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HANNOVER, Germany—”IT is exciting again!” That was the message SAP founder Henning Kagermann gave at the opening session at CeBIT on Wednesday evening.
Whats making IT so sexy? Kagermann pointed to a radical change in how it is used. Instead of focusing on breakthrough products, technologys ability to radically restructure business models is what will make IT fascinating again, he said.
“Business model innovations will replace product innovation,” he said, as a new awareness develops of the “transformational and strategic importance of IT.”
SAPs chairman pointed to three key ways in which information technology has become critical to the world.
First, IT has become ubiquitous, part of our daily lives even more than we know. And that makes a computer failure—such as what happened during the 2003 blackout in New York—an incredibly important event even to people who dont use computers.
Second, scientific progress is impossible without computers. Advances in mathematics, physics and statistics just arent possible without computers.
And finally, Kagermann said he sees business and IT as inseparable. “Our industry started out as a tool, but today it is a catalyst for supporting business globally.”
“The main benefit here today,” he said, “is that access to the know-how is cast into software, and we call that best practices.” And those benefits help companies beyond those in the developed world.
“This will help Russian oil, Chinese steel and water works in Namibia” as well, he said. “Today, emerging companies are able to adopt tried and tested principles of business much faster, and are able to compete globally much more rapidly.”
Kagermann committed to refocusing SAP AG from creating tools to helping to transform corporate business models, and making it easy to experiment and refine those models as well. “In the future, customers will model their business processes rather than reprogramming them.” He explained the concept with an automobile metaphor, likening it to fixing ones car without opening the hood.
The other three speakers at the opening event each echoed that theme of renewed tech-sector excitement and globalization. Each pointed to the growth of exhibitors—larger now than three years ago. Hannovers mayor, Herbert Schmalstieg, provided specifics: 6,270 companies from 69 companies, as evidence that CeBIT and technology are on the rise again.
Schmalstieg, the first speaker, kicked off the event with a look back at milestones that Germany is celebrating this year. “Sixty years ago saw the liberation of concentration camps, an end to dictatorship and fascism, and the start of the reconstruction.” But thats not the only momentous anniversary. “Were also looking back on 15 years of reunification.”
Next Page: The impact of global instability.
Global Instability
The final speaker of the night, German Chancellor Gerhard Schroeder, also discussed reunification as a huge positive event, but also as a way to explain his countrys uneven GDP (gross domestic product) growth.
“We were fortunate enough to see German reunification, and the task we had to face up to was on a state and government level, and on an economic and societal level.”
But reunification is not complete yet—”only about 50 percent of where we have to go.” And that translates into another 15 years of economic drain.
“It cost us money; it cost us growth,” Schroeder said. “Every year, we spend 4 percent of our gross domestic product, 80 to 90 billion euros, on tasks we have to do in the east.”
But rather than complain, Schroeder looked at this rebuilding as an area of strength. “Every year, we transfer this money from east to west. No other economy in the world has to do that, and very few economies in the world could do that.”
However, Schroeder and the other three speakers also spent much of their allotted time apologizing for Germanys shortcomings. Second speaker Willi Berchtold, president of the German Association for IT, was blunt as he addressed not the crowd, but Chancellor Schroeder directly.
“We need a greater sense of urgency” in adopting new technologies, he said. He focused on a digital ID card, a universal health card and, “above all, deploying new media in our schools.”
He also was vocal about what Germany didnt need. “We dont need copyright levies on PCs. We dont need depreciation periods for software, and we dont need license fees on cell-phone usage.” That last item elicited a thunderous round of applause.
Kagermann, too, spoke directly to the chancellor. “In Europe, we spend less than a third of the money on research” compared with the United States, he said. “We need an adaptation of the educational policy, teaching and more.”
Schroeder responded to his critics directly, promising that regulations would not deteriorate Germanys competitive position compared with other countries. He reiterated, though, that “there is a right to intellectual property, and we have to pay for the use of that property.”
But Schroeder used his time not to focus on technology but to highlight world instability, and how it could negatively impact Germanys economy. He focused on three key areas, all centered in the Middle East:
- Raw materials: “A one-dollar increase per barrel increases the German cost by one billion euros. Political stability in the Middle East is of huge consequence for us.”
- Iraq: “Regardless of ones opinion back then on the military conflict, whats important is stability and supporting the democratic development of the country.”
- Irans nuclear weapons: “We want to conduct negotiations to convince the Iranians that they should forgo production of nuclear weapons. The U.S. is expressly supporting us, and we must make this a success for political and economic reasons.”
Suddenly, Hannovers Congress Center seemed more like a meeting of a parliament than a gathering of geeks. Schroeder quickly wrapped up by saying, “Its a great pleasure for me to declare CeBIT 2005 open,” and we all repaired to the basement for beer and snacks.