SAPs Kagermann Lays Out Recovery Road Map

In his Sapphire keynote, SAP AG CEO Henning Kagermann said economic recovery will depend on companies' abilities to effectively consolidate their IT operations and adapt to changing technologies.

ORLANDO, Fla.—SAP AG CEO and Chairman of the Executive Board Henning Kagermann said during his opening keynote at the companys Sapphire 03 conference here Tuesday that economic recovery will depend on companies abilities to effectively consolidate their IT operations and adapt to changing technologies.

Not surprisingly, Kagermann positioned new SAP technologies like NetWeaver and Xapps at the center of these required changes.

Kagermann pointed out that this is the second straight year the theme of economic uncertainty has dominated Sapphire keynotes.

"I felt that times would be better," he acknowledged. "That if wed wait a few months, everything would be better. But I was all wrong. It went worse.

"Consumers lost confidence, and so much of the wealth built up by investors for years was lost in one year."

Economic uncertainty has in turn prompted companies to cut costs, which has meant reduced investments in IT budgets. Kagermann said such uncertainty has become a new economic reality that companies will have to adapt to.

"If you want to have success, you need growth, and if you want growth, you need innovation," he said. "Today nearly every innovation is enabled by IT."

Kagermann argued that business systems have become "oversophisticated" and need to instead do a better job of executing established business practices.

While he spoke of the need for consolidation, Kagermann acknowledged that customers have a choice of applications today—he made no mention of recent moves by Oracle Corp. and PeopleSoft Inc. to consolidate the enterprise applications space—and that SAPs NetWeaver is the way to go to connect those applications, as opposed to third-party enterprise application integration software.

"You hope at the end of the day, EAI tools help you meet the challenge of integration, but theyre just adding another layer of complexity on top of what you already have," he said.