As I’ve mentioned many times, the HR technology market is too big and too exciting to ignore. Today, in a bold move, ServiceNow has introduced a comprehensive new product for employee skills intelligence, learning, career management, and talent mobility.
Built on the acquisition of Hitch (in June 2022), a world-class platform for all aspects of employee development, mobility and careers. It competes directly with similar solutions on the market from Workday, Oracle, SuccessFactors, Cornerstone, Gloat, Fuel50, Eightfold, and many more.
When I was first shown this show, I had such a reaction.
My first question was: Are you sure you want to jump into this complex red ocean of offers?
And the answer was a resounding yes: Gretchen Alarcon, Senior Vice President and General Manager, I’m absolutely convinced that ServiceNow can do a better job in this area, largely due to ServiceNow’s deep integration with other HCM systems, the Hitch skills information engine, and the company’s already broad suite of employee support, excursions, surveys, and transitions services.
I spent many hours with Kelley Steven-Waiss, founder of Hitch, and was convinced she had the knowledge, passion, and energy to pull this together. Combined with ServiceNow’s formidable sales, marketing and engineering team, they have the opportunity to offer a career and development solution for next-generation employees. Kelly stays on ServiceNow with the new title Vice President and Chief Transformation Officer (Kelly is the former Chief Human Resources Officer).
Remember, ServiceNow’s strategy is to help manage the overall employee experience, including service delivery, IT services, hybrid work services (office scheduling and resources), onboarding, and employee transitions. This new platform, Staff growth and developmentexpands ServiceNow to include employee growth, career management, internal mobility – all part of the employee experience.
My second reaction was that ServiceNow is a “quick follower”. While the company has a lot of investment so far, this product has an integrated vision that is still missing from the range of related products in the market.
What does the ServiceNow offer include?
The new product titled ServiceNow employee growth and development (EGD), and includes many of the features that companies want to develop and grow.
If you’ve studied employee development and growth systems for as long as you have, you know that there’s a lot of history to these products, and each has a slightly different job focus. This market totals $340 billion and includes learning management systems, content and talent market products, and skill intelligence systems.
Early Learning Management Systems (SABA, Plateau, Cornerstone) have career path platforms designed to help structured and operational employees plan their careers, develop and assess their skills. Then came the LXP platforms (Degreed, EdCast, Viva Learning) and these systems enabled employees to search and find courses. It also allows managers and learning and development leaders to set up tracks, curricula, learning groups, and even publish documentation and videos for the learning system. (ServiceNow plans to connect to, not replace, LMS systems at this time.)
In the past five years, a new set of tools has emerged: the talent marketplace. These systems took some of the features from before and leaned toward a new use case: helping employees find jobs, projects, mentors, and assignments for growth. Talent Marketplace vendors (Gloat, Fuel50, Eightfold, Workday, and later SAP) exploited a new business dynamic: the need for companies to move and enable people to easily “redeploy themselves” from a low-growth job to a high-growth job. These new systems are appearing in RFPs all over the world.
Learning-focused platforms (LMS, LXP) already constitute a $4 billion market, and this space is filled with platforms that cater to a multitude of learning needs. The talent market segment, which is similar in size to $300-400 million, is growing at 5 times the rate and has the potential to overwhelm and absorb learning systems to some extent. Even LinkedIn now offers a talent marketplace (available on LinkedIn Learning) and major vendors like SAP are putting hundreds of millions of investments into these systems.
Under the hood of all these things is a rapidly growing role for artificial intelligence. Early learning platforms have rudimentary AI tools to recommend content or courses based on keywords and employee interests. The most advanced systems (Eightfold, Gloat, Hitch) use big data AI engines to identify employees’ skills and intelligently match them to new jobs, roles, and functions. As AI evolves, these systems will find and recommend high-potential career paths, new opportunities that enhance nearby skills, and tell companies more strategic information about the skills they have, need, or lose over time.
Just last week, Eightfold launched its workforce talent mapping suite that leverages its massive AI database to help companies easily identify common and in-demand skills, develop job and role-level predictions and plans for transformation and growth. Companies like Gloat and Lightcast are working on similar offerings. (I suggest you listen to my new podcast that delves into AI and explains the three generations of AI-based HR technology solutions.)
So, ServiceNow is entering a very deep, complex and strategic space.
How will they do?
Based on my experience with the company and the team, I expected success. This space is complex and most companies have many single point solutions, no fully integrated solutions. Workday, Oracle, and SAP have the visions of making this all work together, but they’re missing dozens of features and the market is moving too fast for them to keep up.
When I looked at the product and spoke with the team, I walked away with many notes.
First, the design and user experience of ServiceNow EGD is advanced and world class. The system seems intuitive and brings together this complex problem in a compelling way. Given ServiceNow’s experience as a “platform for platforms”, it would be easy for the company to connect with existing systems (content providers, compliance and function systems, learning management systems, etc).
They have advanced features already. ServiceNow includes a Manager Hub and a Career Hub designed to facilitate individual development and manager-led growth. These are the critical features that drive adoption and enterprise value. Features such as onboarding, employee transition management, and part-time ad hoc trips are also available, along with a well-designed mobile app.
It also enables employees to write and discuss aspirations, using artificial intelligence to match their aspirational goals with roles, jobs, and content. This idea has also been followed by Gloat, Fuel50, and Cornerstone with some limited success. Over time, this feature has a lot of potential, as artificial intelligence (AI) and neuro-linguistic programming (NLP) can mine this information to better place people in higher, higher-value jobs.
And, like LXP, ServiceNow EGD will allow employees to browse and search for content.
Is this a new scoring system? Yes.
After that there will be a discussion about who owns the “scoring system”. Most companies hate the fact that employee data is all over the place (it’s just a fact of life, people, but they hate it anyway) so one might ask “Why would I take all my important data in Workday or Cornerstone and repeat it to ServiceNow?” ServiceNow will have to learn to win.
In the end, of course, there has never been a single “scoring system” for employees, so the question really is “Should we trust our career data and learn and grow in ServiceNow?” Will they take care of it and develop it over time? Companies will do this if the functionality is advanced and the connection is strong.
Remember, this is the core message of ServiceNow. The company positions ServiceNow as a “platform platform” that integrates all of a company’s disparate systems into a single point of support and expertise. This situation helps ServiceNow convince companies that employee development data is “experience data”, and while it can also be stored in HCM, ServiceNow may be able to manage the development experience in a more complete and open way.
Incidentally, there is an argument to be made that skill data may also end up being “federated” across systems. The skills engine that recruiters use, for example, is specifically designed for sourcing, selection, name masking, and other features to remove bias (deleting college degrees, for example). The skills engine used for career learning and matching may work differently, so one could argue that companies that use Eightfold or Seekout to recruit can still justify using ServiceNow to develop and grow.
For ERP (Workday, Oracle, SAP) every buyer wants to burn and rationalize skill data into a platform. Newer vendors like Techwolf and Skyhive are trying to address this, but very few customers have accomplished this feat so far.
How smart is ServiceNow’s AI?
Third, customers will ask about artificial intelligence. How advanced is it? What industries are you trained in? How well can you infer skills, job titles, and occupations in a meaningful way?
We know, for example, that platforms like Eightfold, Gloat, Beamery, Phenom, and Seekout have collected billions of employee profiles to infer potential skills, jobs, and roles. Now that Hitch is part of ServiceNow, customers will want to evaluate AI depth, industry breadth, explainability, bias detection, and other features.
Will ServiceNow focus enough energy on AI to keep pace with this development? Time will tell. The real gains in this area lie not in the sophistication of the software, but rather in the depth, quality, and volume of its data. Eightfold has won major deals in telecommunications, financial services, energy, the US military, the public sector, and pharmaceuticals. This means that the skills engine has a deep understanding of the jobs, roles, skills and occupations in these industries. Newer vendors such as Gloat and Seekout are building a similar evolution into their focus industries.
Hitch was (is) an ingeniously designed system that was originally created to manage talent at HERE Technologies, a medium-sized mapping company with employees and contractors around the world. Now as part of ServiceNow, the team has to build integrations with a lot of content providers (this is new territory for the company) and develop its development skills and experience in a wide range of industries. Today, with more than 6,000 skills and 150 million profiles, the system is far behind the competition.
I am optimistic though. Why? This market is huge and many of the existing players are still immature. Cornerstone’s new skill texture is beginning to appear; Workday’s Skills Cloud lacks data and facilities in many areas; And vendors like Eightfold, Gloat, and Fuel 50 are simply smaller players in the market. With ServiceNow’s massive client base and potential users of this system, the company can become a leader if it focuses, wins some big deals, and stays invested.
We will keep a close eye on them, please contact us if you have any questions.
How is artificial intelligence disrupting the HR technology market?
The Talent Intelligence Primer (download)
Crazy defender to lead the talent market
SeekOut brings GPT4 to recruiters. Eightfold launches HR Assistants Program.
What is a neural network? (great overview video)
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