SAP’s loss could be environment’s gain

Perhaps more surprising than Agassi's recent departure was that he stayed with SAP so long

When Shai Agassi left SAP at the beginning of this month to pursue personal interests in alternative energy and environmental policy, it shouldn’t have come as too much of a surprise. After all, Agassi was a serial entrepreneur throughout the 1990s, starting several software companies in his native Israel; he only joined a global company in 2001, when SAP bought TopTier, which he co-founded and sold to the German software giant for $US400 million.

Perhaps more surprising than his recent departure was that he stayed with SAP so long. Coming aboard as part of the TopTier purchase, he served in several roles, most recently as product and technology group president.

His choice to join SAP surprised many in the industry, given that company’s reputation for conservatism, but it was there, rather than with another start-up, that he saw the greatest opportunity for himself, he told Red Herring in 2003.

“I had a vision of enterprise computing that was too big for a small company to execute”, he said at the time.

“I needed to ally TopTier with a much bigger player [and] SAP is providing me with an environment where my ideas about computing can have a real impact on the market”.

CIOs were becoming more conservative after the dot.com crash and wanted to buy from big, well-established suppliers, he said.

Agassi was introduced gently to SAP, first heading up the portals division, which was run separately from SAP’s mainstream operation.

“We modelled it as a Silicon Valley-style company, but including a bunch of people from SAP,” he told Red Herring.

“It was an interesting environment — the people from SAP seemed to feel that ‘this is not our culture’, and the people who weren’t from SAP looked at SAP and said, ‘Thank God this is not our culture’,” he recalled.

When the portals division was integrated into SAP Agassi experienced the then-SAP culture firsthand, arguing for four hours with the senior management about whether a new way of aggregating and building business processes without being tied so rigidly to a database structure should be adopted.

Agassi prevailed and SAP’s xApps applications were born.

While xApps and the development of Netweaver (which places all post-R/3 SAP applications on a single, service-oriented platform) rank high among Agassi’s achievements at SAP, perhaps his most enduring legacy is the TopManage application set.

SAP bought TopManage in 2002, not long after the TopTier purchase. Like TopTier, TopManage was co-founded by Agassi.

It subsequently became SAP’s Business One product, an ERP suite aimed at small-to-medium sized businesses.

The buy helped get SAP into the SMB market and is generating new customers and revenue. This is especially noticeable in SMB-dominated markets such as New Zealand, where Business One is making significant inroads.

Agassi was due to become co-CEO of SAP when Henning Kagermann departed the role, which was originally scheduled to happen this year. However, according to SAP chairman Hasso Plattner, “it became apparent to Shai that he wasn’t comfortable with committing a long-term, 10-15-year period to SAP”.

No doubt SAP would have liked another decade or more of Agassi’s expertise, but the six years it got from him brought it huge benefits.

Alternative energy and the environment are set to gain from SAP’s loss.

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