McDermott was aware of the cultural differences. “When I present to a U.S. audience, I try to inspire them quickly, get them engaged right from the beginning,” he wrote in Harvard Business Review last November. “With a German audience, I need to be more fact based up front and have a more disciplined presentation style to build a case, almost as if I were in a courtroom. I also find that many business cultures appreciate a clearer acknowledgment of problems than U.S. audiences want.”
Adapting to the culture helped SAP’s North American operation back to growth and McDermott was given more markets to oversee, including Asia-Pacific and Latin America, before becoming president of global sales and co-CEO with Jim Hagemann Snabe in 2010 and then sole CEO in 2014. But McDermott – the young deli-owner who won customers from the incumbent 7-Eleven by virtue of being smaller and more nimble – arguably now has the opposite challenge on his hands.
SAP is an organization with more than 85,000 employees in over 130 countries, and its customers are facing an “intense maze of circumstances,” according to its 2016 annual report, meaning that the business must be agile enough to serve them.
Those circumstances include a sense that fund managers have to “adapt or die” when it comes to the digital world as well as the growing complexity of business in general and the impact of artificial intelligence in particular.
“SAP is probably the embodiment of what I would term legacy systems, this old clunky world of ERP (Enterprise Resource Planning software), (a) huge investment but incredibly difficult to change,” says analyst Tom Reuner, a senior vice president of Intelligent Automation and IT Services at HfS Research.
“If I look at the priorities of most buyers of most organizations, they’re looking to … move from (the) concrete world of ERP to (a) much more flexible way of engaging.”
Having a CEO from the U.S. has helped SAP have a more global view, said Reuner, who remembers McDermott when they both worked at Gartner. “A lot of German companies struggled over the years to become more global and almost to shed almost their German DNA and embrace a lot more global mindset. For me, SAP has embraced that, and somebody like Bill, it’s probably his point of reference is more a global one than anything else.”