CEO Visions: A Cautious Optimist - InformationWeek

InformationWeek is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

03:01 PM

CEO Visions: A Cautious Optimist

The year ahead: There will be continued pressure on IT budgets and consolidation in the industry, SAP America's Bill McDermott says, but at some point, customer spending will return to more normal levels.

There's little doubt that the economy will continue to play a dominant role in shaping the enterprise software market in 2003. While many predict the long-awaited economic recovery will begin this year, geopolitical instability and the prospect of war cloud this picture.

One thing we know is that the economy will continue to exert pressure on IT budgets, accelerating many trends that took shape last year. The market saw momentum shift dramatically from best-of-breed niche software providers to suite vendors such as SAP, as customers and analysts began to understand the challenges and true costs of integration. We expect this trend to continue this year.

We also expect further consolidation of the software industry. Customers want trusted partners with longer track records, sound finances that ensure research and development investment and longevity, broader functionality, and the efficiency and confidence that comes with a long-term relationship.

The emphasis on integration has moved beyond company walls to extend functionality into partner and customer relationships. This process pushes enterprise solutions into suppliers, vendors, and partners to enhance customer service and smooth logistics. At SAP, we see underlying technology playing a critical role, as companies extend the enterprise to third parties and face the challenges of connecting to disparate systems that make up their supply and value chains on a global basis.

One area that will have particular focus for SAP in 2003 will be building on relationships through our extended partner network of technology partners, systems integrators, and channel partners. An important market-focus area for business solutions in 2003 will be in the small and midsize business arena, where partners play a key, customer-facing role.

At SAP, we remain cautiously optimistic about the year ahead. At some point, customer spending will return to more normal levels. Until then, we're doing what market-leading companies should be doing: laying the groundwork in system improvements and customer-support networks to be ready to capitalize on the market's ultimate return.

Bill McDermott is president and CEO of SAP America. In a past life, McDermott was president of Gartner Inc.

Search for more articles in InformationWeek about this author:

Do tech stars like Michael Dell, Steve Ballmer, and Carly Fiorina see the future clearly? Check out what our complete panel of 32 visionaries have to say here.

Columns By Other Hardware Company CEOs
Craig Barrett, Intel Scott McNealy, Sun Microsystems
John Chambers, Cisco Systems Inc. Sam Palmisano, IBM
Michael Dell, Dell Computer Joe Tucci, EMC Corp.
Carly Fiorina, Hewlett-Packard Dan Warmenhoven, Network Appliance Inc.

Is the author right? Or out in left field? Have your say on this column and the rest of our Future Visions package at

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Print  | 
More Insights
The State of Cloud Computing - Fall 2020
The State of Cloud Computing - Fall 2020
Download this report to compare how cloud usage and spending patterns have changed in 2020, and how respondents think they'll evolve over the next two years.
Can Cloud Revolutionize Business and Software Architecture?
Joao-Pierre S. Ruth, Senior Writer,  1/15/2021
10 IT Trends to Watch for in 2021
Cynthia Harvey, Freelance Journalist, InformationWeek,  12/22/2020
How CDOs Can Build Insight-Driven Organizations
Jessica Davis, Senior Editor, Enterprise Apps,  1/15/2021
Register for InformationWeek Newsletters
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you.
White Papers
Twitter Feed
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Sponsored Video
Flash Poll