How the Workday Integration Cloud has Helped FairchildSemiconductorEdited transcript of a BrieﬁngsDirect podcast on new forms of cloud-based integration and itsuse in enterprise business processes.Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Sponsor: Workday.Dana Gardner: Hi. This is Dana Gardner, Principal Analyst at Interarbor Solutions, and yourelistening to BrieﬁngsDirect. Today, we present a sponsored podcast discussion on how new forms of cloud-based integration are helping a major high-tech company build new relationships among and between extended enterprise business processes. Well examine how Fairchild Semiconductor has been an early adopter of integration platform as a service (PaaS). The venerable Silicon Valley company has been using graphical tools to build integrations among and between far-ﬂung applications and services but with those integrationplatforms housed in a newly unveiled Workday Integration Cloud. [Disclosure: Workday is asponsor of BrieﬁngsDirect podcasts.]We’ll learn here from the Chief Technology Ofﬁcer at Workday on what the integration cloudapproach can do and how it points to a future in which broad integration capabilities areincreasingly built into software-as-a-service (SaaS) applications. This cloud-based integrationmodel will prove far less vulnerable to the complexity, fragility and cost that plagues traditionalon-premises middleware integration methods.It should also spur the evolution of services ecosystems among multiple business serviceproviders and application providers. So here to dig into what makes integration as a service(IaaS) tick and what it means for the future is Paul Lones. He is the senior Vice President forInformation Technology at Fairchild Semiconductor. Welcome, Paul.Paul Lones: Thank you.Gardner: We’re also here with Stan Swete, the Chief Technology Ofﬁcer at Workday. Welcomeback, Stan.Stan Swete: Thanks, Dana.Gardner: Let me start with you, Paul. Whats the problem now with integration? Why is thisdifferent than a few years ago? Why is it that we need to adopt a different take on integration?
Lones: For companies like Fairchild that are really trying to take advantage of some of the newcapabilities that SaaS providers are offering and put together a broader group of applications,integrations are a new challenge, a broader challenge than they have been traditionally.Gardner: And what is it about what Workday is doing as an application provider that makes thisinteresting -- the human resource management, the human resource (HR) equation. We’ve seenintegrations in some other service orientations, such as in the supply chain side of things. Whywas this a challenge?Custom integrationLones: Traditionally, in the HR arena, there has been no such thing as a standard integration. Every beneﬁt provider, every payroll service provider that you want to work with requires a custom integration. That’s always been true, and having the set of tools that we now have at our disposal makes that a lot easier.Gardner: So, in a sense, the HR ecosystem challenge is a really good place to try to perfect oradvance IaaS. Do you agree with that?Lones: Absolutely.Gardner: Stan, lets go to you. What needed to change and when you looked at this issue of yourecosystem and how it tied things together, what sort of requirements did you have for integrationthat now you can pass along to your customers?Swete: We still look at it as having the same requirements for enterprise integration. Especially for hub systems like human capital management, there are ton of other systems that you have to integrate with. So the requirements are daunting and are still there. Its been the same for a while at enterprise software. What we see as being a cloud vendor, a SaaS vendor, is just new opportunities to leverage the SaaS model to do integration a little bit differently, have the application vendor take on more of the ownership of the integration issue and use the fact that weve got all of our customers running on a single version of the product to tie some integration logic to that and bring more control andstability to that integration for our customers and our partners.Gardner: Why is it, Stan, that the traditional systems, platforms, and middleware that are inplace are not up to this task? Why not just turn the switch on your on-premises integrations andstart tying together these cloud and SaaS based services?Swete: Theres just a split today between the technologies and the platforms that are used toexecute integration and convey data and then the application’s endpoints that are involved withand tied up in the logic of that integration.
Its not that no one is up to it, but its just that that gap splits responsibilities where maybe theydon’t have to be split. What we’re trying to do is marry it, use what we know about ourapplications to create integration logic, and then embed technology that hasn’t been embeddedwith applications before to help with the delivery of that.That hasnt replaced every single kind of middleware technology that you need. You still need amiddleware technology behind your ﬁrewall. You still need specialized middleware technologyin the cloud to do things that it does best. But, for the application-centric part of integration,application vendors can do more.Gardner: Paul, at Fairchild, youve adopted a number of SaaS system approaches or servicesapproaches. One of them is Workday. You have mentioned a few others to me earlier. When youlook at your ability to absorb and adopt and exploit more SaaS, how does integration ﬁt into that?Is this something that needs to be solved in order for you to proceed?Critical enablerLones: Its a critical enabler to take advantage of some of the capabilities that we see are available to us and can help us in our business. We look for two things. One, we want to ﬁnd a supplier that thinks of this in a more holistic ecosystem like way, and that has a series of application-level partners, that we can add to our overall architecture and overall application capability. In addition to that, we look for good integration tools, because even beyond those partnerships, we still have to do a lot of integration work. Gardner: And how long has Fairchild been using Workday for their humancapital management activities?Lones: Weve just recently gone live with Workday and several of their partners and havecompletely transformed our human capital management landscape with Fairchild.Gardner: When you started to do this, I would think that that involved a number of integrationpoints. Perhaps you could share how that works and then we would like to hear more fromWorkday about why their Workday Integration Cloud announcement has come to up to the bat tostart swinging at this problem.Lones: Sure. For the Workday partners who I was talking about earlier, those integrations arehandled between Workday and their partner, which reduced our integration burden. We donthave to maintain those, as both of those applications continue to improve. In addition to that,weve built 28 application integrations ourselves, largely to beneﬁt service providers and payrollservice providers around the world.
Gardner: And you were using your tools or leveraging some of the investments you have made?How did you build those integrations?Lones: We were fortunate enough that we were able to get some early access to the toolset thatWorkday is now making available to their broader customer and partner base.I had a small team of IT staff that was completely unfamiliar with Workday when they ﬁrststarted, and we put them to work on these integrations. We were able to complete these 28integrations in less than 120 days, which I think was pretty good performance.Gardner: Just for comparison sake, how long would that perhaps taken in a traditionalenterprise application integration (EAI) environment?Lones: I wouldnt want to necessarily put a date on that. We do know that from an overall projectimplementation perspective that an on-premises application typically will take 2-3 times as longto execute, and Id expect that the integration piece would have a similar scaling.Gardner: Alright. Well, lets dig in a little bit more with the announcement recently thatWorkday made -- something called the Workday Integration Cloud. Stan, give us the top-downunderstanding of what this is about.Important componentsSwete: The Workday Integration Cloud is an extension of Workdays cloud that we use to hostand process our on-demand applications and it has several really important components. One is aplatform component. The tools that Paul mentioned that they used to build integrations, up untiltoday, have been there for Workday developers. The announcement makes these tools fullyavailable to Workday customers and to Workday partners.In addition to the tools, there is a rich enterprise service bus (ESB) execution environment thatruns the results of these developmental tools. We offer not only the tools to build integrationsystems but the execution environment for the integration systems. And then weve a set ofscheduling and monitoring tools that our customers can use to directly schedule and monitor theexecution of their integrations.So those three things taken together form the platform, thats part of the integration cloud. Theresulting integration systems we also consider a part of the cloud. Workday for some time hasbeen building what we call Packaged Integrations and Connectors. We have a library of thosethat we can make available to our customers.Fairchild has used some of these. These integrations are built with our tooling by us and for ourcustomers. Packaged integrations really just look like another Workday product, but they handleboth ends of the integration challenge.
We also have connectors that handle our end of it but build logic out. The main example is apayroll interface product that lets our customers, gives our customers a starting point for hookingup Workday human capital management to the variety of international payrolls many of ourlarger customers have.Packaged integrations from Workday is another component of the Integration Cloud and the ﬁnalone is just the body of integrations that our customers and partners create.These are the intellectual property of our customers and our partners. Workday does facilitatesharing of those deﬁnitions if the customer and partners are interested, but there is that growingbody of application as well. Those things taken together are the Workday Integration Cloud.Gardner: And just to be clear, this is designed for your customers. This isnt just a generalpurpose integration service that you are opening up writ large. This is about your ecosystem andyour customers, is that right?Swete: The beauty of it is that its based on middleware from a company formerly called CapeClear that Workday acquired three years ago. I think thats very important to mention that. So itsnot like we, an apps vendor, just did our take on an ESB. This is very solid ESB technology, wellthought of by the engineering talent that we now own.Built-in integrationWere taking this technology and integrating it into our applications, building integration intoour applications as the way we refer to it, and then making the combined product available toboth our customers and our partners. The partners are the equally important point. Systemsintegration partners from Workday can get access to these tools and this platform.Gardner: And how about the pricing. Is this something that you would just check a box off andget a different bill for? How does this relate to the existing suite of application services youproviding?Swete: The Workday Integration Cloud platform is being made available at no additional cost toWorkday customers and Workday partners. We make our money selling our application services.Gardner: Im intrigued by this notion of making integration part of the application. I think thehistory of this, Paul, has been that over the years, new applications and platforms, and evenmodels of computing would come along. You would get great productivity from the application,you would buy and install and master the platform, and then you would be faced with anintegration problem.This is happened over and over again. Weve seen it with mainframes to client-server and theninto multi-tier and distributing computing and then ultimately with web and now cloudcomputing.
Given that integration has been a bolt-on, something thats been delivered after they shift in anapplication model, why now change? Why is integration and the application coming togethernow?Lones: Part of it is that our approach to overall enterprise architecture is changing. Companieslike ours and many companies working on this are moving from a monolithic internal applicationorientation to one thats more of a hybrid model, where we want to really take advantage of thenew capabilities and the quicker pace of development and deployment of improvements thatSaaS providers offer.Therefore, integrations naturally become a critical part of that, because the number ofapplications that we use in our business increases somewhat with this sort of approach.Gardner: Same question to you, Stan. Why this need to bring an application and its integrationfeatures together?Swete: The challenge here is that the requirements in the large problem of integration haventchanged, and there have been a lot of tools developed to address the issue. Some results havebeen achieved, but I dont think anyone is satisﬁed with how maintainable enterprise integrationis. And, we happened to think the answer is to build more robust integration where theintegration deﬁnitions themselves are more informed by what exists and whats changing in theapplication.Hub systemThats the opportunity that we were seeing. We came on to it by just being the provider of anapplication that is going to be the hub system and be hooked up to a lot of different systems.We knew that integration was going to be front and center for us as a brand new SaaS vendor sixyears ago. One of the differences we wanted to make was to do more about the problem. So, westarted with an investment of technology.Where that has led us is really tying what can get done with integration technology to whatapplications know about, everything from their security model to, in our case, we leverage a lotthe fact that we know about people and how they are organized. So, were able to haveintegration deﬁnitions that can get routed around for the appropriate approvals before certainsteps happen.That’s unique, but its breaking down the separation between integration that would be built byone side of the company and tying it back to who its really serving, the other side of thecompany.For payroll integration, the payroll admin can be hooked into the fact that a major feed of HRdata is going out to a payroll system and they can get a check on that before it happens. That’s
something we’ve built in and we’ll continue to look for those opportunities. I still think itsactually early days for what our integration tools can leverage inside the application.Gardner: So, the system of record for HR and the governance and policies about employees andtheir roles in the organization can now be applied pretty seamlessly to who gets to dointegrations and/or how integrations as part of a business process would work. Am I reading thatright?Swete: Yeah, how they get executed, how they get approved is all built in to the same sort ofsystem that you use to schedule a report or any other thing you’d do in your application. For us,its just an extension of the application, rather than a hard line and then some integrationtechnology that no one on the app side understands.There still are differences. You still have to have experts on integration middleware and we havethat, but the real beneﬁt we think comes from blurring the distinction and marrying these thingstogether.Gardner: So you mentioned some tools and Paul mentioned very compelling timeframe forcreating 28 integrations. Who are the people who use these tools typically and are they same oldsoftware engineers that were building EAI connections, or is this a wider group of people? Whocan take advantage of this tool capability?Swete: We’ve taken the approach of splitting the development tools into a framework that ismore geared for developing simple integrations, as we call them. This is one-way data in or one-way data out of Workday to third-party systems, and we have a tool called the EnterpriseInterface Builder (EIB) that is a non-programmer could use. You still need to know that you aresending something to a secure FTP location, but you don’t have to be a developer.Sets of choicesWe give you a graphical user interface, we give you a selected set of choices for how you cansource data, a selected set of choices for how you can transform it, and a select set of choices forhow you can deliver it. You can save that, and then you have a deﬁnition that you can thenschedule on a recurring basis. That’s built for non-developers.The other tool that we have has a completely different personality. Its what we call WorkdayStudio. This is the developer tool that we have used to build our integrations, and it is nowavailable for our customers. But, on this one, you want to be a developer. Youre not doingprogramming, but you are working in an Eclipse-based framework with detailed control overintegration components and orchestration of how data ﬂows. So, this is a technical developmenttool.The thing it creates is the same thing that the EIB creates, an integration system that can then beexecuted in Workday, but the creation of it is much more technical.
Lones: Along those lines, this is really a marriage between having a strong, skilled team ofdevelopers with a great tool set. So, its not a substitute for having well-skilled staff in the ITorganization.Gardner: What about the idea here that integration can be better and newly leveraged becausewe’ve solved with a SaaS provider’s multitenancy architecture some of these thorny andcomplex issues about version heterogeneity within the organization?A lot of times companies might want to update an application, but fear breaking or disruptingintegrations. That integration in the traditional sense can become an impediment to theadvancement of features and functions in applications.Paul, did it occur to you that the multitenancy, the fact that everyone is on the same version ofthis app and that all the integrations follow through by virtue of the responsibility of the vendor,not the user, that that’s sort of added bonus. How have you recognized that and what does itmean to you?Lones: Its an important part of thinking about the use of SaaS applications in a company likeFairchild. To the extent that its easy to maintain those integrations through the improvementcycle, we are going to be much more willing to follow a SaaS model, because upgrades comeevery three or four months, depending on who the supplier is.We like that model. Wed much rather have a small incremental improvement every three or fourmonths than have this huge disruptive step function upgrade. Really, it typically is more like areinstallation that occurs for large monolithic installed applications every two or three years. Youneed to have your integrations keep up, and thats an important consideration.Gardner: So its interesting, Stan. You have a user like Fairchild, using these tools, buildingthese integrations, moving more towards a multiparty ecosystem process-oriented beneﬁt, but theresponsibility on those integrations is with you.It seems as if youre really giving an awful lot here. How can you do that with a strong sense ofconﬁdence? Isnt there a risk that if these integrations start breaking that you are in the catbirdseat?Levels of the gameSwete: Yeah, well, there are levels of the game for how you can leverage the support you get outof the core application that we keep moving forward. One level of the game is for us thats veryimportant in the integrations we build and sell are ones that can just share the applicationdeﬁnitions. So, we support those across all the updates and verify that the logic of those is goingto work.For the integrations tools, we can put smarts into the tools that share how the applications areconstructed in that. It gives our customers a leg-up that they can start with these components.
Then they can create integrations that are a little bit more impervious to being broken by changesin the applications, because theyre sharing metadata back into the applications.Lots of integrations are built on our application programming interface (API) and so weve got tobe rigorous about versioning the API and having a contract to support back versions that gives usa certain amount of insurance. Its not like that with some of these opened in the tools that therecouldnt be logic and coding errors that are put in and those are the ones that we would have toencounter together with our customers and were not going to debug every single one of those.So, for different levels of the game, more packaged, complete support, on up to the more open-ended integrations, you do what you can to try to make it so the integrations are a little bit morerobust than what would have been built with a separate tool set.Gardner: Paul, it sounds less like a buyer-seller relationship than a partnership. Do you view itthat way?Lones: We do. Our experience to date, working with providers like Workday and some of theother SaaS providers that we are fortunate enough to do business with, is that companies likeours have more of a voice in the feature improvements of the application.There tends to be, and certainly its the case with Workday, a much more active community ofclients, users, that are sharing information about everything from somewhat technical to verybusiness process-oriented experiences that all of us have had. Thats a very different experience.In some ways, its sort of ironic to me that we view it quite a bit more as a partnership. A lot ofpeople perhaps think that its a SaaS application and, if things dont work out, then when yourcontract is up, you just go ﬁnd another SaaS provider.It is true that there might be a little bit more ﬂexibility, but what we’re ﬁnding so far in ourexperience, and it is early, is that the receptivity and the sense of making improvements together,I think it will actually stick longer than maybe some of the traditional software applications.Gardner: And just to help our listeners understand the extent of your project with Workday, howmany employees were involved? Tell us a little bit about your organization, FairchildSemiconductor, and your global footprint.Global baseLones: Fairchild Semiconductor has roughly 10,000 employees worldwide. Were asemiconductor manufacturing company. We have manufacturing facilities in the United Statesand throughout Asia. Our customer base is global, our employee base is global. Over 70 percentof our business is in Asia and 70 percent of our employees are in Asia. Having the capability toprovide a core HR platform like this to that broad a set of colleagues around the world is reallyexciting for us, and to be able to support our internal customers and the HR group.
Gardner: And have you brought all of those 10,000 employees up on Workday or has it been astaggered rollout? How has that worked?Lones: We’re at the very end of our go-live process and we’ll be introducing this to ourcolleagues around the world on Monday, April 4.Gardner: One thing that’s interesting is the degree of integration complexity when you’redealing with multiple markets. So if you’ve brought all of these employees around the world upon this system -- different payroll, different beneﬁts, different government, different cultures --how is that issue something you can tackle, given that Workday’s integration was a service toyou?Lones: Well, we had a lot of payroll integrations. I don’t think we would have gotten those alldone in the time frame we did without having that capability that Stan mentioned. In fact, withour legacy system, we actually stopped doing payroll integrations, because they were too hard.Now, we’re looking forward to doing some additional integrations with some of our local payrollsystems to improve that connectivity between our system of record for HR and the payrollservice providers that we didn’t build integrations to in the past.Traditionally, we built integrations only for our large-sized locations. There are smaller-sizedlocations where we have sales ofﬁces, and the like and we typically didn’t build thoseintegrations. We’re going to go back and look at doing that now.Gardner: Well great. Stan, lets take a look to the future. Where can this go? It seems if this is aproving ground given the number of different integration points, a global organization likeFairchild. I know you’re pointing this at your ecosystem and your customers, but if IaaS workshere, couldn’t it potentially work anywhere?Swete: It could work anywhere but we’ve got a lot to do here. I think that when we look towardsthe future, there are just several different dimensions where we have to build this up. One issomething that Paul has been mentioning -- just the value of the ecosystem and I think weve gota good start, but there is a lot of building we can do there. That is, we can use the fact that thisplatform is out there and available and proven to attract more and more partners to it bothdevelopment partners as well as application partners who can be the other endpoint inintegrations that we can support.So, building out packaged integrations for us to enhance the ecosystem is one aspect. Deepeningwhat the tools are doing is going to be a never-ending task. We’re just starting to have ideasabout how to share application’s functionality, and embed that inside the tools to make themmore powerful integration tools. I very much look forward to continuing to enhance our toolsetand that will beneﬁt the integrations our customers and partners build.The ﬁnal aspect is the one you hit on, community. We have to encourage people to want to sharethese integrations. We didn’t need to do more to automatically support that because our partnersare going to be generating these things, as our customers, and in the SaaS community, there is
just this great notion about sharing the things you do. So, we see supporting that and we canultimately see that even leading to selling some of the things you do. All of those are potentialfeatures for this space.Gardner: It seems to me a very extensible model.Swete: Well, lets hope so. We think we’re just starting.Gardner: Well great. You’ve been listening to a sponsored BrieﬁngsDirect podcast discussionon how new forms of cloud-based integration are helping Fairchild Semiconductor build newrelationships among and between extended enterprise business processes. Theyre doing thatusing the Workday Integration Cloud.I’d like to thank our guests, Paul Lones, Senior Vice President for Information Technology atFairchild Semiconductor. Thanks, Paul.Lones: Thank you.Gardner: And Stan Swete, Chief Technology Ofﬁcer at Workday. Thanks, Stan.Swete: Thank you, Dana.Gardner: This is Dana Gardner, Principal Analyst at Interarbor Solutions. Thanks for listeningand come back next time.Listen to the podcast. Find it on iTunes/iPod and Podcast.com. Sponsor: Workday.Edited transcript of a BrieﬁngsDirect podcast on new forms of cloud-based integration and itsuse in enterprise business processes. Copyright Interarbor Solutions, LLC, 2005-2011. All rightsreserved.You may also be interested in: • Delivering Data Analytics Through Workday SaaS ERP Applications Empowers Business Managers at Actual Decision Points • Executive Interview: Workdays Aneel Bhusri on Advancement of SaaS and Cloud Models for Improved ERP • Architecture is Destiny: Why the Revolution in Business Interactions Cant Work on Conventional Databases • HCM SaaS Provider Workdays Advanced Architecture Brings New Business Agility Beneﬁts to Enterprises