Managed services News
ServiceNow CEO Bill McDermott On ‘Bold’ Expansion Plans, Innovations, New Chairman Role
Joseph F. Kovar
“ServiceNow is the only software company in the world operating at the ‘rule of 60.’ So if you look at our bottom-line profitability and our top-line revenue growth, combined we‘re right around the rule of 60. And there’s no other company in the world, none, not a single one, including the hyperscalers, that are operating at the rule of 60,” says ServiceNow CEO and newly crowned Chairman Bill McDermott.
Looking just ahead to next year, what are what are some strategic initiatives ServiceNow is looking do?
We continue to expand the platform on so many different dimensions. We went into some of that with the new capabilities built into our Tokyo release, for example, procurement management services, supply chain optimization, and many other aspects of what was known as the ERP environment of the 20th century quickly moved to ServiceNow. Customers really want to innovate and move really quickly. Not because those transactional systems don‘t matter. They do matter. And actually, we’re excited to make them matter even more, because we bring new life to them because their transactional sophistication never changed. But their ability to reorient, rewire, deal with the agility in workflow automation necessary for this era, this generation, needs to be optimized on ServiceNow. So if you look at what we did with Tokyo, we’re now making a bold move into security. Digital trust is a big thing. And think about encryption, data anonymization, security control, and all these things to protect business critical applications, think of that vault on one platform, integrating with all the other solutions, but giving one version of the truth so managers can quickly automate and take action on threats and remediate them before they become serious.
We have unbelievable experienced managers where we‘re guiding them through a leadership journey on employee experience. And now they have one destination to develop the careers of the people that count on them so they can be trained and optimized for productivity. Because a lot of companies out there are either laying off or they’re cutting back, and they‘re going to have to do more with less [by] automating on the ServiceNow platform, and our partners are front and center of this. For example, in the operational blueprints of the future, we’ve got supplier lifecycle management, ESG (environmental, social, and governance) management, procurement service management, all of these things are taking off. And we have multiple wins in the quarter. And example, in the ERP wins that we had in the quarter—we’re not replacing ERP companies, let me be clear, we‘re making them better--we had one company in particular in the manufacturing space that saved $1 billion with our procurement management services solution. And we get a tiny little fraction of that, and we got them going in 30 days. And most ERP innovations take place in less than 90 days. We’re talking about speed. We’re talking about immediate business results, and that‘s what this environment calls for.
We‘ve gotten so accustomed to this. A lot of people don’t understand platforms. Let me explain. A platform is horizontally, tech enabled thing. And as you build technology into the platform, whether it‘s RPA (robotic process automation) or AI, all the capabilities around security, all these workflow automation innovations I’m explaining to you, they scale horizontally. So that means that when we released San Diego in March, or we released Tokyo in September, all the customers that run on the ServiceNow platform had immediate access to all that net new innovation. And they can enable it at their choice without any complication of taking the new code or the new experience forward. Nor do they have any complications in any customizations they built into it. Because we solve those issues on the platform for them so they never have any tech debt with ServiceNow. The CRM market has a well-known brand out there that when they introduce a new platform, they burn the bridges. And they basically say this is the new platform, you‘re going to have to shut things down and reorient your task to the new platform, because that debt is on you to get straight. We do it for the customer. We’re like the Tesla of the enterprise software industry.
Anything else we need to know?
We didn’t talk about it, but I do think it‘s worth mentioning that ServiceNow is the only software company in the world operating at the ‘rule of 60.’ So if you look at our bottom-line profitability and our top-line revenue growth, combined we’re right around the rule of 60. And there’s no other company in the world, none, not a single one, including the hyperscalers, that are operating at the rule of 60. I just want to mention that because a lot of people don’t understand that. Many say when you’re operating in the ‘rule of 40,’ you’re world-class. And we’re operating at the rule of 60.