SAP reshuffles leadership as cloud crusade continues

New moves follow year where customers complained it broke their trust

Global ERP giant SAP has announced two changes to its executive board in order to spur its quest to shift customers to the cloud.

Thomas Saueressig serves as the German company's CIO and has led product engineering since 2016, but he is to depart these technical roles to lead the newly created board area.

This is designed to "accelerate cloud growth and adoption" and is "focused on ensuring customers' ability to embrace continuous innovation in the cloud," according to an official statement.

At the same time, Muhammad Alam will join the company's Executive Board, succeeding Saueressig and assuming responsibility for SAP's product engineering. Since February 2022, Alam was chief product officer for SAP's procurement and supply chain software business. Before that, he spent 17 years at Microsoft doing consulting and managing the Dynamics application business.

SAP made moving customers to the cloud an imperative as part of its pitch to investors after it reset earnings guidance in 2020 – a move that briefly earned a 25 percent drop in the company's value.

Since then, SAP has pushed to execute the strategy with a growing sense of urgency. In July last year, CEO Christian Klein told investment analysts that future innovation would only be available in the cloud on its terms, such as the RISE with SAP lift-shift-and-transform program. Crucially, customers who made massive investments in migrating to the latest S/4HANA ERP platform on-prem would not see innovation in upgrades.

The move was damned by user groups in German-speaking regions and in the UK and Ireland who argued the enterprise software giant had broken customers' trust. It was Saueressig who, in 2020, promised customers the choice between cloud and on-prem for their implementation of S/4HANA, the latest and future ERP platform.

Speaking for the UK and Ireland SAP User Group, chairman Paul Cooper told users in Birmingham: "Mr Saueressig didn't once say that cloud deployments came with full innovation, while other flavors of S/4HANA didn't."

Since then, Klein has assured the German-speaking user group, DSAG, that "we won't leave any customer behind."

He told the user conference in September last year: "There may be others that have acted differently [but] SAP will continue to invest in functions and features for our on-premises customers. We will continue to hold more than 200 ERP versions in more than 130 countries. We will localize them and we will maintain them. For that, we will spend several billions of euros to take these customers along."

In a statement, Professor Hasso Plattner, SAP co-founder and chairman of the supervisory board, said Saueressig had "demonstrated leadership, expertise and customer focus."

Effective April 1, SAP will put the power of a new dedicated board area called "Customer Services & Delivery" behind the company's drive to support customers in their cloud transformations, accelerate innovation adoption, and further increase customer satisfaction, the company said.

"Everything we do at SAP, we do for our customers," claimed Saueressig in a statement. ®

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