| Constellation Research

Accenture's Paul Daugherty: Generative AI today, but watch what's next

Editor in Chief of Constellation Insights
Constellation Research

Larry Dignan is Editor in Chief of Constellation Insights at Constellation Research, where he leads editorial coverage focused on enterprise technology, digital transformation, and emerging trends shaping the future of business. He oversees research-driven news, analysis, interviews, and event coverage designed to help technology buyers and vendors navigate complex markets with clarity and context. ...

Generative AI will have a tremendous impact on workers and likely impact 40 of the working hours across industries, but that doesn't mean 40% of jobs will go away, said Accenture CTO Paul Daugherty, who was the 1,000th guest on Constellation Research's DisrupTV.

Daugherty also said on the show that generative AI is just the first installment of what's likely to be a set of innovations that'll change business. "As exciting as generative AI is, it's not the last and probably not the biggest breakthrough we'll see in AI. There will be other bigger breakthroughs coming with common sense AI," said Daugherty.

He added that shared reality and the merger of the physical world and digital bits will be another advance. "The next stage of digital is digital plus physical," said Daugherty, who also said metaverse has potential even though it's being panned on multiple fronts.

Other technologies to watch include:

Computational chemistry.
Synthetic biology.
Generative AI in pharmaceutical and drug discovery.
Operational technology with new forms of computing like quantum computing.

Daugherty said his team at Accenture is already working on its next Tech Vision Report. In the meantime, here are some generative AI takeaways from Daugherty.

Generative AI will create automation that can replace some jobs, but the bigger impact will be human augmentation. "Every worker will have a co-pilot or multiple co-pilots that help us do things more effectively," said Daugherty. "AI will give people superpowers in the form of these co-pilots that could allow us to do more things."
Think of generative AI as a bit of Moore's Law for people where it can help us know more and extend skills.
Enterprises need to step back and get perspective on generative AI. For instance, companies can't assume generative AI will solve everything. Instead, businesses need to look holistically and see where to apply the technology.
Figure out what models you want to consume and then tune. "For enterprises there is going to be an array of models to just consume or in some cases fine tune and customize," explained Daugherty. "In other cases, you'll want to develop your own models for unique domains."
Companies will need to change processes. "Processes are so different with co-pilots," said Daugherty. "There's also the change management and training around it."

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Microsoft unveils Microsoft Fabric at Build 2023, pitches integration, simplified pricing

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Microsoft launched Microsoft Fabric, a unified analytics platform that combines technologies like Data Factory, Synapse and PowerBI. Microsoft's pitch: Convince enterprises to go with one integrated AI-powered analytics platform instead of integrating multiple vendors and services.

The news, launched at Microsoft's Build conference, is the headliner, but there was a bevy of other Copilot announcements. Microsoft also announced Copilot in Power BI, Power BI Direct Lake, a new storage mode, and Power BI Desktop Developer Mode. Speaking during the Build 2023 keynote, Microsoft CEO Satya Nadella said "platform shifts are in the air." Speaking about generative AI, Nadella said "every piece of the stack has been impacted" and there were 50 announcements related to ChatGPT on deck.

Regarding Microsoft Fabric, Nadella said:

"This is a product we've been working hard on over multiple years. This is the biggest data product launch since the launch of SQL Server. It unifies the business model across all analytics workloads. This unification will fuel the next generation of AI applications."

Constellation Research analyst Doug Henschen put Microsoft Fabric in context:

"We’ve seen a bunch of fabric-type offerings and customers seem to be keen on the idea of having one platform that provides access to all data – even if, in actuality, it’s about distributed data access layer on top of multiple repositories and capabilities, as is clearly the case with Microsoft Fabric. Other examples recently in the news include IBM Data Fabric and its acquisition of Ahana and SAP Datasphere. Other incumbents include Dremio, Starburst, and various “lakehouse” offerings, though Microsoft is combining a huge breadth of workload types and is promising generative AI interfaces on top of them all."

Microsoft Data Fabric also lands as multiple vendors are aiming to be the business process automation platform of choice.

The bet here is that Microsoft's pricing strategy can make Fabric compelling and more economical for CXOs. Customers can buy one pool of compute to power Fabric workloads. That pricing strategy could be compelling. Henschen said:

"One of the most compelling aspects of this announcement, in my view, was the prospect of buying a single pool of credits that can be used across all workload types: data engineering, data integration, data science, data warehousing, BI and analytics. That’s a unique offering and gives a sense of a single platform, even if it’s, technically, a unified layer on top of a bunch of existing offerings. This is classic suite versus best-of-breed marketing. The complication is that these budgets are owned by different groups today, and they’d have to get together to make decisions about how many credits each group needs and so on."

Ferguson, T-Mobile and AON were named customers looking to consolidate their analytics footprints on Fabric. Informatica is one of the first design partners for Fabric and the company said customers can enroll in a private preview starting in June 2023.

Key points about Microsoft Fabric include:

Fabric will have a single unified experience and architecture via a SaaS delivery model. It will also integrate with Microsoft 365 applications.
Each team in the analytics process including data engineers, data warehousing pros, data scientists, data analysts and business users will have a role-specific experience.
Fabric is data-lake friendly and open. Microsoft Fabric includes OneLake, a multi-cloud data lake that is built-in. The model for OneLake rhymes with the OneDrive approach. OneLake is built on Azure Data Lake Storage Gen2 and fully compatible. OneLake also has shortcuts to data lake storage from Azure, AWS S3 and Google Storage coming in the near future.
OneLake supports structured data of any format and unstructured data. OneLake will also be discoverable and accessible in Microsoft 365.
Microsoft Fabric will include Azure OpenAI Service at multiple layers. Generative AI and Copilot in Microsoft Fabric will be available and work with various models. Copilot in Microsoft Fabric will be coming soon.

Henschen noted that natural language (NL) can be the interface of Fabric. he said:

"I think we can expect to see Co-Pilot interfaces proving NL interaction based on the Azure OpenAI service for every type of user. Data engineers will have options to use NL to generate code and drive Spark Workloads. Data integrators and analysts will use NL to generate SQL data transformations and SQL queries. Analysts and business users will ask questions to generate visualizations and dashboards. The workloads and platform are basically the same, but the generative AI lets you, it is promised, work more efficiently and productively without all the coding and drudgery that was previously required."

The workloads

Microsoft said Fabric comes with seven workloads in preview.

Data Factory has more than 150 connectors to cloud and on-prem data sources and the ability to transform data and orchestrate pipelines.
Synapse Data Engineering enables authoring in Spark, instant start with live pools, collaboration tools.
Synapse Data Science provides workflows for building models, collaborating, training and deploying them.
Synapse Data Warehousing provides a converged lake house and data warehouse experience SQL performance on open data formats.
Synapse Real-Time Analytics analyzes streaming data from IoT and edge devices, telemetry, logs with low latency.
Power BI in Microsoft Fabric provides visualization and analytics. Power BI in Fabric is also integrated into Microsoft 365 apps.
Data Activator monitors data and can trigger notifications and actions.

Finally, there's the caveat: Everything announced is still in preview. Henschen said:

"I think we’ll see a lot of wait-and-see reactions from customers and a lot of competitive responses. Changing data platforms is akin to turning a super tanker: It’s not something that happens quickly, and I would not expect a lot of market movement overnight."

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Zoom ends Q1 with 215,900 enterprise customers, touts AI strategy

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Zoom Video Communications' first quarter results were better than expected and CEO Eric Yuan said the company will continue to invest in AI "to help make interactions more meaningful and communications more effective."

The company reported first quarter earnings of $15.4 billion, or 5 cents a share, on revenue of $1.1 billion, up 3% from a year ago. Non-GAAP earnings were $1.16 a share. Wall Street was expecting Zoom to report earnings of 99 cents a share on revenue of $1.08 billion.

Zoom is a key future of work play and appears to be gaining some enterprise traction. The company, which recently closed the purchase of Workvivo, said it had 215,900 enterprise customers in the first quarter, up 9% from a year ago. Zoom added that it had 3,580 customers contributing more than $100,000 in trailing 12 months revenue. Average monthly churn in the first quarter was 3.1%, down 50 basis points from a year ago.

In prepared remarks, Yuan said outlined Zoom's AI strategy, which includes ZoomIQ with generative AI for chat and email composing as well as meeting summaries. Zoom also invested in Anthropic, an AI safety and research company. He said:

"Our partnership with Anthropic further bolsters our federated approach to AI by allowing Anthropic’s AI assistant, Claude, to be integrated across Zoom’s entire platform."

Kelly Steckelberg, CFO of Zoom, said the company is seeing growth in Americas with macro economic headwinds in the rest of the world.

As for the outlook, Zoom raised its guidance. For the second quarter, Zoom said revenue will be between $1.11 billion and $1.115 billion. Non-GAAP earnings will be between $1.04 to $1.06 a share.

For fiscal 2024, Zoom is projecting between $4.65 billion and #4.48 billion with non-GAAP earnings between $4.25 and $4.31 a share.

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8 takeaways from Constellation Research's Healthcare Transformation Summit

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Constellation Research's Healthcare Transformation Summit pulls together healthcare CXOs, analysts, startups, and big thinkers to share ideas under Chatham House rules. As a result, these takeaways are anonymized and high-level observations.

Here's a look at some of the key items from the Healthcare Transformation Summit.

Healthcare isn't immune from broader trends, but in many ways is saddled with more technical debt. The challenge for healthcare is scaling and adopting to an aging population, lifestyle attitudes, government policy, automation, AI and technological change and evolving landscape of health and safety laws.
Some of the hot button issues facing the healthcare industry include:

Medicaid's funding crisis.
Talent and staffing burnout.
Automation of routine tasks with AI.
Optimizing healthcare for telehealth.
Redefining nursing workflows and processes.
Consumerism.
Integrated care.
A patient journey that moves across multiple digital domains and silos.

Immersive AI will retool healthcare. It's early, but the combination of augmented reality and AI will be revolutionary.
Generative AI will increasingly take some of the front-end healthcare roles and drive virtual medicine, but integration, data and privacy issues loom. How Generative AI Has Supercharged the Future of Work
The five senses have almost been replicated with smell and taste the final frontiers.
Digital assets in healthcare will bring new monetization models with unique data sets, network and data, longitudinal data sets, derived data advantage and new classes of data.
Insurance will see new monetization models. Today, insurance premiums represent monetization, but the future will include credit service, reselling market assurance, cash value guarantees, independent valuation services and fractional ownership.
Healthcare has technical debt challenges with massive electronic health record deployments and systems, which are the equivalent to ERP for other industries.

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Dell Technologies revamps APEX Cloud platform

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Dell Technologies updated its Dell APEX multicloud platform with Microsoft and Red Hat offerings, storage and data mobility services and compute and PC-as-a-service updates. Dell Technologies said it will connect its on-premises object storage with Databricks' Lakehouse Platform.

The APEX updates, announced at Dell Technologies World in Las Vegas, came as Chairman and CEO Michael Dell and co-chief operating officer Chuck Whitten walked through the company's portfolio, innovation and customers including the likes of Hyundai.

"Technology is at the center of all the significant opportunities in every domain," said Michael Dell, who noted the company ships 2 units per second and 179,000 orders per day through its supply chain.

Dell also talked about artificial intelligence's leap and how data and infrastructure will drive generative AI advances. "We are going to need new architectures with higher speeds and efficiency," said Dell. He said AI models will be deployed at the edge that are proprietary as well as open source.

"We hear your loud and clear about your future with generative AI," said Dell.

Whitten said customers are trying to solve for the future of work, multicloud deployments, scaling edge infrastructure, generative AI and security.

Here's the rundown of Dell Technologies World announcements:

Dell APEX Cloud Platform for Microsoft Azure connects Microsoft's native management tools, Azure Arc infrastructure and governance across Dell on-premises infrastructure and Azure.
Dell APEX Cloud Platform for Red Hat OpenShift aims to simplify container application development with Kubernetes. Customers will be able to run containers and virtual machines with unified experience and support for various CPUs, workloads and Red Hat Enterprise Linux.
Dell APEX Cloud Platform for VMware will enable the ability to deploy vSphere on an integrated system with Dell software-defined storage. The offering also connects with Dell APEX Private Cloud and Dell APEX Hybrid Cloud.
Dell APEX Storage for Public Cloud will connect with AWS, Azure and Dell APEX File Storage for AWS. Customers will be able to tune cloud strategies across multiple cloud and on-premises storage environments.
Dell APEX Protection Storage for Public Cloud combines data protection storage for AWS, Azure, Google Cloud and Alibaba Cloud.
Dell APEX Navigator for Multicloud Storage is SaaS that simplifies and secures management of Dell APEX Block and File Storage. It combines with Dell APEX Navigator for Kubernetes, a service that provides storage management, data replication, mobility and observability.
Dell APEX Compute delivers bare metal compute in data centers, edge environments or colocation facilities.
Dell APEX PC-as-a-Service (PCaaS) aims to deploy PCCs with predictable costs. The service covers the entire Dell portfolio.

As for the Databricks partnership, the companies said Dell's enterprise storage platforms will connect to Databricks Lakehouse Platform. Dell can connect Databricks in the public cloud with Dell object storage in multiple environments.

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Walmart, Target highlight intersection of supply chain, customer experience

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Supply chain and customer experience are typically viewed as two different disciplines, but Walmart and Target are illustrating how they're blending together.

Walmart has been talking about omnichannel retail for years and its tech team has consolidated apps, installed a multi-cloud approach and invested heavily in supply chain automation and logistics. The upshot is that Walmart's stores, apps and commerce engine are unified. Today, those investments are paying off because Walmart tends to benefit during economic uncertainty.

Doug McMillon, Walmart CEO, said on the company's first quarter earnings conference call:

"The omnichannel model we're building continues to resonate with customers and members. As expected, a higher mix of sales in the food and consumables categories negatively affected gross profit, but strong expense management and progress with our newer mutually reinforcing businesses helped us grow profit ahead of sales at 17.3%."

McMillon added that customers are buying private brands, trading down and cutting discretionary spending. As a result, Walmart is managing inventory tightly as well as expense management. It is also boosting productivity and operating margins via automation.

At its investor meeting in April, Walmart walked analysts through its ambient distribution center and market fulfillment centers, which use automated storage and retrieval systems. "It's about creating a supply chain that's better, not just bigger," said McMillon. "We're excited about how our new capabilities will help our associates by making some of our more physically demanding jobs into more rewarding, higher skilled career paths."

Walmart is realizing that its supply chain game directly impacts the customer experience--especially for digital business. Walmart's e-commerce comparable sales were 27% higher in the first quarter compared to a year ago.

And the big benefit is that the more Walmart optimizes its supply chain the more it increases margins. And customers get goods fresh and fast since Walmart is increasingly about grocery. Walmart CFO John David Rainey said, "we want our ROI to go up every year."

At Walmart's April investor meeting, Rainey said the company's investment in automation, robotics and software are exceeding productivity targets by as much as 30%. Walmart said by the end of the year, 65% of its stores will be serviced by automation and 55% of its fulfillment center volume will be automated.

Target is also connecting the dots between supply chain, automation and customer experience. Target Chief Operating Officer John Mulligan said on the retailer's first quarter earnings call that his company is also investing in automation. He said:

"With this modernization effort, our primary goal is to reduce those labor demands on our stores. We achieved that result by moving work upstream to a distribution center where we can apply the appropriate processes, technology, tools and automation to accomplish the work at scale. This results in higher labor efficiency for the company overall, while allowing our store team members to spend more time in the front of our stores with our guests. In the upstream distribution centers, we've opened over the last two years, we've implemented technology and capabilities that improve how product is sorted and loaded onto trailers headed for our stores. These improvements reduce the necessary time for the store team to unload the trailer and for them to move the inventory to where it's needed in the store."

Target is also deploying automation for the shipment of quantities smaller than a full case. The automated system makes the shipment easier to unload. Target is also upgrading legacy distribution centers and deploying tools for faster store replenishment, said Mulligan.

While sortation centers are not highly automated, Target is using "sophisticated process logic" to sort packages and provide better experiences. Last mile delivery is also a focus for Target, which owns Shipt. Target is using larger trucks for last mile deliveries as well as a standardized way to load them.

Mulligan said:

"While there are many different ways our team is working to gain efficiencies and deliver value to the business, all of our projects have some things in common. First and foremost, they're all designed and implemented with a focus on our guest and continuing to build their engagement with Target. In keeping with that guest focus, we design processes and deploy technology and automation as a way to highlight the human element in our business rather than minimizing it."

Ultimately efficiency and experience are blending together for retailers. Walmart CFO Rainey said:

"Retail has changed a lot in the last 5 to 10 years, and the change over the next 5 to 10 years is likely to be just as significant. Customers are demonstrating preference for multichannel offerings, convenience, value and selection, and up to this point, for most, it's proving challenging to provide all of these things at attractive economics. What's important to understand is this, the investments we've made in people, price, e-commerce, and the high value technology capabilities are why we are at an inflection point today. The benefit of any technology platform is being able to scale it at a lower marginal cost."

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Alibaba plans to spin off its Cloud Intelligence Group within 12 months

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Alibaba Group said it will spin off its Cloud Intelligence Group within the next 12 months as a stock dividend distribution to shareholders.

Daniel Zhang, CEO of Alibaba, said the intention for its cloud unit is "to become an independently publicly listed company." Alibaba had previously announced plans to form a series of companies that will become independent companies. Other spinoffs will include its international commerce unit as well as its logistics group among others.

The company's cloud unit, which includes Alibaba Cloud and DingTalk, a productivity and collaboration suite, delivered fiscal first quarter revenue of $3.58 billion, down 3% from a year ago. Stripping out intersegment revenue at Alibaba, the cloud unit had revenue of $2.71 billion, down 2%, with adjusted EBITA of $56 million.

Overall, Alibaba reported fiscal first quarter net income of $3.2 billion on revenue of $30.3 billion, up 2% from a year ago.

Alibaba Cloud said the decline in revenue "reflected delays in delivery of hybrid cloud projects given the COVID-19 resurgence in January, normalization of CDN demand compared to the same period last year, as well as the impact from a top customer phasing out using our overseas cloud services for its international business due to non-product related reasons."

Alibaba said it is working to diversify cloud revenue from non-Internet industries such as financial services, retail, media and automotive. As of March 31, Alibaba Cloud derived 55% of its revenue from non-Internet based companies.

The plan for Alibaba Cloud going forward is to continue to diversify its revenue and deliver compute for machine learning and generative AI. In April, Alibaba Cloud outlined its latest large language learning model (LLM) and plans to use its generative AI throughout its product suite. The Alibaba Cloud LLM, Tongyi Qianwen, will be similar to other generative AI services where there's a base model that can be customized for business use cases.

So far, Tongyi Qianwen has received more than 200,000 beta testing requests from enterprise users. Alibaba has also used Tongyi Qianwen in its DingTalk suite.

It remains to be seen how Alibaba's cloud unit fares as an independent company. Alibaba Cloud has recently cut prices on multiple instances by as much as 50%. The goal is to increase public cloud adoption in China and gain share.

Alibaba said it is currently seeking external strategic investors in the Cloud Intelligent Group before the spinoff. In addition, the cloud spinoff will be subject to restructuring of assets and liabilities, contracts and incentive plans.

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Cisco's Q3 posts strong networking gear sales, ups outlook

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

Cisco reported better-than-expected third quarter earnings and raised its fourth quarter outlook as its networking portfolio revenue surged 29% from a year ago.

The company reported fiscal third quarter earnings of 78 cents a share on revenue of $14.6 billion, up 14% from a year ago. Non-GAAP earnings were $1 a share. Wall Street was expecting Cisco to report a third quarter adjusted profit of 97 cents a share on revenue of $14.38 billion.

Cisco projected fourth quarter revenue growth of 14% to 16% with non-GAAP earnings of $1.05 a share to $1.07 a share. For fiscal 2023, Cisco projected revenue growth of about 10%. For fiscal 2024, Cisco said non-GAAP earnings will outpace modest revenue growth due to strong comparisons.

Speaking on an earnings conference call, CEO Chuck Robbins said the company's transition to software is accelerating with software revenue checking in at $4.3 billion in the third quarter. Forty two percent of Cisco's revenue is software.

Robbins also said that it has a big opportunity in security, and it will outline new products at its Cisco Live conference. Robbins also said Cisco is moving rapidly to leverage generative AI in its own products.

Cisco's results were helped in part by moves last year to simplify its supply chain, so it had the parts to build its networking gear. Lead times for product shipments have improved 40% over the last two quarters. Going forward, Cisco customers are likely to digest systems that have been bought.

"As we expected, the actions we took in supply chain last year have paid off," said Robbins. "Customers continue to invest in key technologies core to their overall strategy. We will end the fiscal year with double our normal backlog."

Cisco's networking unit was the star of the quarter with revenue up 29% from a year ago. Demand was strong across multiple switch and router products. Cisco's Secure, Agile Networks unit delivered third quarter revenue of $7.55 billion. Secure, Agile Networks consists of hardware and software for switching, enterprise routing, wireless and compute products. Robbins said Cisco is in a much better position to play a role in AI workloads than it was with the cloud transition.

Cisco saw gains in other product lines except for collaboration sales, which fell 13% from a year ago.

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SoftwareOne acquires Beniva Consulting, adds ServiceNow services

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

SoftwareOne Holding AG, which provides software and cloud services, said it has acquired Beniva Consulting Group to expand into ServiceNow implementations. SoftwareOne's cloud and software services have revolved around Microsoft and SAP Cloud deployments.

With the purchase, SoftwareOne enters the services market for ServiceNow Configuration Management Database (CMDB), IT and operations management (ITOM), cloud advisory and application services. SoftwareOne already provides IT asset management services (ITAM).

ServiceNow, which is holding its Knowledge 2023 conference this week, has been expanding its total addressable market via a platform that accelerates value from ERP systems. Beniva, founded in 2016 and based in Calgary, has been riding that workflow and automation wave as a ServiceNow partner.

According to SoftwareOne, Beniva will bring 75 cloud technology experts and directors to the company's software and cloud services practice. The Beniva purchase will also expand SoftwareOne's portfolio of services, increase its ITAM addressable market from $2 billion to $7 billion and be accretive to margins. Terms of the deal weren't disclosed.

Beniva derives 60% of its revenue from ServiceNow deployments and has practices in process automation with RPA (robotics process automation) with UIPath, Microsoft's Power Automate and ServiceNow RPA.

SoftwareOne also reported its first quarter results. The company said first quarter revenue was CHF 239.4 million ($266.45 million), up 4.5% from a year ago, with adjusted EBITDA of CHF 39.6 million ($44.1 million). The company also said it was implementing a program to deliver CHF 50 million in annual savings as well as a CHF 70 million share buyback program. SoftwareOne added that up to 50% of cost savings a year will be re-invested in strategic growth areas.

Brian Duffy, CEO of SoftwareOne, joined the company in early May and said he will be spending the next few weeks meeting the global team. Duffy was most recently President of Cloud for SAP and responsible for scaling "RISE with SAP" to move customers to the cloud.

Duffy said SoftwareOne has a big opportunity in cloud and will focus on customer success and enhancing partner relationships.

SoftwareOne reiterated its 2023 outlook, which calls for double-digit revenue growth and adjusted EBITDA margin of 24% to 25% of revenue.

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ServiceNow outlines generative AI roadmap, bring your own LLMs

Larry Dignan

Editor in Chief of Constellation Insights
Constellation Research

ServiceNow said customers will be able to bring their own large language models to its platform, but the real returns are likely to come from industry and customer specific generative AI models.

CJ Desai, ServiceNow's Chief Product Officer, outlined the company's platform roadmap. ServiceNow's latest Utah release is live now with Vancouver scheduled for September. A Washington DC release lands in 2024.

"GenAI is a catalyst for our platform. It's an augmentation of our platform that's good for our customers," said Desai, speaking at ServiceNow's Financial Analyst Day on Tuesday. "Customers can bring their own LLM and we will provide you with a connector just like we integrate with systems of record. The value for our customers is domain specific LLMs for our workflows and use cases." Indeed, ServiceNow said it would use Nvidia infrastructure to develop LLMs for its platform.

ServiceNow expands finance, supply chain process, workflow automation | ServiceNow Offers AI-Powered Service Operations for Modern ITOps

In September, ServiceNow's Vancouver release will include generative AI enhanced Virtual Agent Q&A experiences, summarized search results and accelerated configuration and extension tools. In 2024, the Washington DC release will include complete self-service, automated knowledge creation for agents and generative AI for admins and builders.

Desai said ServiceNow's platform capabilities built on its data model and code base speeds up innovation and enables the company to use generative AI throughout its portfolio. In addition, ServiceNow has invested in AI for years, often through acquisitions. ServiceNow has been expanding into new use cases, processes and industries such as financial services, telecom and media, manufacturing, public sector, healthcare and life sciences to increase its total addressable market.

ServiceNow CEO Bill McDermott said the company "is the center of the great reprioritization in the enterprise." McDermott said ServiceNow has evolved from mostly talking to CIOs to CEO-level conversations. "We're getting market pull from CEOs," said McDermott. "Just a few years ago they were trying to figure out what ServiceNow does. They want collaboration. They want integration. With AI, the IT strategy is the business strategy."

McDermott added that the company is landing more CEO conversations because enterprises are looking to consolidate tech vendors to take costs out. "Point solutions have gone out of favor and platforms, especially if cloud based, are ruling the day," he said.

Indeed, those CEO conversations are part of the reason why ServiceNow is focusing on finance and supply chain processes at Knowledge 2023. Those processes include a lot of manual work that generative AI can replace and automate. In addition, CEOs are looking to streamline ERP processes, but migrations take too long to truly transform to a clean core ERP instance.

ServiceNow is looking to transform and mitigate the risk with ERP migrations. Nevertheless, the company frequently noted that it is not replacing ERP but building a force multiplier to make systems of record more productive.

Other items of note from the Financial Analyst Day:

ServiceNow operates its own data centers and has 34 globally to date.
Executives demonstrated new workflows for finance and supply chain as well as generative AI capabilities.
Once ITSM is live at an enterprise, additional ServiceNow applications deliver time to value faster with implementations that take anywhere from 8 weeks to 16 weeks.
The company referenced an average selling price uplift as it sells more of the platform to enterprises. Desai said ServiceNow is delivering strong value.
66% of ServiceNow's existing customer base spent incremental dollars with the company in 2022.

Data to Decisions Future of Work Next-Generation Customer Experience Innovation & Product-led Growth Tech Optimization Digital Safety, Privacy & Cybersecurity servicenow AI ML Machine Learning LLMs Agentic AI Generative AI Analytics Automation B2B B2C CX EX Employee Experience HR HCM business Marketing SaaS PaaS IaaS Supply Chain Growth Cloud Digital Transformation Disruptive Technology eCommerce Enterprise IT Enterprise Acceleration Enterprise Software Next Gen Apps IoT Blockchain CRM ERP Leadership finance Customer Service Content Management Collaboration M&A Enterprise Service GenerativeAI Chief Executive Officer Chief Financial Officer Chief Information Officer Chief Technology Officer Chief Digital Officer Chief Data Officer Chief Analytics Officer Chief Information Security Officer Chief Operating Officer Chief AI Officer Chief Product Officer

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Accenture's Paul Daugherty: Generative AI today, but watch what's next

Accenture's Paul Daugherty: Generative AI today, but watch what's next

Microsoft unveils Microsoft Fabric at Build 2023, pitches integration, simplified pricing

Microsoft unveils Microsoft Fabric at Build 2023, pitches integration, simplified pricing

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8 takeaways from Constellation Research's Healthcare Transformation Summit

Dell Technologies revamps APEX Cloud platform

Dell Technologies revamps APEX Cloud platform

Walmart, Target highlight intersection of supply chain, customer experience

Walmart, Target highlight intersection of supply chain, customer experience

Alibaba plans to spin off its Cloud Intelligence Group within 12 months

Alibaba plans to spin off its Cloud Intelligence Group within 12 months

Cisco's Q3 posts strong networking gear sales, ups outlook

Cisco's Q3 posts strong networking gear sales, ups outlook

SoftwareOne acquires Beniva Consulting, adds ServiceNow services

SoftwareOne acquires Beniva Consulting, adds ServiceNow services

ServiceNow outlines generative AI roadmap, bring your own LLMs

ServiceNow outlines generative AI roadmap, bring your own LLMs

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Accenture's Paul Daugherty: Generative AI today, but watch what's next

Microsoft unveils Microsoft Fabric at Build 2023, pitches integration, simplified pricing

The workloads

Zoom ends Q1 with 215,900 enterprise customers, touts AI strategy

8 takeaways from Constellation Research's Healthcare Transformation Summit

Dell Technologies revamps APEX Cloud platform

Walmart, Target highlight intersection of supply chain, customer experience

Alibaba plans to spin off its Cloud Intelligence Group within 12 months

Cisco's Q3 posts strong networking gear sales, ups outlook

SoftwareOne acquires Beniva Consulting, adds ServiceNow services

ServiceNow outlines generative AI roadmap, bring your own LLMs