ServiceNow, Inc. (NOW) Earnings Call Transcript & Summary

All right. We'll go ahead and get started here today. Thank you all for joining today's Demo Center. My name is Kenna McWilliams and I am a Solution Consultant here at ServiceNow. Today, I have my lovely co-host joining me, Nathan, and I'll let him take it away with an introduction.

Thank you, Kenna. Appreciate it. Hi, everyone. I'm Nathan Ascue, also part of the customer workforce team, also a solution consultant and here to present GenAI with Kenna. So really excited to share what ServiceNow has in terms of those capabilities it has today.

All right. Well, thank you so much, Nathan. Before we jump into what we have for you all today, I just want to let you all know that our presentation is set for 20 minutes and all lines on today's call have been muted to prevent any background noise but please use the chat and QA feature to ask questions throughout the presentation. And now that we've gotten that out of the way, I just want to bring everyone's attention how GenAI is a fascinating technology that will forever transform the way we work.

Yes. For sure. I hear you, Kenna, maybe it is a huge buzzword and there's a lot out there. I do think 20 minutes may be a little bit ambitious, and I'm hoping we could make it real for our customers today.

Okay. I'm glad you asked, Nathan. In the next 18 minutes, we'll get through all of that. But first, I want to cover our Safe Harbor slide. So before we get started, we just like to put out our Safe Harbor notice. And as a nutshell, we are rapidly innovating here in some statements in today's presentation will include forward-looking and future plans. So this may be subject to improvements and adjustments as we march on into the future of ServiceNow.

Yes, for sure. And I'm sure by the time everyone's done reading the slide, there will probably be something new out there.

Definitely. And so now that we have that out of the way, there are a lot of ways to answer the question of how will GenAI change businesses forever. But ServiceNow is zoning in on 3 pillars: transforming experiences, increasing productivity and accelerating agility. Transforming experiences is all about creating new ways for our customers and employees to interact, personalize experiences and provide fresh ways to access resources. Increasing productivity is really about consolidating all this information in an intelligent way, reducing manual load on employees and providing context faster, so things are achieved more quickly. And then finally, accelerate agility, supercharge the ability to solve problems and scale with less time spent on repetitive tasks, we can save that brainpower for creative innovation and unique touches.

Yes. I'm understanding the better as a consumer and making it easier to do my job. That sounds awesome, especially at the enterprise level. And Kenna, help me understand how that will apply in the context of customer service? And maybe more specifically, since that's our focus today, do you mind sharing any data points or research on this?

Absolutely, Nathan. Let's imagine a few different scenarios. The common thread here is that GenAI can help us transform experiences, increase productivity and efficiency and accelerate agility and resilience. There are just a few ideas to get your innovation mindset on. Starting at the top left, a university student, Ooma, orders a coffee using the Coffee Corner mobile app, but realize that she chose the wrong location. So she uses virtual agent to correct her order and a customer service agent, Indra, uses Now Assist for CSM to expedite the refund and reroute the order to the correct location. Customer day is saved. And if we look at the top right, an Emergency Response Coordinator Center, or ERCC IT admin uses Now Assist for creator to text capability to quickly scrap a solution for handling insurance claims during wildfires showing how easy it can be to implement an advanced tech solution. Now if you take your eyes to the bottom left of the screen. An employee working from home is using PowerPoint and PowerPoint suddenly crashes right before an important presentation for her leadership team. She uses virtual agent to -- which offers an empathetic response and quickly resolves the issue, enabling her to prepare for this presentation with peace of mind and even leaves time for him to grab some lunch before. And then finally, at the bottom right, Arico uses Now Mobile app to learn about this company's policies on childcare benefits, volunteer time off and donation matching. During this, his daughter's school orientation, efficiently balancing his family needs with his work schedule. These are some -- only just a few examples out of the many that customers can use to leverage Generative AI in their everyday lives. And now if -- sorry, go ahead, Nathan.

I'll just add that's awesome.

Yes, definitely. And now what we have in here is something I'd like to highlight is some customer operation areas also include reducing the number of customer cases within a contact center or otherwise, also increasing customer case resolution efficiency and reducing customer service agent attrition.

Awesome. Yes, that 30% in customer operations sounds pretty promising here, especially with the highest level of productivity lift. It looks like you give me some ideas here how Generative AI can really make an impact on my business and our customers as well. My other question for you, Kenna, is can ServiceNow help in all those areas as well? Or is there more? Or just kind of curious about that.

I'm glad you asked. I can show you better than I can tell you, which takes us to our next slide, which this will be our Now Assist demo personas for today. We'll look through the lens of both the customer and agent. Our customer will use the customer portal bolstered by Now Assist GenAI to receive help with an issue. Then our agent will take on this case to help them solve and communicate it back to the customer in record time using Now Assist tools for added context and effort. So now that we have our personas out of the way, I'll go ahead and transition to our demo environment to show you all these lovely GenAI capabilities. And I just want to make sure, can everyone see my screen?

Yes, we can see it.

Awesome. All right. So George is going to be our customer of Solana today. And he's been having some Internet connectivity issues. So he decides to log into the customer portal to try to get some answers and find resolution to an issue. I just want to highlight that our customer portal serves as a one-stop shop for George when it comes to finding out news, gaining knowledge and putting in requests to get help on certain issues that may be beyond his understanding. And so to make George's life easier, he can leverage the global search to make it incredibly easy to find the help he's trying to get. So by simply typing in the keywords here that he has an Internet issue, he'll go ahead and conduct this first search. And what we see here is the next revolution of self service. Instead of George sifting through all these knowledge-based articles, what we see here at the top is that there's a GenAI summary that allows George to see what he could do about this issue. And what might be leading to the possible issue for his Internet connectivity. The more useful thing we find here is that this gives customers a consumable response. And let's George act faster on this information, potentially deflecting a case altogether and allowing for faster resolutions. And although this likely would solve a issue in real life, for demo purposes, let's explore one more avenue that George can leverage, which is the virtual agent. And once he clicks into the virtual agent, there is another capability that ServiceNow has spent years crafting that's bolstered by GenAI. George enters his issue into the chat and has met with another intelligently generated response. And as we see here, when George put in that he's having an Internet issue in this chat, he was also given an answer by Now Assist. And this allows for him to have another way to conduct self-service when encountering this particular problem. And it can lead to case deflection and this is just one way customers can have all the resources they need to solve the problems remotely. However, this answer doesn't really do the job for George. So he has to go ahead and request help for a live agent. And so he's going to ask for it to be connected with a live agent. And this pretty much brings us to the end of George's journey in the customer portal. We'll go ahead and switch personas into our lovely customer service agent, John Jason. And what we're looking at here is John Jason is able to be a -- able to get information from the agent workspace, and he sees that there's a new case coming in from George in his inbox. So he's going to go ahead and accept this case. And as you can see here, based on the active chat that John Jason has with George, he sees that there is an AI chat summary, which lets them know that there's other ways that John Jason can service the customer and suggest ways to make them happy since this Internet issue is interfering with the service they're providing. And he wants to make sure he can give all best opportunities to the customer, George. And upon receiving this AI chat summary, what John can do next is give him a response regarding this particular issue. And if we go down here into this response template, we can go ahead and summarize the chat history for this interaction, leading to the interaction being passed to another step in the process, which would be opening a case. And so what John Jason is going to do is going to go ahead and end the chat. And from here, as we see in the short description in chat summary, the same summary that was given by GenAI has been led to -- being input into the short description and chat summary of this interaction. And so what George can do next is go ahead and create a case. And by creating this case, we'll go into the list view, and as he's created this case, it shows up here at the top. And so when he clicks into this new case, he can go ahead and look at past activity that's been done with this particular case as well as he can get a summary of what's been done from Now Assist as well. And as the summary is being created, we can see that there's some sort of issue that's going on across the entire enterprise with this particular Internet problems seen by their customers. And so here, there's not really a solution in place just yet. He's going to have to escalate it to IT -- the IT team. And so now that he realizes that this is a greater issue, he's going to go ahead and leverage now or share these work notes and save it to the case. And after he'll go ahead and leverage Now Assist to further escalate this case to the right team. And as we can see here, it gives John different angles to go to about the next step of this case, whether it be another summarization, GenAI, generating resolution notes or summarizing this record. And so now that John Jason can leverage Now Assist, we'll go ahead and pin it to his workspace, that way he can better leverage it in his work environment. He'll go ahead and summarize the record for this particular case. That way, that transfer of knowledge goes from the customer service team and the IT team in one fluid motion. And as it's summarizing the case, we see here that we have a whole summary of the issue generated by our Generative AI solution. And so now that John has all the information he needs to pass this over to that IT team, he can go ahead and transfer this case over to them and know that everything has been done on his end and that the next actions that will be taken will be most likely the IT team reaching out to George to resolve this case. And with that being said, we'll go ahead and close out in the slide deck and finish today's presentation. And so what we're able to see here in this presentation is that Generative AI will impact all workflows from the IT test to developers. And Generative AI is implemented at the platform layer, which is why we were able to see it rapidly enhance our core capabilities across all workflows. While vendors are making future announcements, we have launched capabilities in each one of our workflow domains and expect fast innovation to follow. We're also introducing and will continue to introduce use cases that serve personas across the platform to transform experiences, increase productivity and accelerate agility. And with that being said, we'll go ahead and leave some time at the end for some questions. Feel free to put your questions in the chat to let us know how, if any, lingering things have happened. Besides that, I just want to thank you so much for joining today's demo center, and we hope to see you again here soon.