Makdermott Bill

Makdermott Bill

Biography

Received MBA degree in J.L. Kellogg Graduate School of Management of Northwestern University and also finished the program of training of directors in Pennsylvanian the university (University of Pennsylvania's Wharton Graduate School of Management). Has degree of B.S. in the field of business management which received in Dowling College.

17 years Makdermott worked in Xerox Corporation where he served to the president of one of divisions and became the youngest of top managers of the company.

Till 2002 Bill McDermott held a position of the vice president of division of Worldwide Sales & Operations of Siebel Systems company and also was the president of Gartner Inc.

2002: A beginning of the career in SAP

Bill McDermott joined SAP in 2002, having received a position of the head of the American division of the company. Later a small period the geography of its duties as head began to include South America and the Pacific Rim. Also he became the president of Global Field Operations

2008: Member of Executive council of SAP

In 2008 Bill directed work with clients worldwide and joined Executive council of SAP.

2010: Beginning of the management of SAP

On February 7, 2010 Bill McDermott is appointed one of two chief executive officers of SAP along with Jim Hagemann Snabe. In two years prior to arrival to company management McDermott became the board member of the company. On May 21, 2014 McDermott became the individual CEO of the German company. He is the first American who held this position.

2014: The first book

Bill McDermott published the first book in 2014. It is called "A dream of winners: a way from shop round the corner to a director's office" (Winners Dream: A Journey From Corner Store to Corner Office). In this autobiographical story Bill McDermott tells about the transformation from the ordinary worker into the head of one of the world's largest software corporations from 75 thousand employees.

2015

Hospitalization

On July 10, 2015 it became known that 53-year-old Bill McDermott was hospitalized as a result of receiving damage. SAP did not give the details about the event and only noted that the chief executive officer is already discharged from medical institution.

According to Bloomberg news agency with reference to the official statement of SAP, being in the house of the relatives, to Bill McDermott there was an accident because of which the head of the company was traumatized. The character and damage level are not specified, but, most likely, this is not about serious wound as McDermott already left hospital to which he got as a result of an incident.

Bill McDermott was discharged from hospital to which he got as a result of an incident in the house of relatives

At the same time in SAP do not say when to the top manager there was an unpleasant situation and under what circumstances. With Makdermott members of the media did not manage to communicate.

SAP said that the head of the company is in good condition, and the absolute recovery is expected in the nearest future.^[1]

Loss of an eye

In the middle of September, 2015 details of an incident which happened to the CEO of SAP Bill McDermott two months before became known. It turned out that the top manager suffered a serious injury, but it intends to continue work in the German company and to return to Germany.

At the beginning of July, 2015 to Makdermott there was an accident. After the celebrating the birthday of the father in the USA the head of SAP fell in the house of the brother from a ladder, and a glass which he carried in hands injured his left eye. Makdermott was hospitalized, and he nearly bled to death. Unfortunately, doctors could not save visual body of the CEO of producer of the corporate software.

The CEO of SAP deprived of an eye will continue work in the company

Despite serious damages and need to receive medical treatment, Bill McDermott continued work and even participated in a conference call with investors on the occasion of the publication of the quarter reporting on July 21, 2015. Doctors prohibited the head of SAP flights, and that remained in the USA where is to the middle of September, 2015.

According to the The Wall Street Journal newspaper with reference to the official statement of SAP, Bill McDermott feels well therefore it can return to SAP headquarters in Valdorf (Germany) at the beginning of October, 2015.

Bill McDermott confirmed to the Suddeutsche Zeitung edition the good health and capability further to execute duties of the CEO of the German company.

"Thank God, I survived after such terrible incident" — Makdermott said.

In an interview to the WirtschaftsWoche magazine the chairman of the supervisory board of SAP Hasso Plattner reported that the company has a succession plan of executive positions, however it is not subject to discussion. The employment contract of Bill McDermott with SAP expires in 2017.^[2]

2016

The second book

On January 12, 2016 Bill McDermott announced plans to write the book how people are recovered after losses. The injury as a result of which it lost an eye pushed to creation of such work of the CEO of SAP.

I never thought that I will want to write the second book — Makdermott in an interview of Bloomberg in Singapore told. — In me really there lives the new book. In it the speech not only how the loser could realize a dream, but also how people differently are broken will go.

In July, 2015 Bill McDermott, being in the house of the brother in the USA, fell from a ladder and unsuccessfully landed on glass splinters of a glass which got to it into the left eye. As a result of falling he fainted and when regained consciousness, saw himself lying in a blood pool.

After loss of an eye the CEO of SAP will write the book

As Makdermott remembers, in such picture he had not a panic, but feeling of a pacification: the reason said to him that it is better to fall asleep as it was much more difficult to rise.

Then I began to think that I should get up that I should make it as my story is not told yet — the head of SAP reported.

Being unsteady here and there, he went outside and laid down on the road then someone called the ambulance.

About a week Makdermott lay in intensive care unit, but, unfortunately, the visual body did not manage to be saved. Despite it it continued work and began to appear in public in dark glasses. At the same time scars on the left side of the person and a neck are still visible, the journalist of news agency interviewing Makdermott notes.

By January 12, 2016 Makdermott began to work on the new book created under the influence of a drama story with loss of an eye.^[3]

Makdermott became the highest paid top manager in Germany

At the end of February, 2017 it became known that Bill McDermott became the highest paid top manager in Germany. He was ahead of the head of Daimler carmaker Dieter Zetsche, the Reuters agency tells information.

At the end of 2016 SAP paid to Makdermott about 15.6 million euros whereas Zetsche earned 13.8 million euros, reported in the European consulting company HKP Group specializing in questions of payments of remunerations to top managers. Larry Ellison, the founder and the chairman of the board of directors of Oracle (one of main competitors of SAP), received $41.5 million from the company.

Bill McDermott

In a compensation packet of Bill McDermott for 2016 entered salary 2.4 million euros, fixed payments in the amount of 1.4 million euros and 8 million euros the bonuses tied to the share value of SAP and depending on long-term financial performance of the company. Besides, the head of SAP received additional benefits for 1.6 million euros (here, for example, grants on receiving an insurance or reimbursement of expenses for housekeeping and flights entered) and 571 thousand more euros in the form of pension and other benefits.

In 2015 Makdermotta was issued in SAP by about 9.9 million euros that then allowed it to take the second place among the most highly paid heads of the German companies.

The income of Bill McDermott who in 2010 became one of the CEO of SAP and solely held this post in the 2014th, in many respects depend on a quotation rate of the company. From 2010 to 2017 the share value of SAP doubled, and from 2014 to 2017, in particular — increased by 46%. As of March 1, 2017 market capitalization of SAP makes 107 billion euros.^[4]

2017: Earnings in 21.8 million euros

On February 28, 2018 it became known that Bill McDermott became the highest paid top manager in the German companies again.

According to Reuters news agency with reference to the report on remunerations published by SAP, in 2017 earned 21.8 million euros whereas in the 2016th — 15.6 million euros from a post of the CEO of Makdermott company. Thus, the compensation packet of the head of the producer of the corporate software increased almost by 40%.

In structure of annual remuneration of Bill McDermott 1.37 million euros were the share of fixed payments. Additional payments, like paid leaves, etc., reached 1.27 million euros.

Bill McDermott

Reuters notes that by the end of February, 2018 many German companies did not publish income statements of heads, however, yet most likely, Bill McDermott will win first place by the amount of payments.

A main competitor in the rating of the highest paid top managers traditionally is the head  of Daimler carmaker Dieter Zetsche. Its compensation packet in 2017 made 13 million euros that will probably correspond to the second place. In 2016 Zetsche was paid by 13.8 million euros, i.e. again it is less, than at Bill McDermott.

Earnings of Bill McDermott who in 2010 became one of the CEO of SAP and solely held this post in the 2014th, in many respects depend on the share value of the German company. In 2017 the quotations of SAP rose almost by 13% (for the first time securities of the company exceeded a mark of 100 euros apiece), and market capitalization reached 114.8 billion euros. At the same time the DAX indices 30 and EURO STOXX 50 which SAP treats increased by 12.5% and 6.7% respectively.

The chief financial officer of SAP Luka Muchich (Luka Mucic) received from the company nearly 1.9 million euros for 2017.^[5]

2018

"Success is an anesthesia". Opinion on what heads need to be afraid of

At the end of September, 2018 Bill McDermott in an interview to CNBC TV channel told what, according to him, heads and all people who aim at success at work need to be afraid of. The head of SAP considers that achievement of good results can lead to development of "one of the most dangerous diseases at work" — self-satisfactions.

Success is an anesthesia. It forces people to calm down a little. They begin to think: "Now it is possible to relax because it's done". But it cannot be done. If you lean back on a chair back, somebody will steal your lunch — Makdermott reported, urging heads to be satisfied never with what has already been achieved.

The head of SAP cited as an example Salesforce.com which, according to him, turned from "dark horse" into the company capable it is better to generate the ideas. As a result of Salesforce.com left behind many competitors, including SAP, and became the leading producer of CRM systems.

Bill McDermott

As Bill McDermott noted, being the CEO of SAP, he understood that it is impossible to rest on laurels and it is necessary to continue "move forward".

The most important that the head can do with the successful company — this every day to drive away painful self-confidence — he noted.

The head speaks that it is possible to celebrate victories, but to do it it is necessary not for long because ahead there is a lot of work — such culture adheres to SAP.

Because of annoying randomness Bill McDermott at the age of 54 years lost an eye, and this incident, by its own recognition, "undoubtedly" helped it to become even better with company management.

Now I see things which did not see before. Earlier I could look at the forest and know that on other side there are a small river and mountains with the snow. Then I saw many trees, and now I first of all see snow-covered tops and a watercourse, I look through trees — he was recognized.[6]

Payment of 9.8 million euros from SAP SE

In 2018 Bill McDermott earned from a post of the CEO of SAP about 9.8 million euros that it is twice less, than the previous year (21.8 million euros). The German producer of corporate software disclosed such information on February 28, 2019.

Despite significant reduction of remunerations Makdermott remained the highest paid top manager in the German companies as  Dieter Zetsche income at a position of the head  of Daimler carmaker also decreased more than twice and made about 6 million euros at the end of 2018.

Bill McDermott income on a post of the head of SAP was reduced more than twice in 2018

Zetsche and Makdermott for many years earn in Germany more than others and are interchanged the position at top of the list of directors with the highest income. Daimler reduced payments to the head because of fall of profit in 2018.

Reduction of a compensation packet of Bill McDermott is caused by dates of receipt of the long-term bonuses tied to financial performance and share value of SAP. Depending on effective objectives the CEO of the company can wait up to four years before he earns relying rewards if, of course, tasks are carried out. The labor contract of SAP with McDermott works till 2021.

As notes the business publication Handelsblatt, Bill McDermott earns on average in 105 times more of other staff of SAP, and board members — by 40 times. At the same time average indicators in the DAX index (it includes the largest German companies on capitalization) are the 97th and 45th respectively.

Like the American software makers, SAP provides to directors rather low fixed payments. In a case with Makdermott they in 2018 made 1.31 million euros. Besides, the employer covered 795 thousand euros expenses on use of cars and airplanes for business trips. Here other office expenses of the CEO entered.^[7]

2019

Departure from the job of the CEO of SAP SE

On October 11, 2019 the SAP CIS company reported to TAdviser that the CEO of SAP Bill McDermott is not going to prolong the working contract and leaves the post. Board members of SAP Jennifer Morgan and Christian Klein become managing directors, changes become effective with the consent of the Supervisory council of SAP. Until the end of 2019 Bill McDermott will advise colleagues to provide the most soft junction.

Without Bill McDermott the SAP company will not be former any more". Bill made an invaluable contribution to development of the company, he was the main inspirer of transition of SAP to a cloud who will stimulate our growth as early as many years. We are grateful for everything that he made for SAP. And also we congratulate Jennifer and Christian on an opportunity to strengthen the strong base of the future of SAP. More than a year ago we with Bill made the decision to expand Jennifer and Christian's roles within long-term process of transformation them in our leaders of the next generation. We are sure of their vision and opportunities as transition to the next growth phase and implementations of innovations is necessary to us, told professor Hasso Plattner, the chairman of the Supervisory board of SAP SE

Each CEO dreams of that the company passed to the next stage of development in strong position. I very much am proud of our progress for the last decade. Time for all came to begin other fascinating chapter, and I am sure that Jennifer and Christian will do everything possible. I am glad to support them at this stage as they complete 2019 and will lay the foundation for 2020 and the further future. I want to express to each client, the partner, the shareholder and the colleague sincere gratitude and respect, noted Bill McDermott

Within the last decade Makdermott held the CEO's position, under his management there was a significant growth in SAP, expansion of a portfolio, important transition to clouds. Key indicators, including the market value, income, profit, the involvement of employees and ecological sustainability, considerably became stronger since 2010.

From approval of the Supervisory board the company implements the succession plan of the management designed to save the saved-up examination and to expand possibilities of heads in anticipation of transition by 2020.

Jennifer and Christian already showed that they perfectly supplement each other and will be strong chief executives. It is the leadership model checked by time in SAP with a set of successful examples,

With what problems Bill McDermott left SAP

On October 18, 2019 the ZDNet edition published article with the heading "SAP prepares for the following big problem". It is devoted to what difficulties the new CEO of the company should meet after Bill McDermott leaving. Read more here.

Appointment of ServiceNow as the CEO

On October 22, 2019 the producer of cloud solutions for business process automation of ServiceNow announced Bill McDermott appointment the new CEO. He will head the company in the end of the year.

On this post Makdermott will replace John Donahoe who in January, 2020 will head manufacturing company of Nike sportswear. Until then Donahoe will help ServiceNow with process of replacement of the leadership.

ServiceNow announced Bill McDermott appointment the new CEO

The independent director in council of ServiceNow Jeff Miller considers that experience in global market and the record of service of Bill McDermott will provide "soft junction and will save strong leadership skills".

Bill will even more strengthen an impulse and reputation of ServiceNow as the leader of digital workflows who aims at success of clients and also the preferable strategic partner promoting digital transformation in the companies — he said.

John Donakhyyu headed ServiceNow since April, 2017. Since that moment revenue of the company grew more than for 30% every quarter. However in 2019 stocks of vendor began to fall: in July they cost more than $302, and on October 22 they fell in price up to $228.34 that is 5.2% less, than a day earlier. Moreover, in trading time negative dynamics reached 15% because of news about Makdermott's appointment the CEO and the president of ServiceNow.

According to the analyst of Wikibon Dave Vellante, the discontent of investors is quite explainable as the Donakhyyu command did not manage to be mastered yet, and now Makdermott will implement in the company philosophy from an ecosystem of SAP.

The analyst of Moor Insights & Strategy Patrick Moorhead considers that Bill McDermott, considering his experience, will help ServiceNow to increase business by means of expansion of sales.^[8]

Notes