ServiceNow - Moveworks Acquisition: The good, and the bad

If you are in IT, I'm sure by now you’d have seen many headlines around the ServiceNow-Moveworks acquisition.  

I was super thrilled when I heard it. Because this significant move validates what AI-native companies like Atomicwork have believed all along; that an integrated service management platform built from core with AI can deliver game-changing value, enough to make the giants turn and take notice. The acquisition has put AI-native upstarts for enterprise IT on the map.

It reinforces that AI-driven automation in IT and enterprise service management is no longer optional but essential and it should be at the core of service management, not bolt-on or patched-on.

Firstly, I’d like to congratulate Moveworks for their incredible journey thus far. I’ve been closely following what Conversational AI companies like Moveworks were building for enterprise IT and their work to raise awareness in the CIO community to focus on employee experiences has been nothing short of remarkable. Moveworks has understood the real challenges of end users in modern workplaces and solved for them with AI adoption.

In fact, Moveworks' early adoption by enterprises shows a clear indication that when you build a product that fits seamlessly into employees’ flow of work, the market takes notice.

But their success wasn’t built solely on technology. Moveworks thrived because of their agility and relentless focus on end-user experiences across applications.

However, with this acquisition, let me break down what the hidden repercussions could mean for both ServiceNow and Moveworks users, with the former being notoriously known for their platform complexities, chaotic configurations, and continuously escalating costs.

The risks and hidden traps for existing customers and the IT community at large

I’m sure Moveworks’ customers are already reading the fine print. The big question on everyone’s mind: “What does this mean for us?”  

Interacting with industry leaders and based on conversations in forums, here are my observations on how the situation could pan out.

1. Forced to adopt a complex platform

Moveworks historically integrated with a range of systems – ServiceNow, yes, but also others like Jira Service Management, BMC and more. Many Moveworks customers chose it because it could sit on top of whatever tools they had. Now, with ServiceNow as the new owner, there’s a growing and valid fear of Moveworks becoming an exclusive ServiceNow feature to expand Servicenow’s platform adoption.

Of course, most Moveworks customers are already ServiceNow customers today. But “most” is not “all.” If you’re in the segment that isn’t on ServiceNow, you might face a tough choice down the line: either migrate to ServiceNow’s ITSM to get the full benefit of Moveworks (or to use it at all), or look for alternatives.

2. The integration jitters with overlapping feature capabilities

While ServiceNow claims that they will integrate Moveworks to create a unified, self-service experience, implementing it in real-world with different feature sets without impacting users is a huge challenge.

For example, Moveworks has its own enterprise search and knowledge retrieval systems. ServiceNow has its own knowledge management. Will one replace the other, or will they run in parallel? If consolidated, there’s potential for temporary gaps or even loss of capabilities if overlapping features exist.

3. Innovation velocity at risk

As I mentioned earlier, Moveworks, as a startup, could stay agile and push product updates frequently across its customer base. As part of ServiceNow, releases might be tied to ServiceNow’s slower, enterprise release cadence. If so, the agility that customers loved in Moveworks might be at risk.  

4. The dreaded ‘ServiceNow Tax’

Let’s talk dollar$ for a moment. Moveworks is not cheap; it’s a premium solution that delivered unique value. Now under ServiceNow, there’s substantial speculation that Moveworks could become an expensive add-on to the ServiceNow ITSM/ESM licenses. That could mean bundled pricing. And rarely do bundles save money for customers. The reddit comments from end users of ServiceNow spills it all :)

Often, they increase your overall spend because you’re forced to buy a bigger package. Some in the IT industry cynically refer to this as the “ServiceNow tax”– the idea that anything running on ServiceNow’s platform comes with a hefty price tag for the privilege and lack of optionality.

Ultimately, all this means lower flexibility, reduced choices, and unwarranted vendor lock-ins for IT teams using Moveworks or even ServiceNow for that matter.

And having built and led successful exits before, all I can say is: the market learns faster than the buyer!  

Why agentic IT matters now more than ever  

Moveworks was born in the cloud era to bring the early AI for IT. ServiceNow is an established, legacy platform that has been adding endless features on top of an older CSDM foundation.  

Unlike legacy platforms that don’t build specifically for modern workplaces, an AI-native platform, like Atomicwork, puts the users - both IT teams and end-users - at the heart of its operations.

That’s why a large incumbent acquiring an AI assistant company highlights a growing demand for modern, AI-first ITSM solutions.

What IT teams and CIOs are looking for is not agentic AI, but a purpose-built solution which we call as Agentic IT.  

At Atomicwork we’re creating a full stack, agentic service management platform that is:

• AI-driven: We’re bullish on tapping into AI agents to reason, plan, act and make decisive actions on behalf of end-users for their mundane processes to boost workplace productivity.
• People-centric: AI agents should be available on employees’ preferred choice of support, be it Slack or Teams or email or the browser wherever users spend most of their time working, in the flow of their work.
• Context-rich: With an integrated platform, end-user data is no longer stuck to just individual applications but can be leveraged powerfully with AI for better context to foster meaningful interactions and minimize friction.
• Built for operational excellence: Being employee-friendly, Atomicwork is easy to adopt and can be used efficiently to scale enterprise IT operations across the organization.

I believe this acquisition has sparked a positive change in how IT leaders think about their tech strategy as a whole.  

I urge CIOs and tech leaders to start asking the tough questions at every expansion and renewal timeline of legacy solutions: Are we sacrificing simplicity and costs by playing it safe with an incumbent, legacy market leader? Is slapping yet another AI tool on top of a loaded legacy tech stack moving the needle to achieve real business outcomes?  

At Atomicwork, we're excited to accelerate the way modern enterprises should operate with agentic ITSM; making complexity automated, processes invisible and productivity visible!

If you’d like to understand more about our product philosophy, drop us a note here and we’ll be happy to chat. We don’t have all the bells and whistles yet of traditional vendors but we're working hard to earn the trust of modern IT teams and deliver real value with a great employee experience in the flow of their work.