Recently Bill McDermott, CEO of SAP, gave an interview to Bob Evans, an expert in technology and analyst for more than 20 years, as well as chief editor of the Cloud Wars website (cloudwars.co). From this brief but very substantial interview, I highlight five powerful ideas from Bill McDermott that I´ve extracted from the conversation and that give us a very good idea of his strategy and market perception:
- The importance of having a purpose that guides the company. “Yeah, we’ve gone through a lot of change. Ten years ago, we said we have to be a purpose-driven company, and we dedicated ourselves to helping the world run better and improving people’s lives,” affirmed McDermott. “And that set us on a path of investing $70 billion in innovation. Today SAP is a quite complete enterprise in terms of vision for the company. “Undoubtedly, this is confirmed by the more than 425,000 SAP customers, and the company’s results. According to Bob Evans, for the first quarter of 2019, revenues from on premise and SAP cloud have increased by 16%. Subscriptions in the cloud also increased 32% compared to the equivalent quarter of the previous year. This performance reflects in SAP’s unprecedented market capitalization of approximately $153 billion.
- Trust and Empathy, key factors in relationships. “Trust,” McDermott said, “is the ultimate human currency.” Without the confidence in the vision and the possibility of transforming business, SAP would not have made alliances with other companies possible. McDermott: “Empathy goes a long way. Customers today want you to listen—and they not only want you to listen, they want you to understand what you have listened to, and then take action on it. We want to be a humble company, and a hungry company, but also as a company that is viewed as forward-leaning on the side of the customer.”
- Customer experience defines everything. For McDermott, Experience Management is the biggest idea he has seen in the company in 25 years: “I really believe that Experience Management—and experiences themselves—are the defining category in general for the new economy”. “Because there’s a huge gap out there between what customers want, and ultimately what they say they get.” Pointed McDermott. “In the past, business operations systems have been guiding [customers] an experience without connecting any of what’s and why’s (…) when you can put X-data and O-data together, and you can remember your X’s and O’s, you can probably run a pretty good company.”
- Complacency is a disease. “Complacency is a disease—and lots of companies have it. Especially good companies, successful companies. It’s so easy to rest on your laurels, or to think about the great old days when you’ve built something that’s large and it’s become successful” reflected McDermott “The reality is, if you think like that, you won’t be large and successful for long. This is not an economy and it is not a customer base that tolerates that sort of behavior, surely not for very long.That is why I think you are going to see many companies that were yesterday’s brands not do so well tomorrow. “We’re fighting complacency with all we have, and we’re not taking ourselves too seriously even when we do have a little bit of success.”
- The customer as the center of everything. “The real boss around here is the customer, and we should judge the quality of our work by the success of the customer,” he said. “And I honestly believe the best days of SAP are well in front of us if we just keep the customer at the center of everything we do.”
Author: Conciliac Team
Bob Evans, “SAP and Qualtrics’ $1.6-Trillion Opportunity: Exclusive Talk with SAP CEO Bill McDermott”, May 2019, Cloud Wars (cloudwars.co)