In a not so surprising announcement today SAP CEO Leo Apotheker has stepped down effectively immediately. For a few months now senior software analysts have somewhat quietly predicted just such a move, especially on the heels of a very poor performing year. The timing seems predictable too, as SAP just reported Q4 earnings. Announcing this now also gives the new management team time to get a coherent message together prior to Sapphire, SAP's user conference which will be held May 16-19 in Orlando, FL.
The new leadership team, headed by Co-CEO's Jim Hagemann Snabe, former head of product development, and Bill McDermott, former head of the field organization, both already executive board members. In addition Vishal Sikka, Chief Technology Officer joins the executive board and Hasso Plattner, Co-Founder of SAP and Chairman of the SAP Supervisory Board, will continue to play a role in advising the new leaders on technology and product development. There had been quite a bit of guessing / predicting as to what SAP might do to replace Leo; a company that has been criticized for some major points of its strategy over the last few years. One camp believed that SAP needed an infusion of "new" blood and would bring in someone from the outside while another held fast to the idea that what SAP needs is leaders with established organizational clout so that they could quickly get the SAP ship back on course. The choice is a reasonable one and brings together a strong engineering leader needed to get the R&D teams (SAP has always been seen as an engineering led company) quickly re-focused on moving forward (something Leo had been criticized for disrupting recently) and a customer / sales focused leader to keep the company focused on results. The changes come at a critical time for SAP as they finally bring out a new release of BusinessbyDesign that has been promised as ready for general consumption and as they release a series of enterprise cloud apps (here's my recent post on its cloud strategy). Both moves are promised this year and are seen as critical to get SAP back on track with its cloud initiative.
SAP and its new Co-CEO's face some difficult times as they try to get the company back on track and moving in some important new directions. By Sapphire they will need to make some definitive moves to show that company strategy is aligned, clear and making progress toward stated goals.
