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Summary
During his Knowledge 2023 keynote speech in Las Vegas, ServiceNow CEO Bill McDermott shared details on how 40% of CEOs feel that their organizations will no longer be viable in 10 years unless they digitally transform now. It is an impactful statement and finding that highlights the massive challenge ServiceNow is looking to support businesses in overcoming with its end-to-end intelligent platform for digital transformation. At Knowledge 2023 – ServiceNow’s first major in-person international Knowledge event since 2019 – ServiceNow shared new details on how its platform continues to evolve with new workflow and intelligent capabilities. ServiceNow’s priorities for its platform span further enhancements of capabilities across automation, digital experience, and intelligence.
ServiceNow evolves to become a business platform for the digital era with new automation and workflow capabilities
ServiceNow continues to evolve well beyond its IT-centric roots and heritage. The ServiceNow platform supports businesses to route work and automate processes across the everyday systems people rely on. At its core, ServiceNow has always been a platform company, and the vendor continues to evolve by adding new cutting-edge technologies and capabilities on top of its core. Consequently, Omdia considers ServiceNow to be more of a business outcomes-based company that enables organizations to become digital businesses rather than a product-based vendor. ServiceNow made many announcements at Knowledge 2023 that, thematically, spanned areas including digital experience, sustainability, diversity, systems modernization, and generative AI. In his keynote speech, Bill McDermott labeled ServiceNow a platform that enables “Exponential Enterprises” by helping businesses break down business and process silos to become more predictive and proactive in judging business outcomes and results.
Modernizing enterprise resource planning (ERP)
One of the most notable announcements was concerned with ServiceNow’s new ERP solutions, called Finance and Supply Chain Workflows, designed to enable businesses to optimize and automate core business processes. However, multiple ERP systems that run these critical business processes are commonplace within an enterprise. ServiceNow used the example of two customers: one with 129 different ERP systems and the other with 20 from the same vendor. These customers are trying to modernize their ERP systems and deploy what is known as a “clean core,” which involves a more standardized deployment with customization and integration outside the ERP platform. This is where ServiceNow uses the power of its platform to build specific solutions to transform critical business processes. ServiceNow points out that its intention is not to become an ERP vendor, but to allow customers to modernize and automate essential business processes quickly, leveraging data from ERP systems, and deliver improvements in operational efficiency and user experience. Notable ServiceNow capabilities include:
- ServiceNow Sourcing and Procurement Operations
- ServiceNow Supplier Lifecycle Operations
- ServiceNow Accounts Payable Operations.
ServiceNow Sourcing and Procurement Operations
Organizations need their sourcing and procurement operations to be as efficient and effective as possible. This has never been more important given the economic pressures, geopolitical shifts, pandemic leftovers, and a source-to-pay process dominated by legacy systems. These legacy systems impact the procurement process in many ways, not least the poor experiences delivered due to archaic user interfaces and legacy processes. The other key challenge is that suppliers often use different versions of these systems, which can result in errors. ServiceNow’s solution provides visibility into what organizations spend, which can help improve activities, including contract management.
ServiceNow Supplier Lifecycle Operations
Managing suppliers is a significant challenge. Supply managers and procurement leaders are looking for ways to transform their collaboration with suppliers to solve disruptions while driving critical efficiencies needed for already overburdened teams. Most of the processes involved in supplier management are manual because the data exists in silos. The ServiceNow experience for supplier operations creates a unified digital experience that brings internal teams together with suppliers. It uses digital workflows to make processes automated and transparent. Employees can manage cases and tasks and keep things on track. The most significant advantage is that it promotes supplier/buyer collaboration and keeps everyone on the same page in one system of engagement and action. Supplier Lifecycle Operations include pre-built playbooks designed to automate and accelerate the complex task of onboarding suppliers. Omdia considers the possibilities of this solution as transformative, particularly as it brings all the different elements of supplier management together. For example, legal teams can collaborate on non-disclosure agreements (NDAs) and contractual needs while finance can work on reviews and oversight.
ServiceNow Accounts Payable Operations
ServiceNow Accounts Payable Operations is a process automation solution that helps finance departments to simplify and coordinate the activities required to pay suppliers accurately. It is part of the ServiceNow Source-to-Pay Operations solution. The finance operations and accounts payable teams have many mundane tasks to perform to pay suppliers, ranging from manual entry of invoices into back-end systems to matching invoices with goods received and purchase orders (POs). ServiceNow is transforming the employee and supplier experience across the accounts payable (AP) process through three key capabilities delivered by Accounts Payable Operations:
- Automated invoice ingestion: Accounts Payable Operations ingests invoices using Document Intelligence, an AI-driven processing engine, to scan invoice documents and automatically enter them into the ServiceNow platform. This eliminates the need for AP specialists to manually key individual invoice documents or copy and paste from one application to another
- Accelerated processing: Accounts Payable Operations uses AI to automate the routine accounts payable activities that ensure process integrity, including duplication checks, PO matching, and approvals. This approach breaks the linear model organizations use where the more invoices they receive, the more AP staff they need to process them
- Unified workflows: Accounts Payable Operations provides a single environment with flexible workflow capabilities that enable simplified cross-team collaboration with a single source of truth.
How ServiceNow helps businesses better understand and improve digital experiences
ServiceNow also shared details on various platform enhancements aimed at helping businesses improve customer and employee digital experiences.
ServiceNow’s formal entry into the digital employee experience (DEX) space will have vast implications for this growing market
ServiceNow announced the introduction of digital employee experience (DEX) capabilities into its platform. DEX solutions help businesses better understand an employee’s experience with their technology and provides self-remediation capabilities. The DEX market has experienced good growth over recent years as businesses look to further improve employee support by making it more proactive. ServiceNow’s entry into this space is a significant move and market disruptor in the DEX space – especially as ServiceNow integration is seen as a core capability of many of the pure-play solutions currently in this market. As ServiceNow will now deliver native capabilities in this space, pure-play DEX vendors must further differentiate and enhance their offerings. ServiceNow’s movement into this space is a logical expansion for the company, given its strong employee technical support heritage. Omdia believes that vendors that offer DEX capabilities as part of a broader platform and digital workflow offering – notably ServiceNow and VMware – are best positioned for future success in this market. In 2022, Omdia developed the EMMA (experience, management, monitoring, and analysis) framework to support organizations looking to improve employee experience (see Further reading). The framework discussed how solutions and practices need to support businesses to improve the trifecta of technology experience, employee sentiment, and by also offering a means of helping businesses actually orchestrate new experiences and employee journeys. ServiceNow’s formal move into the DEX space now means the vendor offers capabilities that support all these areas.
Simplifying the digital experience and supporting employee development
ServiceNow Employee Center enables businesses to consolidate service delivery across multiple departments, including IT, HR, legal, and procurement. Businesses benefit by having a single portal and service catalog from which users can request and procure services, enabling businesses to standardize and simplify service delivery. ServiceNow has further enhanced Employee Center by introducing new features, including AI-powered search and extending provisioning capabilities to rooms by integrating physical workplace mapping. This enables customers to check room occupancy and book spaces. Use cases also extend to manufacturing facilities and healthcare settings where ServiceNow acts as a portal allowing organizations to manage the digital augmentation of physical workplace environments.
In its Vancouver release, ServiceNow will also introduce Employee Growth and Development, which will be surfaced within Employee Center Pro, consolidating many capabilities commonly found across different talent management apps. This new capability, powered partly by ServiceNow’s acquisition of Hitch Works in 2022, will help organizations unlock workforce potential by providing actionable employee development controls and levers. This capability allows managers and employees to work together in defining skill development pathways and career growth objectives that make employee growth conversations actionable. Employers can be assigned skills and be guided to add their proficiency level to these skills. The career hub then becomes the destination people can reference as a personal career coach. A ServiceNow bot can also remind managers and employees of upcoming growth conversations in the flow of work. Talking points and agendas can be created automatically to help all parties keep conversations on track. Employee feedback can also be collected (natively and via third-party tools) to help feed into this process. A new manager library in the hub also supports leaders with content that helps them better support employees in the development cycle.
Appendix
Further reading
2023 Trends to Watch: Workplace Transformation and Hybrid Work (December 2022)
Market Fundamentals: Business Mobile Convergence (BMC) and the Future of Work (April 2023)
Digital Partner Opportunities: Ten insights and recommendations from Omdia’s 2022 future of work survey (July 2022)
Market Landscape: Fundamentals of Employee Experience Management (April 2022)
Authors
Adam Holtby, Principal Analyst, Workplace Transformation
Roy Illsley, Chief Analyst, IT Operations
