SaaS Service Management solution from our platinum sponsor
Today we talk to Matt French, the Marketing Director at Service-now.com, who are the Platinum Sponsor of the 14th Annual ITSM Conference.
Skep: Service-now.com provides service management tools using the model of On-Demand or SaaS or ASP (Application Service Provider) or “the Cloud” or whatever folk want to call it. How does that stack up cost-wise against buying a tool and implementing it in-house?
Matt: There’s a big difference between SaaS and ASP. It’s the difference between a modern application and hosted software built in the 1990s – we’ll get into that more later…
Ask a Service-now.com customer and you’ll find that although total cost of ownership was a factor in the decision criteria, simplicity, flexibility and partnership were the real decision drivers.
When evaluating the total cost of software it is important to look well beyond licensing. Sure, Service-now.com can save organizations a boatload of cash on licensing costs with an affordable and predictable subscription fee. The savings really accelerate through the substantial reduction of implementation and reimplementation (upgrade) costs and infrastructure costs. Our approach helps IT be more self-sufficient and frees resources to focus on core competencies.
Service-now.com customers get into production faster than on-premise deployments and continue to evolve their application as needs change without fear of ‘version-lock.’ Today’s client-server ITSM software often impedes agility and can’t effectively support the business by forcing costly six figure reimplementations every few years.
Meanwhile, three times per year for the past five years Service-now.com has simply and automatically applied significant new functionality to customer instances while preserving all of their customizations.
Skep: Your business model depends on economies of scale and getting clients onto a common platform. Doesn’t that mean your services/products are the Lowest Common Denominator, the one-size-fits-all standardised design? Surely the tool ends up looking like a “Mao suit”?
Matt: We’ve all been in the ITSM business for quite some time. Rarely do we speak to an enterprise IT organization that believes a pure out-of-box system will meet their needs. While Service-now.com supports ITIL guidelines, 100% of our customers have customized the application to accommodate their unique ITSM processes and goals, and many have built custom applications on the Service-now.com platform.
This might sound like vendor nuance but it is imperative that a “SaaS” consumer ask the right questions about tool flexibility, get hands-on with the tool, and understand the cost of various approaches before they subscribe. Why? Because there are many one-size-fits-all SaaS offerings out there and an increasing number of ASP offerings posing as “SaaS” that were never designed to be delivered over the Internet or customized without incurring significant cost.
One key to successful outsourcing is to retain control of governance and higher-level management. How can your clients monitor you and hold you accountable?
We are not a traditional software vendor. We provide a service based on partnership and honesty and as a service provider our success is literally and directly tied to the success of our customers.
Each Service-now.com instance comes equipped with system monitoring tools and dashboards that are exposed to the customer. A support portal allows customers to monitor the status and performance of their application and view all open incident and change records. All changes and system accesses are tracked within the system for governance purposes. This coupled with a 99.97% availability SLA results in governance and ongoing accountability.
Skep: What happens when you come out with a new version? Isn’t it simpler to upgrade a system and easier to do the change control when it is in—house rather than hosted externally?
Matt: I think we can agree there is nothing simple about upgrading on-premise, legacy software. Many ITSM organizations have faced the upgrade predicament – either spend large amounts of time, money and resources on a disruptive reimplementation, or look for something modern to eliminate upgrade hassles.
We’ve been automatically upgrading customer instances for almost five years now and it just works. Service-now.com customers are given the opportunity to apply upgrades directly to their production environment or their development environment. Many new features and applications are available via plugins, which are not automatically applied to instances. This gives customers complete control of their ITSM tool change control process.
Skep: How’s business? During a recession, one of the advantages of a service-provider model as compared to a vendor model is the on-going revenue stream. Did you see that? And now that things are warming up again, are you seeing any shifts in business patterns?
Matt: Business has never been better. We’ve doubled our recurring revenue every year since inception and expect to do the same at the end of FY2010. We have been cash-flow positive for three years. We’ve experienced widespread adoption in shared services (HR and facilities) environments and with the continued rapid adoption of Service-now.com in ITSM, we are well positioned to continue our aggressive growth.
There’s no doubt the new economy has driven organizations to think and operate differently. Necessity has spawned innovation over the years. We help IT organizations capitalize on the changing landscape by offering a tool alternative that reduces costs, but most importantly drives efficiency. However, as I said previously, simplicity, flexibility and partnership are the keys to customer success, not cost.
Skep: You guys are big on the concept of Web 2.0. How’s your customer community developing?
Matt: Between local and virtual Service-now.com user groups, Service-now.com user conferences, a culture of transparency and existing social networks (including the Service-now.community), our customers and partners have many options to work together. We’ve simply made sure to be where our customers are and to interact with them how they like to interact. We are constantly looking for ways to expand and improve our community.
Our success depends on customer and partner interaction. We inject customers and partners in the development process. Virtually every functional enhancement can be linked back to a customer or user community request.
Skep: Service-now.com were early proponents of the ASP (Application Service Provider) model for service management. Were there any competitors around and are they still about?
Matt: We believe we offer technology and service that is vastly different than anything offered in the IT service management market. We see a kinship with companies like NetSuite, Salesforce.com, Google, Amazon and Workday. (BTW, I don’t think these SaaS vendors would categorize their offering as ASP.)
Service-now.com represents a new breed of modern software. SaaS has long been pigeonholed as one-size-fits-all and built for smaller organizations. Our customers are proof that modern SaaS is ready for the large enterprise.
We think it is great that SaaS has entered mainstream, but just because the box says it’s SaaS, it doesn’t mean it’s SaaS. Proceed with caution. Here are few items to discuss with the “SaaS” vendor while in the exhibit hall:
· How is the application administered and who is involved?
· How do I change or customize the application?
· How is the application upgraded, how long will it take to upgrade, and who pays for the upgrade?
· How long does an upgrade take?
· Ask for five references.
Skep: Are you happy with 358 customers? Will SaaS always be a niche or do you see it going mainstream in service management?
Matt: 365 customers in five years is simply a good start. Especially when compared to some of the legacy vendors who have a decades-old install base and thousands of customers.
SaaS is mainstream today. Service-now.com customers include the largest businesses in the world. Our growth has been, and will continue to be, exponential because it is in our DNA to make customers successful by delivering a great service. Our business succeeds when we accomplish this simple objective.
Skep: It’s only a few weeks away. Any special surprises for us at the Pink conference? Go on, you can give us a hint.
Matt: We’re just happy that virtually every block of sessions includes at least one Service-now.com customer presenting on various ITSM topics. Be sure to attend Monday’s panel discussion, “IT Leaders Share Their Perspective on Software as a Service” to hear from Chris Pope of NYSE Euronext, Greg Lazzaro of VeriSign, Amy Irwin of Pepsi Americas, and Carolyn Dugas of Clark County, Nevada.