Making the leap from reactive to proactive procurement

At ServiceNow, our procurement and strategic sourcing processes couldn’t keep up with our exponential growth. In four years, we went from 12,000 to over 27,000 employees. In those four years, the procurement team’s managed spend went from $1.6B to $3.6B and the number of purchase orders placed increased 20%.

Like many companies, our procurement and sourcing processes could be complicated and cumbersome. Teams relied on multiple systems for even simple requests, slowing us down and limiting visibility. To support our growth, we needed to transform procurement from a reactive, fragmented function into one that is agile, data-driven, and strategic.

We began at the intersection of people, processes, and technology

We planned to focus on increasing bottom-line value through savings and risk management. First, we built strategic sourcing from the ground up and assessed our operational processes. We also built a high-performing team to manage spend and strategic influence.

Next, we analyzed our procurement operations and processes. We secured leadership buy-in through early wins and guided behavioral changes within the support team. With all the foundational elements in place, it was time to reimagine the full procurement process using our own ServiceNow AI Platform.

Connecting the dots with solutions built on our own platform

We digitized our entire Source-to-Pay (S2P) lifecycle onto our platform using AI and automation to embed processes and connect systems we already had in place. Since Source-to-Pay is part of our larger Global Business Services organization, we centralized business functions and tied our core systems to our teams for connectedness and visibility across the entire enterprise.

The ServiceNow AI Platform integrates, simplifies, and streamlines our S2P operations by combining tools like Spend and Savings Management, Third-Party Risk Management, Contract Management Pro, Supplier Lifecycle Operations, Sourcing and Procurement Operations, and Accounts Payable Operations.

Combining all these solutions created a procurement “front door” for our users, making it easier and faster for employees to submit procurement requests and saving us both time and money.

Over four years, our sourcing hard savings grew 18x, our PO cycle times dropped from 16 days to under 3, and we achieved all this while keeping the sourcing team size flat.

Using the ServiceNow AI Platform, we were able to exceed our savings goals—and deliver on longer-term initiatives. We prioritized speed and efficiency to meet our high-growth demands, delivered a single intake point for our end users and their procurement requests, and provided access to powerful insights to the Sourcing and Procurement team to drive more data-based decisions.