live from Las Vegas it's the cube covering service now knowledge 2018 brought to you by service now welcome back to the cubes live coverage of service now knowledge 18 we are here in Las Vegas Nevada I'm your host Rebecca Knight along with my co-host Dave allanté we are joined by John Donahoe who is the president and CEO of ServiceNow thanks so much for coming on the cube it's great to be here Rebecca so I want to talk with you a little bit about what you said on the main stage this morning you said this is your first year your anniversary of joining ServiceNow you said when you got here you could barely spell IT but when you reflect back on this year what has been sort of the biggest surprise challenges and surprises about about leading this company well I would say a couple things one I've sort of fallen in love with our customers and the challenges and opportunities they have and what I spoke about this morning this digital transformation thing even a year ago is a bit of a buzzword it's a reality for CEOs for companies and therefore for CIOs and then the second thing that is as I talked about it something very exciting is the role of the CIO the role of IT is transforming before our very eyes out of necessity because technology is here to stay technology's driving strategic change at every company can call it a digital transformation called a tech transformation and CEOs need the most technically savvy leader in the c-suite to help with that and that's often the CIO and so I think that's an enormous ly exciting opportunity for the people that are our traditional customer base and then the last thing I just I'm thrilled about is how many companies are saying that ServiceNow is a strategic platform of choice going forward far beyond just IT and so that's something to roll build upon I was struck yesterday in the Financial Analysts session you shared with us your meeting with the board yeah and you said to them look if you want to clean this thing up flip it whatever that don't hire me I'm here to build a sustainable company during company I think is what you said and the attributes of an enduring companies that are Purpose Driven they both innovate and execute they invest in talent and they have a will to win they got a fight in them a lot of good sports analogies there yeah so okay so you've set that framework where do you see this thing going in the next near term mid term and long term well we've said I think it's really important to set the aspiration of what it is you're shooting toward I've been surprised how many customers have responded well to the statement that we aspire to create a built to last company it starts with the purpose I defined our purpose and that purpose is a long term investment and our employees are already deeply resonating with the purpose and then comes the hard work the hard work of how you bring the purpose to life and our purpose and our product and the work we do with our customers all fit together you talked about automation and in many executives that we talked to kind of run away from that we don't want to talk about automation because it implies we're gonna replace humans you said hey we're at the center of automation we have to take that issue head-on what's the conversation like with the executives and customers that you talk to well the first thing is I have to think yet to look at the data which is what I've spent time doing and two things jump out one if you look at where automation is really gonna have the biggest impact it's not in any given job it's actually the third of all of our jobs that are repetitive administrative redundant right that's so we need to automate the low value-added parts of all of our jobs and then that will free our time up to be due to leverage our more creative capabilities to add more value and so if you look at it both at a micro and macro standpoint where automation is going to impact jobs it's not a given category it's more of a horizontal cut of all jobs and then secondly looking at aggregate job creation I've done a fair amount of work with James mineka the McKinsey Institute is to blow up a suit who's got to think the best objective macro study about job creation and there going to be some jobs they'll be fewer of and other jobs they'll be more of and how do we migrate the skills migration so that people have the skills for the jobs of the future one of which by the ways things like being a ServiceNow administrator you do not have to be a computer science major or an engineer to be a ServiceNow administrator you have to like technology you have to embrace technology but you can do it as a mere mortal and so we're looking at ways of how do we help retrain people to have the skills to create one of the jobs that we're creating through ServiceNow administrators John you talk to a lot of people I think five or six hundred customers know and they'll have since I met you a year ago it ServiceNow headquarters we obviously talked to a lot of people on the cube and no question every CEO the ax talked it was trying to get digital right yep they understand it but there's somewhat of a dissonance and I wonder if you sense it in and I wonder if you could talk about how ServiceNow can help wear this the c-suite gets it and they're driving for that but when you go below the line there's a lot of sometimes complacency not in our industry not in my lifetime I'll be retired by then do you hear a lot of that and how can ServiceNow help increase the urgency well I'd say I take a couple things Dave one is the c-suite gets it by not every c-suites role-modeling what's necessary without the cross-functional leadership the partnership of ITN HR and the business units then what happens by tama goes to three levels down people have functional identities and so people role model are behaving the way they see their leadership team role modeling and so if that if that c suite is embracing technology and understanding technology demands cross-functional engagement to deliver great customer experiences and employee experiences then it makes it a lot easier two three steps down the second thing I think c-suite people need to do is be able to say we take if off the table we said I talked about top-down goals most people are scared of a top-down goal the problem is if there's a not a top-down goal then people can debate if we need to make this change and how but if the CEO the c-suite says we are going to improve the employee experience and I'm setting this goal then it's when you go a level two levels down it's not if no no they said if now our job is how and so I think leadership has to do its role and I think I think the c-suite and leadership's learning how you lead and a technology enabled environment so leadership is the key and and the CEO is really leading a little suite I think the whole the whole C suite set of leaders and partnering and reaching out to one another so we I mean as you said on the main stage in many ways the technology is the easy part but what you're talking about is the hard stuff because this is the real change management and and it's human lead so what are you hearing what are you seeing and do you have any ideas for best practices I mean as you said that the the C suite needs to embrace it yes and then push that down but how do you do it what are some what are some of the things you've seen that work well here's some of the things that we're trying to do to contribute toward that because obviously we're a software platform but one is to do what I did this morning which is be more articulate about what best practice looks like what is best in class so that anyone in any organization can can go to their boss and say oh this is best practice this is best-in-class we need to emulate this and here are the returns we can get if we emulate it so one is just hold out the successes successful examples and illustrate what's required that's why I kept saying over and over this morning employee experience is not just an HR issue employee experience is not just an IT issue you need a powerful team of CIO C HR o other functional leaders and then the second thing I think is getting people on i.t to see themselves a little bit differently we have a CIO track going on upstairs with a hundred top CIOs and the whole day is around driving culture change and CIO is leader and I think good leaders they don't just allow a label to be attached to them they invest in themselves they build their skills they build change management skills communication skills and I think whether it's a CIO or IT if they're going to have the kind of transformative impact they can across the company they need to build their technical expertise along with other skill sets you heard Andrew Wilson talk about that and they need to learn to speak business and not just IT John I want to push on something that I'm discerning from you guys and get your reaction so obviously cloud you guys are born in the cloud cloud is a tailwind for you we've seen this Asif occation of business but we seem to be entering a new era moving from a cloud of remote services to one of us fabric Ubiquiti is fabric of digital services so my question is around innovation you talked about that as one of the key attributes of an enduring company what's the innovation equation going forward yeah it's not Moore's law anymore it's not cloud mobile social Big Data at least it doesn't feel that way anymore is it machine intelligence combined with cloud what do you see I think it gets down actually to what I talked about this morning user experience I think machine learning I think AI is going to be a commodity functionality we're gonna get it from AWS or Azure or Google the cloud infrastructure providers whether it's natural language processing whether it's the kind of machine learning capabilities that's that's gonna be sort of available widely then it's our job as a software platform to build that into our platform so we built machine learning capability into our platform we built chat bot functionality into our platform we built leading-edge mobile capability into our platform and again I'll call that I don't know it's the easy part but that's our job in this equation the hard job then is how you apply that to real-world use cases whether you're applying using real-world datasets specific customer data sets and real-world workflows and use cases so let me give you a small example we bought a machine learning company a year ago called DX continuum great machine learning team great machine learning technology we rebuilt it inside the ServiceNow platform okay and I don't believe a AI is a horizontal platform is I don't you know we didn't call it a name it after a a dead scientist that's out what we're gonna do and I'm not casting judgment on it but it's not a solution looking for a problem we built machine learning into our platform and then so we want to be the first user we want to use it on a specific challenge so the case we used it on our own inbound customer support we have about 800 customer support agents that serve our customers about 11 percent of their time is spent on something we call incident categorization and incident routing sounds kind of grunty terms but when summer calls with a problem we have to be able to identify what that problem is and then route it to the right person to fix the problem so 11% of our peoples time was doing that that's not a fun task so we turned on machine learning and within two weeks the machine was categorizing the issue and routing it more accurately than a human can so now what happens is our customers problems are getting solve faster and the 11% of those resources those customer support resources who are engineers in our case are focused on solving customer problems not doing what felt like an administrative task to them and so I think the actual application of machine learning the actual application in many of these these technologies it's the application that's going to matter not the invention so a lot of what you said makes it makes sense to me because you're saying that your customers are gonna be buying essentially that machine learning capability in relative and applying it in very narrow use cases to solve their business problems rather than trying to build it right and you do see some companies trying to maybe get over out over their skis and over-rotate to try to build some of that stuff that's gonna come from the technology suppliers what yours if we're doing our job the infrastructure providers the software platforms like us we're doing our job we're making it easy another small example will be mobile I talked this morning about companies everywhere need to build mobile experiences and so there one do I need to build a mobile design team a mobile coding team if you're up if you're a bank or utility or an oil and gas company or a retailer or well platforms like ours make building mobile experiences really easy for them so we're trying to build that mobile capability that design capability that Design Thinking the mobile capability into the platform so they can just get out-of-the-box functionality and they don't have to have their own mobile designers they don't have their own mobile engineers they can just be saying how do I want to use mobile inside my company and then there they're taking our mobile platform if you will and and creating mobile applications and mobile experiences that are relevant for them so your brand identity is now making work work better for people yes when you are doing your blue sky thinking about the pain points that employees feel and that job candidates feel because that's their another important part of of companies trying to keep their people happy yes what what are what do you see I mean as you said the next three to five years are going to be this the revolution is going to be in the workplace yes what do you see as sort of the biggest challenges that you want to help solve well let me just take a simple use case that that comes to mind as you mention that let's take from the time you start being recruited for a company through that let's say you get hired and get started so the recruiting process you're sending a resume and you don't know if I got in didn't get in if anyone someone may or may not contact you you may get an interview you got to find out where you're going if you're going did you get called back maybe you get an offer letter it comes you get it all set all kind of I would call an unstructured workflow let's say you get hired then the onboarding process onboarding is a classic unstructured workflow you got to go to this security to get your badge you got to go to facilities to get your desk you got to go to it2 get your laptop or mobile phone you got to get to another part of IT to get your email credentials put on you've got to enter your information into the payroll system you got to reenter your same information and pick a health care provider you got a range of the same information and and and get a in the tini system you got to do all this compliance training painting an accurate ownerís picture this is your first impression of the company you're joining now there is no reason they took my mobile phone away from me so I'm twitching there's no reason why there shouldn't be an app that says a recruit says I want to interview if the company they download the app they submit their resume based on the app we give a response in the app they say oh might my resume was accepted and I they want me to do an interview and they want me to be in Santa Clara next once at 8:00 and here's who I'm going to be meeting with and here's their background in the app then they do the interview let's say they get invited back who they're interviewing with we're inside the app okay let's say then they get an offer well then the app has more permission in the offer comes through the app you can print it or you can read it then onboarding starts onboarding can be a seamless experience it still can connect but you enter your data in once it pre fills all those systems and then in one mobile experience you're picking what's your laptop what's your healthcare system what's the bank you want your payroll in teeny to go into and all the complexity is hidden underneath it that's what we have in the consumer world our lives at home when you buy something on eBay all the complexities hidden when you pay with PayPal all the complexities hidden there's no reason why all the complexity can't be hidden in the recruiting and onboarding process and and so the technology's there to do it but it's managing all the workflows managing all the processes underneath so you can pull that together into a seamless experience and that's the kind of experience it's funny I have four grown kids my daughter she started working I won't say where but a major technology company and she's like dad what's up with this onboarding process why isn't it in a mobile app and the Millennials will start demanding this and so I I just think there's so much opportunity to make our lives at work feel more like our lives at home and you just described the capability that allow you to reach your aspirations of the next great enterprise software company when we think of great enterprise software companies we think of Oracle and si P you're nothing like Oracle and si P in my opinion and then of course you think of Salesforce different you know you're not a an SMB how should we be thinking about the next great enterprise software company so this I think this is a really important question Dave and I'd look at it through the eyes that what I heard from the 500 customers and here's what I heard they're embracing digital transformation they're embracing cloud they're embracing cloud at the infrastructure level figuring out their data center strategy and how much they embrace public cloud and then at the software platform level they're saying we want to have four to six strategic platforms and often it's the born in the cloud platforms often its sales force and workday and service now and maybe office 365 or Google for email or communications maybe if they have a supply chain ASAP and they're saying I want those platforms to work well together so no one platform should be claiming they can do everything each of us needs to figure out what's our role and how do we work with one another and our role ServiceNow I'm proud to say is one of those strategic platforms as I said earlier people see our capabilities as being connective tissues helping to pull those platforms together you know in the onboarding example we pull all the data sets and platforms together by the way we don't slap our brand on top because actually employees want to see their own brands they want to see their own company's brand they don't want to know what the enterprise software brand underneath it is they just wanna have a great experience and so I I don't view it I think the winning enterprise software I see a chance for Salesforce and workday and ServiceNow and Microsoft to all be winners and delivering this future for companies where you are the platform of platforms though correct but that's not and I'm being very careful the way I say it I'm not saying we're the top dog sure I'm saying what we're good at is cross-functional workflow actually it's probably the grunt 'ya stuff all those things and you're the best at it and we're the best at you are and our brand we're not we're not forcing our brand everywhere that we're doing it in service to our customers and so I just want to always be listening to what our customers want that's gonna be our North Star they're gonna guide us it always has been I know you know Fred Letty started that from the beginning and that's what we're gonna continue to do well John it's always a pleasure having you on the cube so thanks so much for coming on our show thank you very much Becky thank you Dave great to be happy John I'm Rebecca night for Dave Allante we will have more from ServiceNow knowledge 18 in just a little bit [Music]