Two acquisitions by a dominant IT operations vendor this quarter portend a fresh level of enterprise agentic AI maturity, industry experts said this week.
ServiceNow first launched an AI application for its IT service management (ITSM) product in 2018 and has had enterprise customers experimenting with AI for IT operations (AIOps) since then. As generative and then agentic AI burst onto the scene over the last three years, ServiceNow was already ranked No. 1 by Gartner in market share for software that automates and tracks business and technology workflows, including AIOps platforms, as well as IT operations software, ITSM, IT asset management and software asset management.
On Jan. 17, ServiceNow bought Cuein, makers of AI conversation data analysis software, for an undisclosed amount. On Monday, ServiceNow publicized its $2.85 billion deal for agentic AI software vendor Moveworks, the largest acquisition in ServiceNow's history.
With these moves and the Jan. 29 release of its AI Agent Orchestrator, ServiceNow has a chance to set the tone for the next major evolution of AI for the IT operations market, according to Andy Thurai, an analyst at Constellation Research.
While ServiceNow's agentic AI and automation strengths in their platform have been around for a while, they needed a [way] to build front-end AI assistants quickly and easily.
Andy ThuraiAnalyst, Constellation Research
"ServiceNow has already become the de facto enterprise standard in many services and support workflow management," Thurai said. "While ServiceNow's agentic AI and automation strengths in their platform have been around for a while, they needed a [way] to build front-end AI assistants quickly and easily, and [Moveworks] helps them in that angle."
Moveworks also brings AI-based enterprise search to agentic AI workflows, Thurai added, along with some 500 employees with expertise in AI. Moveworks, founded in 2016, already claims customers such as Hearst, Instacart, Palo Alto Networks, Siemens, Toyota and Unilever, and its latest agentic platform grew to nearly 5 million employee users in about 18 months, according to ServiceNow.
Agentic AI adoption embryonic so far
Agentic AI, in which sets of autonomous software components backed by large language models (LLMs) automatically orchestrate workflows, is expected to make generative AI operationally viable for businesses that have struggled to find a return on investment for their own AI models in production.
"It's really fascinating technology," said Stephen Elliot, an analyst at IDC. "The ability to have expert LLMs in the back end to answer so many different types of questions for different tech and line-of-business stakeholders [represents] massive productivity opportunities, from compressing access to data and answers, and an ability to drive actions."
That said, agentic AI adoption has yet to reach the enterprise mainstream. A 2024 survey by Capgemini found that while 82% of 1,100 executives surveyed at large enterprises expect to deploy AI agents in the next one to three years, just 10% had deployed them so far. As with all AI applications, the data that feeds LLMs must be carefully managed to produce quality results and prevent AI from making inaccurate or even unsafe responses.
ServiceNow has poured ample R&D into AIOps products, but Gartner's Oct. 9 Magic Quadrant report for AIOps found that its offerings were pricey for most companies, and at times required complex configurations.
Still, "particularly in regulated industries, where information needs to follow heavy workflow [governance] components, ServiceNow is a leader," Thurai said.
That said, ServiceNow and other major IT vendors face mounting pressure to yield a return on their own hefty AI investments over the last three years, Elliot said.
"ServiceNow can't close this deal fast enough," he said. "C-Suite executives we are advising are looking to find positive AI returns from their strategy and early uses cases they built in the past 36 months."
Agentic AI represents key advancements over generative AI for mainstream enterprises.
The next agentic AI frontier
Other vendors in the ITSM space, such as Atlassian as well as all the major cloud providers, have begun to roll out agentic AI support in the last year, too. The next step is to go from AI agents that enterprises configure themselves to AI agents that work "out of the box," according to Will McKeon-White, an analyst at Forrester Research.
"ServiceNow has been building a lot in providing customers the tools to build and self-configure agents, [but] the acquisition of Moveworks represents a huge investment in out-of-the-box agentic AI," he said. "The end result that everyone seems to be targeting is a self-starting agentic system, capable of assembling huge numbers of platform components to increase customer automation and improve platform success. We're a little ways off of this, but it's less a matter of 'if' and more of a 'when.'"
Once agentic AI support becomes table stakes in the ITSM market, "Then the fun competition becomes the data layer -- in effect, 'Does the agentic system have the right information to make the right decisions?'" McKeon-White said.
"And the really fun part of this is, for the most part, official processes and official knowledge don't lead to making the right decisions in most organizations," he said. "So it comes down to 'how much signal do you have access to?'"
Thanks to its existing market share position and IP from Cuein, ServiceNow "[has] access to a lotof signal, and can make sense of it," McKeon-White said.
Beth Pariseau, senior news writer for Informa TechTarget, is an award-winning veteran of IT journalism covering DevOps. Have a tip? Email her or reach out @PariseauTT.
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