OTTAWA — U.S.-based workflow-management company ServiceNow plans to spend $110 million over three years to help Canada’s public service scale up AI adoption through domestically-hosted infrastructure and a host of new staff.

ServiceNow is headquartered in Santa Clara, Calif., but counts among eight companies with agreements to provide Canada’s federal government with cloud services as part of its platform, which connects AI tools to existing systems, cloud applications and data sources to automate tasks.

Ottawa has been looking for ways to embed AI in the public service to boost productivity and save tax dollars, and Prime Minister Mark Carney’s first budget in November promised an Office of Digital Transformation that will leverage private-sector expertise to hurry the process along. 

The budget also asks public servants to do more with less, noted ServiceNow’s Canadian general manager Chris Ellison, creating a greater opening for the company’s offerings. “I think that’s what the government is demanding, and that’s what this platform is going to be able to deliver,” he said in an interview with The Logic.

ServiceNow plans to add 100 jobs in Canada to provide customer support and engineering to continuously adapt the platform, Ellison said. In a press release on Monday, the company said part of the investment will go toward new data centre infrastructure that will be built in partnership with Google Cloud, though Ellison wouldn’t say how much it’s expected to cost.

Since April 2024, the federal government has signed 10 major contracts with ServiceNow, totalling more than $3 million, according to public disclosure records, as well as 11 contracts with third-party vendors related to ServiceNow products, totalling $6.7 million. 

The new investments aren’t a condition of any particular contract, Ellison said. But expanding the company’s footprint in Canada will prepare it to deliver the level of AI integration governments in Canada say they aspire to, he added. 

ServiceNow’s third-quarter revenues grew 22 per cent compared to last year, according to its financial results in October, as more enterprises, including governments, look to integrate AI into their operations. The firm’s third-quarter subscription revenues totalled US$3.3 billion. Roughly 20 per cent of the company’s work is with the public sector, but it’s a “massive focus” of its arm in Canada, Ellison said. 

In September, ServiceNow signed a deal with the U.S. public service for a licensing model that offers U.S. federal customers up to 70 per cent discounts on upgrades to its products. The U.S. General Services Administration projected the company’s platform could boost workflow efficiency by up to 30 per cent. 

There is not a similar deal in the works with Canada, Ellison said; rather, the company plans to pursue opportunities with the federal, provincial and municipal governments on a contract-by-contract basis. 

In ServiceNow’s release, AI Minister Evan Solomon said the firm’s commitment will help advance “secure AI adoption and digital sovereignty,” adding, “collaborations like this show how together, public sector and industry can drive trusted innovation that benefits Canadians.”

While the government has not yet defined its new tech sovereignty requirements, Ellison expects that ServiceNow’s new data centre investment—which the company promises will be Canadian-hosted with “advanced data residency,” security, privacy and operational controls—will set it up well to offer sovereign services to the government in the future.

Some 30 to 40 per cent of the AI innovations adopted by the ServiceNow platform are developed in the company’s research office in Montreal, he said. In 2020, the firm acquired Canadian research-focused company Element AI in anticipation of the market embracing the technology. “We can now close that loop with adoption, and these are the types of investments that I believe are going to allow all levels of public sector and government to do that,” Ellison said.