SAP Watch

Jun 13 2008   9:38AM GMT

Léo Apotheker: A dissenting view

JackDanahy Jack Danahy Profile: JackDanahy

By now, SAP’s co-CEO — and soon-to-be sole CEO — Léo Apotheker has been welcomed into his new role by a host of journalists, analysts, and even the French government, which made the former SAP sales head a Knight of the Legion of Honor (whose value is surely diluted by the fact that it has also been awarded to Celine Dion). The conventional wisdom holds that, because SAP has been led by a succession of German engineers who gave the company a decidedly technical face, the time was right for a change of blood. Indeed, that was the thinking that saw Shai Agassi, who was about as foreign to SAP culture and history as anyone could be, almost become CEO.

Sure, Agassi was technologically educated and inclined, but he was also a sales person at heart. Sales, however, isn’t necessarily the best domain from which to choose a software company CEO. Sales people tend to stretch reality in order to close deals, which may be a desirable trait in the CEO of a young company looking to get on a map, but not necessarily a desirable trait for building long-term shareholder value in a mature company.

Waste Management, the company that is suing SAP for $100 million, noted in its complaint that Shai Agassi was present at a meetings on June 17, 2005 at SAP global headquarters, and at least one blogger has already wondered whether Agassi was behind what Waste Management alleges were inflated promises about SAP’s functionality. This year, at Sapphire, Apotheker presided over a carnivalesque atmosphere on the main stage, including a Harley and a Coke truck, that I thought recklessly associated the reliable SAP brand with dot-com era hi-jinks. You had to go to a special session afterwards (attended by about thirty people) to get the serious version of the Apotheker talk about SAP’s ecosystem innovation.

SAP is accused of being boring and predictable, but it’s the horse at the head of the enterprise software market. Changing jockeys in this situation doesn’t make sense, just as the decision to elevate Agassi to co-CEO didn’t make sense. That kind of corporate thinking betrays a slippery understanding of risk management principles. Today, as SAP faces various lawsuits and a deepening perception of being difficult and costly to implement, the voice of sales is just what the market doesn’t want to hear. Rather, it’s the voice of engineering — speaking the language of design, project management, strategic discipline, and process change — that can, and should, guide potential SAP customers through the minefield of problems that stand between a purchase decision and a successful implementation.

I don’t think that Apotheker is that voice.


Demir Barlas, Site Editor

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