After nine years, Bill McDermott is stepping down as SAP CEO

After nine years, Bill McDermott is stepping down as SAP CEO

The American CEO is leaving on a high after a nine year tenure that has seen continued growth, despite some significant speed bumps along the way.

SAP CEO Bill McDermott at the 2019 Sapphire Now: 'Customer satisfaction is a race without a finish line'

SAP CEO Bill McDermott at the 2019 Sapphire Now: 'Customer satisfaction is a race without a finish line'

Credit: SAP

SAP has announced that CEO Bill McDermott will not be renewing his contract and will be stepping down as the CEO of SAP after a nine year tenure, with Christian Klein and Jennifer Morgan taking over, making Morgan the first ever female (co) SAP CEO.

The Long Island-born McDermott was appointed CEO of SAP America in 2002 after stints at Xerox, Gartner and Siebel Systems. He stepped up to the top job in 2010 as co-CEO alongside the Dane, Jim Snabe. He became the first American CEO of the company in 2014.

Every CEO dreams of handing an exceptionally strong company to its next generation. Today we did it for @SAP. I love the people of this company. I couldn’t be prouder of what we did. @JenniferBMorgan & @ChrstnKlein will be outstanding. Now we start the next chapter!
— Bill McDermott (@BillRMcDermott) October 11, 2019

McDermott has been an energetic and charismatic leader of the German software vendor. He is a talented marketeer, having overseen several major product launches, including its next generation ERP S/4HANA, a new CRM system C/4HANA.

He has also been aggressive on the mergers and acquisitions side of the business, including overseeing the major acquisitions of SuccessFactors, Concur, Hybris and, most recently, the $8 billion purchase of Utah-based Qualtrics.

That doesn't mean it has all been smooth sailing however. McDermott has had to shift an oil tanker of a software business towards the new software-as-a-service model in many ways, and has had to confront what was a growing crisis over licensing and pricing in the aftermath of the Diageo court case in 2017.

There have also been inevitable rounds of layoffs, and something of a senior executive exodus over the past year as the company continues its transition.

“Every CEO dreams of being able to transition a company to its next generation from a position of significant strength,” McDermott said in a statement. “When you look at where we were and where we are, I simply could not be prouder of what this company has achieved over the past decade. I am thankful for the opportunity to lead one of the world’s finest companies."

McDermott oversaw huge growth at the software vendor and has seen the stock price steadily grown under his leadership, from US$50 at the end of 2010, to $115 today.

He also suffered a horrific accident in 2015 while staying with his brother, when he fell down a set of stairs with a glass in his hand, nearly losing his left eye as a result. He now wears a pair of signature tinted glasses in public.

SAP founder Hasso Plattner said in a statement: "SAP would not be what it is today without Bill McDermott. Bill made invaluable contributions to this company and he was a main driver of SAP’s transition to the cloud, which will fuel our growth for many years to come. We thank him for everything he has done for SAP.

"We also congratulate Jennifer and Christian for this opportunity to build on the strong foundation we have for the future of SAP. Bill and I made the decision over a year ago to expand Jennifer and Christian’s roles as part of a long-term process to develop them as our next generation of leaders. We are confident in their vision and capabilities as we take SAP to its next phase of growth and innovation.”

Both Morgan and Klein already sit on the Executive Board at SAP. Morgan joined SAP in 2004 and is stepping up from here role as president of the Cloud Business Group, signalling further commitment to that part of the business.

Morgan said in a statement: “I could not be more grateful to Hasso Plattner and the Supervisory Board for placing their trust in me and Christian to lead this next chapter for SAP. We accept the challenge with a high degree of humility, but also with a sincere belief that the best is yet to come for SAP."

Klein is an SAP lifer, who started his career there as a student twenty years ago. He is stepping up from the role of chief operating officer and was heavily involved in the development of S/4HANA.

Klein said in a statement: “As someone who began my career in the halls of SAP, this is the highest honor I can imagine to become co-CEO together with Jennifer. Hasso Plattner has given us a tremendous opportunity and we are truly thankful to him and the Supervisory Board. SAP has the most comprehensive solution portfolio in the industry. We have an unprecedented opportunity to finish what we started and deliver the intelligent enterprise.

"This will be the best way to honour our predecessor, Bill McDermott. We will always strive to be leaders who bring out the best in people like Bill has always done.”

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