CIO SNAPSHOT
SUMMIT
n April 15-16 at the Ritz Carlton in Moon Bay, CA, the world’s most influential CIOs convened for the annual Forbes CIO Summit. This year, we shared tangible insights into what leading corporations are doing to create better corporate ecosystems while mitigating risks and challenging the status quo. We also touched on how to make the move from successful CIO to future COO/CEO. We heard from CIOs who have effectively taken that leap, and they shared stories leaving our audience striving for more. With thought leaders including Accenture, The Boston Consulting Group, RingCentral, Workday and Zoom and more, we assembled a team of experts so attendees left feeling satisfied with clear takeaways to meet their respective business objectives. Here’s your all-access executive summary featuring a few tips and insights from our 2018 Forbes CIO Summit.
user.” That’s not just providing a pretty interface. “They call it employee experience, but to me it’s productivity,” says Josh Bersin, who runs an eponymous consultancy within Deloitte. “I don’t want an enjoyable experience to renew my 401(k). I just want to do it in one click.”
In pivoting, Luddy and Donahoe are competing with a more agile group, which includes Salesforce, Microsoft, IBM and Workday. ServiceNow’s sole advantage: the ability to upsell, leveraging its IT-service dominance to layer on related products. Donahoe boosted sales and marketing costs more than 30% last year.
The spending has generated results. ServiceNow projects about $2.4 billion in 2018 subscription revenue, and while the majority of that will still come from growth in the IT side, the “emerging” categories are expected to make up at least a third of new annual contract value this year, up from less than 20% at the beginning of last year. The opportunity presented by these offshoot verticals, estimated at $34 billion by Credit Suisse analyst Brad Zelnick, is even larger than the overall cloud-based IT market, which is about $27 billion.
The next step across all these areas: Use algorithms to take all these requests, data points and checklists and predict needs, flag concerns and measure efficiency. Rather than just streamline service, the company wants to improve automation and analytics through AI. Many innovations come from third-party app builders. (Clients have built about 35,000 custom apps, for example, to track security incidents like shoplifting and broken windows in a retail store, or to track the status of endangered animals in a park.) And much of the growth is expected to come from AI. Last January, ServiceNow spent $15 million to acquire DXContinuum, which is used throughout ServiceNow’s cloud platform to help customers build predictive models that make it easier to categorize incoming requests. In May, ServiceNow bought the AI startup Parlo for its technology in natural language understanding, which the company plans to inject into its core platform to help customers build intelligent business apps, complete with easy-to-create service catalogues, notifications and assignment tools.
None of this means Luddy has let his company lose it roots. His no-frills practicality still manifests itself at ServiceNow’s Santa Clara headquarters, which are tidy and sunny but whose manicured trees and outdoor fountains are modest compared to the exaggerated play areas and flashy design of the campuses of Facebook and Apple. When asked to pick a lunch spot recently in his San Diego hometown, the billionaire chose Rudy’s Taco Shop, which reminds its customers that shirts and shoes must be worn inside. Luddy, who now finds more time for tennis and his ten-year-old son, was wearing jeans and sneakers. “The last six years have been like this beautiful dream,” he says later at his beach house, basking in the afternoon sun. “I give a lot of hugs, but I don’t let anyone pinch me.”
The next big opportunity: using ai to deliver better service.