Freshworks CEO: Mid-size enterprises can’t compete with giants using AI until they fix their fragmented data

AI service management has arrived, and the enterprises keeping pace didn’t wait for perfect conditions — they consolidated their data first.

Of course, that urgency is creating an opening for companies already positioned as alternatives to legacy enterprise incumbents. Freshworks Inc. has spent more than 14 years building toward this moment, with a customer base that now includes organizations such as Seagate Technology Holdings PLC and New Balance Athletics Inc., according to Dennis Woodside (pictured), chief executive officer and president of Freshworks. Both are “agile enterprises” — mid-size organizations competing with enterprises many times their size, such as New Balance squaring off against Nike Inc., or Seagate against Samsung Electronics Co. Ltd. For companies like these, punching above their weight doesn’t start with AI; it starts with getting their data in order.

“Every customer that I talk to is looking to AI to help them transform their service operations,” Woodside said. “A lot of companies are challenged in that their data is fragmented, their tech stack is fragmented, so the first thing they have to do is they have to consolidate — especially on the IT side — into a system of record that is robust, is broad, is enterprise-grade. That’s what we offer.”

Woodside spoke with theCUBE’s Bob Laliberte at the Freshworks Refresh event, during an exclusive broadcast on theCUBE, SiliconANGLE Media’s livestreaming studio. They discussed Freshworks’ growing enterprise momentum, AI service management and the company’s strategic pillars. (* Disclosure below.)

AI service management gains traction as platform consolidation accelerates

Freshworks announced a set of new capabilities at their annual Refresh event — the centerpiece being Freddy AI Agent Studio, a no-code environment that allows customers to build custom agentic AI applications or deploy more than 20 prebuilt workflows inside the company’s propriety ITSM platform Freshservice, according to Woodside. The company also launched MCP Gateway, letting customers who want to work inside tools like Claude or ChatGPT access and act within Freshservice without leaving them. Furthermore, the company fully integrated IT asset and operations management into Freshservice, consolidating hardware, software and incident response into a single environment.

The announcements also include a new experience level agreement analytics layer — XLA — that moves beyond traditional response-time metrics to measure whether AI interactions actually made employees more productive. That shift in measurement reflects something bigger about where AI service management is heading, Woodside explained.

“When every response can be instantaneous because it’s AI-driven, what you really want to measure is, ‘Did the response make the employee more productive?'” Woodside said. “You can do that by asking the employee, but you can also do that by watching what they do next and understanding that — that’s an agentic way of creating what we call an XLA score.”

The thread connecting each announcement is the same: The promise of AI in service management isn’t just about deflecting tickets — it’s about what skilled IT staff can do when they’re no longer buried in them, according to Woodside. The overarching idea is that AI doesn’t eliminate meaningful work. Instead, it actually creates more room for it.

“I’ve never met an IT team that doesn’t have a list of projects that’s much larger than their actual capacity. The people who are answering questions today from employees — they are very skilled. They understand your systems, they understand your culture, they understand your business. Typically, what I’ve seen our customers do when they have an agent where they’re freeing up that time, they can find much more important work for them to do, much more creative work.”

Customer wins are validating the approach. For example, Seagate migrated off a competitor platform onto Freshservice in three months — rare speed for an enterprise software transition — and Freshservice revenue grew 27% in the most recent quarter, Woodside noted. Looking ahead two years, Woodside sees IT teams inheriting governance responsibility for thousands of AI agents from multiple vendors, a challenge that plays directly to Freshworks’ consolidation-first pitch.

“We are offering our customers — that agile enterprise — a choice that they might not have had 18 months ago, 24 months ago,” Woodside said. “We’ve got customers that are large organizations that have made the choice to bet their business with us, that are transforming their service operations with us, and we’re ready for you — so come on in.”

Here’s the complete video interview, part of SiliconANGLE’s and theCUBE’s coverage of the Freshworks Refresh event:

(* Disclosure: TheCUBE is a paid media partner for the Freshworks Refresh event. Neither Freshworks, the sponsor of theCUBE’s event coverage, nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE