Reassess ServiceNow through the lens of the OneOffice™ and OneEcosystem™

The Situation: The most disruptive force in the operations space is not RPA, process intelligence, AIOps, or observability. It is ServiceNow. Its capabilities build the operational layer for organizations to deliver digital customer and employee experiences by offering cross-functional workflows in the cloud underpinned by a single data model. It provides organizations with a single pane of glass for all their operational data. In doing so, ServiceNow is a key change agent for operationalizing the OneOffice.

Evidence of the market impact ServiceNow is making came in its most recent earnings call. In the full fiscal year of 2021, revenues increased 30% year-on-year. Among newly signed contracts, 43% of annual contract value (ACV) contributions came from outside of IT. Those solutions focus predominantly on customer and employee workflows and its NOW platform. Yet, many stakeholders still believe ServiceNow is largely about IT operations.

The deeper disruptive potential is highlighted by organizations such as Japan Tobacco or Novartis that put ServiceNow at the heart of their GBS (global business services) transformation. Not long ago, this analyst would not have believed he would use the terms “ServiceNow” and “GBS” in one sentence.

Let’s take a closer look at where ServiceNow is headed.

ServiceNow is not entering the RPA market, but it will integrate capabilities with a new release

Just like the AIOps capabilities of the previous acquisition, Lightstep, ServiceNow will integrate the RPA capabilities of Intellibot into the core platform. ServiceNow blog posts provided glimpses of what that might mean for RPA. What stood out for us was a reference to a “business-task automation on the Now Platform,” indicating that to progress to process automation, it needs to integrate more capabilities. Bill McDermott, ServiceNow’s CEO, outlined those additional capabilities will be part of the “San Diego” release. ServiceNow is not entering the RPA or AIOps market; in our view, this move is about extending the core capabilities.

Operations leaders should focus on the native integration of RPA with hyperscalers and embedding automation as part of a broader ISV ecosystem such as ServiceNow as an important step in progressing toward OneOffice. The core value proposition is to link the cloud-native way of delivering services with all the technology and process debt gathered under the moniker “legacy.” Thus, ServiceNow must articulate what those outcomes are to demonstrate to operations leaders its disruptive yet transformative capabilities.

Celonis gives ServiceNow access to new buying centers

Perhaps more illuminating than the comments on RPA were McDermott’s reflections on ServiceNow’s partnership with process intelligence leader Celonis. We have already provided our take on the announcement as the boldest move yet to combine the automation of complex data with process intelligence. The partnership allows ServiceNow to target new buying centers by doing “the x-ray in the non-ServiceNow installed environments. We can activate all the changes that are necessary to augment the business process on the Now Action layer.” In other words, it is about blending insights with actions and ultimately automating those actions. For McDermott, the value creation comes from helping clients with the mass customization of their processes, which may otherwise require “a truck-load” of consultants and lengthy high-ticket projects.

ServiceNow operationalizes the journey toward the OneOffice

ServiceNow’s initiatives are operationalizing the journey toward the HFS OneOffice. Clients remain enthusiastic about the service experience provided by ServiceNow. The strong alignment to the OneOffice mindset comes through the single data model, the cross-functional workflows, and the technology to support these. As McDermott puts it, clients can use the “Celonis EMS platform and convert that insight into action, automation, and remediation with the ServiceNow workflow platform.” ServiceNow provides the Native Automation to deliver on OneOffice experiences.

Industry-led solutions are the next frontier for ServiceNow. The leading service providers blend deep domain expertise with the core ServiceNow platform (see our ServiceNow Top 10 for details). This push provides the touchpoint with HFS’ OneEcosystem™, where organizations increasingly need to collaborate across ecosystems to pinpoint where disruption is coming from, where to disrupt, and how to keep reinventing themselves. Those broader engagements provide an additional layer for an outcome-centric narrative that ServiceNow needs to drive. Cloud-based, cross-functional workflows need to cross organizational boundaries internally and externally.

The Bottom Line: Leaders can operationalize the OneOffice™ with ServiceNow if they integrate it with broader change agents such as RPA and AIOps.

Organizations deploying ServiceNow to transform their GBS organization demonstrate how much progress ServiceNow has achieved in the operational space. ServiceNow can further disrupt operations and accelerate the journey toward the OneOffice. Should the partnership with Celonis prove successful and ServiceNow gets to sell into more buying centers, it will need to expand its narratives to be relevant to additional sets of stakeholders. That includes blending the narrative of a broad set of change agents with its horizontal marketing. Leaders can learn the lessons from Japan Tobacco and Novartis to apply to their transformation journey.