ServiceNow on Wednesday reported strong fourth quarter results with a record number of deals over $1 million. The enterprise tech company, which helps organizations digitize their workflows,
Market dynamics, has clearly benefited from the accelerated pace of digital transformation that has corresponded with the pandemic.
“There are structural challenges facing every industry in every geographic region,” CEO Bill McDermott said during a conference call Wednesday. He cited a handful of challenges in part brought on by the pandemic: “the great resignation, supply chain disruption, inflation, to name a few.”
In the face of those challenges, he continued, “Digital technologies are a growth stimulating, deflationary force… The technology strategy has become the business strategy.”
Even so, “the data shows this is clearly more than a pandemic-induced transformation,” McDermott said. “We’re in a sustained demand environment.”
He cited IDC’s Global CEO survey, which showed that 85% of CEOs plan to sustain or increase their tech budgets this year. From ServiceNow’s own Q4 results, its 99% customer renewal rate “is one of the lead indicators for sustained performance moving forward,” McDermott said.
Furthermore, McDermott said he did not see any evidence of “unusual demand pull forward” in 2021.
“Customers are absolutely focused on technology being the business strategy, and digital transformation is in full flight,” he said. The company’s growth last year, he continued, “happened in an extremely linear and coherent fashion,” positioning ServiceNow to become “one of those real standard platforms for well-run companies in the 21st century.”
The company plans to grow its footprint globally and across industries. To land even more large deals, McDermott explained to ZDNet how ServiceNow plans to target organizations that need to improve their workflows across domains. He gave the example of CVS, which is expanding beyond its traditional retail sales into health and wellness, creating more complex workflows.
“We’ve all lived in a world where enterprise companies usually do one thing good, but they do that in a silo. People that run companies are usually doing multiple things, with multiple vendors in multiple silos — creating islands of automation everywhere,” he said. “We take that sprawl and simplify it on one platform and make work better for everyone.”
