In May 2019, Amalgam Insights attended Knowledge 2019, ServiceNow’s annual end-user conference. Since ServiceNow’s founding in 2004, the company has evolved from its roots as an IT asset and service management company to a company that supports digital workflow across IT, HR, service, and finance with the goal of making work better for every employee. In attending this show, Amalgam Insights was especially interested in seeing how ServiceNow was evolving its message to reflect what Amalgam Insights refers to as “Market Evolvers,” companies that have gained market dominance in their original market and taken advantage of modern mobile, cloud, and AI technology to expand into other markets. (Examples of Market Evolvers include, but are not excluded to, Salesforce, ServiceNow, Workday, Informatica, and Tangoe.)
As jaded IT industry analysts, we attend 25-30 tradeshows and end-user shows each year, including the likes of Oracle Open World, Dreamforce, SAP SAPPHIRE, IBM Think, RSA Conference, Microstrategy World, KubeCon and CloudNative Conference, Tableau Conference, VMWorld, Red Hat Summit, and many, many others. It is part and parcel of being an industry analyst, but it also means that even the most inspiring and amazing speakers start blending together after a while. For instance, in the past 12 months alone, I’ve been at shows that featured everyone from Daniel Pink to Michio Kaku to Peter Diamandis to Ian Bremmer to Barack Obama (as an aside, outside of Ginny Rometty at IBM, where are the women keynoting large tech conferences?).
But the main point here is that it’s easy to get fatigued by these conferences.In that light, ServiceNow started with one of the most inspiring and adorable introductions that I can remember in my tech career. The IT Workflow keynote session started with a video of a young Black girl at an office questioning why work needs to be so hard when this is not what this generation expects from their interactions and transactions at this point. And over the next couple of minutes, she combines the direct clarity of childhood with the expectations of simplicity that we have grown to expect in our consumer lives. By the time she was done, I was ready to hire this elementary school kid to manage my company! You need to watch it for yourself. The link to this presentation is here: https://knowledge.servicenow.com/video-library/day-1-digital-workflows-full.html
That view into the future was the context that ServiceNow set for Knowledge19. As CEO John Donahoe took the stage with the unenviable position of having to top that presentation, he continued the focus on providing consumer-grade interfaces for doing work. Having come from eBay, Donahoe’s key frame of references started with the iPhone launch on June 29, 2007 and focused on the immediacy and simplicity of experiences needed to support e-commerce and the one-to-two second responses that lead people to complete or abandon a purchase. This is a two-part process of creating a simple front-end that supports the behavioral and emotional centers of the brain that is connected to the complexity of a cross-technology backend that automates and supports the cognitive work associated with conducting complex work.
And from both this keynote and subsequent presentations including an Industry Analyst track of executive discussions, ServiceNow’s focus on mobile was extremely clear. The idea of getting every basic process to a set of self-guided series of clicks was front and center in every discussion of user experience across ServiceNow’s various areas. Over the three days that Amalgam Insights was at ServiceNow, our analysts met with a variety of customers, product marketers and managers, ServiceNow partners, and expo exhibitors. Throughout these discussions, the following trends emerged as key areas aligned with Amalgam Insights’ coverage areas of IT management, DevOps, Cognitive Science, and Machine Learning. Amalgam Insights recommends that IT and financial audiences track the following trends coming out of Knowledge 2019.
Seven Key Trends and Products to Watch For
1. The concept of “Agile IT” has been sold as an interesting concept over the past decade, but much of “agile,” has been restricted to specific types of application development rather than the holistic world of application development, data management, infrastructure, software, networks, IT vendor management, and ongoing IT support. This is because IT departments have largely lacked the tools and visibility to prioritize IT effectively. ServiceNow has started to support organizations that use the platform to prioritize business imperatives first. Similar to the concept of “Zero-based budgeting,” where finance organizations seek to rebuild budgets from the bottom up with the goal of eliminating waste, this emerging practice could be seen as “Zero-based IT” where the goal is to ensure that IT efforts are always prioritized on the highest business needs and that people are being uptrained to support future-facing challenges. This requires a combination of program management, financial management, resource management, skills management, and workflows that would traditionally require a portfolio of separate tools.
But this “Zero-based” approach for prioritizing IT is one that particularly resonated with Amalgam Insights because we believe that businesses will continue to have an exponential need for more technology to support personalization, video and audio detection, machine learning, form processing and workflow automation, natural language processing, app and service portfolio management, security and governance as well as the integration, configuration, and customization across all of these areas. ServiceNow’s platform approach provides a starting point for IT organizations to acknowledge the complexity of IT departments, the rapid changes in business prioritization, and the scale of IT technology resources and services within a single environment. As this concept of Zero-based IT shifts from experiment to a well-defined operational and financial practice for maximizing the value of technology, Amalgam Insights expects that ServiceNow and its competitors will be increasingly pressured to combine multiple IT portfolio and asset management solutions to meet the specific needs of enterprise clients seeking Zero-based IT. Analysts Hyoun Park, Tom Petrocelli, and Lynne Baer will be focusing on this transformation over time.
2. From a machine learning perspective, ServiceNow has developed a variety of capabilities to accelerate role-based AI usage. Although ServiceNow has not given its AI efforts a name, as many of its software platform peers have done, ServiceNow does have a portfolio of capabilities that were enhanced through acquisitions such as DxContinuum, Qlue, and Parlo to make algorithmic models for requests, virtual agents and bots, and conversational natural language. Amalgam Insights positions these efforts in context of the Role-based Expert Enhancement Platforms that we introduced in 2017 as the near-future of making AI practical and usable. We believe that AI needs to be focused on a specific role within an organization with the goal of enhancing subject matter expert efforts in context of repeatable and integrable services to maximize value. ServiceNow’s combination of workflow, machine learning, and AI management is well suited for conducting this type of work along with resource administration and work prioritization. Analysts Lynne Baer and Hyoun Park have been digging into machine learning and will be tracking this progress.
3. ServiceNow’s platform is increasingly focused on DevOps with integrations to Github, JIRA, and Jenkins to accelerate access to ServiceNow data and insights. As the platform matures to support modern application development, Amalgam Insights expects that ServiceNow will increasingly be used as a platform to enable more applications on a service and API-specific basis. The current trend towards increasingly granular management of services, calls, data, and workflow-specific workloads requires this transformation. ServiceNow currently identifies over 100,000 members in their developer program, making this a rapidly growing developer community to keep tabs on. Analyst Tom Petrocelli is deeply focused on the needs of the DevOps community in this regard.
4. On a similar note, the challenges of microservices, service mesh, and event management are increasingly pressing against the traditional capabilities of CMDB and IT asset management technologies, which will lead to an increasingly detailed need for custom hierarchies, taxonomies, and ontologies for ServiceNow customers to effectively manage IT assets and resources. On the one hand, this can be seen as relatively simple from a technology perspective, as it simply requires building an additional level of services and resources to be managed. However, the standards for defining these resources are still under consideration. For now, companies seeking to integrate DevOps into the rest of IT will need to create their own taxonomic layer of “microservices,” “APIs,” or “service-based computing” to manage the micro-IT services and capabilities at this level if they seek to keep up with the rate of digital business. Analyst Tom Petrocelli focuses on the practical DevOps aspects of this relationship while Analyst Hyoun Park focuses on the cost and inventory management of microservices and events.
5. From a design perspective, Amalgam Insights finds ServiceNow’s focus on consumer-grade mobile experiences to be especially interesting since it is fundamentally the correct approach to accelerating work, but requires more than “just” robotic process automation or a visually pleasing user interface or intelligent workflow designs. There is an opportunity to bring in cutting-edge neuroscience to optimize these experiences either to support short-term process optimization, reinforce process learning, or support long-term compliance associated with every task by looking at how each click or button push and response aligns to cognitive, behavioral, or emotional reinforcement. Cognitive Neuroscience analyst Todd Maddox Ph.D. will continue to follow how ServiceNow’s design efforts align with top scientific efforts (including his own primary research) in making progress on this front
6. Since ServiceNow acquired SaaS management solution VendorHawk last year, Amalgam Insights has been eagerly anticipating the new solution. At the time, ServiceNow announced that the solution would need to be replatformed to work on the ServiceNow platform, an effort that is in line with ServiceNow’s commitment to supporting one consistent platform across all applications. Although this commitment has led to a wait in launching the new SaaS management solution, this is a smart long-term move as this move will improve ServiceNow’s ability to align SaaS utilization, licenses, and costs with a wide variety of IT activities across software, mobility, network, and cloud computing. As this launch occurs with the New York platform release, Amalgam Insights’ analyst Hyoun Park will be analyzing this product in context of the SaaS Expense Market in general in an upcoming SmartList Vendor Landscape on SaaS Management scheduled for the Fall of 2019.
7. Last, but not least, ServiceNow announced a Financial Operations Management product at ServiceNow focused on the challenges of consolidation and close workflows. This product is an initial foray into the Finance office, which has been relatively hot as of late between Workday’s acquisition of Adaptive Insights, the Blackline IPO in 2016 and stock doubling over the past three years, and recent funding for finance-focused software companies such as FloQast and OneStream Software. This product is not intended to directly compete with the financial products provided by ERP solutions such as SAP and Oracle, but rather to support the complexities of transaction matching, collaboration, and audit associated with the monthly, quarterly, and annual financial close that can take up the majority of a staff accountant’s time. Amalgam Insights will cover this announcement more closely in a separate, but this announcement is an important part of our Future of Finance coverage area that analyst Hyoun Park covers.
ServiceNow has quickly grown from one of many high-growth cloud vendors in the early 2010s to one of the definitive cloud giants in 2019 with well over $2 billion in annual revenue, continued growth rate of over 30%, and the ability to continue looking at new markets over time due to its platform-based workflow management approach. As one of the new megavendors built in the cloud, ServiceNow has to be seen as a serious contender in any market it chooses to enter and continues to work on transformative offerings in the IT, cloud, and DevOps management markets that Amalgam Insights covers. Knowledge 2019 serves as a proof point for ServiceNow’s current strengths in IT, HR, service, and security markets and provides guidance for what is to come from a mobile, DevOps, and Finance offerings going forward. Knowledge 2019 provided many topics of consideration for IT management and finance departments across the maturity spectrum and verified ServiceNow’s continued position as a core management solution for managing IT, service, and business workflows.