ServiceNow has announced that it has signed an agreement to acquire Hitch Works, a company that uses data and AI tools to help map people and skills to projects. The announcement is significant given the current macroeconomic context for buyers, as well as in terms of how ServiceNow is thinking about delivering value to customers.
ServiceNow rarely makes acquisitions, unless it identifies a company (both skills and technology) that it feels could fill a gap, and be easily integrated, across its Now platform. The terms of the deal have not been disclosed.
With regard to the macro context, companies everywhere are having to grapple with what is being dubbed as ‘The Great Resignation’, as employees spent the pandemic reassessing how they think about the experience of work and what it means to them. This could be that they have a greater desire for work/life balance after two years of working from home, or that they have come to the realization that their job isn’t giving them enough purpose.
As such, employers are under a significant amount of pressure to both give their employees more flexibility, but also to ensure that they’re satisfying career expectations and/or ambitions.
With the Hitch Works acquisition, ServiceNow is signalling that it understands that employees don’t want to just be in ‘any’ job anymore - they want to be in the right job, or working on the right projects. If it can help its customers better the employee experience by enabling them to understand where skills are best placed, or will be the most valued, this could in turn help with attrition.
Equally, ServiceNow understands that it will secure larger deals with buyers if it can deliver returns for them quickly. Following a recent conversation with CEO Bill McDermott, it became clear that his priority, given soaring inflation, is boosting productivity for customers.
If the choice for customers is reducing costs or boosting productivity, the latter is a much more value-driven scenario. Ensuring employees are working on projects that match their needs and skills, boosting their experience, is one such way to ensure that workers are more productive.
What we know
ServiceNow has said that the Hitch Works acquisition will allow it to help customers address talent gaps by tying employee learning and development to workforce planning, across a single platform. It cites recent IDC research, which states that CEOs in North America believe that managing the talent skills gap is “the biggest risk to impacting business in 2022”.
The aim is to use Hitch Works’ AI and ML technology to help managers identify which employees are best suited for projects based on skills and interests.
Gretchen Alarcon, VP and General Manager of HR Service Delivery at ServiceNow, said:
If skills are the new currency for business, insight into these skills is critical to driving talent retention and adapting to evolving business needs,
But skills management has historically been siloed, with numerous point solutions and fragmented processes that don't work together. With Hitch, ServiceNow will streamline skills intelligence on a single platform to help business leaders match employees with meaningful work.
Hitch was founded by HR-industry veteran Kelley Steven-Waiss, who was previously CHRO and CIO of HERE Technologies, prior to founding Hitch Works. The company is led by CEO Heather Jerrehian, an entrepreneur and one of the founders of venture capital firm, How Women Invest. Both leaders are expected to remain with ServiceNow once the acquisition is finalised.
AI‑powered skills intelligence is the foundation for the future of work.
Joining forces with ServiceNow allows us to scale our skills and talent mobility solutions across a global ecosystem of business leaders, managers, and employees. Together we will make work more meaningful and purpose‑driven for employees and deliver better business outcomes for companies.
ServiceNow and Hitch said that the acquisition will allow companies to provide equal access to work and development opportunities, “regardless of who an employee knows or how well they network”. Over the last year, ServiceNow added new solutions to its Employee Workflow portfolio to support employees, including Employee Journey Management, which enables employee learning and feedback in the flow of work.
Hitch’s Steven‑Waiss said:
A productive and engaged workforce is the greatest asset of an organization.
As we emerge from the pandemic and face the challenges of the Great Resignation, employee experience is the key differentiator to winning 21st century talent. ServiceNow will advance Hitch’s vision of creating the next generation of workforce and skills solutions.
ServiceNow expects to close the acquisition in Q2 2022. ServiceNow will build Hitch’s capabilities into the Now Platform, beginning with its Employee Workflow solutions - later expanding into customer service, IT, and developers workflows.
It’s clear that ServiceNow sees this as a tactical and strategic acquisition, one that directly ties into its focus on employee experience. This focus on ‘experience’ is an attempt to help customers see direct value from the Now platform, helping them with issues that are front of mind within the macroeconomic context. Obviously we don’t yet have the use cases to quantify Hitch’s effectiveness on the Now platform, but it’s something we will be chasing in the coming months.