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Global CIO: The CEO Of The Year Is SAP's Bill McDermott

With co-CEO Jim Snabe, McDermott's set a vibrant new strategy, restored growth and profitability, and exorcised some wicked demons and ghosts.
"Every quarter we grab huge chunks of market share from SAP," Ellison said in a March 25 press release announcing quarterly earnings. "SAP's most recent quarter was the best quarter of their year, only down 15%, while Oracle's applications sales were up 21%. But SAP is well ahead of us in the number of CEOs for this year, announcing their third and fourth, while we had only one."

It's also well worth noting that the tone of the commentary in Oracle's most-recent earnings press release, dated June 24, was quite different: with SAP having just reported solid quarterly results under the new leadership of McDermott and Snabe, Ellison didn't so much as mention SAP.

But McDermott's inexorable focus on customers and opportunities has pushed the Oracle thing so far out of SAP's consciousness—or at least out of his own publicly facing consciousness—that he just about never mentions Oracle's name. I think he might have dropped the O-word once or twice during his first public comments as co-CEO early this year, but in the several times since then that I've seen him speak or have spoken directly with McDermott, the O-word never comes up.

"From when I became an entrepreneur at age 17, running my own business in high school and college, I knew that it was the customers and the customers alone that would determine whether I continue to have a business," McDermott said in our phone conversation earlier this week.

"Those views haven't changed in my 25 years in the IT industry, and today customer innovation is the Number 1 factor for us in determining real customer value: can we help them run their business differently and better, can we help them access new markets, can we help them motivate their people, can we help them build and extend business networks, and can we help them create real opportunities."

Those attributes, he said, are SAP's keys to success, as opposed to the tactics of that competitor he refused to identify but that he described as one that focuses on the short-term play of consolidating through acquisition, laying thousands of people off, raising shareholder value, but not offering any real long-term innovation.

The exorcising of the Oracle ghost and others seems to have made an indelible impression on SAP's workers, a point McDermott underscored in describing a recent gathering of 23,000 SAP employees and family members in Germany:

"Let me tell you about the secret sauce at this company these days: I was with my family in Germany over the weekend at a big company party and it was raining and cold but there were 23,500 people there, including 8,000 kids playing on monkey bars and running around," McDermott said. "It was great—being one big family, and getting energized, and having fun, and the party went on until 1:00 a.m.—it was like Woodstock!

"I'll tell you, the whole company's on some real adrenaline now—and it's amazing to watch."

Turnaround artist, confident co-CEO, customer-centric leader—all are roles McDermott will need to continue to employ aggressively and relentlessly. But one role that McDermott can drop is the exorcist-in-chief gig, because here in mid-2010 it appears that all of SAP's demons and ghosts are long gone.

RECOMMENDED READING:

Global CIO: Oracle Hammered By SAP For Stifling Customer Choice

Global CIO: Oracle's Phillips Says Standardizing On Oracle Is IT Cure

Global CIO: How SAP Is Leading The Mobile-Enterprise Revolution

Global CIO: Oracle's Larry Ellison Declares War On IBM And SAP

Global CIO: SAP's Top 10 Priorities To Become Undisputed #1

Global CIO: Oracle President Phillips Says 22% Annual Fees Great For CIOs

Global CIO: How Will Larry Ellison Counter SAP's Mobile Offensive?

Global CIO: 10 Things SAP's Co-CEOs Should Focus On

Global CIO: Larry Ellison's Nightmare: 10 Ways SAP Can Beat Oracle

Global CIO: IBM Sees Surge In Customers' Transformation Projects

Global CIO: Larry Ellison's New Acquisition Underscores Vertical Strategy

Global CIO: Apple's iPad, Electric Cars, And Runaway CEOs

Global CIO: Google CEO Eric Schmidt's Top 10 Reasons Why Mobile Is #1

GlobalCIO Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO,
or write to Bob at [email protected].