It’s all about - Re-imagine …
The new marketing tagline of Cornerstone is all around re-imagining the product offering. The area of imagination are centered on two directions – product functionality and user experience. In two keynotes presented by CEO Adam Miller, the company went at length and into detail to highlight the latest improvements in both directions.
|
Picture from Twitter |
Miller did a great job at explaining how the Millenials increasing labor force share changes the requests and demands for the enterprise and with that for its HCM and talent management systems. Equally the consumerization of IT requires vendors to upgrade their offerings to take account of easier to use systems, bring your own device (BYOD). And then work is changing itself, becoming more international, location and device independent, location agnostic and multicultural.
Re-imagine functionality
Cornerstone wants to re-imagine the functionality behind its key three automation areas – performance, learning and recruitment. Cornerstone has targeted specific new functionalities In each of the three automation areas, to bring them further, and closer to the new workforce’s needs. Not surprisingly there has been special attention on recruitment.
|
Example Re-imagine Performance - Picture from Twitter |
Re-imagine user experience
The other direction of the re-imagination project is around the user experience. Cornerstone rightfully realized about a year ago, that their product’s user experience was falling behind and has embarked into a brand new user interface with a much more 21st century tune, you may even say consumer grade user interface.
The overall acceptance of the new user interface was very positive by the attendees and I think Cornerstone has done a very good job creating a lightweight, easy to use interface experience with good cross platform consistency.
|
From ZDNet - June 4th 2013. |
But it’s not only the user experience, the modern workforce also needs more modern collaboration tools, so Cornerstone rebuild the Connect product, consistent to the new user interface. At this point it is a powerful multifunctional feed function, that serves the collaborative usage needs well. The Connect product gets complemented by solid project and task management functionality.
My main concern on the new user interface paradigm is the scroll intensity and related downsides. The old user experience paradigm of the eyes are faster than the mouse comes to mind – when users need to scroll to get to information – it takes time and in the worst case – they may not even find the information, as they do not start scrolling. But overall the new Cornerstone user interface is a significant increase in usability and can rightfully claim to be consumer grade.
Public Sector, SMB and force
Cornerstone has expanded beyond being a pure horizontal vendor – with a focus on public sector and is adding (north American) functionality to make it a strong provider of talent management for this vertical. And while public sector organizations certainly can take help managing talent, it was a surprising choice of a vertical to me.
Equally Cornerstone has started to offer products for the small and medium size businesses (SMB) – mainly centered around the performance functionality of last year’s acquisition of New Zealand’s Sonar6. Sonar6 was a leader in the gamification trend for enterprise applications and it is good to see some of that DNA not only being preserved for the SMB offering (<500 employees is the cutoff) but that some of the Sonar6 acclaimed performance management functionality like the helicopter view have made it to the mainstream product.
And back in February Cornerstone released it’s Salesforce based product. Interesting enough the company operated a subsidiary in stealth mode for some time, let it build a product on force.com and sell it to over 70 customers, including Salesforce themselves. It’s a gamble not only on the salesforce ecosystem and partner sales activities, but also on the force.com platform as an alternative to the more Microsoft centric mainstream products.
Cornerstone Uniquenesses
The company has a few unique characteristics that are worth mentioning here. At the preceding analyst day it became clear, that the executive team has been working together for a long time, know each other well and is very consistent facing the questions of the analyst community. It’s remarkable that these executives were able to grow along with the company for the last years of very rapid growth, a living proof of hiring talent for growth.
Moreover Cornerstone is one of the very few enterprise vendors out there with a single platform, with all offerings being built on top of this platform. This not only ensures consistency for end users, but also a higher productivity for development resources. At the same time a single platform company needs to have an attentive eye on the time appropriateness of the platform, but Cornerstone seems to have a good eye on this. The user interface modernization being a good indicoator. Likewise the force.com based product seems to have been an alternative platform validation project, with the nice side effect to yield a separate product for the Salesforce ecosystem.
Then there is the location of the company, being headquartered in Santa Monica. And while there are more recent successes from Silicon Beach it remains an unusual location for an enterprise software company. But Cornerstone has reached a good critical size and attracts enough talent for their product development teams to allivieate this a concern. It could even be an advantage, as Cornerstone engineers come with a relocation extra price tag, should a competitor try to poach.
And finally a lot of respect has to go to Adam Miller – who is the driving force on product vision and direction. Few software companies today rely on their CEO to do this – and even fewer CEOs come to mind to have that capability. Even more remarkable is that Adam's background is not in the high tech industry – but in legal and investment banking. Talk about a wide talent profile.
Positive customers
We always like the opportunity to formally and informally chat with customers and partners at user conferences. And while the overall atmosphere is always giddy and excited at these events, we heard only very little negative and critical comments. Cornerstone’s customer base is positive on the company and products and is looking forward to get the upcoming Spring 2013 release to their users.
|
Picture from Twitter |
The road ahead
Like Workday, one of the few other single platform HCM vendor in the market today, Cornerstone has a year of execution tasks and challenges ahead of them. Once you have a great product you need to get it to customers and with little localization needs for talent management required – in comparison to core HR and payroll – the worldwide expansion is a key task for Cornerstone. Hiring, training and getting sales people to the first sell in many geographies outside North America will be critical. And then the ramp up of the following value chain with partners, consulting capability and delivery infrastructure to ensure customer viability and satisfaction. The latter has the most obvious need for investment – as the company does not have a data center in the APAC region yet – something that due to international networks latency is pretty much a necessity.
And while Cornerstone is hitting the right notes in terms of re-imagining their core products it needs to keep investing into them. Across performance, learning and recruitment the latter is probably the lightest in terms of functionality. And while the weakening of Taleo in the marketplace due to the Oracle acquisition has helped some early customer successes, this situation won’t stay quiet as it is now for too many quarters to come.
Not only will the Oracle / Taleo combo get its act together, but we will see also the Workday recruitment module in less than 12 months from now in the marketplace. This will transform the currently close partnership between Cornerstone and Workday into a coopetition at best.
So it’s time for Cornerstone to invest in distribution, delivery and products. The news of the planned 220M US$ debt offering is a good sign that Cornerstone is serious about the expansion needs and takes advantage of favorable conditions in the capital markets.
Advice for partners
Find a role in the upcoming expansion that Cornerstone needs partners to fill. Find a win / win area that you can invest and execute in and that allows you to setup for above average revenue growth in the next 12-18 months.
Advice for customers
You are in good hands with Cornerstone for learning and performance. The external enterprise functionality is a very good addition and value add.
If you look for recruitment, make sure it’s a good fit.
If you are in public sector understand the road map and make sure you get re-assurances for its timely delivery if your critical processes hinge on it.
If you are an SMB make sure the gamification nature of the product suits your employee base – and if it does – you have one of the most exciting talent management products at your disposal.
If you are on the force.com platform and want to run an integrated talent and sales / service system – Cornerstone is one of the more viable and capable vendors.
If you are based in APAC make sure you have sufficient re-assurance for onsite application performance.
MyPOV
A good event for Cornerstone with significant product innovation – not only on the business functionality but also the critical platform side. Cornerstone has positioned itself well and earned a very good market position that it now needs to execute to expand and solidify in the next 12-18 months all across the world. Exciting times for the company’s customers, its partners, investors and employees. And when well executed, it will not only re-imagine the products – but also the company.
