 Las Vegas, it's theCUBE, covering Knowledge 16, brought to you by ServiceNow. Here are your hosts, Dave Vellante and Jeff Frick. Welcome back to ServiceNow Knowledge 16, everybody. This is Dave Vellante with Jeff Frick. Dave Stevens is here, he's a VP in GM at ServiceNow, a longtime CUBE guest, CUBE alum. Dave, coming off the keynote, welcome back. Yeah, thanks. So yeah, I said fun up there this morning, we were talking. We did, it was a blast. So, big news this week, right? You guys, the third estate, really the whole service management going across the enterprise, customer service, becoming a fundamental discipline of all organizations. Talk about, start with, where'd this all come from? Yeah, so it was interesting. I've been at ServiceNow about three years now and when I came in, I wondered, hey, we're doing all this stuff for IT, what about customer service? And so, we surveyed the customer base, we started asking ServiceNow customers, what do you think, what are you doing? And we found over 50 customers that were already using ServiceNow for customer service. And since we hadn't built anything special to support them, we asked them, how on earth are you doing this? And they had gone in and customized the platform and added account and contact and contract and entitlement and all this stuff so that they could use a service management approach to customer service. And so, as an engineer, we got the product team together and we started to make investments and it all culminated this morning with the market launch of this new offering. But we were led here by our customers. So what's broken about customer service today? Is this a 15 minute show? Like we did. You're just a bumper sticker in 10. It's all personal. People are infuriated by poor customer service all the time. And the thing is, as consumers, we get mad about it, but the enterprises that deliver poor customer service, that was never their intention, okay? And so there's some market research out there suggests that businesses are leaving $41 billion a year on the table because customers, when they receive this really poor customer service, they go also, I have a personal experience. Do you want to hear it? Yeah, please. Everybody has their sob stories, okay? So just in the last three weeks, and I'm not gonna say the company, all right, because I don't want them to feel bad, but a cellular provider, I was calling up to get help. I was transferred six different times, hung up on twice, and I never actually got the customer service that I needed. I invested over 45 minutes. And right now, so my next step, I called my credit card company, I put a merchant block on the cellular provider and I left, and that's what people do. The systems that these enterprises are using to deliver customer service, they're a part of the problem. It's not that that cellular provider wanted me to have such a horrible experience. It's just what ended up happening. And the agent as well, you called it the ticket treadmill. He or she is on the ticket treadmill. Yeah, for sure. The customer service leader, if you're lucky enough to be in a company who's growing, their products are being sold to more and more customers. The ticket volume is going through the roof. We call them customer cases. So the customer service leaders, well, let's just see if I can hire my way out of this hole. But then, that's going to impact gross margins. They can't really do that. The company's looking for leverage and economies of scale. And they go into their customer service solution. We need a traditional CRM-based approach to customer service and it just doesn't work. They don't have the tools they need. So a couple of things, we could probably spend an hour on this, but a couple of things that really drive you crazy about customer services. When you're having a problem and you call up and the first thing they say, they apologize. They say, oh, I'm sorry. And it's just, it feels insincere. And then you touched on the other one, which is, would you like to take a survey? Yeah, yeah, yeah. You get the opportunity to take a survey after you're not assisted. It's an embarrassing conversation. So let's take a cable company. That's another popular example. So I want to watch Game of Thrones and I turn on the TV, cables out. So I'm upset because I just, I need my Game of Thrones. So I call up and it's very clear when I'm connected to an agent, that agent has no idea if my service is up or not. And they are reading a script and they're gonna take me through, did you reboot this? Have you done that? Blah, blah, blah. And that's not okay. So it wastes a ton of my time. I don't watch Game of Thrones. I know I don't get to watch Game of Thrones. So we come up and say, all right, customer service management's different. The IT guys, they've been doing this a long time. They can see, they tie in their operations, right? And you can see every connected device between cable company headquarters and my TV, my neighborhood. And if the agent can see that, well, okay. They might be able to help me. They know that something up the block blue and the cables out. They're not gonna ask me to do 100 things that aren't gonna make a bit of difference in whether or not Game of Thrones is gonna suddenly show up. I was just wondering if all that was just a bunch of BS to stall, why something is going on in the background. I know you were gonna say that the phone company asked you your number four times on each particular transfer, which is the other thing. Well, what's your name again? No, no, you call up and they say, okay, please type in your account number. Type in your phone number. And then they transfer the agent and the agent says, what's your account number? Right, right, right. That's not great. That's not on your screen, please. Why did you ask me in the first place? I think there's a room up on the service experience for us as consumers, we know this. And the thing is, if you're the agent, you just get beat up on all day long. You don't want, you said maybe they're insincere, maybe they're just, they have a lot of empathy, but they're for sure burned out, right? Because they know they can't, they've got maybe their knowledge management system and a couple of other things, tools and tricks, but they're not empowered. And that means that the enterprise that's providing the service is super slow. And for us as consumers, in this digitally connected service economy, it's not okay. Right, so the other thing that we'll pick on cable companies they'll do is that, because you made this point, you can't just keep hiring people. So what they'll do is they'll think they're automating and you'll get an automated voice. I can help you with that, right? Okay, so what's the difference between automation and self-service? Talk about that. Well, for most enterprises, if they use even a traditional CRM-based approach to customer service, deflections the name of the game. So they do not want the customer to call in, right? And so they put a self-service portal out so customers can get service themselves. That's the concept. But all the capabilities are that exist there is you make the customer type in the case. So they don't have to spell their last name, they're not talking over the phone in a frustrating way with the agent, but it hasn't actually eliminated any work in the enterprise, right? Because the case is still created, it still needs to be worked and handled and resolved. And so that's the real difference. So if you have your customers create tickets online, that's self-service. Automation is the customer can go in and do what they need to do online and they're done with it. And they're in fact talking to a computer not just initiating a request for an agent to get involved. So how does service know? Well, I was gonna say, what about the third part? The other interesting thing is the third-party data. If I have a bad customer experience, I go straight to Twitter and I tweet right at them and say, oh, absolutely. You're one of those guys. Rude force. In fact, and sometimes you're responded, in fact, you talk about the cable company, my local cable company, you could tweet to them, but there's another Twitter handle that somebody published that you can tweet to. And if you tweet to that one, usually your service comes back on pretty quickly. It's the one that they keep it on. That's awesome, but they're like 2% of customers that are on Twitter and they're all out of use. But when you think about the customer service problem, and now you have all these other ways that I can vent my frustration. How are you seeing teams incorporate that? How do you use that extra data to help solve problems faster? Most customer service solutions, they tie into a social media monitoring platform where you detect customer sentiment and try and get ahead of it. Okay, so whether it's Facebook or Twitter, et cetera, you're trying to detect the digital body language of the consumers out there. And the ones that are super frustrated before they impact your brand, you want to make sure that you know and you're able to intercept that and engage. You engage the customer where they're at. And that's very important. And then there's a bunch of dedicated tools that do that that most customer solutions tie back into. But the key thing that service now brings in addition to how it would connect out to social media sites is being able to diagnose and fix the reasons why customers are calling it in the first place. So there's a difference between listening and being a customer service as the complaint department and actually being able to drive service improvement continuously. And that's what service management is all about. We talked about automation, that's the service catalog. We talked about connecting all those digital devices. That's something called the CMDB that we leverage. It's a concept born out of IT, applied to customer service. And it's a big, you know, it's a game changer. And that's really the part that Frank touched on his keynote yesterday, which is that different kind of an attitude in terms of finding root cause, solving problems versus just fielding the complaint and saying we feel really bad. Yeah, we feel bad. We'll send you 10 bucks off your next bill or you know, whatever you got to do. You strike me as somebody, you like that 10 bucks off, don't you? If it ever comes, yeah. No, I just, like you, I just want, the game is on. I want to, I got 50 people at my house for the Super Bowl party and there's no Super Bowl on the TV. Yeah, for sure, for sure. But you're talking, Dave, about as well, reactive versus proactive customer service. So talk about that and talk about how service now affects that. Yeah, so the question is, is customer service on an island in an enterprise, right? They're all by themselves, all by their lonesome and you know, do they feel the full weight of these customer issues right on their shoulders? We used an image this morning, okay? It was a kid who looked very sad with a big backpack on and that's the customer service leader in many of these enterprises. Yeah, so he's in the playground and the backpack is weighing him down but all the other cool kids are hanging out behind him. Yeah, there's all these cool kids. So why won't they play with you? Okay? Sales and marketing and finance and engineering. And operations and engineering and so on. And so the service management approach is to connect all these departments together inside the enterprise so that they can collaborate to reduce the reasons why customers need help in the first place. And using service management, you hold those different departments accountable. So in one system, I have operations data. I have engineering data and I'm also able to tie that back to all of the incidents, the customer cases that have come in and the customer impact. So I know, oh, this issue's impacted 25 customers. That issue's impacted 66 customers. And I can actually establish service level agreements for each of those departments so they get with the program and help out. Instead of doing all this over email or phone calls or who knows what, they're able to all use the system together, play together on the field. So great customer service is the team sport and it's not just that customer service leader. That customer service leader needs everybody on the field in order to participate and drive continuous service improvement. So this is really important. The demo this morning you showed, and this is obviously interactive and changes minute by minute, but you showed like the big red or orange square, which was a collection of the main problems. So how would an organization take us through sort of a use case? You see that big square, what do you do next? Yeah, so I was talking to an online retailer out of Europe two weeks ago. And I asked them like, how are your agents spending their time? He says, well, you know, occasionally something really bad happens in our online operations, but that's occasionally what we're inundated with are all these requests to do things that we don't have automation around. And believe it or not, one of the really tough ones is simply updating account addresses. And I said, well, you're an online retailer. Like that doesn't make any sense to me. Like I'm sure that you can go onto the website and change your account address, et cetera. Not so much. Like they could capture that information, but then their customer service agents had to go through and update seven different systems to update that account address so that that e-commerce could continue to flow through. And so we go in and show the service catalog, which is one of the components and service management existed forever at ServiceNow. And we say, you can leverage this. Let me just create this form for you. We'll publish it to the self-service portal. You can integrate it in with your website. And the reason why I'm tying it back to that graphic you're thinking of is that was the top automation opportunity in our demo today. It was the account address update. You might think, well, why did we choose it? Well, we chose it because of the conversation with the online retailer. They're really struggling with it. They had 10 people who did nothing but that full-time. So that's the difference between self-service and automation. If you use the service management approach, you can reduce the reasons why customers need help by root cause analysis and then also just using the service catalog to automate a way of recurring requests. And it's interesting coming off of what Dave just said from Oshkosh, where when they were putting in the processes to automate their own systems, they had the intersection points with all the other different groups and then cleaning up that connection is what really leveraged then going into these other groups. Hey, can you help us as well? Because these interdependencies are very real. Something as simple as changing an address is not something so simple. No, it's not. And Oshkosh, I mean, Dave is a great CIO and he's got a great team at Oshkosh. They make these incredible military equipment machines and what they've been able to do with the platform, it's inspiring. And it is, that's inside the enterprise. This is customer service management. That's outside the enterprise. But they're so much in common. It's the same story. It's how do you hold these different departments accountable and how do you drive continuous service improvement? All day, all day long. And just to be clear, so we're talking about self-service and automation. You guys are driving for both in the appropriate place. Yeah, for sure. Yeah, absolutely. And that's example you gave about the retailer and the address change. You see that so often, you'll go in and you'll say, didn't I make that change? Or the change has mistakes in it. It ripples through, so the quality is an issue. And that affects the overall customer experience. So where are you at today with the new capability? So you have a set of customers that said, we did this. Yeah, we did. We added all these mods. So you guys took that and said, we're gonna do it for the rest of the world. Yeah, yeah. So you build a product. We did, and we've been at it for a while. So we shipped the first version of the product in December. And right here at the conference, we have, I think four or five customers who are already live and using it. And it's really inspiring. There's Epicorps, a mid-market ERP company. And they had seven different customer support systems and an opportunity to improve their net promoter score. We have Fiserv, who is on day one with Frank, really, really big financial services, outsourced provider of services to all the major banks and financial institutions. They're up and running on it. We have NICE, which is Workforce Management Software. So it's really great because here at the conference, customers are connecting with other customers and learning what they did. So we have a solution. We have live, referenceable customers who are speaking at the conference. We feel really, really good about having this brand new approach being driven into customer service. Well, it ties into the whole new, I call it the new way to work. You guys done a lot of research on that. And it ties into your TAM expansion. It's like every year we come to this conference, started out at ITSM and then it just keeps getting bigger and bigger and bigger. You talked about First of State, Second of State, Third of State. There's a very colorful analogy that Frank mentioned where service management is the Third of State, CRM, the Second of State, ERP, the First of State. I won't repeat the whole analogy, but people really are beginning to reconsider. Hey, customer service, does that belong in CRM or does it belong in service management? And that's really fascinating. It's really, really interesting for us. And a lot of these early adopters who have gotten on this dedicated product we built for customer service management, they're coming back to me and they're saying something that's kind of funny, but also true. They say, you know, Dave, we use Salesforce, okay? Salesforce is for sales. ServiceNow is for service. It's not that complicated. It's in the name. It's gonna be a simple thing to say. I know, I like that one. It's good. And we had Chris on from Epicor as well. And you know, we talked about, you know, they have five kind of core products that their business is built on today, but they've got a historical legacy of like 85. So the thing that really is coming together for me is really just the shared services piece. That's where ServiceNow can play. So how do you cost account for your customer service folks when you've got to support 85 products? There's only five of them that are rolling off the shelf today, you assign it all to them, or is it truly a shared service when it's a shared service? Looks like a perfect opportunity for you guys just like ITSM or HR or legal or whatever. So Epicor had those seven different customer support systems. And you know, that's a challenge to have an integrated customer service experience for your customers when you have that. And they're here at the conference, you know, and you wonder, well, is that commonplace? Is it not commonplace? And they're talking to a prospect evaluating customer service management. It's like, yeah, I have five. What were your seven? You know, what were you using? Oh, here's what we're using. And we really need to bring all this together on a common platform with a common approach. So that we can get leverage out of our customer service agents. We can be more effective in delivering service. We can drive customer satisfaction up, costs down. It's a great story. Well, here's what I love about what I'm hearing. Over the last several years I've come into these events. You guys, and this is a recurring theme. You are helping IT organizations, organizations in general, get rid of stuff. Yeah. And that never happens in IT. Well, you always bring in stuff. Our application portfolio grows and it grows and Dan McGee talked about it this morning. Tens of thousands of applications. And if you look at the application portfolio, a lot of them aren't even being used or they're being used by a couple of people, but you can't get rid of it because they're hanging onto it. What you've done is very clear in talking to customers, come in and say, okay, we're going to bring this function in and you're going to be able to retire these systems. Yeah. And again, that's rare and it's a good thing. I'm glad you feel that way. And we certainly do see that. Dan talked this morning about the connected experience, about how you have different choices inside the enterprise, right? You can pretend that you don't have too many apps. You can just say no and try to block new apps from coming in. You can buy all the apps from one vendor, which is, that just never works. Or you can leverage a common platform and using the common platform, you can drive a consistent service experience across all the apps and really start to rationalize what it is you're running. So I do think that's a very powerful message. Well, it's funny. But even then, like you say, but so seldom if you say, okay, but did you get rid of anything? The answer is no. And over the last two days, the answer has been yes, we have gotten rid of some stuff. I think that's the piece that's usually missing. Everybody loves new shiny toys, but are you actually getting rid of anything on the back end? Yeah, for sure. And I love the last message because in the keynote this morning, you guys were kind of joking tongue in cheek. Yeah, your CRM was Siebel or Salesforce. It doesn't matter. Yeah. And it doesn't matter. No. Well, those systems all share something in common. They come from a CRM perspective, which means they're focused on the customer engagement piece only. So when it comes to diagnosing and fixing, those companies never built up a DNA, a muscle, a set of products and solutions that help you do that. There just isn't anything there. And so I think what Dan said, which is very true is that those systems all too often when they're deployed just become ticket buckets. Right? Customer service as the complaint department. It's not very empowering for customer service. It doesn't work out for companies. And the thing is, the world has also changed, right? So those solutions might have been okay 15 years ago, but we live in a digitally connected service economy. Internet of things, right? I think Gartner says maybe 30 billion IoT devices by 2020. I have an e-bike. By the way, it is a cool bike, okay? It goes 100 miles on a single charge and up to 30 miles an hour. And everyone believes I'm in shape when I'm riding that thing. I've seen those things pass on me. I'm like, whoa, get back here. Yeah, that's me. I'm like, you know, I'm in my jeans and I'm still going, everybody's all biked out in their biker gear and I'm right past them. But that bike is a sign of things to come, right? It actually downloads patches to itself over the cellular network, okay? And if I have an issue with that bike and I call in customer support and they cannot see the real-time operational health of my bike, they cannot help me. They cannot help me. And that's becoming, IoT is the new norm, okay? And so we think, you know, this approach, the service management approach to customer service is coming at the right time where these enterprises are shifting and more and more are technology-based and need something a lot more than what these CRM-based solutions for customer service have traditionally offered them. Well, it reminds me of the example, Tesla, you download a software fix, new patch. I won't name the company, but the Japanese car manufacturer sends you a notice to bring it in for service so they can update. Yes, and do you know how long they want it for the day? Yeah. For the day. We'll give you a loaner. Yeah, obviously from a cost standpoint, that's horrible for them, but then the experience for us as consumers is also bad. It's a huge upside in this space. The swim lanes though, Dave, seem to be getting a little fuzzier, although maybe not. Maybe you guys are very clear in your swim lane anyway, but as you encroach into the, well, you've done this in HR and seems like you got a good thing going with Workday now, those fuzzy there for a while. And same thing now with CRM, ERP, but you're touching all the systems of record, the systems of engagement, I mean, like tentacles spreading out through the organization. Yeah, I think one of the things that you can look at all these different products that ServiceNow offers now and you could say, wow, they're spreading out really broadly, but we're not. So what- Because you're focused. We're focused on service management, right? We've become, ServiceNow's becoming synonymous with service management. And it turns out that this service management category of software applies to every department in the enterprise, including customer service. So we're actually quite focused on this message and we're just continuing to be the people that are bringing it forward in the marketplace. Excellent, another great segment, Dave Stevens. Thanks very much for coming back in theCUBE. Thanks for having me. Good to have you again. All right, keep it right there, everybody. Jeff and I will be back with our next guest. Right after this, this is SiliconANGLES, theCUBE, we're live from Knowledge 16. Right back. Every once in a while, a true brea-