survey and I say, dog on it, you guys, I don't know how to do this. It's broken and now I can't order my mover or whatever I need to do, please call me. Or who do I call? Where's that data go? Does that data go in the backend system?
Speaker 1 00:16:01 Probably not. Probably goes in the intermediate system. So that intermediate layer, that employee experience platform actually needs its own database. And one of the big categories of the HR and employee experience market is feedback, surveys, ratings, suggestions, crowdsourcing information, which would normally go to its own system. Well, I have a feeling that a lot of that data's gonna end up getting stored in the intermediate layer. Now, SAP did a big deal with Qualtrics and they built all these Qualtrics interfaces into success factors. But where's the Qualtrics data go? Workday acquired pecan, which is a really outstanding system and they're planning on launching all sorts of employee experience and feedback tools into Workday. But what if it's feedback about a journey that happened during a journey experience that's probably not a pecan application. So there's going to be a little bit of a holy war between these vendors of what data goes where you don't need to be involved in that, but they're gonna be involved in it and they're gonna be debating amongst you, you and your IT people, which system is quote unquote the system of record.
Speaker 1 00:17:11 I would argue based on my experience that there're going to be multiple systems of record. There will be a core massive system of record for most of the HR and employee data, then that'll be Oracle or Workday or Success Factors or ADP or one of the more payroll oriented companies. But there will also be a system of record for experience data. And this has been what Qualtrics has been evangelizing for the last couple years. The feedback data, the experience data on what you're doing at work needs to go somewhere because people are gonna wanna look at it. There's a person who runs HR service delivery, there's a person who runs it, service delivery. There's a whole team of people trying to address employee cases and they're gonna wanna look at the data on what part of the employee experience is working, what part isn't working.
Speaker 1 00:17:56 We have a whole bunch of people complaining about this in this city. We have a whole people complaining about that in that city. And that information is really valuable, especially now when we need it almost in real time. So maybe there's a virus outbreak and a bunch of people have submitted cases or entered information to the chatbot about some crisis going on in the company. Where's that information stored? It's not gonna get stored in Workday or Oracle most likely. So that intermediate layer is a really important part of the market. You know, I've been talking for 20 minutes probably too long. I guess what I'd like to do just to sort of wrap up, is just encourage you to think about this, reach out to us and we're spending a lot of time on these architectures and working with most of the vendors. And I think it's worth you spending some time with your IT department crawling through this and making sure you understand your company's strategy.
Speaker 1 00:18:47 All of the vendors would like to be clearly part of all three layers and they will all try to be part of all three layers. But I think it's up to you as a buyer or an IT or an HR person to clarify the strategic vendors at each layer. And be careful not trying to get one at layer two to do what layer three does or vice versa because they won't be very good at it and the data won't necessarily go in the right place. And this is an ongoing part of the market and we're gonna keep up as best we can. So if you have any use cases or architectural scenarios you're working on, please let us know and we'll be happy to help you. Thank you.
