SAP in the Middle East

Posted by: Steve Hamm on June 19

Got some interesting intel from SAP CEO Henning Kagermann today. While the US market has been slow for them, they’re doing well in emerging markets, especially Russia and India. Another bright spot: The Middle East. “They’ve got the money and they’re smart enough to know their oil won’t last forever,” he says. So the locals are investing in technology and innovation. SAP improved its performance in the region by buying a distributor that wasn’t performing well. It turned out that having a local presence mattered a lot. But while customers and governments in the region have urged SAP to put a development center there, it’s premature, says Kagermann. He already has R&D centers in Germany, Palo Alto, Canada, Paris, India, China, Israel, and Bulgaria, and he’s concerned about splintering too much. So what he offers is to help improve the computer science programs in the Middle East’s universities. “We’ll help produce skilled young people who can handle our software,” he says. It’s tough to get Westerners to go to the region on long assignments, to the strategy is to train local people so they can handle software installations. The Germans have a reputation for being rigid, but you don’t see that in the way SAP approaches world markets.

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