Global CIO: An Open Letter To SAP Chairman Hasso Plattner
Ten very candid suggestions on overhauling SAP's value proposition, corporate culture, commitment to the cloud, competitive outlook and more.
does your answer inspire confidence and trust? No, it doesn't--and that same result holds true for all the botched and inconsistent and ineffective messaging that's come out of SAP this year.
SAP Customer Bill Of Rights. Yes, this would probably decrease the leverage your salespeople have with clients--but it would send an unmistakably clear message to your customers that you are willing to do more than just talk about re-establishing trust. (Altimeter Group's Ray Wang would be the perfect person to help you craft this.) I'm not talking here about the Top 100, for which you and all of SAP seem to be performing brilliantly; no, I'm talking about the other 94,900, each of whom needs to be able to leverage IT to move faster, smarter, more flexibly, and with more confidence than ever before--and to do that, they need to know what they can or can't expect from one of the top enterprise software companies in the world. And they need that in writing, and they deserve for it to be a very public commitment.
Customer Needs Vs. SAP Desires. I have to tell you, Hasso, it was a real stunner to hear you say that you and all of SAP's other executives believed that because your Top 100 customers are tickled pink with your enterprise support quality and pricing, then all of your other 94,900 customers must feel that way as well. (And c'mon now--is it really true that all of those Top 100 are "extremely happy with what we do in maintenance and what they have to pay for it"? Heck, I don't expect you to tell me--but you should be brutally honest with yourself, because if it's not true, there's big trouble ahead for SAP.) Consider what that means for the element of SAP's culture that you need to obliterate: it means that no one in all of SAP--no executives, no sales managers, no board members, no one--was willing to say that this myopic view of the world was completely wrong, that most of SAP's customers do not think 22% maintenance fees are just wonderful, and that your rollout of across-the-board maintenance hikes based on that distorted view of the world would lead to disaster. If they're not willing to speak up about something as fundamentally vital as that, Hasso, then what other topics do they consider taboo? More important, how do you break down and flush away the cultural impediments that led to such see-no-evil groupthink?
What Is SAP? What Value Does It Deliver? I saw a staggering statistic glommed on at the end of a recent SAP earnings announcement: that 65% of the transactions making up the world's global economic output are touched or managed by SAP systems. Is that true? And if so, what does it mean about the role SAP plays in today's global economy, and the role it can play in tomorrow's more-complex and farther-flung and faster-paced global marketplace? Is SAP an ERP company--and anyway, what does that mean anymore? Is SAP a BI company, a middleware company? Does it make customers better, faster, smarter? Does it do mobile better than any enterprise company in the world? What is SAP, and what value does it deliver? Again, there's no doubt that you and your fellow executives know the answers--but in today's hyperevolving IT marketplace, do your customers and prospects?
The Top 100 And The Other 94,900. I've touched on this above in a few places but this might be the single most important issue for you to tackle so here are a couple of other thoughts. What are the reasons that those Top 100 love SAP so much? And how can you then bundle or package as much of that goodness as possible and make appropriate portions available to the other 94,900? Because if you can't, maybe you need to split the company up in some way to be able to keep a small number of premiere accounts extremely happy while creating a whole different structure to handle The Masses: a Cadillac and Chevy approach?
Your Very Righteous CTO And CVO. CTO Vishal Sikka glides through discussions of complex technology and optimized business processes and the business value they can create with an ease that I've rarely seen from any executive in any company. Great move to put him on the Executive Board, but be sure his ideas and insights are heard because he's the one SAP executive I've seen or heard who can really articulate why SAP is relevant and valuable now and has the potential to continue to be so in the future. And Chief Value Officer Chakib Bouhdary brings to your party that elusive thing that's missing from the discussion above about What Is SAP and what will it be in three years: a metric-based framework for generating growth and business value from business technology in general and SAP software in particular. We wrote about it a few months ago in Global CIO: SAP 2.0 Promises Business Value Over Products: Can It Deliver?.
Business ByDesign: Credibility-Crusher? Here's a little anecdote that typifies my assertion that SAP has botched, consistently and methodically, every attempt to tell the world about what this product is, what it means, when it will be out, and how it will complement other SAP products: