SAP Regulars
We are confident that the SAP community will survive the S/4 disaster. It will cost us a good deal of money again, and each of us CIOs will need to have some tough conversations with our CFOs. But those of us who survived R/1 will survive Hana and S/4. What is unclear to us regulars is how the SAP Supervisory Board will function without Hasso Plattner, and how the roles in the SAP Executive Board will be distributed.
We are already looking forward to the first PKL plus the corresponding Excel sheet from SAP board member Julia White. She came from Microsoft and is responsible for marketing. Now she has also been given the role of top pricing manager - an interesting combination: marketing and pricing. Whether this will fulfill our DSAG's desire for standardization, consolidation and transparency remains to be seen.
A good deal is changing at SAP right now, but it remains to be seen whether this will lead to a constructive reset, as the German edition of Manager Magazin suggests on the cover of its April 2024 issue. Here is a comment from our club: "Well said, but I fear that this derailment at SAP will continue. This is also an opportunity for real change and transformation. In this respect, I believe that a very challenging time of transformation lies ahead, not only for the SAP environment, but above all for SAP itself."
The extent to which SAP is unsure of itself was demonstrated recently when Jürgen Müller’s executive board contract was extended by only three years. The Chief Technology Officer, who is under the protective hand of Hasso Plattner, has one of the most important tasks in the ERP group: to prepare the SAP Business Technology Platform for the market and turn it into a successful model. Not an easy task, and certainly not one that can be accomplished in only three years.
If the entire SAP Supervisory Board had believed in the work of Chief Technology Officer Müller, the contract would have been for five years. As it is, it appears to be more of a farewell present for Hasso Plattner. One of the regulars at the meetup, who is very familiar with the situation in Potsdam, Germany, also told the group that Jürgen Müller's future lies more with the Hasso Plattner Institute (HPI) at the University of Potsdam than with SAP itself.
Thomas Saueressig’s role is a mystery to us at the club. Since April 1, he has been responsible for customer services and delivery on the SAP Executive Board. Has he been removed from his traditional area of responsibility, or is the new area of responsibility a preparation for replacing Christian Klein as CEO? The saddest figure on the SAP Executive Board is Christian Klein. His decline can be seen on the cover of Manager Magazin. After the hard years of nothing but technical support, there seems to be no energy left for future innovations.
Repeatedly emphasizing the megatrends of AI and cloud is no strategy. Christian Klein emphasizes cloud because everyone else is doing it, and he talks about AI even though the company has no core expertise in areas such as finance, supply chain planning, or e-commerce with BRIM. Another comment from the club: "Growth and size are not always effective. Through its many acquisitions, SAP has lost quite a bit of spirit and culture, and gained complexity in its portfolio. That pleases the shareholders, but certainly not the customers. It used to be unthinkable that employees or even managers would leave SAP. It was a community. But enough about the past. Let's look towards the future. Hyperscalers have mastered the technology. And SAP should focus on its business strengths. For the benefit of customers, and even if the share price falls again.”
Christof Kerkmann described the situation at SAP in the German Handelsblatt as follows: "At around 200 million EUR, the restructuring costs are higher than originally thought. CFO Dominik Asam justified this (...) with the fact that more employees in the U.S. have signed up for the early retirement program.” Some with a penchant for darker thoughts might think the rats are fleeing a sinking ship.
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