ServiceNow Names PayPal Chairman As New CEO

ServiceNow on Monday named John Donahoe, former CEO of eBay, to lead the company as its new CEO.

Donahoe, who has been chairman of PayPal's board since July of 2015, will take the reins from current CEO Frank Slootman, who plans to step down on April 3 after six years in the role. Slootman will remain as the Santa Clara, Calif.-based company's chairman.

Donahoe spent more than seven years running online auction powerhouse eBay as its president and CEO. Before that, he spent 23 years at Bain & Company, rising to lead that global consulting firm.

[Related: ServiceNow Integrates Security Platform With Palo Alto Networks, TaniumTo Speed Up Security Incident Responses]

Once he takes his position as CEO and president of ServiceNow, Donahoe will be charged with guiding the IT services management vendor, possibly the fastest growing enterprise software company out there, as it looks to extend its portfolio across the enterprise.

In recent years, ServiceNow has introduced applications that leverage its cloud platform to venture beyond a traditional focus on IT services.

ServiceNow is vying for market share as a customer service platform and is setting its sights on Salesforce in that arena. Last year the company released its Security Operations platform, meant to streamline incident response operations, as it is looking to parlay its position managing IT workflows to become a security player.

In an interview Monday morning on CNBC, Slootman said the hire was driven by the availability of a candidate of Donahoe's stature in the industry, and not by any business or time imperatives.

With Donahoe sitting next to him, Slootman said he wanted to "make room" for Donahoe by stepping aside as CEO, recognizing the value the former eBay leader could bring to the company.

Tom Kieffer, CEO of Virteva, a ServiceNow partner based in Minnesota, told CRN after watching the two executives on CNBC that he takes their claims that the hire was opportunistic, and didn't stem from external pressures, at face value.

Viteva's business has grown dramatically in the last 18 months, Kieffer said, directly because of its partnership with ServiceNow. The company uses ServiceNow to run operations for its MSP business, and also deploys the product for customers as a systems integrator.

Like Viteva, eBay is also a ServiceNow customer, Kiefer said, so the incoming CEO is likely familiar with the platform and its benefits to businesses.

While Slootman wasn't facing pressure to vacate his position, the broader product focus makes it a good time for a leadership change, Kieffer told CRN. Slootman was hired to help take ServiceNow public five years ago and was the right leader for that chapter in the company's history.

"It's always healthy to bring in some new perspective," he said. "ServiceNow is looking to grow beyond IT. They now have credible tools and a story to tell with the rest of the business."

Kieffer noted that Slootman's leadership team, mostly brought in from Data Domain and EMC, built the company's channel, largely inspired by those companies' models.

But now ServiceNow has "to learn to behave as a large enterprise SaaS company," and Donahoe has valuable experience running a larger organization with a business that spans well beyond the IT services market.

In the CNBC interview, Donahoe said: "over the last year I've had a great opportunity to step back and just survey the landscape, and the trend that just stood out is the role the cloud is having on both consumers and enterprises."