The Post-Shai Era II

On the plane home from SAP’s Sapphire conference, reflecting on the overall impact of the announcements and the gestalt of the conference, it’s easy to conclude that SAP will survive Shai Agassi’s abrupt departure.

On the plane home from SAP’s Sapphire conference, reflecting on the overall impact of the announcements and the gestalt of the conference, it’s easy to conclude that SAP will survive Shai Agassi’s abrupt departure. It may be hard on the press – who seemed to be craving the acerbic sound bites and pithy quotes that made Shai easy to interview – and it may be harder on analysts, such as myself, who now have to spend their time with four or five senior execs discerning the nuances of a set of strategies that Shai managed to keep in his head at the same time.

 

But what really matters are the customers and partners, and for these constituents, there was an almost eerie sense that things would be more than okay – and while missed, Shai would not be mourned. (He’s still alive and kicking, btw, and in case you want to see what he would have said at Sapphire, check out his blog here).

 

There’s a couple of reasons why this transition was so smooth, and in them lie some interesting reasons why business culture is vastly different – and potentially superior – east of the Atlantic. Reason one, independent of geography, was a good quarter. SAP made a major gamble in holding its conference on the first business day following its Q1 earnings announcement. Bad news would have make the whole show an exercise in exhorting demons and offering up excuses, with any positive message being buried in the avalanche of CYA activities. Signs of positive financial momentum can turn even the greatest skeptic into an optimist – for better or worse. 

 

The second reason is that SAP has a ton of great product and technology – in fact, a helluva lot more than many customers, analysts, press, and other observers often realize. This Sapphire was a great excuse to remind everyone – including not a few people inside  SAP itself – that the company’s vision of organic growth has paid off handsomely in ways that Oracle can only dream. Oracle can buy and buy and buy, but it will take more than the $22 billion it has so far spent to reach SAP’s product achievements – after all, they bought the customer bases of largely moribund companies like Siebel, PeopleSoft and JDE, and relatively few truly innovative companies.

 

Finally, the reason that the post-Shai era promises to be a good one is that the company’s German-style management culture assiduously cultivated an extremely broad array of talent, and rewarded that talent even before they were ever asked to step up to the plate and fill in for Shai. This breadth of talent starts at the board level and permeates the culture of the company all the way down. Shai himself was particularly good at hiring smart, talented people whose job descriptions did not include sycophantic agreement with everything that that top management said or did – unlike some other companies and managers I could mention (unfortunately, you don’t know who you are.)

 

The result was a unique transition, one that SAP should get lots of credit for engineering: most companies would have suffered the loss of a charismatic leader with a visible vacuum at the top. At SAP, there was no sense of great loss, and while no one who stepped up to the plate is necessarily as charismatic as Shai, their respective abilities to articulate the message and further the strategic goals of the company speak volumes about what collective management – as opposed to the cults of personal initiative that American companies tend to cultivate – can do in easing transition and ensuring continuity. No a bad showing after all.

 

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