TITANS OF TECH
The No-People Person
SAP’s Henning Kagermann says you’ll soon run your business by remote control. Then you’ll have no one to blame but yourself.
By John Battelle, July 2004 Issue
Henning Kagermann isn’t an avid jet pilot and sailor like Oracle’s (ORCL) Larry Ellison, or a showman and provocateur like Salesforce.com’s Marc Benioff. Now the chairman and CEO of Germany’s SAP (SAP), the world’s second-largest software firm, Kagermann, 57, used to be a physics professor. And from the way he talks, it’s as if there were still chalk dust on his shoulders. But ask him about his competitors and he becomes hyperaggressive, dismissing his peers as preening chest thumpers who have lost touch with their customers. He may have something there: In the market for software that runs business operations, SAP is larger than the next two firms put together. That’s not a theoretical equation, since one of the two, Oracle, has been trying to acquire the other, PeopleSoft (PSFT) — a deal that’s been blocked by the U.S. Department of Justice on antitrust grounds. As archrival Oracle prepared for a trial contesting the ruling, Kagermann reflected on SAP’s role in the business-software market, the company’s recent flirtations with Microsoft (MSFT), and why robots will replace offshore labor.
Oracle’s lawsuit seems unprecedented. It’s rare for a company to dispute an antitrust finding in court. What’s your view?
On the one hand, even if Oracle and PeopleSoft were combined, they would be less than half our size. So we still wouldn’t have a competitor that’s close to us. But we don’t like artificial definitions of markets. It’s not a good precedent.
So there’s a part of you that agrees with Larry Ellison.
Why focus on finance and HR applications, as they did in this case? Why not enterprise resource planning, for example?
During the trial some things came out regarding merger discussions that SAP had with Microsoft. Can you tell us more about that?
Microsoft approached us, we were listening, and then they discontinued the talks. I believe they felt it was a little too complex. That’s it, that’s all. Not a story.
Hypothetically, then, is there some logic to the idea?
[Laughter] I can sit here and say nothing for 30 minutes if I have to!
The American tech industry seems to thrive on bravado. PeopleSoft’s Craig Conway, for example, has taken you on personally, accusing you of cribbing his speech material.
Why do people even listen to this stuff?
Maybe it’s more interesting to watch rich guys take potshots at each other than to talk about software.
But enterprise software is sold on trustworthiness, not glamour. All this chest pounding, it’s only for the press; it’s not for the customer, believe me.
It seems that Tom Siebel, Marc Benioff, and Larry Ellison would disagree with you. These men are well known for being flamboyant …
Yes, but what is their success in this market? Larry claims that he will overtake SAP. But just look at the facts. Who’s gaining market share? It’s all bullshit. Just look at the figures.
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