Digital transformation should be top of mind for every C-suite executive these days. Why? Because digitizing manual processes can drive exponential increases in employee engagement, fierce customer loyalty, better scale, and of course, higher profitability.
COVID-19 has only accelerated this trend. Before the pandemic, some companies got a head start on creating new, digital business models—Domino’s move to a technology-first pizza company, for example. Now, with traditional, physical business just barely emerging from shutdowns in many parts of the world, these companies are leaning into their digital businesses to bounce back.
Disney is another great example. They had to close parks and in-person experiences during the pandemic, but grew its Disney+ streaming business to 50 million subscribers as of early April.
Done right, digital transformation can deliver great experiences for employees and customers. Lawless Research conducted a global study of 6,000 workers last year that proves this point. In the research, about 80% of employees in highly digitized companies said automation simplified work processes, enhanced efficiency, and boosted productivity. And 72% of employees from highly automated companies said digital workflows improved customer satisfaction.
Work after COVID
While no one knows exactly what work will look like after the pandemic, I foresee a hybrid future where most companies will need to support customers and engage employees through both centralized and virtual work. Companies that are further along in their digital transformation will be better equipped to manage these evolving experiences.
Digital workflows are the core of any digital transformation model. Let’s be honest, though. Digital transformation isn’t easy, nor is it free. Companies worldwide will spend nearly $7.4 trillion on digital transformation programs between 2020 and 2023, according to IDC. If you’re a CIO, how can you have confidence in your digital strategy, and how can you advocate for the necessary budget?
When IT met finance
That’s where CFOs (like me!) come in. I believe the CFO-CIO relationship is a critical piece of a successful digital transformation journey. In fact, I partner closely with our CIO, Chris Bedi, to ensure that ServiceNow prioritizes and funds digital transformation programs that increase customer success, unlock productivity, and drive ROI. Through this partnership, we work to maximize business value, sharpen our competitive edge, and identify new opportunities to transform business functions across our company.
Keep in mind that Chris and I are a bit of an anomaly. We both report to our CEO, Bill McDermott. But what about the 50% of CIOs who report to the CFO? The complexity and criticality of these conversations increase significantly.
So, how can you navigate a conversation with your CFO about digital transformation, regardless of your reporting hierarchy? Follow these five tips, and I think you’ll hit on the main points your CFO cares about.
Focus on business outcomes
CFOs want to know exactly how digitization will boost customer loyalty and employee productivity. The majority of us are data driven. While cost always matters, measurable business outcomes are just as important. Chris and I agree that the opportunities we discuss must be credible and must solve real business problems. We focus on proven methodologies, value frameworks, and best practices as we evaluate existing and future digital transformation investments.
Here’s an example of the outcomes that ring true for Chris and me: By adopting a service catalog in our customer-facing instance of the Now Platform, we’ve fully automated resolution for more than 100,000 customer requests that were previously handled manually. That has not only resulted in a better self-serve customer experience but has also allowed us to free up $21 million a year that we can reinvest in our customer support operations. That’s music to any CFO’s ears.
Solve cross-company problems
A CFO wants to see solutions that can help break down departmental siloes and solve problems across the enterprise. If you ask me to fund a digital program that only benefits one business unit, you won’t get more than five minutes of our next Zoom meeting. Trust me, the conversation will go much better if you propose a cross-organization platform that integrates with existing software to improve business outcomes.
For example, we’re currently piloting a digital service delivery solution for our legal team, which serves every department in the company. Early results have been encouraging. On average, the new digital workflow eliminates five emails for every intake form. This reduces ramp-up time for new legal projects by 80%. Contracts get drafted and executed faster, which reduces time to value across ServiceNow. That’s a conversation I want to have.
If you ask me to fund a digital program that only benefits one business unit, you won’t get more than five minutes of our next Zoom meeting.
Integrate advanced tech
An important component of digital transformation is the ability to apply machine intelligence to make work, work better. CFOs are more likely to fund digital solutions that leverage AI and machine learning because they power more intelligent and forward-looking decisions, which leads to faster and easier solutions. And yes, save money along the way.
These advanced technologies, when integrated into core platforms, accelerate the effectiveness of your digital workflows. For example, our internal IT support teams use our Virtual Agent chatbot to enable self-service for common tasks like password resets and knowledge base searches. We’ve saved a total of 8,575 hours with Virtual Agent. Employees experience an 83% success rate in obtaining answers.
Our Technical Operations team uses ServiceNow Predictive Intelligence to find similarities across open incidents or cases. The system proactively creates incidents 41% of the time by analyzing the data that’s been collected. As a result, we’ve reduced issues reported by employees by 10%.
Deliver omni-channel services
Companies were shifting to mobile platforms before the pandemic, because employees and customers were increasingly demanding work experiences that match the ease and simplicity of their favorite consumer apps. In the COVID-19 era, companies especially need mobile service delivery because fewer employees are in physical workplaces. A distributed workforce can still be a productive workforce though, if they have consumer-grade tools to help them get their work done anywhere, anytime.
[Read the Workflow Guide: Return to the workplace]
Mobile in particular offers critical functionality as economies reopen and employers consider a return to physical workplaces. Companies will need to put processes in place that ensure workplace readiness and employee health and safety. Digital workflows can simplify and automate these tasks – which include everything from enforcing physical distancing to contact tracing, office cleaning, and assigning resources like desks, conference rooms, and PPE. Mobile apps like ServiceNow’s Safe Workplace Suite, which nearly 400 of our customers have implemented worldwide, can be a physically distanced way to gauge employees’ readiness to return to the workplace and address any safety concerns.
Articulate your path to business value
I tease Chris that he channels his “inner CFO” when he talks about the difference between “interesting” and “compelling” business conversations. CFOs don’t really want to hear about how upgrading some legacy IT tool will make your team marginally more efficient. We care much more about tangible business outcomes, strong ROI, and fast time to value.
How are you improving productivity? Will there be return we can reallocate? Can we count on these benefits long-term (at least five years ahead)? At ServiceNow we’ve achieved $40 million in IT productivity gains through automation. We’ve shifted 13% of our Opex from keep-the-lights-on to growth initiatives. And we’ve seen a 7% improvement in IT cost as a percentage of revenue.
That’s a compelling conversation right there. So next time you’re in a budget meeting with your CFO, figure out how to focus the dialogue on success outcomes. At the end of the day, that’s how your digital transformation project will get funded. More importantly, it’s how you’ll create value for the business.