All change in SAP's on-demand leadership

All change in SAP's on-demand leadership

Summary: John Wookey's departure left plenty of questions. Today, SAP made a valiant effort to answer them.

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TOPICS: SAP, CXO, Data Centers
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The leaked departure of John Wookey, as leader of SAP's large enterprise on-demand development organisation last weekend certainly got industry tongues wagging. Everyone who thinks they have an opinion worth sharing jumped in on the action. I was shocked at the announcement but chose to keep quiet until I'd had an opportunity to hear from the man himself and from Peter Lorenz, EVP, SAP On Demand/SME.

A big part of the reason I was shocked comes from the fact that less than a couple of weeks ago, I recorded a candid conversation with John about development of on-demand solutions - see the video above. At the time he seemed relaxed and in command of a clear strategy going forward. He also seemed much happier and assured than when we last met about a year previous.

I walked away from the conversation believing that SAP had finally got its head around SaaS/on-demand/cloud. There was not a whiff that anything was amiss. Another executive in those same meetings said that he saw Business ByDesign - upon which Sales On-Demand is built - as being SAP's future for the next 20 years. That's a big statement for a company that has recently been criticized for flogging old technology. Such a sudden departure means something went wrong somewhere. When I spoke with my contacts inside the company, there was a similar sense of shock. In the two and a half years John has been at SAP, he built up a formidable reputation as a do-er and the results we recently saw in Sales On-Demand were impressive. What happened?

It says something about the importance of this event that SAP was prepared to front a call today with myself, Paul Hamerman of Forrester, Ray Wang of Constellation, Bill McNee of Saugatuck, my video partner Jon Reed and others.

On today's call, John said that he really does want to spend time with his growing family, hinting that the next steps in taking the On-Demand and ByDesign teams efforts forward would have kept him away from the commitments he wants to make to family. Even so, I asked whether there was a triggering event to which John replied that he has been talking about this for some time to the senior management team including Peter Lorenz and Jim Snabe, co-CEO. Do you buy that?

Speaking from personal experience, I can understand this as an explanation but it begs the question about what happens next and especially as it relates to the development teams. The On-Demand teams are using design thinking principles which are fundamentally different to the way in which SAP's on-premise applications are built.

Pulling any company out of its comfort zone is never easy. There are always going to be difficulties. Yet, John was brought in with the specific remit of developing on-demand solutions. At the time, colleagues nodded their collective heads with approval largely because John was not only highly respected for the work he did at Oracle but as a proven leader. As example, during our videoed conversation John hinted at the internal struggle SAP had in deciding to ditch the Frictionless code in favor of moving to ByDesign as the platform upon which on-demand solutions are built.

During today's conversation, Peter Lorenz confirmed that the teams will be kept intact and that there is no plan to subsume them within the larger organization. That is despite the fact that there is a general feeling that over time, there will be some melding of on-demand and on-premise applications.

I'm not sure how SAP will make this work. Many of the lead developers bringing Sales On-Demand to market are based in Palo Alto, while the ByDesign teams are based in Walldorf Germany. Holding those two very different cultures together will require a very strong leader. Right now, that person is not in post. However, Peter Lorenz's life might be made easier by the fact that Hasso Plattner, co-founder and still a driving force behind development, is very much in favor of the newer styles of development exemplified by the On-Demand team.

John has stated that he will give up 'active management' in the next few weeks but is willing to stay on as a consultant for as long as SAP wishes. It is not easy to see how that squares with his desire to get back to family life and SAP's need for a swift transition.

Some of us have been concerned that with the big ticket HANA solutions front and center, on-demand would get less love internally. Peter affirmed there is 'no lessening of commitment to on-demand.' The next proof point will come at SAPPHIRE at which SAP is hoping to launch Sales On-Demand to the customer base and provide a firm indication of the timelines for next tranche of on-demand apps.

As a final comment, John said that he won't be turning up at HP any time soon.

Later today, Jon Reed and I will be recording a special JD-OD.com show where we parse our thoughts further on this topic.

UPDATE: here is the full conversation recording from today's conference call.

Topics: SAP, CXO, Data Centers

Dennis Howlett

About Dennis Howlett

Dennis Howlett is a 40 year veteran in enterprise IT, working with companies large and small across many industries. He endeavors to inform buyers in a no-nonsense manner and spares no vendor that comes under his microscope.

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7 comments
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  • John Wookey's Departure

    Good reporting. Good analysis. Nicely done. Thanks.
    toppundit
  • RE: All change in SAP's on-demand leadership

    Dennis, Very helpful coverage. Something feels very wrong here, but I guess only time will tell. Could it be that with ByD coming on strong, and Fusion now in at least beta, SAP's likely to move ByD up market faster, perhaps reducing the longer term role for large enterprise on-demand? I can certainly understand burnout, but nothing in your video interview suggests anything like that. Unless he'd already decided and what we saw in the video is a man entirely comfortable with his planned exit. But then staying on as a consultant makes no sense. I'm feeling very Miss Marplish over all of this.
    naomibloom@...
  • RE: All change in SAP's on-demand leadership

    Impressed with the reporting and apparent transparency from SAP.
    markm@...
  • RE: All change in SAP's on-demand leadership

    Very good analysis/comment. What you miss is that SAP is a German company and the mentality is very much so aka stringent, do as your told, command lines, etc. I've worked with SAP on high level for more than a decade. It's like meeting the government. Hasso Plattner and others are innovative but the system is not. I think that is what happened.
    Boan2003
    • RE: All change in SAP's on-demand leadership

      @Boan2003 in the call, Wookey does point the German-ness thing out and if you listen to the whole you'll see that we do press SAP about the split teams issue. He also on the video and in the call discusses design thinking approaches. That has reaped rewards and is showing fruit. So while I agree with the issues you outline, I've yet to see it causing problems in getting code out the door.
      dahowlett
  • RE: All change in SAP's on-demand leadership

    Dennis,

    SAP doesn't get cloud and it still has too much of its business-as-usual turf to defend. In this regard, it's no different to Microsoft or Oracle. Unless SAP creates a genuinely independent cloud/SaaS apps business, led by entrepreneurs, not corporate salarymen, it will simply fall further behind to salesforce.com and its growing array of CRM and non-CRM platforms: e.g. Force.com, VMforce, Database.com and Heroku.

    The other problem is that Sales OnDemand is not an extensible platform and CRM crucially depends upon the ability to apply significant customisations and third-party extensions. AppExchange is living proof of this.

    Moreover, until SAP recognise the power of declarative development over hard-coding for 80%+ of apps, they will never match the productivity of Force.com. They could have been the leader with declarative development if they had persisted with Coghead. The fact they shut Coghead down says it loud and clear: SAP remain in denial. Changing a few executives and using horsehit statements like 'needing to spend more time with the family' is just applying hope - and as we all know, hope is not a management tool!
    XceliantBear
    • RE: All change in SAP's on-demand leadership

      @XceliantBear - you're forgetting two things: 1, Wookey didn't have to do this call. In fact it is VERY rare to see this type of call at all. 2. I know the man. So calling his statement 'horseshit' is beyond ungracious, it's downright offensive.

      I've no doubt there is more to be discovered on this but I've reported on what they said, I recorded and posted the conversation for anyone to listen to (have you?) and you can be sure that if any of this is out of kilter with what happens going forward I will be first in line to remind them of past statements.
      dahowlett