 Live from Orlando, Florida, it's theCUBE, Covering ServiceNow, Knowledge 17, brought to you by ServiceNow. And we're back in Orlando, everybody. This is Dave Vellante with Jeff Frick. CJ Desai is here. He's the Chief Product Officer of ServiceNow. The newly minted 150 days in at CJ. Great to see you. Off to see you as well. Fantastic job. Thank you, thank you, thank you. The team did a great job. Very crisp, I was struck by your story about last October when you were contacted by ServiceNow. You fired up the platform and started playing around and built an app. Yeah. And you found it was a good experience. That was a great experience. I'll tell you, Dave, I mean, from my standpoint, when you join a company that is built on a platform like ServiceNow, you want to make sure that you feel great about the foundational elements because it's always, you can build floors on top of a foundation, only when the foundation is strong. So, you know, ServiceNow always, I don't know if you know, but it started out as a platform company. And then they used the service management use case and went deep in that use case and then went to operations management and other products, as you know. And I just wanted to make sure that, hey, how easy it is if I'm a customer or if I'm in the product development organization to create an app. And having that strong foundational layer, you know, even simple things like, it's a cloud offering, first of all. You have an integrated development environment. You can start creating workflows, UI, all of that is so easy. And there's no headache of figuring out how to deploy the app because it's right there. So you just publish it and you're done. Yeah, it's interesting. One of the first CUBE interviews we did at Knowledge was with Doug Leone, the famous VC, and he told the story of he saw this. But what am I going to do with this? And Fred away, I said, go build something on top of it. And that's what happened. And then so, but help our audience understand CJ because you talked about Jakarta today. And Jakarta is a platform capability. And if we understand it correctly we were talking about earlier, the business units have to figure out, okay, how do we apply that capability to our particular needs and our customer needs? So explain that. Yeah, so I'll tell you there are two things that happens in the products organization, right? First is we do releases every six months twice a year. So every six months twice a year. And we go by alphabets and we pick cities, just a fun factoid. We pick cities that go from North America or South America to Europe to Asia. So H release last year around this time was Helsinki, right? After Helsinki was Istanbul. And then we have Jakarta, so we are now in Asia. And then next will be Kingston and the one after that is London. So you go alphabetically. And the reason we pick this city names and alphabets, we support our customers because it's a multi-instance paradigm, N minus one and N minus two releases. So when you make name of the cities, customers will have conversation with me and say CJ, we were on Helsinki, we are upgrading to Istanbul, or we are going to skip Istanbul and go straight to Jakarta, for example. So first of all, that's our naming system that we use. Every six months you will see us talk about a specific release. And you heard from John yesterday was very clear in saying, listen, our customers want to hear our roadmap. They want to know what we are up to. And so we took that customer feedback to heart and decided, why don't we just tell them what's coming in Jakarta? So Jakarta will be released this summer. And from a planning standpoint, Dave, to answer your question, we figure out first, what do our customers want? And is it in the applications that we talked about, like ITSM or CSM or security or HR? And for those applications to deliver the functionality, what do we need to do in the platform so that the functionality can be delivered? So the requirement process is a complex requirement process. The applications team will give requirements to the platform. Customers also sometimes have requirements for the platform on scale. Platform will build the functionality. Applications team will build the features on top of it. So in Jakarta, which is coming out this summer, we have six new products. You saw some of them software asset management and others, 30 major features. And that's how. So after Jakarta, we are already in planning for Kingston. After Kingston, I think I'm going to announce it for the first time would be London. So it's Jakarta, Kingston, London, are the three releases. Yeah, so when we go to these events, a lot of times at the keynote, somebody will make a product announcement, you get a little golf clap. It always happens at ServiceNow Knowledge that you get somebody hooting in the audience. Today, the hood came for software asset management. There were the three high level things you talked about today. Performance, with UX and performance. And then the vendor risk management, which is very interesting. We'll talk about that a little bit. And then the software asset management, the guy must have been an Oracle customer hooting and hollering. But so give us the high level overview. All right, so here is the thing, right? Our buyer is IT organization. We started with IT. We love our buyer and CIO to all the organizations that support CIO, head of infrastructure, you know, the portfolio management team, the business management, within IT. And one of the things that we saw, and this is the requirement that we got, is when we talk to CIOs about how to make the IT organization productive, because IT, it's a tough job, man. It's a tough job. Things go down. You are like, okay, of course, IT. And technology is such an integral part of our life that people are always looking at IT to make sure that deliver great technologies. So, IT budget. And you know, every, Dave, you do this all the time. Everybody talks about IT budgets. What's happening to IT budgets? How are the IT budgets going up or down? Are you asked to do more with less? I mean, there are so many examples I can use. But as for Gartner, 25% of the IT budget is on software licensing. Then there is hardware and all the other infrastructure and people related costs. 25%. So if, and as you know, some of the vendors put you through a pretty complex audit process. So why can we, our chief buyer is IT, why can we give them a platform or a product that allows them to discover how many products you are using by vendor? Microsoft, Oracle, some of the examples you use for desktop, it's Adobe, and others. You use these products. Are you really utilizing all the licenses you have? Or are you potentially in overage so that you actually have a sense of where you stand with every vendor that you are using that makes up your 25% budget? You know, we talk to financial customers, manufacturing industrial customers, and these are billions of dollars of budget. 25% is still a big number. Any improvement in that 25% could go a long way. And what CFOs do not like is when CIOs go and tell the CFO, hey, we didn't clear this audit or potentially these guys may sue us for a contract violation. So we decided we are going to create a product that helps you get a good posture on what your licensing is. Does that make sense? And that's why, you know, I also saw on Twitter a lot of people love this idea that, hey, can we automate this software asset management process, discover what's being deployed, allow you to reclaim, and at the end, help you save the cost. Well, and the other one was the cloud management. Yes. Platform, which again, similar type of situation, especially with all the freemium services and test dev and card swiping. Yes. That the thing can get unruly pretty quickly. And, you know, in my last job as you are aware, I was in an infrastructure space. And one of the things in speaking to customers always realized that, hey, IT was not agile enough. We decided for some customers, we decided to go and use some of the public cloud services. We rented infrastructure because IT could not keep up with our demands. And, you know, you go and speak to IT. They said just there is so much going on that sometimes it's not easy for DevOps communities in particular that you pointed out, so much going on. So, IT felt like they were losing control. Developers, whether they're application developers in IT organization or in business units, just want that agility. And, IT felt like if they cannot deliver that level of service, you had the shadow IT functions going on in the departments. And, we acquired a company called ITAP about a year ago in April. The first year was all focused on re-platforming. Like I said today, I think many times, sure people got sick of listening to me, is we are going to re-platform every acquisition that we make and we usually buy technologies not business so far. And, we re-platform it. And now, IT gets the control back once before you have the developers, DevOps people. Yes, sure, go and use public cloud. But, IT will still have a single pane of glass that allows you to look at your resource mapping, utilization, understanding the cost and the usage, whether you are on public cloud service or a private service. Well, it's huge because it's very unpredictable. People often complain, well, I get the cloud bill at the end of the month. But a lot of times there's not just one cloud bill. It's many, many cloud bills. What happens is you remember this in the downturn, a lot of CFOs said, go to the public cloud, eliminate CAPEX. And then, when we came out of the downturn, lines of business said, I got to move fast. And this cloud thing seems to be working for me. IT seems to have really, you know, in previous big picture trends like this mega trends, IT oftentimes has been sort of pushing back. You know, you saw that with client server. Yeah, they had security concerns, compliance concerns. Today, they are now saying, okay, hey, we have to embrace cloud or we're toast. And Dave, I'll tell you, there are customers. I mean, some very large customers in regulated industries who tell me that CJ, we are now cloud first before we decide to do something. I mean, that's a pretty big statement. Cloud first, I mean, if you remember 2008, 9, 10, 11, 12, 13, that journey and how customers were reluctant and they're like, I don't know, my data losing from here and this and that. Well, I got to bring this up. So I was reading an article on Silicon Angle, EMC World is going on Dell EMC World this week and Michael Dell basically made the statement in his keynote, if you were cloud first, you could be in trouble because of the expense and so forth. I don't buy it. I think the other, I love you Michael, but the value that customers are getting out of going cloud first, maybe yeah, maybe the bill at the end of the month is high, but the other residual effects on your business, the speed, the agility, the processes, you're seeing it, aren't you? I mean, I'll tell you straight up, there are customers that are asking us because again, IT is our key buyer and key customer and we appeal to the IT department and the CIO is even at the CIO dinner the night before, people are embracing cloud. Now they are on a journey. Some of them have maybe moved few percent of their workload, some of them may have moved a little higher, but they're on some journey and they are trying to balance when the cost pros out with the cons or the cost out with the cons out with the pros, but can you give us some kind of control plane to manage our cloud resources, understand the usage, understand the billing which we do through financial management and time with IT processes because that resource lifecycle, that VMU provision, right? That VMU provision in the cloud, what happens to the lifecycle of VM, can you create an incident, can you close it out? That's equally important besides just saying, hey, I'm going to move this particular workload to cloud. So I feel that customers are on this journey of some kind of combination of public and private cloud and it doesn't have to be zero sum game. Infrastructure continues to grow. I don't feel like, okay, if you do this, that means you do not do private or if you do private, that doesn't mean you. And containers are going to just exacerbate that problem. All right, and the demand for compute store and networking is not going down anytime soon. I'll tell you like our own environment, so my team runs a cloud infrastructure, so our platform runs a cloud infrastructure and you saw some of the availability numbers. I mean, our growth, we are trying to invest in compute network storage ahead of our growth. So it's not, and we are a cloud service. So I always look at it as, this doesn't have to be zero sum game. Customers are expanding. They want the agility, like you said, the agility that the business is asking, can you develop this app faster? Can you give me what I need? Is what's driving this? It's a top-line game for businesses. Jeff, I just want to inject some of those numbers on your cloud. 50,000 instances, 150 million active users and 10 billion transactions per month. Yeah, but I want to get, it's funny, you're talking about Jakarta and London. I remember when we were doing interviews around Dublin, which I guess was a while ago. But I'm curious, because there's this other trade-off and get your perspective, is in a DevOps world and kind of a continuous integration and development world, people want to push code frequently. On the other hand, in an enterprise world, and we've talked to a couple of the customers, they can only take it so much. And so you've kind of got this ying and yang and you want to get stuff out and there's patches and this and that. And you're on a relatively aggressive for current enterprise release schedule. On the other hand, the trend is clearly just keep, pumping it out, pumping it out, pumping it out. How do you see that kind of sorting itself out over time with these big enterprise customers? I will tell you, from a technology standpoint, there is nothing that prevents us from doing more frequent releases. Yes, we have to mature our product release processes. We have to mature our cloud operations and how fast we can churn the code. There is nothing that prevents us technically from, instead of two releases a year, maybe do four releases, it doesn't. But our customers, and we talk our customers first, listening to customers you saw John today, I mean, we want to listen to them and they will tell us that I was at a large financial institution in Boston two weeks ago in your hometown. And they told me that I cannot do every six minutes, six months, I cannot do every six months CJ. We usually skip a release, right? And so I am just, we are just listening for specific use cases around service management, the processes, customer around the same thing with operations management. Right now, six months about feels right. Every six months release, we do quarterly patches but we do not release features in those quarterly patches. Just patches, okay. And for the emerging products, like you saw customer service, HR and security, I mean the team did a great job. When I look at those releases, is it potentially can we push things fast? Maybe, but right now I'm okay based on customer feedback. If customers come in and say I want every three months, I have to see what does that mean? Let me run something by you. I told Jeff I've been sharing cabs with practitioners all week, it's great. You just have wonderful conversations. And one said to me, I've asked service now if they can give me more granularity in the releases. I said that doesn't sound trivial. In other words, if I can selectively choose features, is that even technically feasible? I mean, this is the isolating the feature, micro feature development, making sure your schema is abstracted enough. I mean, there are companies in the consumer world who do that and push code out really fast. I would say right now one of the requirements I do get is we are on IT service manager. We have been a customer of service now for a while but on this other thing, say customer service or HR, I want to take the new features. So my IT service management is that, say, Helsinki, but I want to take the HR, like the onboarding. You saw the onboarding which is in Jakarta. So does that mean I need to upgrade this thing to leverage the HR features? The answer is yes, because it's all built on single platform. Now, I do not want to do where customers, we give them two instances and then we do a back and pipe integration, a connector, so you can be on Helsinki for ITSM and Jakarta. That breaks our model and I do not want to do that. There are companies who, say, reside in different tenants and will give you one product. I do not want to do that. So I wanted to ask you about this too, CJ, because you have a dogma, you have your own cloud. You see a lot of SaaS companies now saying, okay, you see Workday, a little bit of Salesforce, certainly Infor, putting their applications on AWS, for example. You guys are very proud of your cloud. You have availability. I think when you show availability numbers, you downplay it. Actually, people don't understand this. You're talking about application availability. You're not talking about the server. No. Light, okay. But you're very dogmatic about your cloud and this issue here, you won't do something that maybe is going to help one customer but is going to ruin the experience down the road for all. And that dogma, is that a valid? It's not a criticism, it's an observation and is that a good thing? So I would say there are some design principles or operational principles that will live it and we are going to stick to that. Like we talked about acquisitions and replatforming. Think about Dave, you have somebody coming in. You acquire machine learning company, really smart kids, really smart people, machine learning or data sciences, and art more than a science. And looking at prediction, accuracies and things like that. Now you tell them, welcome to service now. Here's your badge, you just got onboarded. It's great what you built. We are not going to sell that standalone. You need to replatform, which typically takes one year before we can launch your product. I mean that's a tough message. That's a tough message for an engineering team to hear that now I have to figure out how does this platform work? I mean if I had a magic bullet, I would tell you if I can wave the magic wand, I'll say acquire this technology in machine learning AI, combine that with our organic development. It's replatformed and I have a toolkit that does this thing and it is replatformed but that's not easy. So on these kind of principles, whether it's replatforming, how we do the releases, how we look at the cloud, and I want to answer your public cloud question. Right now, as you know, we are active, active. I've seen your interviews in the past here. We are active, active. We have eight paired data centers, 16 around the world. And we make sure with our multi-instance architecture, the availability of the uptimes are very high for our customers. And when they upgrade, we know they can pull the upgrade. I'm going CJ from Helsinki to Istanbul or Helsinki to Jakarta when that's available. But can we potentially look at moving our footprint and renting a infrastructure in a public cloud? I'll never say never, but right now there is no need for it. No, you see it. Well, there are advantages to having your own cloud. I wanted to ask about your role as Chief Product Officer. Fred Lutty had that title. We were sort of joking earlier. Fred was a coder, right? The company brought Frank in for adult supervision. And so you're inheriting that title, but I sense that you're a different type of manager. What do you bring to service now? All right, so I'll tell you first of all, Fred, Frank, and even Dan McGee who had this role. Last year he was here. I saw his interview. He's here today. Phenomenal people. I mean, I have interacted with all three of them. Dan McGee helped me transition into my role. Frank hired me and just great, great guy. And even with Fred, going through this user experience, how do I think about the user experience based on the persona? He's always there to provide input with lots and lots of energy and feedback. So let me just tell you for in less than 30 seconds what my role is, right? My role is I have platform team and the cloud infrastructure team that's run by Pat Casey who is doing CreatorCon tomorrow. I have individual application general managers that you saw some of them today. And I also have the customer support organization and the user experience teams. So that's my overall responsibility. So it's a responsibility that Fred Ladi had till last October and Dan McGee had till last December combined into one. So it's a big job. And it comes with a lot of responsibilities on behalf of our customers. You talk about high availability number. I mean, we have to make sure that we keep our cloud service up and running secure, but at the same time bringing this innovation in platform and the applications is my job. So I've done, fortunately when I started out of college, it makes me sound old, I know. When I came out of college, I worked for a company that was doing business applications for a long time, eight years there. And I worked in that applications technology team. I worked in the CRM applications, did things for financial applications. Then I went on security software understanding how you protect the applications you write all the way from OS up to the application stack. And then I work for infrastructure companies, you know. So that gave me a really good feel on the entire stack. How do you scale that stack? And be maniacally focused on what do customers want? I mean, I'm very fortunate to have great customer relationships, many companies around the globe, I reach out to them, ask them, tell me what you think, tell me what we are doing well. So customer focus, having done product development for 20 plus years now and understanding all the way from application stack to the underlying infrastructure is where I can help. Yeah, it's like a triple threat that you have. The product innovation, the enterprise, class, security, and scaling, as you mentioned, are very, very important. All right, CJ, I love having you on theCUBE. You're a great guest. We could continue, but we got to leave it right there on time. Yes, that sounds great. Great to see you again. Thank you so much for coming on. Thank you. I really appreciate it. All right, keep it right there. We'll be back with our next guest. This is theCUBE, we're live from Knowledge 17. We'll be right back.