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It hardly seems like a big headline when a company announces a new award program for its employees. To save you the suspense, that’s exactly what we just did at SAP with the Hasso Plattner Founders’ Award. But there’s something behind this award that I personally believe is very special and unique.

/wp-content/uploads/2014/05/image002_jp5g_451340.jpegFew companies can lay claim to being the originator of an entire industry. Thanks to Hasso Plattner, Dietmarr Hopp, Klaus Tschira, Claus Wellenreuther and Hans-Werner Hector, SAP is one of the exceptions. Four decades ago this team of five engineers had the courage to do something bold. They believed so strongly in an idea that they left secure careers to bring their experiment to life. It was the ultimate act of innovation, a belief that there was a better way for businesses to run and the guts to go for it. Look what they created – not just a thriving company in SAP, but an entire industry rallying around the purpose they first saw. Those of us who have the privilege of carrying the SAP logo on our business cards stand on the shoulders of these giants.

My pride in SAP’s heritage aside, there’s more to this story.

Today every CEO I speak with is hungry for new ideas. They recognize that in this era of disruption, business model innovation requires an openness to new thinking from anywhere. SAP in many ways proves the point – 80% of our net-new revenues come from businesses we were not in 2009. Likewise, businesses in all industries will soon find themselves growing in ways they probably hadn’t conceived of only a few short years before. This challenge goes far beyond the boardroom. Winning companies are actually empowering their own customers and employees to help architect their future.

Just recently Hasso Plattner himself reminded everyone at SAP that we all face the innovator’s dilemma. Citing Clayton Christensen’s brilliant work, Hasso made one thing clear above all else: if we stop innovating, we’ll lose. The battle is in the will to be restless – to never stop looking around corners for the big idea that isn’t quite ripe. No corporate policies can make this happen, but they can certainly impede it from happening.

Here’s where CEOs have to play a significant role. Building a culture that promotes innovation is fundamentally about demonstrating that actions live up to words. It’s one thing to say that failure is OK. It’s another thing altogether to reward people who have the guts to try something big that ultimately fails. It’s true that the 21st century workplace is more open, giving individuals and teams some runway to dream, ideate and innovate. But most businesses are still highly complex with way too many layers between employees, their customers and their leaders – thereby limiting the possibility that most experiments will ever be noticed or nurtured. So the role I see the great CEOs playing is less about what they say and more about what they show by example.

So back to our new award – we’re offering it because we want every one of our 67,000 employees to be on notice: the courage and boldness it took to start our company is exactly what we need to keep growing it. We need ideas – bold ideas. We need people to have the entrepreneurial spirit to take our focus on simplifying everything and make it their own personal mission. What can they do that really moves us forward to the ultimate benefit of our customers?

In return for the leadership that our colleagues show, we’ll take the momentous step of honoring them alongside the giants who built us.

This is a moment for everyone to think and act like a founder – courageous, innovative, entrepreneurial. You’ll be able to tell a lot about the future of SAP by the number of compelling candidates we’ll have to consider. Knowing what I know about my colleagues, I predict a really difficult decision lies ahead.

Related media:

SAP Founder Hasso Plattner Recognized as Top Media and Tech Leader of the Past 25 Years

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  1. Mario Herger

    Bill, this sounds like a great idea (if I understand it correctly it’s an internal founder award to promote intrapreneurship and ultimately get out new innovations that turn into the next successful SAP products), but I am skeptical if there will be the will for long term duration and an approach that goes beyond just an award. We need one that changes the structure to enable intrapreneurship/foundership in an honest way.

    I left SAP in October 2013 after 15 years and had run internal innovation communities with over 5,000 colleagues. I worked in a team that organized all the Innojams (including HANA Olympics). I started the gamification initiative with my colleagues, we pushed the change so that we can create iOS apps, we run the Innovation Steampunk to purposely circumvent SAP-internal policies when we thought this is in the best interest of SAP and innovation. So I have some experience with this founder/intrpreneurship-culture inside SAP. And I was not a manager, I was just Mario from the trenches.

    While there were (and are) a lot of great colleagues doing really awesome stuff, we also had very hard times with a lot of gatekeepers who just wouldn’t do anything or prevent us. In the past three years legal and compliance alone had hit me 3 times because of different violations etc. that are part of when you are pushing the boundaries with innovation. Other colleagues can tell you even more stories on how legal dealt with them. When legal runs the company, you have a problem.

    Or imagine justifying to buy a Kinect Motionsensor for $150, which was denied, as were four years ago iPhones, because they were not business relevant. Or software that was not in the SWAP. There was no urgency to approve that. So colleagues installed that of course illegaly (violating internal policies, endangering their jobs).

    Even those teams that had the persistence and the story (whatever did not include HANA was anyways something you shouldn’t even try to push) such as the folks from SAP Research in Dresden building the SAP Gamification Platform (on HANA) which is a probably the killer app for HANA are going nowhere with getting this out as a product or at least a pilot with a customer.

    Other projects just fizzled because they couldn’t get a server to test, or were not allowed to interview a customer to verify their pilot.

    Or do you remember the Global Business Incubator? The last team to run through that program – the SAP Performance Gaming team – was told that they would not get their bonus, because the program was cancelled. They had worked their *** off, and people like Andreas Vogel who have done multiple of these projects and are these kind of intrapreneurs that SAP so desperately needs are kind of shown the finger. People talk about this. They hear about that. And now comes another initiative. Everyone will run, because this is from Bill, but in a 1/2 year that’s over.

    If you do just one award again, you’ll just thinking short term. You have to fix and reintroduce a culture again that allows that.

    Then let me ask you: who is selecting the award winners? A jury of managers who have never done their own startup, but just administered/managed/milked the cow? The same who do everything that Hasso or you say and may only want to please you both to get on with their next career step? The same that you just tell “hey, can you be a jury member?” The very same that think they are all Steve Jobs but have never interacted with startups and ideas? The same who have no stake in the idea or may be even threatened, because this is actually something that they should have built with their teams but found all excuses why the idea is not good? Instead of makers the excusers? The same who know innovation only from websites such as Forbes, Business Insider, or TechCrunch, but not because they go to VC pitches, hackathons, meetups etc.?

    Have you seen real VCs interacting with startups? These are the people you want to have. And they should have a stake in it.

    Well, well, anyways you’ll certainly have a great result. One that you can send out via press release, pad everyone’s shoulder. But not the result that may bring SAP into the future.

    You have no idea how much the focus on HANA HANA HANA (which is a database and SAP is foremost a company that does great business apps – this is like BMW selling their cars by only talking about the engine) stifles every other initiative. If it’s not something with HANA, forget about it. No chance. No manager caring about his/her career would support that. Especially not those transient managers that just come in, create chaos, and then leave, taking a huge salary increase in their next job. There were so many incidents in the company in the past years that whoever thinks they want to do something innovative just give up. And the managers who really try are being punished because of so many management changes. Like one of my last managers who had 6 managers in 3 years, all just caring about their own career, creating an absolute chaos.

    Even those projects that have been run through such awards programs in the past (HANA Olympics etc.) ultimately failed, because nobody cared. Management applauded, handed out prizes, and as soon as they turned around forgot about it. The teams just were dazzled. Event the new d-code program with now a TechShop like environment in Palo Alto, where people can tinker, suffer from people being prevented by their own management to go there. There is “more important work to do.”

    The founder award will be successful, no discussion. Everyone will make it seem like this. But if you want to create longterm impact, you need to create an infrastructure that allows innovation from all niches to come through, and not torpedo it with shortterm thinking.

    I wish you good luck, and I want that program to succeed at SAP for which I still do care a lot. A lot of good friends and great people work there. But an award scheme alone will make good material for jubilant press releases, but not good result for the company in a long term.

    A founder/intrapreneur ultimately is not motivated by a prize, but by getting his/her idea out to the world and make a dent. And this is what you need to make sure: not that they get a prize, but enable them to make an impact.

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    1. Twan van den Broek

      Wow some serious statements. I agree that the past years SAP folks did a great job with ideas and initiatives. But somehow these new toys didn’t make it to the store or to customers. Personally I think that SAP has tried to sell technology too much the past years. See how the new focus on applications is going to work out. But please don’t block adoption with difficult and high license models.

      Twan

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    2. Mark Teichmann

      Great comment. Discussions like these are what make SCN so valuable.

      Many of the topics you mentioned are well known to me and not only exist at SAP 😉

      What I am really asking myself is: How likely is it that real founders will work at large companies like SAP?

      From my experience the bureaucracy and overhead gets larger with the size of a company. Innovative people are creating small agile startups. If they are successful, they are swallowed by big companies and slowly all of the agility is killed by bureaucracy. After that the founder usually leaves the company and moves to another field of interest. One nice example for this scheme is Damien Katz and his CouchDB. Another example may be the path of the Neptune guys. They started as a small team with highly creative, skilled, enthusiastic people like Njål Stabell and are so quick in realising their unique Idea that SAP can hardly follow with their gigantic SAP Mobile moloch. Let us hope that they are not swallowed too soon. But ideas like this one would not have had a chance inside of SAP, I think.

      Cheers,

      Mark

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      1. Njål Stabell

        Thanks for the mention Mark Teichmann there is a lot of great entrepreneurship in the SAP ecosystem and SAP has realized that they do not have to invent everything themselves ( See the new SAP PartnerEdge program for Application Development ).

        There is a famous entrepreneurship quote that says “Big Companies Can’t Innovate”, let’s hope SAP proves the quote wrong and also utilizes their ecosystem.

        Oh and both my co-founders Ole-Andre Haugen and Andreas Sulejewski deserve a mention as well 🙂

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    3. Bill McDermott Post author

      Thank you Mario for pouring your heart and soul into this feedback. There is no question we need a cultural change – you are absolutely correct. The point of this award is very consistent with many of your comments. We need the disruptive mindset to find the next big ideas. To your point about the crushing process and blocking that’s happened in the past, we’re trying to fix this from both sides. Managers need to be open to new thinking but colleagues need the courage to push when they really believe. Let’s be clear: this will be messy. Change usually is. Press releases matter less to me than innovations, so please tell the great friends you still have at SAP that I’m very serious about opening the floodgates to see what our innovators can do. Best regards, Bill 

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      1. William Newman

        “Press releases matter less to me than innovations.”

        Bill McD – thank you. This tells me I made a good decision to join SAP.

        Where is my thumbs up emoticon?

        Bravo, sir.

        Best,

        Bill

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    4. Njål Stabell

      Hi Mario,

      I think your views are shared by many. I am a serial entrepreneur and have been through the VC “elevator pitches“. Believe me, imposed exit strategies by investors can be equally bad for innovation.

      I was just re-reading the comments of this blog and felt a bit bad about my own. The reason for this is that our team was recently in Walldorf where Andreas Kunz and Frederic Berg, both SAP employees, showed us the “SAPUI5” wing.

      This was something we previously had requested as our company’s techies are die hard UI5 fanboys.

      So, SAP has managed to create an HTML5 framework that is better than anything I have seen on the market. Be it from competitors or lean and mean startups. As this framework was open-sourced, it shows that not everything at SAP is run by legal or pricing. 

      My point, and I guess that this is for both Mario Herger and Bill McDermott, great innovation has been achieved inside SAP recently and should be proof that it is possible.

      To the new founders inside SAP, look to the SAPUI5 team!

      BR

      Njål

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  2. Nicolette Schumacher

    To Mario’s comments – your points are valid and many have shared the same frustrations and experiences within not only SAP, but similar companies of our size , the point of this award is to find a new avenue in which employees actually are empowered to be heard and initiate change . Often people don’t have the opportunity to see how large organizations work and in reality we don’t have a system which allows our CEO , no matter how visionary he is , to just make huge decisions to fix things like Steve jobs could when he eliminated 70% of the product two months back at apple . The same frustrations you describe are felt at every level as is the nature of a complex global company with works councils and a history of processes and change . The positive of this and the end result is more about the rest of our people seeing the result of the winner and therefore being inspired to see that anyone at SAP has the opportunity to enact change if they believe in it . You mentioned Steve Jobs . It’s ok for people to think like or want to be like him, what most don’t know about Steve is that his philosophies and motivations in business were deeply rooted in his studies of eastern philosophy and Zen Buddhism . He saw the world in a much different way and it had nothing to do with technology . The point is this award provides an avenue for change, and like nature , one small tiny change can result in a sequence of events which ultimately change the big picture at large. The real innovation if you ask me is the one brave enough, crazy enough, and maybe recklessly naive to come up with something which innovates not just technology … but the product itself dramatically changes all of the issues you describe by transfotiming the culture . I have to say if there is anything we have today which has the power and capability to this it is and will be HANA without a doubt. HANA is the secret weapon to change the cultural, execution issues while also providing a new product to the market . She is simply the eyes and ears which see everything as it’s happening all at once, without bias, and an ability to interpret and commindicate the intangibles – therefore perhaps addressing some of the issues you bring up. A wise man once said creativity is not about coming up with a new amazing idea , it’s simply just thinking more about the experiences you have than other people do and connecting things in a way others don’t notice . We have the spirit, bravery, and intelligence in the company, it’s just going to take someone who can connect the dots in a new and different way to break through the barriers you describe. Anything is possible. The limits and boundaries are illusions 🙂

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  3. Patrick Maroney

    I recently had the honor at a manufacturing conference to share the stage with leaders from Cisco, Pitney Bowes, LNS research and SAP.  The discussion focused on what top companies are doing to drive INNOVATION around the topics of Big Data, Internet of Things (IoT) and Machine to Machine (M2M).  The discussion most definitely touches upon similar innovator’s dilemma topics that Hasso and Clayton touched upon at Sapphire recently. Your readers – those with the “disruptive mindset to find the next big ideas” –  may be interested in watching a replay of the presentation and panel discussion here.  

    Also, we’ve begun a blog series summarizing this discussion as well as interactions with top companies’ leaders over the past 12+ months:

    Part 1:  Business Trends driving CEOs

    Part 2:  Data Driven Decision Making 

    Part 3:  – coming soon

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