Where Are Customers Leading ServiceNow Now?

Day Two at Knowledge12 brought me into closer contact with ServiceNow's founder Fred Luddy and CTO Arne Josefsberg, as I sat down after the keynote for one-on-one meetings that brought the company's key strategies into clearer focus. The Luddy keynote was instructive, too, revealing the company founder to be a true techie, who can deploy ServiceNow solutions and program an airline tracking program in real time. However, the most essential message from ServiceNow concerned the importance of the customer.

All three key trends in the ServiceNow portfolio of offerings are the direct outgrowth of customer requests:

Platform robustness - advanced high availability (HA)
Workflow productivity - using social collaboration via liveFeed
Scope expansion - moving beyond IT automation

I've already touched on the advanced HA and its importance to customers and prospects in the US and in Europe. According to Josefsberg, who by the way was at Microsoft for 26, not 22 years, ServiceNow's customers value highly the ServiceNow logical partitioning approach that ensures separateness of data stores and conforms with regulatory requirements. As of now, the GENERATION2 platform has been rolled out across nearly half of ServiceNow's customer instances and by July should be universally available in the US East-West configuration and in Europe, including the special niche deployment for Suisse financial companies (Zurich-Geneve). Longer term, ServiceNow will serve customers in AsiaPac and Latin American geographies, as well.

Luddy's keynote yesterday morning introduced the workflow productivity advantages of using social collaboration via LiveFeed, rather than email, to channel and track action and interaction while managing incidents. Instead of threads and tributaries and detached streams of email communications, LiveFeed provides a focal point and a single, unified stream. Live feed channels all participants and their activity in an incident resolution process, captures it and passes the log of their activity to the incident tracking system. The productivity benefits are clearly dramatic: less wheel-spinning and time wasted, more focused workgroup collaboration, and superior recordkeeping. The keynote audience thundered their appreciation with sustained applause.

The third area that customers have driven, and continue to drive, is the expansion of the ServiceNow platform beyond the IT domain. Already ServiceNow has numerous examples of customers creating business solutions in shared services such as HR, Facilities and GRC, and also in line-of-business (LOB) functions such as insurance claims, services requests, scheduling, resource provisioning and other business functions. ServiceNow has published a book of case studies from customers that have build Cloud solutions, including Brit Insurance, CERN, Key Energy Services, Kimberly-Clark, Latham & Watkins, Lemminkäinen, Liberty University, Plexus, Progress Energy, Qualcomm, Sephora, SunGard Higher Education, The Ohio State University, and Verisign.

Given these positive customer themes, we also feel it important to indicate one significant area of challenge for ServiceNow – Services. While smaller partners such as Fruition may continue to provide hands-on implementation services, it is less clear how ServiceNow's new relationship with KPMG, a major Knowledge12 conference sponsor, will impact that other working relationships, for example, ServiceNow's relationship with Accenture.

ServiceNow is presently out ahead of the curve – and the competition – with its technology platform and its coherent breadth of solution capability. Heading into its IPO, it seems clear that ServiceNow has a very positive trajectory, so long as the company returns soon to profitability, as its pace of expansion (and hiring) has run it into the red, although apparently temporarily. Moreover, ServiceNow's evolving strategy, embracing social collaboration and Cloud solution development, differentiates the company significantly from the other ITSM players such as BMC or HP whose Cloud capabilities lag significantly behind.

A companion Lens360 blog post was published earlier this week entitled What's New at ServiceNow's Knowledge12?

Michael West is Vice President with Saugatuck Technology. His areas of research and consulting expertise include Cloud Computing, “Enterprise Ready” SaaS, ISVs in transition to SaaS, Cloud Development platforms, SaaS Integration, Social Computing platforms, and GRC. In 2000, Mr. West joined Saugatuck as an early co-founder after leaving Gartner, Inc., where he served as Vice President and Research Director. In 2004-5, Mr. West spent a year in Washington, D.C. at the Corporate Executive Board as Practice Manager of the Information Risk Executive Council, before returning to work at Saugatuck and re-focusing his interests on Software-as-a-Service and Cloud platforms. Mr. West has over twenty years experience in Information Technology at John Hancock, Fidelity Investments, Apple Computer, and Gartner. He is a frequent speaker at conferences and other industry events on a wide range of topics concerning technology and business strategy. He has written and presented research on information management, data administration, applications development, application integration, object technology, client/server architectures, graphical user interface and usability strategies, web site development and Internet applications, network computing, electronic commerce, portals, hubs and communities. Mr. West has an A.B. from Williams College , M.A. from Johns Hopkins University and M.B.A. from the Boston College Graduate School of Management. He has taught IT Strategies in M.B.A. programs at the Boston College Graduate School of Management and at the Haas School of the University of California at Berkeley.

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