The company is gaining Silicon Valley expertise as it navigates North America and battles Oracle and Siebel.
Posted Jun 23, 2005
German giant SAP AG has enticed a number of executives from enterprise rivals, including Oracle, PeopleSoft, and Siebel, and to join its production team, the company announced this week. In the past 18 months the company has hired more than 200 employees from a range of competitors. While the software industry has always poached talent from competitors, most of these folks are usually sales people. What makes the recent hires by SAP noteworthy is the number of development and marketing executives included, according to the company.
The new hires will join SAP's product development team, run by Shai Agassi, president of the product and technology group, in California. These include Richard Campione, former Siebel vice president and general manager, financial services and public sector business; Mike Mayer, former senior director of international projects at Oracle; Nimish Mehta, previously a senior vice president of customer data integration at Siebel; and Gordon Simpson, formerly CTO at BEA Systems.
"Over the past several months we've augmented our current team's expertise with new talent that together will lead SAP in the enterprise application and platform market over the next decade," Agassi says. "This wave of incoming talent proves that SAP is attractive not only to outside companies seeking a stronger partnership, but also to leaders outside our organization who are looking to influence the industry through their work at SAP." A spokesperson for SAP maintains the company was not actively looking to go on a hiring spree. "It's not like we had Shai knocking door to door locking for these people," he says.
According to AMR Research, Oracle has recently doubled its market share in business applications to 12 percent with its $10.3 billion acquisition of PeopleSoft. SAP, the leader in that segment, has an 18 percent market share. SAP says it plans to add 3,000 employees to its more than 32,000-member workforce. The additions come as Oracle and Siebel have both announced job cuts. Specifically, Oracle has stated it will cut 5,000 jobs following its purchase of PeopleSoft.
SAP stands to gain competitive intelligence from these personnel changes, according to Martin Schneider, enterprise software analyst at The 451 Group. With most enterprise software road maps planned five to six years in advance, companies can "get a holistic view of the competitor's mindset," he says. "It's like the Yankees hiring Terry Francona, or the Red Sox hiring Joe Torre. By having an idea of what your competitor is going to be doing for the next five years, you can better plan your strategy to compete or go around their product development."
The addition of so many Silicon Valley executives also provides SAP the ability to navigate its product line into a heretofore unconquered North America. "A lot of their executives are now from North America. They're trying to get into the North American market and are getting the best people they can," Schneider says.
The moves are proof of industry consolidation and rough times at industry competitors, Schneider says. "If Siebel embraces OnDemand, it's going to take a lot of hits and have to restructure and reorganize itself into a stronger, leaner company. Oracle's business applications have been tenuous at best. Plus, they're dealing with the fallout of the PeopleSoft acquisition. It's not smooth sailing at Oracle and Siebel right now. There's a lot of uncertainty and confusion there."
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