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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.

Ursula Burns: The first black women CEO of a fortune 500 company

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It all started with a woman, living in the rough and tumble public housing projects on the Lower East Side of Manhattan, believing that educating her children was the only solution to all her problems, mostly poverty. This woman was Ursula Burns’ mother.

“We were poor for sure but my brother and my sister and I were shielded totally form this poverty and we were shielded by this one person and that was my mother”, says Ursula, who was ranked by Forbes magazine amongst the most powerful women on the planet. She adds, “she was a frantic every day to try to make sure that we were safe and fed and educated”.

Her mother used to make $4400 a year, half of which was spent in sending her three children into a catholic school. Ursula remembers her childhood and says, “we got dental care by her (Ursula’s mother) cleaning the dental office. We got healthcare by her cleaning the doctor’s office”.

So, when Ursula completed her schooling and was looking forward to start her college life, her primary motive was to choose a degree course that would help her earn lot of money. After doing some research she came to know that Chemical engineering promised a carrier with the maximum monetary gains. She applied to various colleges and got admitted to Brooklyn Polly.

Ursula Burns
Ursula Burns, Image Credit: fortunelivemedia, Flickr

At Brooklyn Polly, after attending the first lecture, she realized two things. First, she wasn’t good at chemistry. Second, she hated the subject. Disappointed, she decided to stick to her previous plan of being a teacher, which she had abandoned after knowing the salary of a teacher. She also thought of becoming a nun or a nurse.

Fortuitously, her advisor suggested her to look out for other branches of Engineering. Ursula Burns settled for Mechanical Engineering and in her own words, ‘rest is history!’

She was hired by Xerox in 1980 as an intern and a year later she was made a permanent employee. About the time when she joined the firm Ursula recalls, ‘when I joined in 1980 there were literally and virtually no women in engineering.’ She also adds that the absence of any black women in the engineering department became a significant advantage for her. Being different from the crowd she was easily and frequently noticed.

She slowly climbed the ladder of numerous positions before becoming the CEO of the company, thirty years later. She appreciated Xerox’s policy of not asking her to become something or someone they want. All they wanted was her hard work and efforts and in return provided her with ample opportunities. One of the reasons, she admits, that she stayed at Xerox all this time through was that the company stood upon their promises.

Besides Xerox, Ursula Burns has served on numerous professional and community boards, which includes Exxon Mobil Corporation, American Express, Boston Scientific, National Association of Manufacturers, University of Rochester, the MIT Corporation, the Rochester Business Alliance, and the RUMP Group. She is also among the founding Board of Directors of Change the Equation, which is an organization that focuses on improving STEM-based education in the United States.

Ursula became the first black-African women CEO of a fortune 500 company. In 2014, Forbes ranked her the 22nd most powerful women in the world.

In a speech she delivered at MIT she recalls an advise her mother gave her: Where you are is not who you are. ‘…until I became the president of Xerox and I started to realize that if you don’t check yourself early you’ll start to become these ugly people these ugly leaders who think they’ve so much and that they’re so far away from the people who actually make the world go.’

In the same commencement speech at MIT, from where her own son graduated, she concluded by saying,

‘The measure of money is the least important measure over the long term.’