When Thomas Saueressig became CIO of SAP on May 1 of this year, he was among the youngest CIOs of a multi-billion Euro company at 31. Though young, Saueressig came with a long history at SAP, having joined the company while he was a student in 2004 as part of a cooperative program at his university in Mannheim, Germany. He quickly accumulated a wide array of experiences beginning with 40 software implementations. He took on rotations around the company and around the world. He was particularly influenced by culture of innovation during his six month stint in Silicon Valley.
When Saueressig became part of the IT leadership team under his predecessor as CIO, Helen Arnold, he was responsible for driving innovation while maintaining stability. Achieving this balance correctly is one of the fundamental challenges of the modern IT executive. He was successful enough to be asked to succeed Arnold when she was, in turn, asked to lead a new SAP business area called “data as a service,” in California.
As a millennial, Saueressig recognizes that he is familiar with modern technology and modern practices that are ascending in importance as the digital natives increasingly populate companies around the world in ways his older colleagues may not be. As such, he has modernized the SAP workplace in a variety of ways, and introduced several new business models to the company, all topics we cover in some depth herein.
Peter High: Thomas, you are one of the youngest CIOs of German DAX company or of a major company anywhere in the world. SAP has touted the advantages of having a millennial as a CIO. What do you see as the advantages?
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Thomas Saueressig: There is more than one advantage. While I am not officially a digital native, I am of the generation that grew up with personal computers. I could write Basic code at the age of six long before I could write a grammatically correct sentence. This level of comfort with PCs means I completely understand and relate to how millennials expect their work environment to function. They want to be flexible, they want instant access, and they want applications to be seamless. This makes them both happy and productive.
Like all companies in the digital economy, SAP is undergoing a major transformation. We have reinvented ourselves as the cloud company, powered by SAP HANA. In order to accelerate this, we need all employees to have an innovation mindset to be open to new ideas and agile in our ability to change. On the whole, millennials are able to accept and embrace change. While we rely on our older colleagues for their wisdom and experience, it is also important to have individuals who fuel change energetically. I appreciate that the SAP workplace makes room for both.
High: You began your career at SAP while you were still at university through an internship program. Can you describe the roles you have had since, and the sources of your rapid rise through the organization? At what point was the CIO role a goal of yours?
Saueressig: I started out as an SAP consultant and later became a project manager. During this time, I completed forty software implementation projects in customer relationship management. When you are on-site, you gain huge insight into the implementation and go-live of SAP software solutions and an understanding of how challenging large IT projects can be. That empathy that I developed for our customers on-site and specifically the users of our solutions now feeds into my strategy of driving user-centric IT. After that time, I had the opportunity to do a top talent rotation and moved to Palo Alto in the heart of Silicon Valley for six months which opened up my mind for innovation and entrepreneurial spirit.
I then had the opportunity to work as an executive board assistant, which gave me a holistic view across the whole of SAP, a different view on decision making and handling of escalations. Subsequently, I took on various leadership roles in the IT organization, starting with ramping up the Enterprise Mobility team to mobilize SAP, each time honing my understanding of the critical role IT plays.
I would not say I made the CIO role a goal of mine, but there came a moment when it was clear that the role was open and I was happy to go for it. I feel very honored that SAP has trusted me with the responsibility, and it is a clear sign of the trust SAP puts in its employees. It is also important for me that it is not about the title. It is about the impact you can make and, with this role, impacting the lives of 80,000 employees as well as driving the external perception with our digital presence.
High: Many CIOs follow predecessors who have been asked to leave, and therefore a major change is required. You are following a CIO who has been promoted. To what extent has your strategic plan been one of continuity versus fundamentally new priorities?
Saueressig: In my role as Head of IT Services, I was charged by the then-CIO with leading the delicate balancing act between driving innovation while ensuring stability. This is absolutely critical not only for SAP but for all companies facing transformation in the digital economy, and it continues to be a strong pillar in my strategic plan. I evolved the strategic plan to become a user-centric IT and to enable SAP to become a Digital Enterprise, meaning providing the most modern workplace as well as enabling new digital business models. Additionally, we are accelerating our move to the cloud and to transform the IT delivery into Agile. This has a direct impact on the IT workforce. Hence, a key priority is the development of our people, to ensure the right skillsets, but also to foster the right mindset, spirit and culture in the IT organization.
High: You have noted that part of your role as CIO and Global Head of IT Services is to play a fundamental role “in driving the digital transformation at SAP to truly become a Digital Enterprise which runs simple.” Can you describe what you mean by this?
Saueressig: This has multiple aspects. As I described, SAP is on a continuous journey to become the cloud company, powered by SAP. This significantly changes SAP and the IT organization needs to enable the new business models. In parallel, we need to automate and optimize our business processes to enable sustainable growth and high volume business scenarios like the Business Networks.
The greatest value and asset of SAP are the 80,000 employees with all their experience and expertise. IT organizations need to focus the activities to have positive impact to the user and therewith drive employee satisfaction and employee productivity. Hence, providing a modern workplace is key, where people can work anywhere, anytime, and on any device but also have the possibility to collaborate in virtual team across the globe.
High: How does IT help enable a modern workplace in your mind?
Saueressig: At SAP, IT has long been the driver of an innovative modern workplace. When I first started in IT, we were the first company to offer employees digital devices so that they could work on the road. Now mobile is a core pillar in our strategy. We are constantly looking at ways to improve, simplify, and streamline the workplace for SAP’s employee population. Improving the productivity and satisfaction of our 80,000 employees is key to success, especially also considering the tremendous collaboration and communication across the globe. IT is key to enabling the global knowledge and experience sharing and, with the new technologies, provides great potential to optimize this even further and also enable a new work environment. Key to this is the innovation mindset that I mentioned before as well as having great people. My teams are at the forefront of innovation at SAP and have the opportunity to leverage the latest and greatest technology.
High: You also enable new business models. Can you describe some of these new models, and the rationale used for the changes?
Saueressig: The rationale is SAP must meet new customer expectations, and by customers we mean literally anyone, including small, medium, or start-up businesses as well as individuals. Some of these expectations are things like in-app purchases and renewals, pure digital products that you only need a credit card to buy in addition to products priced by the number of users per month. Within minutes customers can scale their solutions to their needs. In a digital world, this needs to be fully automated and able to run at scale.
To support this new business model, which we call “SAP Digital Business,” we built the SAP Store on SAP Hybris to simplify the end-to-end process of finding, purchasing, and consuming software in a completely no-touch and low-touch environment till the provisioning of the cloud tenants in the data centers. With this, IT also becomes part of the core value chain. We can dynamically change offers to match market needs extremely quickly and it gives us a basis to explore new models for example usage-based pricing, third party, and partner offerings as well as affiliations with other online providers.
High: SAP has long had an “SAP runs SAP” program, where IT is client number one of the company. What has been your philosophy in managing the so-called “SAP runs SAP” program?
Saueressig: It is a no-brainer that we are happy to use and showcase our own software. In so doing, we provide those proof points for customers who are perhaps looking at cloud or SAP S/4HANA and wondering whether to make the shift. We are able to demonstrate how and why we did so, and how our business has improved. It is a great proof-point for our customer so see also global scale companies leveraging our software to differentiate in the market. SAP is a great reference customer across all areas, from the Digital Core with SAP S/4HANA, Customer Engagement & Commerce, Workforce Management, Supplier Management or the SAP HANA Cloud Platform.
However, it is also essential that what we do is simple, which is why we now talk about “SAP runs Simple”, and with that we not only use all of SAP’s products, but also actively show how SAP is actively working on process simplifications and redesign which is a key success factor. We should never forget that it is not about the software per se, but the user and the impact we can generate for him/her and this includes multiple more factors.
High: What technology trends particularly excite you?
Saueressig: I am very interested in finding ways to feed technologies such as machine learning, artificial intelligence, augmented reality and voice recognition into the SAP workplace. With my strong affinity for technology, it is a priority for me to keep an eye on these developing trends.
Peter High is President of Metis Strategy, a business and IT advisory firm. His latest book is Implementing World Class IT Strategy. He is also the author of World Class IT: Why Businesses Succeed When IT Triumphs. Peter moderates the Forum on World Class IT podcast series. He speaks at conferences around the world.
Date: August 29, 2016