Workday Renewal Negotiation Strategies for Enterprises

Workday Renewal Negotiation Strategies for Enterprises

Negotiating a Workday SaaS contract renewal is not a routine administrative task – it’s a high-stakes opportunity to reset terms on cost, compliance, and flexibility. The following 15 strategies (in a Gartner-like advisory style) will help CIOs and enterprise procurement professionals secure the best renewal outcomes.

Each strategy is presented with actionable steps (what to do), key considerations (what to think about), and its practical impact on your organization.

These tips focus exclusively on the Workday SaaS subscription (licenses and cloud services)—not on professional services or one-time add-ons—to ensure you achieve long-term value on the software contract.

Use these strategies to reduce costs, stay compliant, and maintain flexibility for future needs.

1. Start Renewal Planning Early (Give Yourself 12+ Months)

What to do:

• Begin preparations at least a year in advance: Set a renewal project timeline well before your contract expiration. This should include internal alignment on goals, gathering usage data, and assessing alternative options.
• Secure time for a credible Plan B: Work backwards from your renewal date to ensure any needed RFP or migration evaluation can be completed before then. If adopting a new system is even a remote possibility, you’ll need sufficient lead time to explore it.

What to think about: If you wait until the last 90 or even 180 days, you’re already behind. Vendors count on late negotiations – by then, you’ll have no real alternative but to accept their terms. In contrast, starting 12+ months early lets you conclude talks with enough runway to switch if needed.

One advisory firm notes that if you can’t reach a favourable deal before the contract ends, you’ll be “forced to sign a deal most favourable to your vendor” – hence the need to prepare and negotiate well before expiration. Early preparation also means involving all necessary stakeholders and getting executive buy-in without rushing.

Practical impact: A long lead time dramatically increases your leverage. Workday’s team knows you could still walk away or at least run a competitive process if negotiations stall – a scenario much less believable in the final weeks.

By planning early, one enterprise was able to run a full benchmark and competitive bid process 10 months before renewal, which pressured Workday into offering deeper discounts to close the deal on the customer’s timeline (not Workday’s). In short, early planning prevents last-minute scrambles and ensures you have options on the table, leading to a more favourable renewal outcome.

2. Assemble a Strong Negotiation Team and Executive Support

What to do:

• Form a cross-functional negotiation team: Include procurement experts, IT/CIO representatives, finance, and relevant business leaders. Define each member’s role (e.g., lead negotiator, legal advisor, technical SME) and establish a clear chain for decision-making and escalation.
• Engage executive sponsors: Secure backing from a C-level sponsor (CIO, CFO, or CEO) willing to get involved. Brief them on the goals and empower them to intervene or approve concessions in real-time during negotiations.

What to think about: Vendor sales reps are trained negotiators who will test your team’s resolve. Workday’s negotiators may push back or say “no” to your requests to gauge your seriousness. The best counter is having credible clout on your side: when your executives are prepared to step in, it sends a message that your position is firm.

Workday will listen when a CIO or CFO reiterates the asks directly. In fact, “when the vendor hears your positions repeated directly from your executive sponsors, it authenticates your negotiation team’s credibility”. Ensure your executive sponsor has budget authority and can commit resources or approve strategy shifts if needed. Regularly update them so they’re ready to engage at key moments.

Practical impact: A well-prepared team with executive support shifts the power dynamic. Internally, it ensures alignment – your negotiators won’t concede important points without consensus. Externally, Workday’s team will realize your organization is serious and coordinated.

For example, a Fortune 500 firm brought its CFO into a renewal meeting after initial talks stalled; the CFO calmly reiterated the necessity of a specific price reduction and hinted at exploring alternatives.

This executive-level engagement prompted Workday to improve the offer, knowing the request had top-level backing. The practical result is often a faster negotiation cycle and a better deal, as Workday’s sales reps are more inclined to meet demands when faced with a unified, well-supported customer front.

3. Audit Your Current Usage and Contract Entitlements

What to do:

• Inventory your Workday usage: Gather data on how each Workday module is used. Identify the number of Full-Service Equivalent (FSE) workers or employees counted and which modules or features are deployed vs. sitting idle.
• Review the contract line by line: Check your current contract for key terms – especially usage limits, pricing escalators, true-up provisions, or auto-renewal clauses. Note what you’re paying for each component (if known) and any discounts or protections already in place.
• Identify under-utilization or gaps: Pinpoint any areas where you do not realize full value (e.g., a module you bought but never fully implemented or licenses far over actual users). Also, note if certain features require an upgrade or if you experienced pain points with the service.

What to think about: Your renewal strategy should be rooted in reality – how well has the Workday investment paid off so far? Many enterprises seek fee reductions at renewal because they’ve found parts of Workday under-delivered on value or were never fully adopted. If you’re paying for 10 modules but only actively using 8, that’s a red flag (and an opportunity to negotiate).

Likewise, consider if any compliance issues could arise: Are you exceeding any licensed counts or using the software in ways not covered by the contract? If so, address these proactively in negotiations rather than waiting for Workday to find them. Also, evaluate if your business has changed since the last contract—mergers, divestitures, or layoffs could mean your workforce size or requirements have shifted significantly.

Practical impact: Conducting a thorough internal audit serves as your negotiation ammo. It highlights where you’re overpaying (e.g., for unused capacity or features) and where the contract may constrain you. For instance, one company discovered they were licensed for 15,000 workers but only had 12,000 active employees after a business spinoff.

Armed with this data, they approached renewal, seeking a reduced license count and a corresponding fee cut. As a result, Workday adjusted the contract to the new baseline, saving the company hundreds of thousands of dollars and aligning fees with actual usage.

Knowing your usage and contract inside out, you can confidently request to drop or reallocate unused licenses, fix any troublesome terms, and ensure you only pay for the value you receive going forward.

4. Set Clear Objectives and Requirements for the Renewal

What to do:

• Define your success criteria: Decide on the key outcomes you need from the renewal. This might include a target percentage cost reduction, eliminating certain unfavourable terms, adding new capabilities at minimal cost, or improved service levels. Rank these objectives (must-haves vs. nice-to-haves) with your stakeholders before negotiations begin.
• Identify pain points and improvement areas: Gather input from functional teams (HR, Finance, IT admins) about any current Workday agreement or service issues. For example, is a module underperforming? Do users complain about support or downtime? Use this to formulate requests (e.g., additional training, stronger SLAs, or replacement of a module) that will increase the solution’s value to your organization.

What to think about: It’s not just about lowering the subscription fee; it’s about maximizing the value Workday delivers for the money. Your objectives should cover both commercial terms and operational needs. For instance, if a particular Workday feature wasn’t used because it lacked enablement, one goal could be securing free training or consulting credits to boost adoption (indirectly increasing value without increasing cost).

Always ask: “How will this change benefit our business?” Negotiation asks tied to clear business value are more persuasive to the vendor. Also, anticipate trade-offs. You might aim for a 15% cost cut, the flexibility to drop a module, and a cap on increases, but be prepared to prioritize if you can’t get everything. Knowing your priorities in advance ensures you sacrifice the lesser-value items if necessary while holding firm on the critical ones.

Practical impact: Clear objectives keep your team focused and consistent during the negotiation. You avoid getting sidetracked by vendor upsell attempts that don’t align with your goals. For example, suppose your top objectives are cost reduction and flexibility. In that case, you won’t be swayed by an offer to add a shiny new module at a “discount” (which increases spend and complexity).

Instead, you’ll steer the conversation back to your priorities – say, “That’s interesting, but our main goal is to reduce the run rate for the next term by double digits.” This disciplined approach often earns respect from the vendor and yields a contract that directly addresses your business needs.

In practice, companies that enter talks with a clear wishlist (and defined fallback positions) achieve more concessions and face fewer unwanted surprises in the final agreement.

5. Leverage Competitive Alternatives (Keep “Plan B” Options in Play)

What to do:

• Research the market: Even if you’re likely to stick with Workday, investigate other SaaS HCM/ERP solutions (Oracle Cloud HCM, SAP SuccessFactors, Ceridian Dayforce, etc.) or best-of-breed alternatives for specific modules (e.g., Cornerstone for learning, Adaptive vs. Anaplan for planning). Understand their pricing and capabilities at a high level.
• Signal your alternatives to Workday: During negotiations, tactfully remind Workday that you do have options. Without overtly threatening, mention that you are evaluating other solutions or have received interest from competitors. For example, “We’re also looking at what Oracle could offer for our HR and finance systems as we consider our 5-year roadmap.”
• Maintain credibility: Only use the competition lever if you can back it up. If asked, be ready to reference a recent demo, a pricing inquiry, or a scenario where switching was discussed internally. The goal is to make Workday genuinely worry that part (or all) of your business could move elsewhere if needs aren’t met.

What to think about: Once Workday is embedded, switching is costly and painful, and Workday’s sales team knows it. After adopting a SaaS solution, we note that the vendor is aware that “the feasibility of you not renewing is very slim,” which means they typically hold most of the leverage.

However, that doesn’t mean you have zero leverage – it means you must manufacture leverage by seriously considering other options. Be realistic: if migrating entirely off Workday is out of the question, focus on competitive alternatives for expansions or modules.

For example, if you’re renewing Workday and considering adding Workday Learning, get a quote or case study from a leading learning management competitor. Even limited alternatives (like considering another planning tool) can give you an edge.

The key is to be believable. Idle bluffs won’t work; Workday will call them. On the other hand, presenting a credible scenario (even if it’s a long shot) where Workday loses some or all of your business can heavily influence its flexibility.

Practical impact: Strategically introducing competition puts pressure on Workday to sharpen its pencil. Workday’s account team will have to justify to higher-ups why they might reduce your price or give concessions, and one of the strongest justifications is “to prevent losing the customer to a competitor.”

For instance, one large enterprise customer hinted that since they were already using SAP for finance, they were exploring consolidating HR onto SAP if Workday’s renewal terms weren’t satisfactory. This *“stick” approach got attention: Workday, not wanting to lose a flagship client, came back with a significantly improved offer.

Even if you never intend to follow through, this tactic, when used carefully, can secure better pricing and terms. Sometimes, simply naming a competitive price (“Vendor X offered us 20% less for a similar scope”) has led Workday to match or beat the rate. The result is that keeping a Plan B visible often forces a Plan A that’s much more favorable to you.

6. Align Negotiations with Workday’s Sales Quota Timeline

What to do:

• Time your negotiations to quarter-ends: Be aware of Workday’s fiscal calendar. Workday’s fiscal year ends on January 31, so Q4 for them is November–January. Quarters often close at the end of April (Q1), July (Q2), October (Q3), and January (Q4). Schedule key negotiation milestones (like final offer discussions) to coincide with these quarter-end periods.
• Exploit sales’ need to hit targets: Communicate that an agreement could be reached by the end of their quarter if your requirements are met. For example, let the rep know, “We could finalize this by the end of January, but we’ll need an extra 5% discount to justify signing now.” This links your concession directly to helping them meet their quota.
• Consider an early renewal deal: If your term doesn’t expire conveniently near a quarter-end, you might propose an early renewal (renewing a few months before expiration) to sync with a quarter or year-end. This can incentivize Workday to offer concessions to close the deal ahead of schedule.

What to think about: Like most SaaS vendors, Workday’s sales executives live by their quarterly and annual targets. They are often willing to bend more at the end of a quarter/year to book the deal. Use this to your advantage, but don’t let their timeline dictate your decision – only accelerate signing if the deal meets your needs. It’s a bit of a poker game: the rep might offer a “quarter-end only” incentive.

Often, that incentive is real because their managers give extra approvals during crunch time. For instance, Workday’s Q4 (Nov–Jan) is typically a high-pressure window; a savvy CIO can leverage this by negotiating in January when the rep is eager to close. “Quotas drive enterprise reps… The rep will be motivated to offer extra discounts or concessions to book the deal in their quarter”.

Just be mindful: if you aren’t ready or still need internal approvals, don’t rush into a subpar deal for a time-limited discount. Workday might try to create urgency, but remember – the deal still has to make sense for you.

Practical impact: Timing your renewal to align with Workday’s fiscal pressures can lead to meaningful cost savings. Many enterprises have secured a 5-10% discount or extra freebies (like extended subscriptions or support credits) by capitalizing on quarter-end urgency. For example, a company negotiating its renewal in Q4 got Workday to include an extra module at no cost for one year simply because the rep needed one more big win before year-end and was willing to be generous.

The practical effect is that you can capture concessions that might otherwise be off the table by being sensitive to when you negotiate (not just how). Just ensure any accelerated signing benefits you as much as it helps the sales rep – it should be a win-win, not just a win for Workday.

7. Negotiate Caps on Annual Price Increases

What to do:

• Push for a rate cap in the contract: Insist that any year-over-year price increase is limited to a fixed percentage (or a narrow range). For instance, negotiate language like “fees shall not increase by more than 3% annually upon renewal,” regardless of inflation or new features.
• Challenge any index-based escalator: If Workday proposes tying increases to an index (e.g., Consumer Price Index plus an “innovation” uplift), use data to argue against it. Show the compounded cost impact over time and counter with a flat or lower cap.
• Secure it early if possible: The best time to get a low cap is in the initial deal or well before renewal, when you have more leverage. But even at renewal, make it a priority to ask, especially if your original contract has no cap.

What to think about: Unchecked renewal uplifts can erode any discount you achieved initially. Workday often includes an annual escalator, such as CPI + 3-4%, to cover inflation and product improvements. This might have been ~5% total in years of modest inflation. However, with recent inflation spikes, those increases could approach 8–10% per year, which compounds brutally over a multi-year term. (Imagine a $750K annual fee ballooning to over $1.1M by year 5 with ~9-10% yearly hikes).

Do the math and use it to make your case. Many enterprises have successfully negotiated much lower caps, in the 3-5% range, instead of allowing open-ended CPI-based increases.

Be prepared for Workday to argue why they “need” the increase (e.g., to fund R&D), but remember your perspective: you need cost predictability to ensure the software’s price doesn’t outpace its value. If competitors offer more favourable terms – if Oracle or SAP promise 0% increases for a period, bring that up.

Practical impact: Capping the increase locks in significant savings over time. For example, one company’s Workday contract originally allowed nearly a 9% yearly rise (with inflation). They renegotiated to cap increases at 3% max. Over five years, that difference saved them roughly $800,000 compared to the original trajectory. The cap saves money and provides budget stability – your finance team can forecast SaaS costs confidently without fear of big jumps.

8. Take Control of Auto-Renewal and Notice Periods

What to do:

• Diarize the renewal notice date: Identify if your contract has an auto-renewal clause and note the deadline by which you must notify Workday of non-renewal or changes (often 60-90 days before term end). Set calendar reminders well in advance and ensure your legal/procurement team is prepared to send a written notice on time.
• Always send an intent-to-negotiate letter: Even if you fully plan to renew Workday, formally notify the vendor that you intend to review and renegotiate terms. This prevents an automatic rollover. A simple letter from your procurement or legal department expressing the desire to discuss renewal terms is enough to stop an auto-renewal.
• Negotiate the clause: If you have the opportunity (either in the initial deal or as an amendment), try to soften the auto-renewal terms. For example, you might negotiate a longer notice window (120 days instead of 60) or remove auto-renewal entirely, requiring mutual agreement to renew. This puts more control in your hands.

What to think about: Auto-renewal clauses are sneaky sources of vendor leverage. If you miss the notice window, Workday can lock you in for another full term under the existing terms. That means no price breaks, no new concessions, and possibly even built-in price increases kick in automatically. Don’t let a date on the calendar rob you of a negotiation opportunity. Be proactive: Workday typically requires notice 2-3 months before the contract ends, which isn’t a lot of time if it slips by.

You signal that nothing is assumed by sending a notice of intent to renegotiate. Also, consider coordination: even if your team knows you’ll renew, not sending a notice can forfeit leverage. Workday might assume you’re just going to accept the status quo. Conversely, when they receive a formal notice, they alert their account team that this renewal is not a “done deal” – you’re actively looking at terms.

That alone can put them in a more flexible mindset. Finally, if your legal team can negotiate the removal or modification of auto-renew clauses (some enterprises succeed in getting a clause that says renewal requires a fresh quote or mutual agreement), you effectively force a conversation at each renewal rather than being passively renewed.

Practical impact: By controlling the auto-renewal process, you ensure every renewal is a negotiation, not a rubber stamp. One large company nearly missed a 90-day notice period buried in contract fine print – catching it and sending notice allowed them to negotiate a new three-year deal with improved pricing. In contrast, an auto-renew would have locked in the old higher rate for another year.

The difference was millions in savings. Even if you continue with Workday, giving notice to renegotiate can lead Workday to offer better terms preemptively rather than risk you saying you won’t renew.

In practice, avoiding unintentional auto-renewal protects you from being stuck with unfavourable terms. It keeps leverage on your side since you can always choose not to renew if talks fail (whereas if you forget to give notice, that choice is gone). This strategy costs nothing – just good contract management – but it can save a fortune and ensure you always have a say in your contract terms.

9. Insist on Transparent Pricing and Metrics

What to do:

• Demand detailed pricing breakdowns: Ask Workday to provide a line-item quote for your renewal. This means seeing list prices, discounts, and net prices for each module or service. Don’t accept an opaque lump sum. If Workday bundles products, request a cost breakdown so you know what you’re paying for each piece.
• Understand the FSE (Full-Service Equivalent) count: Have Workday explain exactly how they calculate your employee count for billing. Clarify definitions (e.g., how are part-time or seasonal workers counted? Are certain populations excluded?). Ensure the number of FSEs in the contract reflects your workforce to avoid overcharges.
• Use external benchmarks for context: Gather pricing benchmarks from industry sources or consultants for companies of similar size and scope. Know what a competitive per-employee or per-module rate looks like. Then, challenge any line item that appears above market norms.

What to think about: Without transparency, you could be overpaying in hidden ways. Workday’s practice of bundling multiple modules into one price can obscure individual component costs. This makes it hard to tell if Workday Recruiting is priced fairly or if it’s being subsidized by a high fee on Workday Learning. By insisting on a breakdown, you shine a light on any overpriced elements. Also, understanding the pricing metric is part of compliance: Workday uses the FSE model (typically per employee).

Make sure you’re not counting more FSEs than necessary – for example, some contracts allow you to exclude contractors or retirees or to count part-timers as a fraction of an FSE. Verify these details. On benchmarking, remember that knowledge is power: if similar enterprises pay $50 per employee and Workday is quoting you $70, you have a strong case to push back.

There can be large disparities – one company’s Workday HCM quote came in at $100 per FSE per year, while another of similar size was $45. That gap highlights why transparency and benchmarking are critical. Just be sure to compare apples to apples (consider contract size, number of modules, region, and when the deal was signed).

Practical impact: Gaining pricing transparency empowers you to surgically negotiate. Instead of just saying, “The total cost is too high,” you can pinpoint that “Our payroll module fee is above market,” or “We need a bigger discount on Recruiting.” This often leads to better outcomes because the vendor sees that you know exactly where the issue is. For instance, an enterprise customer demanded a breakdown and discovered their Workday Learning module was effectively priced at double the industry benchmark, hiding inside a bundle.

Armed with that info, they negotiated the Learning fee by 30% while keeping other modules the same, leading to substantial savings without reducing scope. Furthermore, clarifying the FSE count meant they weren’t charged for several hundred interns that shouldn’t have been included, correcting the license basis.

In sum, transparency and metric clarity ensure you pay for what you use and need—nothing more. This builds trust in the long run, as you and Workday clearly understand the contract components, reducing disputes or surprises later.

10. Separate Expansion Bundles from the Core Renewal

What to do:

• Unbundle renewal vs. new scope: If Workday proposes a combined deal (renewing existing subscriptions plus adding new modules or users), insist on evaluating the renewal portion independently. Ask for the price to renew your current services as-is, and then separately the cost (and discount) for any expansion.
• Ensure co-terminus terms: When adding new products or users, negotiate so all subscriptions co-terminate at the same renewal date and carry consistent pricing protections. This way, you won’t have different end dates or terms that weaken your position later.
• Analyze bundle discounts carefully: If Workday offers a bundle discount for signing up for more at once, calculate the effective cost of each component. Ensure that the discount is meaningful and you’re not committing to things you don’t need to get a “deal.” Only bundle if it truly makes financial sense for each piece.

What to think about: Vendors love to do a “blend and extend” at renewal: they mix your renewal with new sales to show one attractive package, sometimes to mask a high increase on the renewal portion. Don’t fall for it blindly. You need clarity on how much you’re paying to renew what you already have, versus how much is for the new additions. Sometimes bundling can be a win-win (you get a volume discount on the new stuff), but you won’t know that without breaking out the numbers.

Also, be wary of bundle conditions—for example, if they say, “We’ll give you 50% off Module X if you also keep Module Y,” what happens if you want to drop Y in three years? You might lose the X discount, which creates a lock-in. It’s crucial to have co-termination and consistent terms across bundled products so you aren’t handcuffed.

As Redress Compliance advises, “insist on seeing the as-is renewal price separate from any expansion… ensure any multi-module bundle has co-termination and protections – you don’t want to drop one piece to blow up your discount on everything else”. In short, maintain the ability to remove or swap components without penalty later.

Practical impact: You preserve your negotiating leverage and clarity by handling expansions separately. For example, one company was renewing Workday HCM and considering adding Recruiting and Learning. Workday’s initial proposal lumped them together at a single price. The company requested a split quote and discovered that the “bundle” obscured a 12% rise on the HCM renewal.

They pushed back, reduced the HCM renewal to a minimal increase, and still received a fair discount on the new modules. In the end, they signed the new modules but with confidence that each piece was appropriately priced.

Moreover, by aligning all products to the same end date and terms, they set themselves up to renegotiate everything holistically next time. They won’t be trapped by a prior bundle agreement if their needs change (maybe they want to drop Learning later). Essentially, separating renewal and expansion ensures you get transparent value on new investments without undermining the economic terms of your existing subscription.

11. Optimize License Volume Commitments (Adapt to Growth or Reduction)

What to do:

• Align licenses with current workforce: If your employee count has decreased since the last contract (due to layoffs, divestitures, etc.), attempt to reset the licensed FSE baseline at renewal. Prepare data on the current headcount to justify reducing subscriptions so you’re not paying for employees you no longer have.
• Plan for future growth in negotiations: Conversely, if you anticipate significant workforce growth or plan to roll out Workday to more users in the future, use that as a bargaining chip. Negotiate volume tier discounts now based on that expected growth, or secure a price hold for adding more FSEs later at today’s rates.
• Avoid over-committing: Don’t agree to a higher minimum FSE count than you need if Workday pushes you to increase your commitment “just in case,” resist unless they offer a commensurate discount that justifies it. You can always add more licenses later – ideally at the same per-unit price if you negotiated that upfront.

What to think about: Workday contracts often lock in a minimum number of FSEs for the term, meaning you pay for that number whether or not you have them employed. If your company shrinks, that’s a problem – you could be stuck paying for 10,000 employees when you only have 8,000. This is a hidden trap: “If your employee count decreased, you might still be stuck paying for the old higher count…

Try negotiating a renewal provision to reset the baseline to current employees or allow a reduction”. Even if Workday resists lowering the count, argue that any competitor’s bid would naturally be based on your new, lower headcount. If the drop is dramatic, you might not get a full reduction, but perhaps a partial concession or some service credits. Conversely, negotiating now can save money if you expect growth (or need more modules later). Workday’s pricing has volume tiers – larger deals get better per-unit rates. If you’re at 9,500 employees today but likely to be 12,000 in two years, try to get pricing as if you had 12,000 now. Highlight that growth potential: Workday may give you a break, knowing they’ll get that future business.

In one example, an organization informed Workday that they might acquire another company, which would add users; this helped them secure a better price tier immediately, assuming that Workday would benefit when those users came on board. The key is to right-size your commitments – not too high (paying for ghosts) and not too low (paying a premium if you grow and need more later).

Practical impact: Optimizing license volume saves money and avoids waste. If you successfully negotiate a lower baseline due to downsizing, you directly cut costs – paying, say, for 8k employees instead of 10k could drop your annual fee proportionally (20% in that case). One company achieved a mid-term adjustment after a divestiture: Workday wouldn’t refund money, but they agreed to allow the unused license value to be applied as credits toward other Workday services.

It wasn’t a pure reduction, but the company repurposed about $300K of spending that would have been wasted. On the other hand, negotiating with growth in mind locks in economies of scale. If you get a volume discount now for future users, you’re essentially future-proofing your pricing. As you grow, those additional users come in at a known low rate, rather than you having to renegotiate later from a weaker position.

In practice, companies that leverage expected growth in negotiations have seen outcomes like “price per employee stays flat even after adding 20% more employees.” In contrast, unprepared customers often see their per-unit price increase when they add users outside of a negotiation cycle. The bottom line: make your license count work for your real business size, adjusting up or down with minimal financial penalty.

12. Eliminate Shelfware and Unused Modules

What to do:

• Identify unused subscriptions: Scrutinize which Workday modules or features you bought but haven’t fully deployed or used. Common culprits might be add-ons like Learning, Recruiting, or Planning that sounded good initially but never got rolled out enterprise-wide.
• Decide whether to drop or swap: For each underused module, determine if it still holds future value for you. If not, plan to remove it at renewal to stop paying for it. If it might be useful eventually but isn’t now, consider negotiating a swap or deferral – perhaps exchanging it for another module that you need more or dropping it this term with minimal penalty and the option to add it back later at a set price.
• Prepare your case: Document that it’s not being used (e.g., “Module X was never implemented, providing no return on its cost”). If possible, show you’re willing to invest those dollars elsewhere with Workday. Vendors are more amenable to swapping if they see you’re not just cutting spending but maybe reallocating it to a module you will use.

What to think about: Shelfware – software you paid for but aren’t using – is a double waste: it adds cost and complexity with no benefit. Workday deals often bundle multiple modules, which can lead to shelfware if your adoption lags. Don’t continue paying maintenance on a shiny toy in the box. That said, Workday may push back on dropping a module, especially if it was heavily discounted in a bundle (“We gave you Learning at 50% off as part of the deal, so if you drop it, the overall discount might change…”).

Be ready for that argument and focus on the logic: you’re not getting value from it, and it’s better to reshape the contract to fit your actual usage. A smart approach can be: “We haven’t rolled out Learning as planned; can we exchange it for another module or remove it with minimal penalty?”. Often, Workday will consider a swap, especially if you trade an unused product for a newer offering they’re promoting.

For example, you might swap out an unused Learning module in exchange for Workday Journeys or another module you genuinely plan to use, keeping the spend the same. If they flat-out refuse removal or swap, you might negotiate a deeper discount on that module to at least pay less for the unused piece or a shorter term so you can shed it later.

Practical impact: Eliminating shelfware ensures that every dollar spent delivers value. One organization realized they were paying about $200K/year for Workday Recruiting, even though they had barely adopted it (their recruiting team continued using another system).

At renewal, they negotiated to drop Workday Recruiting entirely, which freed $200K annually that they could save or redirect to other priorities. Alternatively, consider a case where a company had not deployed Workday Learning but was interested in Workday’s newer Skills Cloud.

They negotiated to swap Learning for an equivalent value of Skills Cloud subscriptions. The result: they didn’t cut the budget, but they traded an unused asset for one with actual planned usage, increasing the ROI of their Workday portfolio. By tackling shelfware, you avoid paying maintenance on “empty seats.”

This cuts costs and simplifies your contract and support efforts (fewer modules to manage). Plus, it sends a message to Workday that you expect tangible value for everything you pay, which can lead them to be more attentive in ensuring the successful adoption of what you do keep.

13. Balance Contract Length with Flexibility Needs

What to do:

• Choose a term that fits your roadmap: Standard Workday subscription terms are often 3 years. Decide if a shorter or longer term benefits you. If you foresee major changes (like adopting new modules, acquisitions, or divestitures) shortly, a 3-year term or shorter might be wiser so you can renegotiate sooner. If your environment is stable and Workday is strategic, you might consider a longer-term only with sufficient safeguards.
• Leverage term length in negotiation: If you are open to a longer commitment (e.g., 5 years), use that as a bargaining chip. Offer it in exchange for something significant, such as a bigger discount, locked pricing with minimal increases, or added services. For example, tell Workday, “We could consider a 5-year renewal, but only if we get a 15% cost reduction and a 2% cap on increases yearly”. Don’t extend the term without extracting value from it.
• Avoid excessive lock-in: Be cautious of terms beyond 5 years. Technology and business needs change. Unless the long-term deal is exceptionally good, sticking with the typical 3-year cycle may be better. If you go long, ensure you have clauses that allow for flexibility (like reducing scope at certain milestones or renegotiating if you acquire a company, etc.).

What to think about: Contract length is a double-edged sword. A longer deal can protect you from price increases and save the hassle of frequent negotiations, but it also reduces your agility. Workday might offer enticing discounts for a 5- or 6-year renewal (because it secures their revenue and reduces their sales effort), but remember: your business could evolve. New competitors or solutions might emerge, or you might need features that weren’t in scope.

Redress Compliance points out that while some enterprises opt for 5-+ year deals to lock in rates, “longer terms = less flexibility if things sour unless you secure strong protections.” Ideally, align the term with your strategic plan. If you’re sure Workday will be your backbone for the next decade, and the deal is great, locking in can be fine—negotiate escape hatches for extreme scenarios.

Conversely, if you think in 2 years you might revamp your HR tech stack or add a major module, you might not want to be mid-term when that happens. Instead, a 2- or 3-year term could let you renegotiate around that time.

Also, watch out for vendor-driven term changes: sometimes Workday might push a 4-year renewal instead of 3 to stagger customers’ renewals or hit internal metrics. Stick to what benefits you. In summary, balance cost certainty against future flexibility and err on flexibility if unsure.

Practical impact: The right term length optimizes pricing and adaptability. For instance, a company anticipating needing Workday’s Planning module in a couple of years chose a 3-year renewal instead of 5. When the time came to add Planning, they were at the negotiating table again and leveraged that expansion to get a better deal—something they couldn’t have done if locked in for 5 years.

On the other hand, another enterprise comfortable with a long commitment secured a 5-year deal with a fixed 0% increase for the first 3 years and only 2% thereafter, plus an upfront 20% discount for the extended term. This saved them millions, and they were confident they’d stick with Workday.

In that case, the long-term paid off because it was coupled with significant safeguards. Essentially, by strategically using term length, you save money (through deeper discounts for longer terms) or save flexibility (by keeping terms shorter to adapt and renegotiate). The wrong term length, however, can either leave money on the table or leave you stuck in a deal that no longer fits, so this is a lever worth careful consideration.

14. Secure Data Ownership and Exit Rights in the Contract

What to do:

• Establish clear data ownership: Ensure the renewal contract explicitly states that your company retains ownership of all data stored in Workday. This is usually standard, but double-check it. You want no ambiguity that the data is yours and you have the right to it.
• Include data access and export clauses: Negotiate terms that guarantee your ability to access and export your data at will. Ideally, you should have the right to export data during the subscription via APIs or tools and a provision for accessing data after contract termination (e.g., 30-60 days of read-only access to extract remaining data).
• Plan for transition assistance: If possible, add a clause that Workday will provide reasonable cooperation or assistance if you choose to migrate off. This could be as simple as agreeing to provide data dumps in a standard format (CSV, XML) or a few hours of support to ensure data is ported successfully. You might not get much here, but even a small concession can help if you ever need to leave.

What to think about: While discussing exit when you’re renewing may seem premature, long-term flexibility demands thinking ahead. SaaS lock-in is real – one of the biggest pain points of leaving a SaaS platform is extracting your data and shifting systems. Workday is mission-critical (it might hold your HR records, financial data, etc.), so you must ensure you won’t be held hostage by your data if the relationship ends.

Verify that the contract doesn’t impose heavy fees or undue restrictions on getting your data out. It’s wise to negotiate a post-termination access window, such as “Customer may access the Workday environment in read-only mode for 60 days after termination to retrieve data”. This prevents a scenario where you’re suddenly cut off and scrambling to get information on the day your contract ends.

Also, consider data format: stipulate that exports will be in a usable format (not some obscure form). Regarding data ownership, most vendors will agree that your data is yours, but ensure no language limits your rights. Sometimes, there are clauses about data being deleted X days after termination – make sure that timeframe is enough for you, or extend it if needed (especially if you operate in an industry with data retention requirements).

Additionally, consider compliance: if you have regulatory obligations (GDPR, etc.), ensure Workday’s data deletion or return contract terms align with those. All these points might not directly lower your costs today, but they save you from potentially huge costs and headaches later if you decide to switch systems or need to perform a large data extraction.

Practical impact: Locking down data and exit rights gives you leverage and peace of mind. One company negotiated a clause that, upon non-renewal, Workday would provide a complete data export and a 45-day read-only period for verification. When they later decided to transition to a different platform, that clause saved them from paying hefty fees – they had enough time to export everything and verify data integrity, avoiding business disruption.

Another firm didn’t have such a clause and had to renew for an extra year to systematically extract and migrate data, costing them an extra $500K they hadn’t budgeted. By getting these terms upfront, you maintain the freedom to make future decisions (even if that’s to leave Workday) without prohibitive cost or risk.

Moreover, knowing you have an exit plan strengthens your negotiating hand in renewals: Workday sees that you can leave smoothly, subtly reinforcing your leverage. In summary, solid data ownership and exit provisions ensure you’re never truly locked in – you stay with Workday because it’s the best choice, not because you’re technically stuck.

15. Leverage Benchmarking and Independent Expertise

What to do:

• Use third-party benchmarks: Obtain data on what other companies pay for Workday or similar SaaS solutions. This might come from industry peers, consulting firms, or market research. Look for metrics like cost per FSE, typical discounts at your spend level, or module price trends.
• Consult independent licensing experts: Consider bringing in an independent SaaS licensing advisor (like Redress Compliance or similar firms) to help shape your negotiation strategy. These experts have experience with vendor tactics and often have proprietary data on deals. They can validate your targets and identify missed opportunities.
• Keep the vendor honest with facts: Subtly drop in benchmark figures or analysis when negotiating. For example, “Our analysis shows that enterprises of our size usually pay around $XX per employee for this module.” You don’t have to reveal sources, but citing specific numbers lets Workday know you’ve done your homework. If you have an advisor, you can also allude to “market analysis” or say, “We have industry experts advising us.” This signals to Workday that their usual playbook might not work for you.

What to think about: Negotiating in a vacuum is risky. Workday’s sales team negotiates deals daily and has far more information than you do on pricing benchmarks and wiggle room. By leveraging independent data and expertise, you level the playing field. For instance, an advisor can point out that Workday’s quote for your Financials module is 20% above what similar clients pay, giving you a concrete point to contest. They might also highlight contract terms that others have that you should ask for.

Additionally, advisors know the “gotchas” and typical concessions; they can tell you which of your asks are realistic and which might be a stretch. For example, an expert might suggest that asking for unlimited self-service support calls is futile, but getting an extra sandbox environment thrown in is quite doable.

Importantly, using an independent firm shows Workday you’re serious about getting a fair deal. As one expert advises, bringing outside benchmarks “puts pressure on Workday, showing that you know your stuff… quoting specific metrics shows you are an informed buyer”.

Just be careful to use reputable sources and ensure confidentiality (you wouldn’t want any proprietary info leaked or NDAs violated when sharing benchmark data). The goal isn’t adversarial; it’s to inform and strengthen your position.

Practical impact: Engaging benchmarks and experts often translates to tangible cost savings and better terms you might have missed. For example, a global enterprise hired an independent SaaS negotiation consultant who identified that Workday’s initial renewal proposal lacked a standard clause capping future price hikes. With that insight, the company added a price cap and secured it, preventing potential six-figure increases.

In another case, benchmarks revealed that the customer’s discount was below market; armed with that, they pushed Workday for an improved discount from 25% to 35%, saving an additional $1M over the term. Beyond cost, experts can ensure you address compliance and flexibility terms properly – maybe they’ll suggest adding an audit clause or an SLA credit that you wouldn’t have thought of, which could save headaches or money later.

In summary, independent insight = money and time saved. It validates your stance, uncovers blind spots, and often accelerates the negotiation since you come to the table with a well-founded position. Workday, seeing that you’re well-advised and benchmarked, is more likely to present a fair deal sooner rather than dragging things out.