2019-05-05T09:56:00Z

What is the cost of implementation and maintenance of ServiceNow?


We are thinking of purchasing ServiceNow for our business. Beyond the license and service cost of ServiceNow, what is the added cost in professional services, ongoing development, and customizations, etc.? 

What is the added cost per dollar ACV? For example, is it 10% on top? 30%? 

What % of that added cost is tied to upgrades?

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33 Answers

author avatar
Top 5LeaderboardReal User

Giving PS % against license subscription costs is not possible without knowing the subscription costs in your location and for your scale of implementation. However, I have included the rough estimate of days which will help you to work out those percentages.

My experience is that unless the client's ITSM processes are very mature or exist to address a very specific need, then they are best advised to implement ServiceNow ITSM initially close to "Out of the Box", however, some configuration is nearly always required.

Remember the client starts paying for the license subscription straight away, so get the solution implemented as early as possible and start to gain the benefits, customization and integrations initially should be kept to a minimum, with the aim to get the solution up and running quickly in a form that works for the client.

Often the client is not able to fully identify the requirements until seeing the "Out of the Box" solution, so by using an Agile implementation method the client gains the opportunity to refine requirements after trying the "Out of the Box" solution first. Allow enough budget to make changes/refinements during the project.

After the initial implementation and when the client has got used to using the new solution in production, they often want to implement some changes perhaps in the first year of operation or early in the second, so allow some budget for this.

Implementation - Professional Services:
Requirements gathering - Even in an Agile and out of the box implementation, some requirement gather is required.
Build - Configuration, Customization, Integration
Delivery into Production - This may be a number of iterations, perhaps as an example starting with Incident, Problem, Basic CMDB and Change in the first iteration, followed by perhaps Knowledge, Reporting, SLA's, Request, Portal in multiple iterations afterward. This mix can be decided at the start of your project.

Enhancements - Professional Services:
Enhancement gathering
Build
Delivery into production - This maybe as a single or multiple iterations.

The yearly costs of one professional service are difficult to estimate exactly because of the variation of scale and complexity, but my experience is that an initial ITSM implementation project should be budgeted at between 70-120 days, though I have seen complex implementations with data migration of 300+ days.
Year two professional service for enhancements are again varied but 40-80 days would be a "ballpark" estimate, in my experience.

ServiceNow upgrades:
These are delivered by ServiceNow at no cost, but remember to budget for testing and any remediation required.
Typically, the license subscription provides at least a test and production environments (Instances in ServiceNow language), so platform upgrades can be tested before they go live.
ServiceNow provides a simple mechanism to clone the Production to the test instance, the test Instance can then be upgraded and used to allow testing to gain confidence that the upgrade of the production instance will be trouble-free or at least any remediation required can be carried out prior to a production upgrade. ServiceNow provides an automated testing solution which may well reduce the ongoing costs, but require an investment initially to set up and may not be included in your specific license subscription.

Words of warning: I have often seen a client define a very complex and customized set of requirements, then after a year or two they have requested that we simplify the solution by removing complexity and return to "Out of the Box" functionality. Beware that when gathering requirements you do not try to either replicate an existing complex solution or try to achieve too much in the first release.

By using an Agile approach time scales can be reduced, small solutions with limited functionality can be implemented in as little as 5-6 weeks, but a normal timeline is 10-13 weeks.

My opinions are my own and based on personal experience, others may have different views to mine, but I hope that my views will be respected by other posters and the site's guidelines followed.

2019-07-19T21:20:26Z
author avatar
Top 20Consultant

Since ServiceNow totally varies their rates depending on customer,
geography, number of users etc, it's very hard to suggest what would be
price of professional services, ongoing development, and customizations,
etc.

If this is just for estimation purpose for a proposed project, then it
would be reasonable to keep about 15-20% costs for this in overall budget.

Customizations in case of ServiceNow are divided into two categories - the
ones which don't affect what ServiceNow refers to as "CORE TABLES" in the
database and the ones which do affect. ServiceNow charges extra for doing
anything to CORE TABLES - that means apart from paying to a consultant who
is modifying or customizing the application, for such changes you end up
paying to ServiceNow also. Also there are plenty of guidelines for this from ServiceNow
as too much change in CORE TABLES can cause UPGRADE ISSUES later.

2019-05-17T09:09:33Z
author avatar
Consultant

Upgrade is seamless and with very less problem if I compare with Other Product like Remedy etc. Like every upgrade few basic things to follow. How Old your version is , How much customization is done in ServiceNow. More the customization more the cost both development and testing cost. I do not think upgrade needs any extra cost apart from a team who will test the ServiceNow after upgrade and fix issues.

Deployment is very fast in ServiceNow if I compare with some other product and my past experience of Implementation of on premise ITSM Tools setup. All depends on degree of Customization you do. I will suggest to keep product as close to OOTB and do light more/less complex customization.

Integration of ServiceNow with other stuffs like AD, ADFS, HCM Tools, Monitoring Tools and Discovery Tools are very easy. If I take less customized ITSM Modules then below should be the timelines.

IM+SLM- 3 Weeks (1 Resource)
CM - 3-4 workfloes - 4 week (1 Resource)
PM- 2 weeks etc
CMDB- 2 weeks to start and the on Going

Hope this helps. Supporting ServiceNow is easy as we only support application if I compare with On Premise Setup of ITSM. All Infra stuffs are managed by ServiceNow.

So Way to Go. Please connect with me if needed - +91-9818453673

2019-05-17T08:30:06Z
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