SeviceNow CEO: ‘The Destruction Of Time Is Like The Ultimate Enemy Of Humanity’
‘You have to realize the soul-crushing work that most people are stuck with on a day-to-day basis is not actually the work they ever dreamed of doing. And in most cases, it’s not even what they signed up for,’ says ServiceNow CEO Bill McDermott as he unveils ServiceNow AI Platform, a relaunch of the company’s AI platform.
The first, and arguably the most important presenter, was McDermott, who spoke of his vision of ServiceNow as what he called “DESCO21C,” or the defining software company of the 21st century.
ServiceNow is a company that continues to grow by expanding its flagship Now platform for building digital workflows that McDermott called a “once-in-a-generation platform” that now cuts across a customer’s entire enterprise.
[Related: ServiceNow CEO McDermott: ‘We’re Running The Table In CRM’]
“[We] can integrate any data source, any hyperscaler cloud and any LLM into the ServiceNow platform,” he said. “So I really like our positioning. The TAM [total addressable market] keeps expanding. It’s growing by the day, and we’re just innovating at a pace I don’t think any other company could match.”
Most recently, that growing TAM is acceleration in large part to an emphasis on AI and in particular agentic AI, McDermott said. Agentic AI refers to the ability of AI from different systems being able to communicate with each other to better manage processes while lessening the need for human intervention.
Automation comes when “you apply agentic AI, not fake silo agents that are going to a dead-end street doing U-turns but are real agentic AI agents that are reinventing business processes and how companies run,” he said.
To learn more, read more of McDermott’s key points from ServiceNow’s Financial Analyst Day.
Three Key Growth Factors
McDermott said ServiceNow is riding a wave of three growth factors that are coming together now to quickly expand the company’s TAM.
“One is the core business,” he said. “Every great company has to have a great core business. [Six years ago, I told the board] that we would expand the perimeter of what ServiceNow is capable of and we would build a once-in-a-generation platform. And recently, we added data and we more than doubled our TAM with RaptorDB and Workflow Data Fabric. So now companies can integrate those systems of record. They can integrate any data source, any hyperscaler cloud and any LLM into the ServiceNow platform. So I really like our positioning. The TAM keeps expanding. It’s growing by the day, and we’re just innovating at a pace I don’t think any other company could match.”
ServiceNow Built For This Macroeconomic Moment
ServiceNow, like the rest of the IT industry, is currently having to deal with macroeconomic disruptions, but it is uniquely able to not only weather the disruptions but come out more strong, McDermott said.
“First, this is not our first macro disruption,” he said. “We’ve been through many of them, and we really don’t get shook up about it. I take it more as a weather report than I do something we should be all shook up about. So we’re cool, calm, and collected. And history shows in enterprise software, the platforms that matter always come out of disruptions stronger on the other side, and I think that has never been more true than it is right now.”
Agentic AI, Not Fake AI Agents
McDermott said that when he says his company integrates with the entire stack, it is taking all the objections off the table to bring ServiceNow in as a customer’s central nervous system.
“And so think about this,” he said. “You integrate with any system of record, then you move any data into a workflow where you’re automating things across all business processes. But then you apply agentic AI, not fake silo agents that are going to a dead-end street doing U-turns but are real agentic AI agents that are reinventing business processes and how companies run. This is the AI layer. This is the real AI agent company, and when customers hear that, it clicks, it just makes sense. So we feel fantastic about the platform.”
How ServiceNow Differentiates Itself
CTOs, CEOs, COOs and CEOs, when looking at innovating across their enterprise, are not looking at just their ERP system, their CRM system, or their human capital management (HCM) system.
“They’re thinking, ‘Wow, probably ServiceNow has something going on there. Let me learn more about that,’” he said. “And so if you just look at the great [Nvidia CEO] Jensen Huang himself, he calls ServiceNow the AI operating system of the enterprise. And that’s how he uses us, and that’s how he thinks about it. And we’ve been jealously guarding this clean pane of glass to really simulate the iPhone for the enterprise. It’s clean and it’s beautiful. There’s enormous complexity behind it, but the user doesn’t feel the pain. And so at Knowledge 25 we’re going to relaunch the ServiceNow AI platform. [Customers] want us to meet them where they are. They want to do business with a company that has empathy at mass scale. So when I say any infrastructure, any data and any AI model all coalescing on one platform, ServiceNow, the AI platform for business transformation, that’s the story we’re telling.
Growth Factors Powering ServiceNow In Years Ahead
The key to understanding ServiceNow’s future is to remember that it is putting AI to work for people, McDermott said.
“You have to realize the soul-crushing work that most people are stuck with on a day-to-day basis is not actually the work they ever dreamed of doing,” he said. “And in most cases, it’s not even what they signed up for. Think about this: The destruction of time is like the ultimate enemy of humanity. On average, people waste five hours a day on that smartphone in their pockets. In the enterprise, there’s a legacy tax of $10 trillion, just for America as a country, for legacy systems that are not well integrated and don’t talk nice to each other. That’s equivalent to a 7 percent GDP tax. This is a massive problem. And therefore, when I think about this platform, we invented something we call ServiceNow AI Platform. And with ServiceNow AI Platform, we’re going to make bold moves with lighthouse customers [early adopters] where we bring our team of black belts and the customers’ best and our partners’ best to get these customers innovating across the enterprise, get them live swiftly, and push broad adoption from a shareholder value standpoint that’s going to click the meter after all the free use cases are over. And for the customer, it’s going to enable them to lower their cost, fix their margin profile no matter what revenue environment they’re in, and it’s going to let them dream again, grow again. And so today, when you see CRM and you think about configure, price, quote, sell and service all on one platform, you’re going to see only one company in the world that can do it. So we intend to make a very bold move and go all in on CRM with data. We have the world’s fastest database, RaptorDB, 27 times faster than anything else we put against it. And we’re going to combine RaptorDB, Workflow Data Fabric and the automation layer, fundamentally changing the way companies do business. And you’ll see how we take this to every industry, every geography, and we put this together with our partners to get mass scale across the globe.
ServiceNow Drinks ‘Its Own Champagne’
ServiceNow has enjoyed strong growth because it places stock not only in its own employees, but in running the company using its own Now platform, McDermott said. Unlike companies that hit speedbumps with the pandemic and Russia’s invasion of Ukraine, ServiceNow made sure it kept its employees.
“At that time, we had a no-layoff pledge with our employees because we knew we hired with tremendous intentionality in the first place, and no matter what shockwave came our way, we would need the great people on the other side,” he said. “And now we’re up to 1.7 million people that are applying to ServiceNow annually. So it’s really hard to get in here. And the other thing I think is super important is ‘Now on Now.’ We drink our own champagne before we bring it into the marketplace, and we found all the jobs that our technology can do in every corner of the office. And that’s why we're able to absorb tremendous growth and still give the leverage and the free cash flow margin that our shareholders truly appreciate.”
