As high-flying ServiceNow continues to build out an end-to-end portfolio of digital workflow solutions by expanding into the ERP heartland of finance and supply chains, it might seem inevitable that customers will be trapped in the middle of an escalating ERP battlefield already featuring heavyweights SAP and Oracle.
But I don’t think that’s how this is going to play out, because ServiceNow CEO Bill McDermott knows the ERP world — and the future world of digital business — all too well to trigger some cataclysmic Destroy All Monsters scenario.
Instead, ServiceNow is making it quite clear that it intends to have its finance and supply chain workflows complement and enhance the big ERP systems customers already have rather than clashing against and competing with those traditional systems.
Here’s the key insight from the ServiceNow press release describing the new Finance and Supply Chain Workflow solutions, and I’ve highlighted the final sentence because it is the one that truly reveals McDermott’s intentions:
“Organizations today require more connected, responsive solutions that work across multiple departments and systems. Unfortunately, for many organizations, siloed systems of record were not built for today’s agile work and are difficult and costly to change. Finance and Supply Chain Workflows bring together people, processes, data, and technology in one easy‑to‑use platform to get work done across critical business processes. Now, finance, procurement, and supply chain teams can operate more efficiently, lowering the total cost of operations, while improving user experiences. By using data from existing ERP investments, businesses can automate processes and digitize mundane, manual work faster without the cost and organizational impact associated with large migrations.“
When we look at the ServiceNow introductions from that angle, a few things become clear:
- ServiceNow is definitely not looking for a clash-of-civilizations showdown with the much larger and more deeply entrenched ERP leaders, SAP and Oracle.
- McDermott definitely is looking to build out a complete and seamless portfolio of digital-workflow solutions that customers can deploy to create the end-to-end and interconnected processes that are the foundation of digital business.
- As it seeks to fulfill its goal of becoming “the platform for end-to-end digital business,” there’s simply no way to avoid the core areas of Finance and Supply Chain — if it wants to be a full-scale player across the enterprise, ServiceNow must play in the ERP space.
- If McDermott can thread the needle — and I must admit the hole in this particular needle is pretty darn tiny while the thread is pretty thick — and convince customers using traditional SAP and Oracle solutions that ServiceNow can bridge them into the future, that will be a very big win.
- And ServiceNow’s heavy focus on developing and acquiring advanced AI capabilities over the past few years is paying off handsomely in this new introduction as customers are beginning to demand AI-optimized solutions.
Final Thoughts
First of all, for more on ServiceNow’s latest thinking and its very successful Knowledge 23 show last week, please check out these on-location videos from my colleague Tony Uphoff:
- How ServiceNow Approaches Customers, AI, and Growth
- How ServiceNow Will Integrate Generative AI and Up-Skill Workers
Competition makes everyone better. As I’ve said many times, the savage competition in the Cloud Wars ensures that the ultimate winners are the customers, because they benefit from relentless waves of innovation produced by the greatest growth market the world has ever known.
But competition doesn’t always have to play out as a head-to-head, winner-take-all slugfest. And I think what McDermott and ServiceNow are orchestrating here is a superb example of the new type of thinking — and the new type of customer-centric collaborative competition — that will define the next stage of the Cloud Wars.
Because it is built around the notion of what customers need, rather than what tech vendors want.
To hear practitioner and platform insights on how solutions such as ChatGPT will impact the future of work, customer experience, data strategy, and cybersecurity, make sure to register for your on-demand pass to Acceleration Economy’s Generative AI Digital Summit.
