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SAP SE

SAP SE – The Largest Company Developing Enterprise Software For Business Operations

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Even a small enterprise needs the help of the IT sector to run his or her business smoothly. With the arrival of digitalization, we don’t realize to the extent we are getting dependent on the internet. Data transfer, data storage, software development has become an integral part of the tertiary sector of the economy. With emerging businesses in every field, the software companies are also flourishing providing them with enterprise software. SAP SE is the world’s leading enterprise software company. It develops software for carrying out numerous business operations and to provide better client-customer relation. Five founders, Dietmar Hopp, Hans-Warner Hector, Hasso Plattner, Klaus Tchira, and Claus Wellenreuther founded the company in 1972. It is one of the oldest companies in the sphere of software development and one of the most successful as well. It is a company that serves worldwide with an employee count of more than 100,000.

About the Founders

All the five founders worked at IBM before founding SAP SE. When the company was founded Dietmar Hopp served as the CEO of the company for ten years. In 1998, Dietmar became the Chairman of the supervisory board. And, from 2003 he served as a board member for a couple of years.

Hans-Werner Hector is famous as a German software engineer and an entrepreneur. His net worth is $1.9 billion. It was through the success of SAP SE he became one of the richest men in the world. Due to some arguments and conflicts of interest with his partners, he left the company in 1997.

Hasso Plattner served as the Chairman of the supervisory board of SAP SE since 2003. After the financial year 2017, Forbes reported his net worth to be $13.1 billion. In 2005, he founded Hasso Plattner Ventures, a venture capital fund to support the young entrepreneurs. Currently, he lives in Potsdam, Germany.

Klaus Tchira served as the board member of SAP SE from 1998-2007. In 1995, he founded a non-profit organization, Klaus Tchira foundation for supporting innovative projects. He passed away on 31st March 2015.

Claus Wellenreuther left IBM in1971 and then programmed a financial accountancy system for batch processing. After this, he joined the co-founders of SAP SE and founded the company. He also founded DCW software in 1982 which SAP acquired in 2003.

Origin of SAP SE

Initially, IBM received the rights for working on Scientific Data Systems (SDS)/ SAPE Software project. Five scientists from the AI sector of the company worked in it until the project was called off. So, instead of leaving it midway the co-founders of SAP SE decided to resign from IBM and establish another company. SAP SE is the abbreviation for Systems, Applications & Products in Data Processing.

The Journey of SAP SE

The first client of SAP SE was the German branch of Imperial Chemical Industries. SAP SE was interested in making real-time system software. So, they developed the payrolls and accounting software instead of punch cards. On the contrary, IBM used punch cards for storing the information.

In 1973, the company launched its first commercial product which was known as SAP R/98. After this product, much other modified software was launched using the base model of SAP R. In the late 1970s, SAP R/2 was launched followed by SAP R/3 in 1992. In the meantime, the company shifted its headquarters to Walldorf, Germany.

In the following years, SAP got listed in the German Stock Index DAX and STOXX Europe 50.

Expansion 

From 2012, SAP eventually started showing interest in cloud-based storage. A company in the IT sector always needs to keep up with the changes taking place around the world. So, it started acquiring companies that could help it sell cloud-based products. In 2014, the company acquired Concur Technologies, a cloud-based travel management company for $8.3 billion. This year, the company came into a joint venture with IBM for the same purpose.

To date, the company has acquired more than 70 other companies on an international level. Some of the biggest companies SAP bought are Qualtrics, CallidusCloud, Concur Technologies, Ariba, etc. SAP has a partnership with companies like Adobe, GK Software, CA Technologies, and many more.

The company also plans to invest billions of dollars in sectors like the Internet of Things. By the end of 2020, the Company will invest around €2 billion in sectors like this. The company is also planning to cut employees. Currently, the Company is putting exclusive interest in sectors like AI, ML, IoT, and the blockchain community.

SAP SE

SAP SE – Inspiring Journey of the Company That Emerged Out Of Rejection

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It’s a tough task to manage the financials, logistics, HR and other business areas without the help of technological tools, especially for bigger companies. Such tools bring accuracy as well as transparency in the organization. The combination of various business processes is achieved through it. One of such Enterprise Resource Planning (ERP) software is SAP SE.

SAP SE journey – a very basic version of the most celebrated software as per fortune 500 companies

In 1971, Xerox left the hardware manufacturing sector and asked IBM to shift its business systems to IBM technologies. That time five IBM engineers from the AI department were working on enterprise-wide systems based on the software to which IBM has given rights to, Scientific data systems (SDS) /SAPE software. They were told that the project they are working on is not of use. That time, they decided to leave IBM and start their own company.

So, in 1972, those 5 engineers – Dietmar Hopp, Hasso Plattner, Hans-Werner Hector, Klaus Tschira, and Claus Wellenreuther founded SAP SE. currently, their headquarter is located in Walldorf, Germany and regional offices all over the world in 170 plus countries with more than 425000 customers.

Further Exploration of SAP SE

In the beginning, they developed programs for payroll and office for their first client Imperial chemical industries. Their software was real-time, unlike IBM.

In 1973, they moved to a commercial product which was their first financial accounting system. (SAP R/1) It has centralized data storage and improved data maintenance. In 1979, SAP involved other areas like material management & production planning. (SAP R/2). This SAP R/2 version did not improve until 1990.  SAP R/3 was released in 1992 and was developed with new features in 1995.

By this time, it already achieved the mainframe computing trend and the concept of business process integration came into the picture. To accommodate all these changes, SAP R/3 was replaced with SAP ERP central component in 2004. The latest version is of 2016, SAP ERP 6.0. Till 2016, SAP was the world’s third-largest software and programming company. As per recent reports, it is on number one. Most of the fortune 500 companies use this software.

Five Co-founders, One Dream

The five founders have different stories before they were in IBM and have different journeys with SAP. Let’s have a short introduction to the life of masterminds behind SAP SE.

Dietmar Hopp

Starting with Dietmar Hopp, who grew up in Hoffenheim. He was a telecommunications engineering student and after that, he joined as a consultant at IBM. Then SAP was founded, and he was the CEO of SAP SE from 1988 until 1998, chairman of its supervisory board from 1998 until 2003 and member of the board from 2003 until 2005. When he left the board, he kept 10% of the company’s shares.

Hasso Plattner

Plattner has received many awards and recognitions for his commitment to economics and science ranging from Leadership Award for Global Integration to the “technology guru”. He was also estimated to be worth US$10.8 billion by Forbes in 2016.

Klaus Tschira

He got his Diploma in physics and worked at IBM before he founded this company, for which he was a board member From 1998 to 2007. He passed away on 31 March 2015 in Heidelberg. As well, he was a recipient of many honors in his lifetime including several doctorates.

Claus Wellenreuther

Wellenreuther studied business administration at the University of Manheim in operational research. He left the business in 1980 due to his health condition and got compensation of 1 million DM.

Hector

One of the founders, Hector, A trained mathematician successfully built up the North American market for SAP. Later, he was separated from the company in 1997 after a falling out with his partners.

CEO till 2019 – William R. “Bill” McDermott

Formerly William R. “Bill” McDermott was the CEO of SAP who is currently CEO of ServiceNow.  While he was the co-CEO and CEO, SAP’s market value increased from $39 billion to $156 billion. McDermott went to North-western University’s Kellogg School of Management where he earned his MBA. He joined SAP in 2002 as CEO and was designated to the SAP Executive Board in 2008. He did various roles in SAP.  On October 10, 2019, McDermott decided to leave SAP SE. In 2016, McDermott was named “Manager of the Year” by the German Business Daily. He also received the award as TOP CEO by Glassdoor.

Current Co-CEOs – Christian Klein & Jennifer Morgan

Presently, the duo Klein-Morgan handling the CEO position of the firm. Starting from Jennifer Morgan, she joined this company back in 2004. After serving for a long time, in 2017, she appointed in SAP’s Executive Board. However, she became the first female in America that first-ever appointed to the Executive Board. While Klein, the Co-CEO joined the company in 1999 as an intern. Thereafter serving at several positions he named as a CEO along with Jennifer.

Bill McDermott : The Inspirational Life Story of the First American CEO of SAP

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Great minds and great ideas will find their way to success, even after facing difficulties. Such a great person with a great mind is the American businessman and the highest paid CEO of SAP SE, Bill McDermott, who despite spending his childhood in poverty emerged as one of the most powerful businessmen of America. McDermott has described his whole amazing life story in his book, “Winners Dream,” co-written by Joanne Gordon, that has been awarded a gold medal for a business memoir of the year by the Axiom Business Book Awards.

Early Life

McDermott was born in Amityville on Long Island, to Kathleen and Bill McDermott. His father worked as a power maintenance specialist at Con Edison, and his grandfather, Bobby McDermott, was a famous basketball player. According to his book, he had a tough childhood, and his family faced critical financial conditions. Even the family used to live in a house with a floor that flooded every time it rained.

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McDermott, from a very tender age, started working in part-time jobs. At the age of 11, he started selling newspapers, greeting cards, cookies, and other products and saved enough money to start a new business. When he was sixteen, he bought a Country Deli for $7,000, with the money he earned in past five years, with different jobs and businesses. His County Deli business proved to be most beneficial for him, as he was able to get admission into an undergraduate course in business management at Dowling College, with the earned profits.

After completing the undergraduate course, McDermott joined Northwestern University’s Kellogg School of Management to pursue an MBA degree and later, attended the Wharton School of Business, where he completed the Executive Development Program.

Career

Possessed with awesome management skills and an MBA degree, McDermott managed to get a job in the sales department of Xerox. He continued working in the same department for 16 years, and at the age of 36, he was promoted to the post of Division President of Xerox’s sales, becoming the youngest person to hold that position in the company.

Later, in 2000, McDermott became the President of Gartner and served at the same position till 2002. He also worked as the Executive Vice President of Worldwide Sales and Operations at Siebel Systems.

Career with SAP

In 2002, McDormett joined SAP America, as the CEO of the company. Only in few years, he was designated to the SAP Executive Board, followed by gaining the position of co-CEO of SAP AG, in February 2010. SAP is a German company, and McDermott became the first American to hold the position of the CEO of the company, on May 21, 2014.

Personal Life

McDormett is married to Julie McDormett, and the couple has two sons together. At the time he was working in Gartner, Julie suffered from breast cancer. After six months of chemo, she recovered from the disease. But later, his mother suffered and died of pancreatic cancer. The incident encouraged him to launch the Kathleen McDermott Foundation for pancreatic cancer.

McDermott is a member of the Business Roundtable and the European Roundtable of Industrialists (ERT). He has won many honorary awards including the GENYOUth’s Vanguard Award, the City Year’s Idealist of the Year, and the Manager of the Year by the German Business Daily.