SAP Sapphire: CEO outlines vision for 'a better future'

In a speech last night, co-CEO Bill McDermott sought to preach the word about the company's short-term potential. This morning, counterpart Jim Hagemann Snabe looked beyond the horizon.
Written by Andrew Nusca, Contributor


ORLANDO, Fla. -- There's a reason SAP has two chief executives.

New York City-bred Bill McDermott has the gusto, presence and accent befitting his hometown. He's the coach jumping up and down on the sidelines, barking at you to hustle down the field.

Denmark-born Jim Hagemann Snabe? He's the more cerebral of the two, quieter and busy sketching out possible plans of attack from the bench.

While that stylistic difference was certainly on display here at SAP's Sapphire Now conference, it manifested more in how each executive chose a topic for his keynote.

Last night, McDermott spoke the good word to the faithful: the world is growing now, and we need to act now.

This morning, Snabe architected a vision where his company was riding atop waves of change 40 years into the future: We don't know what the world will be like in four decades. Forget about looking around today's corners -- what about preparing for corners we don't even realize are there?

Snabe kicked off his presentation by reminding the audience that 2012 is his company's 40th anniversary. What was begun as a startup by five disgruntled IBM engineers has become the kind of company that books Van Halen to play its birthday party, with tentacles in many major multinational corporations.

On his 40th birthday, Snabe took a trip to India. On SAP's 40th birthday, it bought SuccessFactors.

"I can assure you, we feel like 20 again," he said, grinning.

Likening the company to NASA -- the agency turns 50 this year -- Snabe said SAP too began as an ambitious dream for technological leadership. Only instead of space travel, it was real-time computing and software could help companies run better.

"Leadership is about dreams and details," he said. "Dreams, because you need to imagine a better future, a future that challenges your current assumptions…and details, because if you don't get the details, you'll never get there."

In the Seventies, SAP operated without its own computer -- it used others' machines instead. It finally bought its own Siemens mainframe in 1979, which offered a whopping 2 megabytes of memory, the average size of today's e-mail attachment.

That's a tremendous amount of progress in a short time, he said. Can you imagine what the next 40 years will bring?

"How will the world look like in 2052? It's almost impossible to imagine," he said.

We do know a few things. For one, today's world population will grow another 2 billion to a total of 9 billion. China, India, the U.S., Nigeria, Brazil and Mexico will see most of that growth.

The world's population will also urbanize. That won't be so evident in developed economies like Western Europe, the U.S. and Canada, but Asia and Africa will see massive increases.

"The total footprint of urban areas will increase by 100 million square kilometers, which is the size of Germany, France and Spain put together," he said.

And we know the world's population is aging. For the first time, there will be more people over age 60 in the world than the rest, putting tremendous pressure on resources like food and oil. Asia will see most of that boom.

"The future is not set in stone," he said. "Technology innovation plays a major role in creating a sustainable world tomorrow."


The future may be impossible for the chief executive of a software company to imagine, but not so impossible that Snabe couldn't hazard a few guesses in front of 10,000 people.

He made three predictions:

  1. In less than five years, everything will be mobile. "That [mobile] device is thousands of times more powerful than the mainframes that used to run entire corporations in the Seventies," he said. "Imagine that power 40 years from now. Imagine it 10 years from now."
  2. In less than five years, everything is cloud. Private or public. When paired with mobility, the user no longer cares where apps or data sit -- they only care about availability and speed. "Today we talk about clouds; I predict that tomorrow we don't talk about them. That's just the way [we will live]."
  3. In five years, everything will reside in main memory. We must "be able to recognize patterns and be able to optimize things we haven't before," he said. The key question: will there be hybrid setups, or will it all reside in-memory? "To those people who still defend the disk age, I will quote physicist Richard Sears," he said. " 'The stone stage ended not because we ran out of stone.' "

Each one of these technologies "is a significant step forward," he said -- but combine them and new opportunities emerge.

"We are facing a fundamental paradigm shift when it comes to technology," he said. "We choose to innovate the future, and not consolidate the past."


The real advancement, however, will be when businesses begin to connect with each other to swap data, insights and technology in real time.

"A network is significantly better than every single entity," he said.

Snabe called this concept the "intelligent business web," blurring boundaries that denote traditional competencies with new ones. "You don't have to become a banking company to offer banking services," he said.

Which comes back to his overarching theme: not just the future, but a better future. Through technology.

"We are creating the foundation for solving some of the resource-constraining situations that will face in the future," he said. "The power is moving to the people, and we can connect them."


To ground his ideas a bit, Snabe welcomed to the stage Ron Dennis, executive chairman of the McLaren Group.

McLaren is, of course, known for its Formula One racing prowess as well as manufacturing the fastest road car on Earth. The company has been a pioneer in the use of composites for automobile manufacturing and serves an industry where performance, and winning, can be measured acutely and publicly.

"I'd like to try driving one of your cars," Snabe said.

Dennis replied: "Easily obtained. Checkbook?"

But few are aware of the company's work developing high-performance control systems for cars -- yes, electronics, along with the telematics and data systems to support them -- that it licenses to its own racetrack rivals.

"That was the big breakthrough for McLaren," he said. "When we made our sport a science."

That technology isn't just used for cars, either. In one example, McLaren "absolutely crammed" an Olympic skeleton "full of electronics" to monitor the actions of its female driver, capture them via GPS and then inform her of what she was doing during practice runs. The idea: ensure that muscle memory recalls the best reactions possible.

"We don't get involved unless we can make a performance-enhancing contribution," he said.

Similarly, its systems are used in San Francisco's Bay Area Rapid Transit system to monitor passenger security and actuation.

"A very distant spinoff from that very embryonic first move when we built our first electronics systems back in the early Eighties," he said, chuckling.

So why the McLaren cameo, aside from the HANA-as-supercar metaphor? Because the auto group trades, effectively, in "the art of the impossible," as Dennis described it. It aims for the future, and winning is measured in milleseconds.

In other words, the marriage of McDermott and Snabe's two tales: win now, and win later.

"The decisions we make today create the opportunities of tomorrow," Snabe said. "We believe it's time to invent a new future again."

Photo: Tom Raftery

Editorial standards