Chris Bedi, President and Chief Financial Officer of ServiceNow, warned that the rush to spend on artificial intelligence could trap companies in costly dead-ends unless they answer three fundamental questions. He drew on the software giant's recent $7.75 billion purchase of security firm Armis as a case study of disciplined capital allocation.
What happened?
ServiceNow completed a landmark acquisition of Armis, a move Bedi described as a bet on closing the gap between asset visibility and cyber risk. The deal, one of the largest in the company's history, reflects a broader trend: trillions of dollars are being poured into AI initiatives worldwide, reshaping competitive dynamics across sectors.
Why does it matter?
According to Bedi, the core challenge for any enterprise is finite capital. Even with abundant fundraising options, money directed to one project inevitably means less for another. In a market where AI can generate functional code in minutes, the speed of replication raises the bar for what truly warrants funding.
Bedi outlined three questions that should guide every major AI investment:
1. Does it deepen the competitive moat?
He stresses testing each proposal against the ability to strengthen what is hardest to copy about the business. Bedi cited JPMorgan Chase as an example, noting its in-house LLM Suite that leverages proprietary data and systems, creating a unique AI resource. ServiceNow, he added, relies on more than two decades of workflow automation experience, a massive install base and domain-specific data to build its moat.
2. Does it address a real customer need?
Bedi highlighted the importance of listening to customers, not just internal advocates. He recounted how feedback about fragmented AI projects across enterprises led ServiceNow to develop an "AI Control Tower", a central hub for managing AI initiatives and governance.
3. Are customers adopting the solution and seeing measurable value?
He warned that investment decisions do not end at launch. Adoption metrics and tangible business outcomes must be tracked. ServiceNow's own Enterprise AI Maturity Index shows that while 59 % of organisations use agentic AI, only 9 % have built autonomous, multistep AI workflows, indicating a gap between spending and realised benefit.
What happens next?
Bedi urged firms to stay agile but avoid reactive spending. He advised that when an AI project fails to deliver, companies should be ready to close the spigot and reallocate resources to higher-impact initiatives. By aligning investments with clear competitive advantage, genuine customer demand and demonstrable adoption, businesses can turn AI from noise into a strategic asset.
As AI continues to reshape markets, Bedi's framework offers a pragmatic roadmap for executives seeking to balance bold bets with fiscal discipline.