SAP's CEO Léo Apotheker resigned today. SAP will return to a co-CEO structure, replaced by Bill McDermott, head of field organization, and Jim Hagemann Snabe, head of product development.
The particulars are to be announced early tomorrow.
According to the Financial Times, one reason for the resignation is SAP's delays in the introduction of a new online-based business software for small and medium-size companies.
The competition is getting fierce for companies like SAP that have prospered for years with on-premise software deployments for the world's largest companies.
SaaS providers are starting to make some headway into the market against giants like SAP. Companies like NetSuite are offering services that do not require software or a significant infrastructure.
NetSuite knows it has an opportunity to take clients away from SAP. It has a program for prospective customers that want to switch from SAP to NetSuite.
NetSuite even offers a cloud conversion kit. Here's how it positions itself against SAP:
If you're running SAP R/3 4.6 or 4.7, then you know that it's time to make a difficult decision. Should you upgrade to SAP ERP 6.0--and face a notoriously complicated, expensive and risky process--or pay a costly hike in maintenance to keep your old system running? Fortunately, there's another option.
In face of this, it doesn't help that SAP increased maintenance fees during a worldwide recession.
Dennis Howlett said the resignation is no surprise.
"It won't take a nano-second for the enterprise pundit tongues to start wagging. I'll kick it off. Leo's departure has long been predicted. In private conversations stretching back to last fall, I initially thought he would survive through SAPPHIRE but more recently thought the company would get the Q4 earnings out the way and then make changes. So it seems.
The choice of new leaders should not be surprising but hardly imaginative. In effect, SAP has chosen 'last men standing' rather than taking what some of us thought might be a bold move by appointing an outsider."
What is SAP's alternative in the market? How is it moving out of its shell into a more modern company that can compete with SaaS providers like NetSuite? We'll take a look at this issue tomorrow on ReadWriteCloud.