While a lot of software companies are closely associated with their founders or chief executives, few are as joined at the hip as SAP and founder Hasso Plattner. So in many ways the best bellwether of how well SAP is doing is to check in with Plattner. When Plattner is up, SAP is up. And when hes down, the company is down with him.
Add another six years to my coverage of SAP, and it looks like the Plattner index is still the best way to read the tea leaves. In the midst of the biggest management shake-up in the companys history, the not-so-hidden hand of Hasso Plattner was everywhere. In private calls to analysts and in public forums, Plattner was there to explain why heir apparent Shai Agassi left, why SAP will be okay without Agassis leadership, and why the companys new management structure is going to be a winner.
Maybe a little more Hasso Plattner might be good for SAP. After all, the month of March was a bad one for SAP. First came the in-your-face lawsuit from Oracle that, from where I sit, looks destined for the discard pile. But not before it succeeds in damaging SAPs reputation and the third party maintenance market that SAP subsidiary TomorrowNow helped pioneer.
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Then, while everyone was still digesting Oracle v. SAP, Shai Agassi resigned amidst a massive reshuffling that, while in no way related to the lawsuit, made for a textbook example of poor timing. At least it temporarily took the lawsuit off the table, though, dont worry, not for long.
All this followed news that SAP had another lackluster quarter, while archrival Oracle hiding behind an accounting morass that makes analysis of the accretive value of its acquisitions largely impossible claimed a huge uptake in revenues in its critical applications business.
Meanwhile, SAP marches off to a double rendezvous with destiny. In one week later this April that will surely go down in history as a major inflection point for the company, SAP will report its Q1 2007 earnings and then assemble its customers, prospects, and partners for its annual Sapphire conference.
Its always dangerous to time events like this so close to one another bad news in the earnings call will surely swamp a Sapphire already struggling to have product and strategy messages heard above the din created by the lawsuit and management changes. Good news will give everyone something to fete, but only insofar as the new management will be able to assume a less defensive position in the wake of the charisma deficit left by Agassis departure.
Which is where Plattner comes in. For the first time in years, Plattner will take to the stage at Sapphire and help articulate the companys strategic vision. (Last years appearance doesnt count Hasso mostly talked about esoteric design issues.) While hes prohibited by German law from taking an executive role in the company, theres nothing stopping him from playing the eminence grise role that he is so perfectly suited to play. Without a doubt, if the Plattner index is up, the aforementioned charisma deficit will be quickly forgotten.
Right now, the Plattner Index can only go up. Agassis departure was clearly something Plattner would have liked to avoid, and, with no obvious drubbing in the financial markets following the announcement, and no one claiming that Agassis departure and the lawsuit were connected, Plattner has to be breathing a little better. The management changes seem to be playing well for now, and the plethora of seasoned management that the company can deploy to fill in Shais is truly impressive.
But the real showdown will be at Sapphire, with Q1 numbers on hand and an inquisitive audience looking for the proof points that all is and will be well in SAP-land. Long gone are the days when Hasso would break out an electric guitar and play for his customers, but I for one expect the performance of a lifetime. And not just from Plattner: its now or never time for SAP.