Workday has announced the immediate departure of Chano Fernandez and the appointment of Carl Eschenbach as Co-CEO alongside Aneel Bhusri. The press release stated that Chano Fernandez stepped down from the role with immediate effect and was no longer on the Workday board of directors. No reason was given, nor was there a statement from Fernandez in the press release, leaving the reason for his sudden departure a mystery. It may not be long before he appears again.
The appointment of Eschenbach is not one of a complete outsider, as he has been a member of the Workday board since 2018. However, this is a temporary appointment as he will serve until January 2024, giving workday time to consider what to do in the long term. Workday has a history of promotion from within but will take time to consider the options and may consider an external appointment.
Aneel Bhusri, co-CEO, co-founder, and chair, Workday, “We have an incredible opportunity in front of us, and I’m confident that Carl, with his leadership skills and his proven experience in helping technology companies scale, as well as his commitment to culture and values, will help lead Workday through its next phase of growth. Chano has been an integral part of Workday since he joined almost nine years ago and has helped us to achieve great success and growth. We thank him for his many contributions.”
Who is Carl Eschenbach?
Eschenbach will continue to be active in Sequoia Capital, the venture capital company he has been a partner at since 2016. Eschenbach is also a board member at several companies, many of whom Sequoia have invested in. They include Zoom, Snowflake, UiPath, Palo Alto Networks, Cohesity, Aurora, Gong.io Retool, Salt Security, Cresta, and Grafana Labs. Whether he retains all those positions over the next year is not yet known.
This will be his first CEO role. He was previously president and chief operating officer at VMWare, working there for 14 years. Before VMWare, he held sales leadership roles at Inktomi, EMC, Alcatel-Lucent and 3Com.
Carl Eschenbach, co-CEO of Workday, commented, “I’ve long admired Workday and how it has redefined the enterprise software industry, with a focus on putting people at the center, a values-based approach to leadership, and a relentless focus on customer service and innovation. This has helped differentiate Workday, driving its growth and success in supporting some of the world’s largest organizations,” “I’m thrilled to be expanding my role at Workday and working with Aneel, the rest of the leadership team, and our amazing group of employees to help us build on this great momentum and take hold of the massive opportunity in front of us.”
Enterprise Times: What does this mean
This is the second departure of a co-Ceo in a few weeks following the announcement that Bret Taylor will step down at Salesforce. The announcement was made after the close, and the initial response was positive from the market, with shares rising slightly by 0.39%. To calm the market further, Workday reaffirmed its financial guidance for the fourth quarter of fiscal 2023 and its preliminary outlook for fiscal 2024 as provided on Nov. 29, 2022.
Bringing in an interim co-CEO makes sense, and Eschenbach has the experience to take over the role and should understand the Workday culture from his time on the board. It is a risk, though, as he is a relative outsider and is not steeped in the same culture that Workday instils in its employee base.
There are questions, though. How much time will Eschenbach dedicate to Workday? Will he retain his other board roles or hand them over to other Sequoia partners? What will be his responsibilities at Workday, and will he have the remit to make sweeping changes? The latter seems unlikely. The decision to bring in someone to support Bhusri, no doubt, comes from the founder himself, with no obvious succession plan for Fernandez; this seems a sensible, if knee-jerk reaction. The big question, is why did Fernandez leave?
