Changes to SAP leadership reflect AI, cloud shifts
SAP's latest executive moves have Sebastian Steinhaeuser overseeing strategy and Philipp Herzig as CTO, but analysts say the continual changes shouldn't concern customers.
SAP leadership is undergoing another round of leadership changes after a turbulent year that saw several longtime executives leave the company. But this round is likely to stabilize SAP's internal structure, emphasize cloud growth and should have little effect on customer relationships, according to analysts.
In conjunction with its earnings call Tuesday, Sebastian Steinhaeuser was appointed to the SAP executive board as the leader of Strategy and Operations, a new board area that will focus on driving SAP's internal and external strategy on business and technology transformations, according to the company.
Steinhaeuser began at SAP in 2020 as chief of staff to CEO Christian Klein and subsequently held the position of chief strategy officer. Prior to joining SAP, Steinhaeuser was a consultant and partner at The Boston Consulting Group.
Current Chief AI Officer Philipp Herzig added the title of global chief technology officer, filling the role after Juergen Mueller exited the company in September.
Also, Jan Gilg and Emmanuel Raptopoulos will assume co-chief revenue officer (CRO) roles. Gilg, currently president and chief product officer for SAP Cloud ERP, will oversee SAP Americas, while Raptopoulos, currently president of SAP EMEA, will add Middle East and Asia Pacific regions to his list. Ada Agrait was named chief marketing officer, filling the post that was vacated when Julia White left the company in August 2024.
SAP is also forming a new extended board made up of senior company leaders, including the newly named CTO, co-CROs and CMO. The extended board will act as a strategic advisory body to drive AI-focused transformation strategy, according to SAP.
SAP also extended Thomas Saueressig's executive board appointment until 2028. Saueressig has led the SAP board area for customer services and delivery since April and was previously the head of cloud product engineering.
The executive board changes will take effect Saturday.
Continual leadership reorganization
The appointment of Steinhaeuser to the executive board is an indication of Klein's move to formalize the company's strategic position, according to Holger Mueller, vice president and principal analyst at Constellation Research.
"SAP has never had a chief strategy officer, and we all know that SAP will need a lot of strategy in the next years to convince the installed base to migrate to S/4HANA Cloud," Mueller said.
AI is the wild card in helping to realize the internal strategy and prove the value case for customers, he said.
"The promotion of Philipp Herzig [to CTO] goes along those lines," Mueller said.
SAP has continually reorganized itself over the years, which has been criticized as being too complex and confusing, according to Joshua Greenbaum, principal at Enterprise Applications Consulting. But, he added, as long as the company produces strong business results, it earns a certain amount of immunization from criticism.
Adding Steinhaeuser to the executive board is a good move, and elevating the new position of strategy and operations head makes sense, Greenbaum said.
"It's an important part of the business to give strategy essentially its own functional area, which will help the company deal with the complexities of running in this continuing, complex environment," he said.
Steinhaeuser's strategy role will be internally focused on taking a complicated company and its many operations and trying to rationalize them, Greenbaum said.
"The other side of his mandate is operations," he said. "Anything that any large corporation can do to rationalize its operations is usually a good thing because things grow and get out of hand very easily when you have both organic growth and M&A-based growth that SAP's been doing over the last few years."
The other changes, including the elevation of Gilg to the co-CRO role, indicate that SAP has a significant amount of talent in the pipeline, Greenbaum said. Gilg, who has been building and selling S/4HANA Cloud for years, will take on more of a sales role than he has before, Greenbaum said.
SAP seems to need to move the chess pieces around a lot, but I'm not sure how much that impacts customers in the end.
Jon ReedCo-founder, Diginomica
SAP customers and industry watchers should not place too much weight on the frequent leadership shakeups, according to analyst Jon Reed, co-founder of Diginomica.
"To a certain point, it's less about rearranging the chess pieces and more about how they are delivering," he said. "SAP seems to need to move the chess pieces around a lot, but I'm not sure how much that impacts customers in the end."
The reorganization in 2024 caused SAP to diminish in their standing as a premier global employer, as this led to an amount of internal turmoil, he said.
"They still are a top-tier global firm, but all the reorgs they did had an effect internally, and eventually you want to get past that and start figuring out how you can upskill your people and keep the talent you have," Reed said.
Visionary potential in CTO
Some of the other moves indicate the direction that SAP will follow in the coming year, according to Reed. The extension of Saueressig's contract shows that he will be a key figure in driving cloud transitions for customers, and Herzig could be the first truly visionary CTO that SAP has had in a long time.
"It's been impressive how he's handled SAP's AI strategy, including a fairly transparent approach to communicating with customers around issues like SAP prioritizing new AI features in their SaaS and public cloud offerings," Reed said.
The new leadership team will still be judged on its performance, but customers should not be overly concerned about any significant changes in direction at SAP, he said.
"This is more about acknowledging there's a serious change in the market and they want to go forward with the strongest arrangement of the chess pieces they can come up with," Reed said.
Jim O'Donnell is a senior news writer for Informa TechTarget who covers ERP and other enterprise applications.
