Bill McDermott quits as CEO of SAP

Bill McDermott to be replaced by Jennifer Morgan and Christian Klein as co-CEOs

Bill McDermott has quit as CEO of SAP with immediate effect, staying on at the company only until the end of the year in an advisory capacity when his current contract expires.

McDermott became sole CEO in 2013 after Jim Hagemann Snabe stepped down. Snabe and McDermott had been appointed co-CEOs in 2010.

In response, the company has reshuffled its senior management, promoting not one, but two SAP executives to become co-CEOs of the company

SAP executive board members Jennifer Morgan and Christian Klein will step into McDermott's shoes, a move that the company claims was part of its long-term succession plan. McDermott will remain at SAP in an advisory capacity until the end of the year.

Jennifer Morgan has been at SAP for 15 years. She most recently served as president of SAP's Cloud Business Group, putting her in charge of Qualtrics, SAP SuccessFactors, SAP Ariba, SAP Fieldglass, SAP Customer Experience and SAP Concur. She was elevated to SAP's executive board in 2017.

Christian Klein, meanwhile, joined SAP 20 years ago as a student. He has most recently served as the company's chief operating officer, but has also overseen the development of SAP S/4HANA, the company's flagship enterprise resource planning software.

Previously, he worked as SAP SuccessFactors' chief financial officer and as SAP chief controlling officer. Klein was appointed to the SAP executive board in 2018.

SAP, like Microsoft and (especially) Oracle, has faced criticism in the past over its licensing policies and practices, particularly the notorious software licence audits. Analyst group Forrester indicated that while some customers will be disappointed to see McDermott leave, others will be hoping for change.

"Some customers will view this change as refreshing due to issues they have faced and pin on McDermott at the helm related to value for the money, pricing policies including the indirect access issues, and a culture some deem as overly sales-oriented," said Liz Herbert, Forrester vice president and Principal Analyst.

She continued: "The change presents an opportunity for SAP to start fresh and move to more customer-centric behaviours in their sales approach and customer support. The change also presents an opportunity for SAP to return to the more product- and engineering-centric focus that defined the company for so long."

However, Paul Cooper, chairman of the UK and Ireland SAP User Group, was positive about McDermott's contribution.

"He took over as co-CEO [alongside Hagemann Snabe] at a very difficult time for SAP, dealing with the contentious issue of Enterprise Support and both worked very closely to regain customer confidence," said Cooper.

The User Group also welcomed a return to the co-CEO model. "Christian has been a key executive sponsor of the SUGEN [SAP User Group Executive Network] ‘Ease of doing business' and ‘Licensing' charters.

"He has always made time to listen to product feedback and understand how SAP could work better with customers. We look forward to hearing Christian and Jennifer's vision for SAP as the 2025 maintenance deadline for ECC6 fast approaches."