There’s a big shake-up going on over at SAP, with reports suggesting its executive in charge of its cloud business unit, Shawn Price, has been sacked. This comes just three days after SAP exec Vishal Sikka apparently stepped down for “personal reasons”, and just four months after Price replaced Robert Calderoni, who quit the post in January.
What with Calderoni only having held the position for a few months after replacing Lars Dalgaard, who took up the role following SAP’s acquisition of SuccessFactors, that makes three cloud chiefs in the space of just 12 months. It’s no surprise that people are now asking just where the company plans to go from here.
Price’s sacking was first reported by Re/Code, which said the decision was made one week ago. It also notes that Price will not be replaced, adding that SAP is trying to spin this move as a “natural progression” as its business matures.
“[Price’s] role was a transformational role, and we’re at a point where we’re a leading cloud player,” said a SAP spokesperson to Re/Code. “There will no longer be a single individual cloud executive. His responsibilities will be divided among other executives.”
What SAP is trying to say is that cloud is no longer a standalone part of its business. Rather, everything the company does revolves around the cloud. But that hasn’t always been the case. As its on-off commitment to its ERP product ByDesign illustrates, SAP has stumbled between embracing the cloud and a more traditional “business as usual” model.
The move seems somewhat bizarre due to Price’s background. Having been president of cloud-based subscription billing company Zuora, he was extremely well qualified for the role – his removal suggests that SAP really still doesn’t fully understand the cloud. Rather, in order to try and protect it’s existing revenue streams, SAP seems to be putting a lot less emphasis on the cloud. This theory makes sense when one looks at its recent financial performance – sales of its traditional products are falling, while its cloud growth has been less than encouraging.
In any case, there’s a big transition going on at SAP right now. The company is set to abandon its dual CEO structure on May 21, when it will appoint American Bill McDermott as CEO. Current co-CEO Jim Hagemann Snabe is set to remain at SAP, taking a seat on its supervisory board.
One theory is that this is just McDermott making moves ahead of time, trying to put his own team in place ahead of his arrival. That may be so, but considering SAP’s pressing need to respond to the disruption going on in the industry right now, the move looks a lot more negative than the company is trying to make out.