It was announced last week that ServiceNow has hired Paul Smith to head up the company's EMEA region. The appointment was of particular interest for two key reasons - firstly that Smith was previously working at cloud giant Salesforce as its UK general manager, and secondly it's the first clear indication of how CEO Bill McDermott is planning to beef up ServiceNow's leadership team.
We at diginomica got the opportunity to sit down with Smith (virtually) to get a better understanding of his ambitions for ServiceNow in EMEA, what drew him to the company and also to learn how he's planning to make ServiceNow a strategic platform for buyers as they consider their response to the COVID-19 pandemic.
Before we dive into the interview, it's worth noting that ServiceNow has been undertaking a serious shift in its go-to-market strategy in recent years - expanding out of its ITSM roots and putting additional focus on customer service management, as well as customer and employee experience. CEO Bill McDermott - previously long time SAP CEO - recently joined the company and has been pushing the idea of ServiceNow being at the centre of a ‘workflow revolution' in the enterprise. For more background on ServiceNow's strategy, you can read diginomica's analysis here and here.
When asked why he decided to make the jump from Salesforce, Smith said that ServiceNow had become a company of interest after working closely with a Salesforce customer advisory board. Over the past year or so, Smith said that the customers in question were speaking positively and with excitement about how they were using the Now platform across their organisations. Smith explained:
In terms of why ServiceNow, now? It's rooted in what we were just talking about, in terms of what I was starting to see and hear in the marketplace. Very senior technology executives who I trust and whose opinions I trust, were talking about almost the ‘untapped potential' in this organisation. The untapped potential in the Now platform. It's amazing in ITSM and its current market, but if you think about what the world's going to need to deal with all these current challenges organisations are facing - massively untapped potential.
When referring to ‘current challenges', Smith is specifically talking about the impact of the COVID-19 pandemic on organisations across the world. Not only have companies had to rethink how they operate, given work from home measures and social distancing requirements, but they are also facing unprecedented demand across customer service functions. In other words, there is increased pressure on employees and a need to rethink business models for the future.
All of this is happening at great speed and this will mean that companies will be making strategic decisions around their technology use at a pace that was very unlikely just six months ago. ServiceNow wants to be in a position to be front and centre of those positions, which is a priority for Smith.
He gave an example of a multinational manufacturing organisation (which can't be named publicly yet) that had 58 projects prior to COVID-19, with high visibility at the board level. Post-COVID, this has been stripped back to 11 projects. However, Smith said that these are 11 projects that have "massive weight behind them". Smith explained:
All of these new business models are being opened up, are having to be put in place, and something that was previously a six month decision making cycle is now a two week decision making cycle. Everything is accelerating. That of course plays to the strengths of ServiceNow, in terms of agility, speed and being a partner that can help those new business models take place. Not just internally to employees, but absolutely extending out into delivering amazing experiences for your customers.
And Smith is fully aware that there isn't time to be wasted, as companies are going to be making changes in the immediate future. He added:
Right now, I am impatient. I wake up in the morning after seven days [in the job] with a sense of impatience to get on and make some of the changes. When you come into an organisation in a senior position, you are in a uniquely privileged position because you come in with fresh eyes and you can see in front of you this already successful business. You've got to avoid the mistake of change for changes sake. Let's preserve what's amazing and remove any bottlenecks to go faster.
But then I think the risk is missing the opportunity, not going fast enough. The risk is CEOs are making decisions in the next 12 months around the organisations that they are going to partner with for the next five years, around how they wrestle with all these challenges. I want to make sure that ServiceNow is a part of those conversations right here and now. So there's an impatience to make sure that we're doing that. So yeah, it's executing at speed.
An eye on $10 billion
As noted above, ServiceNow has a long history in serving the ITSM market. However, in recent years the push to expand its remit - because of the versatility of the Now platform - has meant that it has eyes on a variety of use cases across the organisation.
Smith said that even though he's just a week into the job, he's already hearing stories of where ServiceNow has secured deals in the Customer Service Management space, for example, with buyers that have no history of using the platform for ITSM. These types of deals are going to be key to ServiceNow's future success if it wants to become the ‘workflow engine' of the enterprise. Identifying use cases outside of the IT department and bringing those to the fore will be essential for future sustained growth.
Smith believes that ServiceNow is on the right track and he is already eyeing a $10 billion revenue target. He said:
I look at the growth curve - $4 billion of revenue now on a path to $10 billion. That journey from 4 billion to 10 billion in revenue is going to be incredible and I want to be a part of it. I had a similar journey with my last organisation and I learnt a lot on the way and I think I can help ServiceNow do it faster.
What's enabling ServiceNow's ability to branch out across the enterprise is the simplicity of the platform itself, said Smith, which hasn't had to be a Frankenstein cloud of cobbled together systems in order to achieve growth. He said:
One of the other things that massively attracted me here is the one architecture, one platform, one data model - it hasn't grown by massive acquisition. I think this is an organisation that is untapped in terms of the platform capability in terms of what that platform can do. It's big enough and robust enough to scale to support the needs of some of the largest organisations in the world.
It's that purity that creates our agility. As and when there needs to be growth by acquisition, re-platforming those acquisitions as we have done to date, onto the Now Platform preserves that. Preserving the agility is going to be really, really important.
Getting comfortable with the C-suite
Smith said that his primary ambition over the next 18 to 24 months is to be able to publicly outline how ServiceNow is being used in 10 of the biggest and "most exciting organisations on the planet". And not just to be working with them as a solution to solve one particular problem, but as an organisation-wide platform that helps to manage their challenges through 2020/2021.
However, front of mind for Smith is equipping his teams in EMEA to sell this version of ServiceNow clearly, effectively and confidently in boardrooms and with the C-suite. This is something that has been expressed by CEO Bill McDermott too, where he talks about engaging with CEOs, rather than IT leaders. He added:
The piece that I'm passionate about is making sure we are there, as the partner, to communicate with CEOs and executive boards wrestling with these challenges. That's one of the things I'm going to be very focused on, is helping the ServiceNow team across EMEA have those conversations. Equipping them with the ambition, the confidence, the tools, the enablement, to go out and have those conversations with the board of directors of XYZ company. It's easier said than done, but we've got to make sure the teams are lined up and enabled to do that.
It's a priority that the team is absolutely fluent in partnering with the C-suite to communicate this opportunity.
Over the past six months or so there has been a renewed vigour within ServiceNow. McDermott has clearly brought in a laser sharp cross-enterprise focus and is ramping up the company's expertise in ensuring it can speak to a wide variety of use cases. Smith has plenty of experience in this area from his time at Salesforce, as well as a comprehensive contact list, I'm sure. As I've said before, there is a solid understanding in the market of how ServiceNow solves problems for ITSM - but the use cases outside of that need to be identified, articulated and showcased for all to see. The company needs to be careful not to fall into the trap of talking in broad strokes and instead go to market with practical advice and clear examples of how this workflow engine solves problems in a COVID-19 world.