Software firm ServiceNow has seen remarkable growth in the past year or so, posting its second $2b quarter ever this last quarter, and cracking the Fortune 500 list for the first time ever. And it’s done all that despite the volatile economy, and without conducting layoffs. Its CFO, Gina Mastantuono, spoke with us about how balancing innovation with discipline has helped the company achieve those milestones.
This interview has been lightly edited for length and clarity.
What role should a CFO play in a company’s growth?
The ability to see across the enterprise is a unique vantage point that CFOs have…We need to understand the growth accelerators. We need to understand the drivers and the levers across the business, not just the numbers. And part of that is making the right investments.
We’ve continuously been able to grow our core technology business while also investing heavily outside our core into adjacent areas like customer service, employee [and] creator [workflows]...In order to do that well, you have to invest ahead of the curve sometimes. And you have to make some smart bets…CFOs today are in a really unique position to help companies think much more strategically about innovation, disruption, and really help drive not only financial discipline on the bottom line, but strong growth on the top line.
How does generative AI fit into ServiceNow’s strategy?
We’ve been investing in AI for years. One of the first acquisitions that I greenlit as CFO was for an AI acquisition of talent back in 2020.
We just announced our Vancouver [software update] release…which has a lot of our new gen AI functionality built in. And one of the things that we’re really excited about is Accounts Payable Operations…APO automates the entire accounts payable process. And it’s obviously very early days, but we had some customers beta testing it and they report reducing their average manual processing cost by up to 80%, which is pretty remarkable.
Are there ways you personally use AI on the job?
I use it internally for forecasting, taking tons of data on how our business has performed over different periods of time during different cycles in the market, and really using AI to help think about what that means for the next month or the next quarter. We’re still doing bottoms-up forecasting while we’re testing those ML models, so we’re not using it in its entirety. But more often than not, you’d be surprised at how ML and AI models are actually more accurate than a bottoms-up approach.
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As a CFO, how involved are you with your company’s talent strategy?
Talent is our biggest asset outside of our IP. I spend as much time with my chief people officer as I do with my direct finance leadership team, because understanding the talent strategy, making sure that it aligns with the growth numbers that we’re projecting and the growth levers is extremely important. While I don’t own talent strategy—nor should I—I need to be in the conversations; I need to be helping to drive the direction and where that’s going.
Tech layoffs made headlines earlier this year. How were you able to avoid them?
It’s amazing that we can say we’re one of the only tech companies who haven’t done layoffs. Layoffs are really expensive. They are hard on culture. And people always remember how you treated them. And so we made a promise early on that we fight hard for our people and that they could depend on us.
We’ve always been really disciplined from a growth and profitability standpoint…We pulled back on hiring pretty early last year, when we started seeing things in the market that I was concerned with.
Now, it’s that we’re not hiring. We still hired 10,000 people over the last two and a half, almost three years. When I started, we were just at 10,000. We’ve crossed 22,000. It’s about being smart and disciplined about where we’re putting those hires. It’s about prioritization. In 2022, we filled 1,500 open positions, through talent mobility—with existing employees moving into different roles.