Example of saying “yes, but” to customers…

Per some recent comments and posts (here and here) on discussing responsiveness to customers, Henning Kagermann related a story on a call that I had completely forgotten about.  I’m certain that it has been told publicly before, but I’ve disguised it a bit just in case…

In the early 1990’s, SAP was approached by a delegation of firms w/r/t industry-specific improvements to R/2.  They had a list of demands that they wanted to see implemented in R/2.  Fair enough.  That industry was perhaps the core of SAP’s success to that time, so why not do it?  Except that SAP was in the midst of developing its next generation product, R/3.  We also wanted to expand our footprint to other industries and markets.  There was no way we could do R/3 and satisfy much of that list of demands in the current product.

If you know anything about the history and success of SAP, you can guess the answer.  We chose to spend the preponderance of our efforts on R/3.  While some of the key demands were satisfied, most were deferred in favor of ensuring that R/3 got to market.

This example illustrates the challenge well.  Most of the time you should listen to your customers so you can satisfy and delight them.  But listening for too well for too long can mean that you wake up one day and find that you’ve become a no-growth “legacy” business.  Sometimes you need to say “yes, but.”

Good article on SAP CEO transition

I liked Carter Dougherty’s recent article (here) on the pending handover from Henning Kagermann to Leo Apotheker.   Most of the focus is on Henning and the tone is casual and chatty, befitting a successful exiting CEO.  For the most part the facts, spin, etc. appear correct.  It’s also useful to remember that Henning did lead sales for a bit; he isn’t simply a coder. 

There is one bit of emphasis I’d like to add to this paragraph:

There is some truth to the tale being told in the markets, but the reasons run deeper than a mere change of chief executives. The company is indeed shifting its focus more toward the bottom line,…

Definitely agree so far.

… and less on the multibillion-dollar investments in technology that helped make it the market leader in the lucrative field of business software.

Don’t agree here… in fact, my take is that we’re being more careful about how we spend our R&D dollars.  The intent is to focus the development portfolio on initiatives that are true game-changers or keep us on top of the current game, which usually aren’t small potatoes.

For more on this, my own comments when we announced the new R&D targets are here, along with some from Dennis Howlett (here) and Larry Dignan (here).

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