SAP's Vishal Sikka Resigns; Leaves Company at a Crossroads

Following a supervisory board meeting Sunday, SAP announced the resignation of Executive Board Member Vishal Sikka. With Sikka's resignation effective immediately, the supervisory board named Robert Enslin and Bernd Leukert to the company's executive board "to advance the technology industry's most successful transition to the cloud," according to a company statement. Though the company says Sikka has stepped down due to "personal reasons," analysts agree that his decision could represent a major organizational shift for SAP.

Once called "the innovator of our generation" by SAP co-CEO Bill McDermott, Sikka spent roughly 12 years at the company, overseeing four major acquisitions (Business Objects, Sybase, SuccessFactors, and Ariba), driving massive updates to the SAP Business Suite, and championing the development of SAP's next-generation database, HANA. With growing pressure from customers and competitors to focus on applications and cloud-based solutions, however, the company was ripe for an executive shakeup, according to Ray Wang, cofounder and analyst at Constellation Research.

"The company has been trying to make decisions as to whether they're going to emphasize apps versus platforms, which is what [Sikka] wanted to do. They also have to choose between execution versus innovation, which [Sikka] was known for, and if they'd rather buy software versus build software," Wang says.

Recent acquisitions in the marketing space, for example, have left SAP with a hole in its suite of offerings. "Think about all the marketing companies that have been bought up: Unica, ExactTarget, Silverpop, Neolane...what's SAP got? You take an area like CRM in the marketing sense, and you have to ask: Do we buy or do we build?" Wang says. It's those kinds of questions that the company faces, he explains.

The pressure from customers that have been eager for more app-based solutions is mounting as well, and analysts predict that a redirection will be a welcome change on the customer front. "SAP product development will become more application- and less technology-centric, which is good news for SAP customers," Holger Mueller, analyst at Constellation Research, says. SAP is at a logical point where enough has done enough to run SAP apps on HANA, Mueller explains, but now the question becomes where the company will direct its investment. "SAP is well funded to invest both in applications and technology, but an overall higher focus on applications will benefit customers more," he says.

Sikka's resignation came as a shock to the SAP community and the software technology community as a whole. "There has been an emotional outpouring—shock, sadness, and grief," John Appleby, HANA practice lead at Bluefin Solutions, wrote in a blog post on SAP's 

CRM Covers
for qualified subscribers
Subscribe Now Current Issue Past Issues

Related Articles

Sapphire Now: Combining Technology and Strategy to Achieve Simplicity

Speed of SAP HANA is one route to better customer and employee experiences.

At Sapphire Now: SAP Intends to Shed Complexity

Enterprise software needs consumer-level simplicity, says SAP CEO Bill McDermott

Big Blue Makes Key Cloud Announcements at IBM Innovate

IBM launches SAP apps on Softlayer, opens a data center in Hong Kong, and updates Bluemix with DevOps.

Adobe Announces Strategic Partnership with SAP, Touts Updates to Marketing Cloud at Adobe Digital Marketing Summit (Video Interview)

Adobe's innovations surround deeper Marketing Cloud integrations, the real-time enterprise, and mobile marketing.

After CEO Ouster, Plattner's Plea: "Please Trust SAP. We Have Not Forgotten You."

Announcing the exit of Chief Executive Officer Léo Apotheker, SAP returns to a "Co-CEO" format, appointing Bill McDermott and Jim Hagemann Snabe to split leadership duties.