Friday, May 11, 2007

WSJ revisits Shai Agassi vs. SAP

Shai Agassi left SAP a few weeks back. The Wall Street Journal has a sort of a post-mortem, with afairly simplistic piece on globalization within SAP.

The globalization challenge within SAP is not all that different from the one faced by many other companies around the world. Whenever the markets for large companies move - SAP's customer-base started in Germany/Europe, but now US is its #1 market and Asia is growing rapidly as well - turmoil is inevitable.

SAP has globalized and is a more diverse company today than ever before. That SAP has development centers in India, China and Eastern Europe is not surprising. That it has a development center in Silicon Valley is not that surprising either. What is cool and rather unique is that it moved a lot of decision-making authority from Walldorf, Germany, to Palo Alto, USA.

The first attempt to do so started with Hasso Plattner's move to take SAP into the dot-com era in the late 90s. The pendulum swung the Walldorf way again with the dot-com crash and Plattner's exit as CEO, but swung back again to Palo Alto with Shai Agassi's promotion. What will happen next is not clear.

My hope is that decision-making @ SAP spreads more universally. A lot of the ecosystem that sustains SAP (SAP implementation companies and SAP consultants) is now based in India. SAP's second-largest development center is in Bangalore. Yet, there is precisious-little decision-making happening in Bangalore.

If SAP manages to universalize itself more, it will have a massive edge over a relatively US-centric company such as Oracle.

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