SAP Watch

Feb 10 2010   4:40PM GMT

What if Shai Agassi never left SAP?

CourtneyBjorlin Courtney Bjorlin Profile: CourtneyBjorlin

Hasso Plattner made it quite clear during his press conference announcing the resignation of SAP’s CEO that he didn’t want to dwell on the past. But as reporters, dwelling on the past is one of the things we do best.

So around here we got to thinking — what if Shai Agassi had never left SAP? Before Leo Apotheker was named deputy CEO in 2007, Agassi was SAP’s golden boy and the heir apparent to Henning Kagermann. He left the company once it became clear that he wouldn’t succeed Kagermann, at least right away.

Reading the speech Agassi planned to deliver at Sapphire 2007 is almost painful. So many of the points he emphasizes are what Plattner said SAP needs to figure out to grow and move forward now.

In a blog entry, Agassi posted the speech he “would have given at Sapphire,” and cited the three axes of innovation, a word we just started to hear again from SAP late last year.

First, and foremost, he pointed to the importance of strong functionality.

“SAP programmers define themselves by the transactional modules they have built over the years,” Agassi’s blog post reads. “And they continue to evolve and drive those modules from the key genome of transactional process understanding so unique to SAP.”

Second, was openness of platform.

“We had to make two key decisions around the platform-ing of the mySAP suite – one around the technology infrastructure (in particular should we buy from someone or should we build our own), and the other (much tougher) one-should we document our engines through Web services in ways that will enable smaller ISVs to build solutions that target our core Suite accounts,” he wrote.

And the last was the simplification of SAP.

“That whole effort revolved around simplifying the consumption of our solutions in ways that would eliminate waste, or as I called it, ‘SAP Tax’,” he wrote. “The thought process was fairly simple – find places where people had to perform tasks that did not provide direct business value and eliminate them through better design or better packaging of the products.”

These points, particularly the “SAP Tax,” align with customers’ challenges now. Many are running old SAP installations, which they want to find ways to optimize. Customers are trying to figure out what to do with software that they bought from SAP and haven’t yet deployed. And they’re trying to rationalize why in some cases what they were sold isn’t living up to their expectations.

“What [SAP] can do is help customers find ways to optimize existing SAP instances,” Ray Wang, partner at Altimeter Group, said in an interview. “People don’t want to get rid of the SAP investment. They want to minimize the cost, and innovate around SAP.”

Two years later, in his very first, and last, Sapphire keynote as sole CEO, Apotheker was still talking about some of these points – stressing the importance of making software easier to use and deploy. We heard about SAP enabling “the clear enterprise.”

But the problem was, it was never clear to the enterprise what SAP was talking about — because that vision was never really clear to SAP.

In 2007, Agassi wrote that he thought SAP was “marching forward to success.” Yesterday, when I spoke to Strategy Partners’ Helmuth Gümbel, he had one of his trademark good lines, “[SAP is] marching into the future, but we don’t know how to take our customers with us.”

Bill McDermott and Jim Hagemann Snabe now have that challenge of showing the customers that vision and getting them to follow. But would SAP have been a “better place” now if Agassi had never left?

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