The Wall Street Journal
has a long page one story today on SAP, highlighting cultural issues hindering the firm's progress as a worldwide software vendor. It begins, "Five years ago, Germany's largest software company decided it had to become less German."
An interesting statistic: in 2000, SAP employed 3,900 software developers, 75% of whom were based in Germany. In 2006, the software development headcount increased to 8,500, but only 60% were German.
SAP also made other changes to become less "German." It adopted English as its language for corporate meetings. In place of its traditionally methodical approach to software engineering. , and it began to use a rapid product development approach to bring new products to market, under the leadership of Shai Agassi.
Predictably, these changes have created quite a bit of conflict within SAP's organization, especially in Germany. The WSJ article describes the impact on SAP's German staff:
In August 2005, a German employee complained to a local newspaper that Mr. Agassi's "boys come in at very high levels, without even being seen by the staff here." Five months later, Germany's national Handelsblatt newspaper published an article headlined "SAP and Globalization -- March of the Americans." One German manager was quoted saying, "It's clear Agassi would like to get as many functions as possible to the U.S." Mr. Agassi says his mission was "to bring the best talent we could find anywhere into SAP, regardless of location."
In April 2006, SAP executives hosted a town-hall meeting in Walldorf on the "Americanization of SAP," where workers aired concerns over the increasing use of English and the hiring of engineers overseas. A few months later, a handful of SAP workers, including Mr. Schick, won enough support to start a workers' council, roughly equivalent to a labor union.
This explains much behind the departure of Agassi, who grew impatient with the pace of change, especially when it became clear he would not get the top job at SAP until at least 2009.
It also provides insight into why SAP's growth has trailed that of Oracle's, a fact which Oracle is trumpeting these days in full page ads in major newspapers.
Read the WSJ story
for much more.Related postsSAP's Shai Agassi calls it quits