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ServiceNow ITOM workflow platform the next logical step from ITSM

Having firmly established itself in the IT service management business, ServiceNow hopes its workflow platform will bring the same level of success in IT operations management.

As pressure mounts to produce more compelling cloud-based services, some IT departments are looking closer at technologies to better automate and manage tasks for their IT operations.

One company that hopes to capitalize is ServiceNow Inc., a longtime provider of IT-focused services and specialists in IT service management (ITSM), based in Santa Clara, Calif. But, more recently, the company has doubled down on its IT operations management (ITOM) tools.

"They aren't pivoting into IT ops, because it isn't necessarily a new strategy for them," said Sanjay Medvitz, a research analyst with Technology Business Research Inc. (TBR) in Hampton, N.H. "It's more like the next logical step, because [ITOM] is closely tied to their ITSM business, where workloads overlap. It also can help them go after new users."

At the center of the company's redoubled ServiceNow ITOM push is its ServiceWatch Suite, a technology it acquired from the Israel-based Neebula Systems for $100 million in 2014.

The suite includes a configuration management database (CMDB), which serves as a repository that holds data pertaining to a collection of different IT assets. ServiceNow ITOM also handles incident and problem management, as well as change management, and provides service catalogs.

By pulling service maps into the CMDB, we can inform enterprise users how a stack of infrastructure relates to a particular business service.
Kevin MurrayServiceNow, senior director of product marketing

The suite offers a way to map different business services against information pertaining to an IT shop's specific infrastructure, according to Kevin Murray, senior director of product marketing with ServiceNow, a capability many IT shops lack.

"One of the problems of getting information discovered and put into [the CMDB] is it's not correlated to a particular service -- it's just a bunch of data," Murray said. "But by pulling service maps into the CMDB, we can inform enterprise users how a stack of infrastructure relates to a particular business service, like the finance system or HR and the CRM systems."

A $1 billion company as of the end of fiscal 2015, ServiceNow has set the ambitious goal of reaching $4 billion in revenues by 2020. ServiceNow ITOM products and services will have to experience steady growth over the next four years if it is to reach that plateau.

ITSM accounted for approximately 70% of the company's overall revenue in 2015, but CEO Frank Slootman recently said he expects that portion of the business to drop to 50% by 2020, with ITOM revenues growing to be a larger part of the business.

Too rich for most?

Some users think the pricing on some of ServiceNow's offerings are too rich for their blood and decided to stay either with their own in-house service desk, or a combination of that coupled with contracted outside support.

"We evaluated their [ITSM] services for some of the IT help desk chores we needed taking care of, but it was just beyond what we had budgeted," said one IT professional with a large manufacturing company in Minneapolis. "Our needs are tactical, and their platform is definitely a more strategic play."

Meanwhile, other users think it's worth the money because of some of the advanced automation capabilities and the convenience of not having to deal with the nitty-gritty details of implementing and maintaining such services.

[ServiceNow ITOM] is a foundation for taking things beyond incident change or change management, and the fact we can do it all on system.
Brad PaubelMartiz Inc., VP of internal customer technologies

"Their ability to go beyond ITSM was the distinguishing factor," said Brad Paubel, vice president of internal customer technologies at Maritz Inc., in St. Louis. "It's a foundation for taking things beyond incident change or change management, and the fact we can do it all on system."

Still, other users caution that cost comparing ServiceNow with more traditional IT help desk offerings users already have in-house is complex, but, in most cases, it is probably worth the investment.

"It's not an apples-to-apples comparison," said Bart Murphy, CTO at York Risk Services Group, based in Parsippany, N.J. "You have to look at [ServiceNow] from the standpoint of an enterprise platform and the number of systems it can touch. It's a good tool for help desk, but it can help you replace or integrate other systems with their platform."

A move beyond an IT help desk

ServiceNow's workflow platform had its beginnings a few years ago when the company designed an IT service management application to help automate routine service desk tasks, such as picking up help desk tickets, assigning them to IT staff and tracking the resolution of the problem. The goal was to build a business that would replace legacy on-premises IT service management applications, Murray said.

The application won over enough IT shops that ServiceNow followed up with a discovery application to pull infrastructure information into a cloud-based CMDB that fed the IT service management application.

Over the past year, company officials have emphasized strongly that ServiceNow is a platform company, claiming they have moved well beyond being only an IT service help desk provider. They said they believe the underlying software platform allows the company to better host its IT service management products and provides a way to smoothly integrate not only ServiceNow ITOM products and services with its ITSM products and services, but also products from third parties.

While the platform-centric strategy has largely paid off when competing against smaller service desk competitors, it could eventually draw the company into a much larger arena, populated by more voracious competitors.

"They want everyone to know they are a platform company, which is going to eventually draw them into new competition with the likes of Salesforce, IBM and any number of other top-tier cloud-based companies," TBR's Medvitz said.

Ed Scannell is a senior executive editor with TechTarget. Contact him at escannell@techtarget.com.

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