Cloud Sherpas To Invest $12 Million In ServiceNow Business

When Cloud Sherpas, an Atlanta-based born-in-the-cloud VAR, purchased tech consultant Navigis early last year, it added to its ranks a thriving, if not always well-understood, ServiceNow business.

The number of ServiceNow customers doubled in the first year after the acquisition, and is projected to do so again, while year-over-year revenues grew by more than 150 percent, said Jason Wojahn, president of CloudSherpas’ ServiceNow division.

But that growth is only one reason Cloud Sherpas just announced it will invest $12 million over the next two years in the division, Wojahn told CRN.

[Related: Cloud Sherpas Invests $10 Million In Global Cloud Advisory Practice ]

Wojahn, who was previously vice president of U.S. operations at Navigis, told CRN that the reason for the growth has much to do with a product expertise that allows Cloud Sherpas "to respond in a more agile fashion to the market opportunity of ServiceNow."

Most IT professionals, according to Wojahn, don't really understand the possibilities presented by ServiceNow -- they think of the company only as a vendor of IT management services. This lack of understanding stems from ServiceNow’s origins a decade ago, Wojahn explained.

"Back in 2004, if you wanted to sell someone a cloud platform, you had to put something on it. If you didn’t, you risked customers getting too much of a greenfield," Wojahn told CRN.

ServiceNow’s founder, Fred Luddy, was experienced in the service management and workflow space, and that's what he showcased on his platform. But many IT professionals mistake that as the only component of the product; ServiceNow always was intended to be a larger platform for development, Wojahn told CRN.

"In 2007, Navigis was the first ServiceNow implementation partner when it launched a channel. Cloud Sherpas has run with that early success -- it became the first ServiceNow Preferred partner and has now installed 450 implementations and worked on more than 1,000 total projects with the vendor. Earlier this year, Cloud Sherpas was named a Master Solutions Partner, the highest partner designation available."

The ServiceNow model applies itself well to IT service management applications, such as incident management, problem management, facilities management, change management and service requests. ServiceNow offers more than 20 applications under that umbrella.

In itself, it's a good business, Wojahn said.

"When companies are doing well, they tend to invest in things like IT in an effort to drive more automation. More things need to go to digital infrastructures for managing those workflows and activities,’ he told CRN.

Cloud Sherpas has mostly sold ServiceNow end users those kinds of cloud-based IT management services. But it also has implemented ServiceNow to provide wider business-process services, and that's an offering that will drive future growth, Wojahn said.

"ServiceNow is really pushing this notion of Enterprise Services Management," Wojahn said.

The IT Service Management ecosystem with which the company is mostly associated is a $3 billion industry; Enterprise Service Management is thought to be between a $6 billion to $10 billion market.

An advantage of partnering with ServiceNow is the company’s practice of listening to customers when they are asking for new features and functionality, Wojahn said.

"They aggressively use that information to make their platform better," he told CRN.

"They have a great product development team," but their customer base serves as an even larger aspect of that team. The constant development manifests itself in biannual upgrades of the product.

ServiceNow's focus on using its powerful platform for a wider range of service management applications developed in close consultation with users suggests a potential for future growth eclipsing even what CloudSherpas has seen over the last year. And that is ultimately the motivation for pumping $12 million into the business, Wojahn said.

ServiceNow's genius is it's "using IT to be the center of the universe for extending it for business applications and extending it into those other markets," he told CRN.

PUBLISHED MAY 5, 2014