Ensuring its innovation agenda and market momentum continue to accelerate, SAP has pre-emptively extended the contract of CEO Christian Klein through the end of 2028 and named him chairman of the company’s Executive Board.
Klein, whom I picked as the Cloud Wars CEO of the Year for 2023, was under contract through the end of 2025 but a few vital factors convinced the company’s Supervisory Board to act early in locking in Klein for three additional years:
- Hasso Plattner steps down as chairman. While this move has been in the works for a year, the actual transition took place officially last week, and I am certain that Plattner wanted to ensure that before leaving the company he co-founded 52 years ago, his hand-picked successor would have a very tangible sense of the confidence that not only Plattner but the entire board have in Klein.
- Klein is recognized as the unconditional leader of SAP. Without meaning any disrespect to the company’s new Supervisory Board chairman, Pekka Ala Pietila, SAP is now Klein’s company. No doubt Klein will happily and eagerly follow all legal and regulatory obligations for German-based corporations regarding the interplay between Supervisory Boards (SAP’s is now headed by Ala Pietila) and Executive Boards (SAP’s is now chaired by Klein). But it is clear that with this early contract extension, this is Klein’s company. And I suspect that a lack of clarity about that position — or perhaps a lack of willingness to fully accept it — is what led SAP to part ways with the former Deloitte executive, Punit Renjen, who was SAP’s original pick to succeed Plattner before Renjen and SAP decided three months ago to call that off. For more on that, please see “Hasso Plattner’s Last Stand: 3 Questions as SAP Shuffles Chairmen.”
- Klein has led an utterly brilliant transformation. For all its technological prowess and the indispensable role its software plays in running many of the world’s largest companies and a very large chunk of the global economy, SAP was in disarray when Klein was named sole CEO in early 2020. Longtime and highly visible former CEO Bill McDermott had left for ServiceNow five months earlier, and SAP followed McDermott’s departure by naming both Klein and Jennifer Morgan as co-CEOs. That lasted just a couple of months before Plattner decided that the onset of the pandemic required faster decision-making, and that the co-CEO model had to go. Since that very shaky early start, Klein has not only pushed SAP back on its feet but also made a cloud-first innovation machine that’s become one of the fastest-growing major cloud vendors in the world: SAP is #4 on my latest Cloud Wars Growth Chart.
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Final Thought
When I named Klein the Cloud Wars CEO of the Year for 2023, Plattner shared this comment about Klein, who joined SAP in 1999 as a student-intern and has described himself as “a child of SAP”:
“Christian is exactly the CEO SAP needs at this critical watershed moment, as AI fundamentally reshapes the technology and business landscapes. His vision, courage, and decisiveness are evident in the many successes we’ve celebrated during his tenure as CEO, most notably in SAP’s cloud leadership. This will ensure the company capitalizes on the strong foundation of the past 50 years.”
And last week, in an analysis headlined “Farewell, Hasso Plattner: Naming Christian Klein CEO Tops Legendary Legacy,” I offered my own perspective on the role Klein has played:
“But the SAP article does not mention what I believe is the crowning decision of Plattner’s extraordinary 52-year career: In early 2020, with the pandemic raging and the entire business world thrown into turmoil, Plattner chose to abandon the co-CEO model that had been a staple at SAP and made 40-year-old Christian Klein the CEO.
“In hindsight, with all the great success Klein has had, Plattner’s decision doesn’t seem risky at all — in fact, I’m sure some folks would regard it as ‘obvious.’ But at the time, it was anything but that, particularly with the pandemic disrupting the operations and outlooks of many and perhaps most of SAP’s global customers.”
And for all that Klein and SAP have achieved in his first four years as CEO, I think the best is yet to come as Klein & Co. fuse Business AI into their world-leading enterprise applications to help SAP customers blur the line between what is possible and what is impossible.
