ServiceNow: keeping its head above the cloud

By Kieron Bain

It is somewhat surprising to hear that ServiceNow CEO John Donahoe, a man undoubtedly at the top of his game, locates his footing within the cloud computing giant, as at the very base of the hierarchal tree…

“I am a servant leader,” he tells us. “It’s a model I learned in business school at Stanford. As CEO, I don’t see myself at the top of the organisation. I’m at the bottom, working to make everyone else successful, starting with our customers. Servant leadership demands constant listening and learning. I learn from everybody, from every encounter. I seek feedback and I strive to get better every day. I’m also competitive. I like to win. So, I work hard to serve our customers, our employees and our company, and to be the best leader I can be. It’s a never-ending journey.”

Donahoe joined the cloud-providing enterprise software company ServiceNow (based in Santa Clara, California) in April 2017 as President and Chief Executive Officer. He came with a robust CV, his previous role being CEO of eBay from 2008 to 2015, during which he oversaw the eBay, PayPal and eBay Enterprise businesses with revenues more than doubling to $18bn and market value increasing over 250% to $80bn.

Prior to eBay, Donahoe spent more than 20 years at Bain & Company, starting as Associate Consultant and rising to become the firm’s Chief Executive Officer. Donahoe still serves as Chairman of PayPal and is also on the board of directors of Nike and the Bridgespan Group, a nonprofit advisor for mission-driven organizations and philanthropists. We caught up with the Dartmouth College and Stanford Graduate to fully explore his ethos and how it has spearheaded success at some of the biggest companies in the world…

The cloud space is fast becoming a crowded market place, but ServiceNow is successfully managing to stand its ground…

ServiceNow is the fastest growing enterprise software company above $1bn in revenue. We serve over 4,000 customers, including more than 42% of the world’s 2,000 largest publicly traded companies. We finished 2017 with our best quarter ever. We now have 500 customers doing more than $1mn annually with us, and our biggest customer has topped $20mn. We have a diverse global customer base and strong momentum. Our platform and products enable customers to streamline and simplify workflows across their organisation, creating easier, better, more intuitive experiences for their employees and customers.

How can bigger companies overcome the inertia created by having to design and instill processes whilst dealing with an ever more rapidly accelerating business environment?

Good process should be an enabler, not a roadblock. All companies today must be agile, flexible, adaptive and responsive to changing customer needs and market dynamics. As companies grow, more process is necessary to ensure everyone understands how to get things completed efficiently. But process must not get in the way of staying close to your customers, listening, and responding to customers’ needs.

You have served big companies, but is there anything you can learn from small businesses on how to best serve consumers’ interests while remaining competitive in the marketplace?

Small businesses are incredibly close to their customers. They interact directly and personally with their customers every day. Their customers may be neighbours, friends, fellow church members or old childhood friends. Small businesses can be highly attuned to local market conditions and competitive issues. Small business owners and employees live and work in the community in which they operate and compete. Staying close to your customers and intuitively understanding market dynamics can be challenges as businesses scale; customer intimacy and deep market knowledge are key to enduring success. Nothing replaces actual customer interaction and on-the-ground experience.

What was it about the opportunity at ServiceNow that inspired you to make the commitment to this business?

ServiceNow is a very customer-focused company with great products and technology. We are making a difference in how people work. We make the world of work ‘work’ better for people. That’s our purpose, and that’s incredibly inspiring to me. We believe deeply in the vision of our founder Fred Luddy to help make work easier for regular people. And we are building on the great work my predecessor, Frank Slootman, did to grow ServiceNow and put us on the path we are on today. We are focused on helping our customers succeed, and on building a great, enduring company that will help shape the future of work for people.

This is my first time working in enterprise software. I’ve spent most of my first year listening to and learning from our customers. It’s been very gratifying to hear the passion people have for ServiceNow and what we can achieve together. I’ve also been struck by how startlingly consistent the conversations are regarding the challenges CIOs face. We are doubling down on customer success, making sure we are a valued strategic partner to help enable customers’ digital transformation and create new employee and customer experiences.  

What do ServiceNow’s service and products mean to the customer base? What are some key benefits of your products?

Every customer I speak with is managing digital transformation and trying to provide better ways of working and better experiences across their organisation. Our customers understand that ServiceNow is a powerful cloud-based platform to better enable employee and customer experiences. Whether in IT or customer services management, IT operations, HR service delivery or security operations, our products enable customers to streamline and simplify workflow, better manage data and issues and allocate resources, and create better experiences.

How does ServiceNow’s approach to AI differ from such leading competitors as Google and Amazon?
We are focused on using machine learning to enable better workflows and better experiences. Machine learning is native to our platform, making it accessible to all products on the platform. This is a powerful way to streamline and simplify workflows, freeing up people to focus more of their time and energy on more meaningful work that creates more value than performing routine tasks.

What do you believe will be the greatest challenge to your AI strategy over the coming years and how do you plan to overcome this barrier?

In technology in general, the biggest challenge is always staying abreast of innovation and keeping up with the pace of change. AI will continue to evolve rapidly. Our focus will be on how to use AI effectively to solve practical problems for our customers and create better work experiences.

Where do you think AI will take ServiceNow over the next five to 10 years? What is your planned innovation roadmap and what notable developments are you already working on?

AI is just one aspect of the opportunities ahead. We are also evolving our systems and investing more in UX (user experience) and UI (user interface). We are also investing in mobile, ensuring our experiences are mobile friendly. We are focused on delivering best of class, ‘out of the box’ ideas to our customers.

What implications will AI have for the US economy and how should industry adapt to these changes?

Technology is fundamentally changing the nature of work. Like any period of change, some jobs we know today will disappear – technology will offer better ways of doing that work, whether that’s automating routine tasks or making mobility driverless. Other jobs will be created that we can’t imagine today. That’s been true in every period of technology-driven change and innovation.

Everyone will need to learn how to work with technology in new ways, particularly AI. Everyone will need a core set of digital skills and competencies. In the 21st century, everyone must be digitally native. That’s true in the US and globally. We see this speed of change in our personal lives today. We are interacting with voice-activated AI in our homes in ways unimaginable just a short time ago, and we love it; it’s convenient. We are adapting and learning. Similar changes are coming to the workplace at an accelerated pace. We will need broad-based, public and private collaborative efforts to help everyone navigate the transformation. 

To what degree will the AI revolution create the need for fundamental social change and reform in the US?

AI and other technology-driven innovation is accelerating rapid change in our personal and professional lives. All sectors of society must get better at understanding what these changes mean, how we should adapt and how we can ensure more people benefit from these changes and share in the opportunities ahead. We face tremendous opportunities and significant challenges – we must tackle both. Technology-driven innovation will continue to play a powerful role in the growth of the US and beyond, and in how we live and work. We’re all in this together and ensuring positive outcomes will require public-private partnership, collaboration and shared vision. Get smart – understand the technology and the opportunities it creates for your business. Don’t wait – don’t underestimate the speed of change. Most importantly, understand how to harness data. AI will be ubiquitous. Using your data effectively with AI will drive competitive advantage.

How are you shaping ServiceNow and how are you creating individual employee buy-in to your ethos and philosophy?

I am meeting with employees worldwide to share our purpose and culture, and our focus on driving customer success and building a great, enduring company. We call it our Global Purpose Tour, which we’re finishing up right now in Asia Pacific with stops in Sydney, Singapore and Hyderabad. Our purpose: we make the world of work ‘work’ better for people. Going forward, everything we do will be designed to activate and fulfill our purpose. We’re driving clarity and alignment about ‘why’ we are here (our purpose), ‘what’ we are doing (our strategies), and ‘how’ we will accomplish our goals (our culture). Investing in talent is a priority for me, and we are evolving our company brand to reflect our purpose. This is an exciting time for us and employees are responding enthusiastically to our journey ahead.

What is the most important lesson you have learned in business during your tenure at some of the biggest companies?

Success starts with a continuous commitment to learning and personal growth. I believe deeply that no-one cares more about your career than you do. Whatever your ambition, each of us must take ownership of our career development and our aspirations. No one else will do it for you. Find meaning and purpose in your work. Be clear about your goals, about how you want to integrate your professional and personal lives. Find the right balance for you. Careers don’t unfold in straight lines. Often, the most meaningful experiences are the most unexpected. If you do the hard work of managing your own career, I believe everything else takes care of itself. Yes, sometimes luck and circumstance will play a role in the opportunities you have, so be ready for every opportunity, and find satisfaction and meaning in every job you have.


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