Work and Human Resources in SAP

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2023

Hasso Plattner's departure as board chairman

On February 23, 2023, the German corporate manufacturer ON SAP announced the departure of the company's co-founder Hasso Plattner from the post of chairman of the company's board. His place was taken by former CEO Deloitte Punit Renjen. More. here

2.5% staff reduction

On January 26, 2023, the German corporate manufacturer software SAP announced the reduction of 3 thousand jobs, or about 2.5% of the total staff. Thus, another large IT company resorted to layoffs.

According to Reuters, the measures announced by SAP show that the company seeks to cut costs and focus on the cloud business, which in October-December 2022 showed revenue growth of 30%. At the same time, SAP continues to move from a work model, which involves deploying the product on the customer's own servers, to a model for providing services from data centers, Reuters reports.

SAP is laying off thousands of employees

In Germany, where SAP is headquartered, the company will cut more than 200 jobs. According to the CFO Luka Mučić, through the announced restructuring, the company expects to save €300- €350 million by 2024. At the same time, the number of employees who are planned to be fired has not been finally determined, but it is known that reductions are planned in all representative offices and divisions of the German software vendor.

We continue to target our portfolio in the areas where we are strongest to continue our accelerated growth. This prompted us to announce that we intend to carry out a very targeted restructuring in certain areas of SAP, which will affect up to 3 thousand jobs and will include a reduction in headcount by about 2.5%, "said SAP CEO Christian Klein.

Since the beginning of 2023, staff cuts have been taking place throughout the technology sector, including giants such as Amazon and Meta (recognized in Russia as an extremist organization and banned). Amazon has revealed plans to cut 18,000 jobs, or about 6% of its workforce. Meta is cutting approximately 11,000 employees. Twitter also cut 5,000 jobs.

IT companies in the US are cutting staff amid fears of an impending recession. They faced rising interest rates and inflation in 2022, bringing down their shares and forcing advertisers to cut back on online advertising.^[1]

2021: SAP reveals US salaries

In mid-November 2021, the salaries of SAP employees in the United States became known. The company pays from $68 thousand to $310 thousand per year.

After SAP's business was hit hard during the COVID-19 pandemic. The company's recovery strategy helps it bounce back, and SAP is already actively selecting new employees. In order to help the software platform for business operations, and in general customer service, return to growth and compete with other corporate technology giants such as Oracle and Salesforce, SAP is actively investing significant of its funds in its cloud division.

SAP revealed salaries in the United States

From August 2020 to July 2021, SAP consistently hired new employees, despite the fact that at the very beginning of the coronavirus pandemic, their hiring numbers slowed down significantly. The company hired hundreds of engineers, analysts, sellers and managers in its offices in the United States alone, bringing the total number of SAP employees in the United States to more than 19 thousand people.

In order to determine how many new employees and what remuneration they receive in SAP, Insider analyzed the data on 643 approved visa applications on form H-1B. According to the data from the visas, you can understand about the ranges of basic salaries in the company, but the data does not include various bonuses or other forms of compensation for employees.

Annual base salary of hired employees for 2020-2021 by SAP:

• Architect developer (California) - from $242 thousand.
• Support Expert Engineer (Texas) - from $208,000
• Senior Engineer DevOops (California) - from $190 thousand.
• Leading Engineer (California) - from $156 thousand.
• Senior Support Engineer (Pennsylvania) - from $90 thousand.
• Support Engineer (Florida) - from $68 thousand.
• Chief Business Process Consultant (Pennsylvania) - from $193 thousand.
• Chief Business Process Consultant (Illinois) - from $188 thousand.
• Chief IT Technology Consultant (California) - from $186 thousand.
• Business Process Consultant (Georgia) - from $182 thousand
• Chief IT Business Services Consultant (Texas) - from $171,000
• Senior Consultant for Business Processes (Texas) - from $163 thousand.
• Business Process Consultant (Washington) - from $95 thousand.
• Sales Support Expert (Florida) - from $197 thousand
• Pre-Sales Expert (Massachusetts) - from $154,000
• Sales expert (Pennsylvania) - from $136 thousand.
• Senior Director of Sales Solutions (Florida) - from $135 thousand.
• Senior Pre-Sales Specialist (Texas) - from $126,000
• Pre-sales specialist (Georgia) - from $94 thousand
• Senior Service Sales Manager (Oregon) - from $310 thousand.
• Senior Sales Manager (Florida) - from $268 thousand.
• Head of Support and Services (Pennsylvania) - from $253 thousand.
• Senior Development Manager (California) - from $237 thousand.
• New Jersey Value Consultant - from $234,000
• Senior Service and Support Manager (PA) - from $228,000
• Development Manager (California) - from $215 thousand.^[2]

2020

Launch a dating app between SAP employees

In mid-August 2020, it became known that the German manufacturer software SAP developed and launched an application similar to the company. Tinder The new solution is designed for single employees who perform job duties remotely. More. here

Jennifer Morgan's departure as CEO of SAP

On April 21, 2020, SAP announced the departure of Jennifer Morgan as CEO of the company. From April 30, this position will be held alone by 39-year-old Christian Klein. The German manufacturer of corporate software linked the restructuring at the highest level to the COVID-19 coronavirus pandemic, which affects the activities of companies and pushes them to change. Read more here.

2019

Firing the best programmers

In March 2019, it became known about the dismissal of leading SAP programmers as part of a large-scale restructuring aimed at the active development of the cloud business.

According to Reuters news agency, Björn Goerke, CTO and head of SAP Cloud Platform, left the German company. In the past, he was the Chief information officer of SAP.

In addition, Thomas Jung and Rich Heilman, who are considered programming gurus and were highly respected in the large SAP developer ecosystem, fell under the abbreviations.

Bjorn Gerke is a former SAP Chief information officer

The publication said the layoffs underscore the determination of the general director Bill McDermott to implement its long-stated ambitious plan - to take SAP out of its comfort zone, in which the company offered out-of-date enterprise software in order, and complete the company's transformation into a provider of digital platforms. Because of this migration, the vendor risks alienating key customers who generate most of SAP's revenue. They fear that the company may stop supporting its old products and force customers to switch to new cloud solutions like SAP S/4HANA.

The existing business must be backed up by the necessary innovations, says Marco Lenck, chairman of the German organization SAP User Group (DSAG), which represents the interests of 3,500 companies. - We see that many people with technical knowledge leave the company. Such a trend cannot be allowed to spread too widely.

Bill McDermott spent nine years at the helm of SAP working on changing the business model. However, the traditional business of selling PC-based software licenses and providing support services still generates three-quarters of SAP's revenue and most of its profits by March 2019. At the same time, this business is stagnating against the backdrop of a rapidly growing cloud business.

McDermott promised to triple cloud revenue by 2023 - up to 35 billion euros. To fulfill this task, he relies on young IT specialists with experience in the development of cloud services. SAP attracts new personnel both through HR departments and through acquisitions of other companies. At the same time, the vendor is parting ways with experienced developers representing the old school.

In March 2019, it became known that SAP is dismissing top programmers

IT consultant and founder of technology site Diginomica, Dennis Howlett, says SAP is abandoning "outstanding" professionals to offset the shortcomings of its cloud strategy.

Bill McDermott calls SAP a growing company, but where does Bill get growth from other than acquisitions? Howlett wondered.

SAP consultant partner Thorsten Franz says he found out about the layoffs on social media and was worried.

The software is similar to Lego with details you can put together to create your world. Obviously, it was too good to last. Now SAP says, we don't like this house anymore, so we're firing the architect and all the people who are working on it, "Franz said.

SAP said that by March 2019, negotiations are ongoing with employees over layoffs due in the second quarter. The company is going to offer employees to voluntarily leave or go ahead of schedule to retire with appropriate compensation. This restructuring will allow SAP to "invest in key growing areas and make changes in other areas to prepare them for the future," the company added.^[3]

SAP launches recruitment program after 4,400 people quit

On February 20, 2019, it became known about the launch of a recruitment program in SAP. The company will begin actively hiring specialists in March - almost two months after the announcement of mass layoffs.

In an interview with the German business publication Handelsblatt, SAP human resources department Director Cawa Younosi said that the company, as well as competitors, needs professionals in cloud computing, the Internet of Things and other growing areas.

SAP is looking for specialists in the field of AI, the Internet of Things, etc.

An SAP spokesman did not specify the number of people scheduled to be admitted to the state. Unosi only said that by the end of 2019, the number of personnel will be higher than in February.

In January 2019, SAP CEO Bill McDermott said in an interview with The Wall Street Journal that the company employs 96.5 thousand people, but it is planned to lay off 4,400 employees.

We're going to move our employees and focus on the areas that SAP needs most: artificial intelligence, blockchain, the internet of things, quantum computing. Currently, the company employs 95 thousand people. If we talk about what will happen in a few years, then the number of employees will become more, - said the head of SAP.

In a conversation with reporters, he also reported that the reduction in staff will be carried out through the early retirement program and the payment of compensation to all dismissed employees. Bill McDermott also promised to launch a recruitment of new specialists for various departments, and SAP financial director Luka Mučić claimed that by the end of 2019, the company's staff would exceed 100 thousand people.

As The Register was told in SAP, most of the reduction of 4,400 employees will affect Germany and the United States. In addition, the personnel purge was supposed to affect the company's representative offices in France and Canada.

Large-scale staff reform: employees are offered to change positions and retire ahead of schedule

On January 29, 2019, SAP announced a large-scale corporate restructuring, on which the company will spend from 800 to 950 million euros. Most of the expenses will be in the first quarter.

At the same time, due to the reform, the German manufacturer of business software hopes to achieve savings of 750-850 million euros, starting in 2020.

SAP announced a large-scale corporate restructuring, on which the company will spend from 800 to 950 million euros

At the same time, SAP CFO Luka Mucic told reporters that the new program is not designed to reduce costs, but to "adapt" the company to market conditions and "simplify" its structure.

As part of the restructuring, some employees will be transferred to other positions, someone will be offered early retirement with compensation. At the same time, the total number of personnel will only increase by the end of 2019, Muchich assured. By the end of 2018, the company had a staff of about 96,500 people.

According to Agence France-Presse, the company is going to cut about 3 thousand jobs.

We're talking about a fully voluntary termination program. We expect that the number of employees who left will be slightly more than in 2015, "said Luka Muchich, referring to the program for the reduction of 2,200 jobs, which was then launched against the background of the transition of SAP from traditional software to cloud.

In an interview with CNBC, SAP CEO Bill McDermott stressed that it is better to launch a restructuring at the beginning of the year.

The earlier you start, the more benefits you can get by the end of the year. We need to change when the company has become strong. This is exactly what we are doing, - said the head.

SAP is rebuilding its corporate structure to accelerate the growth of the cloud business. In 2018, its volume rose by a third, amounting to almost 5 billion euros. The company intends to triple cloud revenue by 2023, Bill McDermott said.^[4]

On the day the restructuring was announced, SAP shares fell nearly 4% in value.

2018

Launch of a business accelerator for women

In August 2018, SAP introduced a business accelerator for companies run by women. SAP.iO Foundry has supported nine startups in New York. Read more here.

Employee Awareness Courses Help SAP Grow Profits

In May 2018, it became known that SAP decided to conduct self-awareness courses for all its employees in Germany. This helps the company increase profits.

According to Reuters, for the first time with meditation and self-awareness technology, SAP industrial engineer Peter Bostelmann met during a severe personal crisis ten years ago, and the impression turned out to be so deep that in 2013 he convinced his employer to start experimental courses among company employees. Subsequently, Bostelmann led the global meditation course program at SAP - he teaches colleagues to live in the moment and fully perceive their own thoughts, feelings and environment.

SAP saw a source of profit in psychological training

Employees who have completed the course are healthier and more active, better able to cope with the stresses of an ever-changing world, Bostelmann said. In 2018, SAP conducts meditation courses for all 22 thousand employees in Germany and offers consulting services to other companies, including Siemens and Deutsche Telekom. SAP has invited 20 coaches in several countries, with another 20 joining in July 2018. Of the 91,000 SAP employees worldwide, 6,500 people took part in the two-day training program, including several top managers. Another 5,500 employees are waiting for their turn.

Corporate self-awareness courses have also been applied by companies such as Google and Intel, but SAP claims to have moved much further. Despite the doubts of skeptics who claim that such courses do not affect anything, SAP coaches are confident that self-awareness helps employees cope with stress and improves their health. Namely, these factors affect stress resistance, the ability to think clearly in emergency situations and the productivity of people's work, which in general significantly increases profits. Since 2014, SAP has conducted research on the impact of factors such as employee engagement in business and their health on company profits. According to SAP estimates, an increase in employee engagement by 1% leads to an increase in profit by 50-60 million euros, while an increase in the health culture in business increases revenues by 85-95 million euros. The company expects financial growth in 2018.

SAP refuses to clarify the costs of self-awareness courses for employees, but claims that the investment pays off twice. Training, according to the company, has led to an increase in employee activity and a decrease in absenteeism for a disrespectful reason.

In past years, American companies have concluded that every dollar invested in programs to combat socially significant diseases brings in an average of $3.8, and every dollar spent on lifestyle initiatives brings in only $0.5. However, it is programs to promote a healthy lifestyle that significantly reduce the number of absenteeism, according to a study by Rand Corporation.

To get consent from SAP leaders to conduct self-awareness courses, Bostelmann referred to research data on neuroscience, as well as an example of tennis player Novan Djokovic and Formula 1 champion Nico Rosberg. After attending the course in 2017, Daniel Holz, managing director of SAP in Germany, decided to hold it for all employees in the country as part of a program that includes 80 different training options.

The course helped me learn how to drown out the noise of everyday life and focus on what is really important, "Holtz emphasized.[5]

2017: Discontinuation of recruitment due to cost cuts

On August 4, 2017, it became known about the cost reduction program launched by SAP. The enterprise software maker has suspended hiring and reduced business trips.

According to the German publication WirtschaftsWoche, citing an internal SAP document classified as "top secret," the company froze the hiring of new employees until the end of 2017. In addition, restrictions on business travel are imposed: they must be strictly connected with customers.^[6]

SAP stopped hiring and reduced travel

It is noted that the SAP Supervisory Board approved these measures on July 15, 2017 to fulfill financial tasks. The growing value of the company's shares increases the remuneration of top managers, depending on the quotation rate. In April-June 2017, SAP's operating profit decreased by 27%, which was largely due to large internal expenses and the cost of paying compensation on shares.

An SAP spokesman explained to Reuters that the company has stopped increasing the staff of developers and sales specialists, while maintaining a set of other items.

This is in no way a freeze on overall hiring, the company said, adding that non-essential business trips are indeed being canceled.

During a conference on the publication of statements for the second quarter of 2017, SAP CFO Luka Mucic said that the company began to restrain staff growth after it increased by 3 thousand people in the first half of 2017 and by 7 thousand in 2016. By June 2017, SAP had 87,114 employees.

SAP's financial statements show that the company's global workforce increased by 9% over a 12-month period that ended in June 2017. Compared to the end of 2015 - the beginning of 2016, the state grew by about 5%.^[7]

According to TAdviser in SAP, recruitment may decrease in the second half of 2017:

The active personnel policy of the beginning of the year served as the basis for growth, but in the second half of the year the number of employees hired will naturally decrease, most likely. However, this does not in any way indicate a changed SAP HR strategy.

2016: Waiver of annual staff performance assessment

In August 2016, it became known that SAP refused to conduct an annual assessment of personnel performance. The German company believes that the personnel audit takes up too much time and money, and often demotivates employees.

Instead of evaluating the performance of employees once a year, SAP decided to arrange for them more frequent inspections conducted in the form of conversations between managers and their subordinates. By August 2016, the new system is being tested for 8 thousand employees of the company. In 2017, it is planned to implement it among the entire state, numbering almost 80 thousand people.

Wolfgang Fassnacht, director human resources department at the German office of SAP, told Reuters that an annual staff review that highlights lagging and prosperous employees is often inappropriate when conducting a constructive dialogue.

SAP stopped evaluating employees annually

The estimated gradation of employees does not work. People are open to feedback, as well as harsh criticism, until they start to be rated. Then the doors will close, says Fassnacht. "The old system is too static. It no longer reflects the dynamic shutdown in which we work.

According to the top manager, SAP receives many responses from customers, which could be the reason for the rejection of the annual audit of personnel.

Reuters notes that SAP was one of the first large European companies to adopt the American trend of abandoning the annual analysis of personnel efficiency. Previously, such certification was abolished by IBM, Gap and General Electric.

Many companies are reforming systems for assessing performance indicators, but completely abandoning them is considered a "more radical change," the consulting agency said PwC following a study released in 2015.

SAP's move is interesting because the company is the leader in the global human resource management software market and has made a big bet on personnel control tools by buying the American cloud company SuccessFactors for $3.4 billion in 2012. SAP intends to keep the sale of these solutions and, moreover, is going to release software for continuous management of employee performance.^[8]

Regular interviews with current employees are good, since this model involves constant communication and individual training, says Graham Kenny, managing director of Australian Strategic Factors (specializing in strategic planning and evaluation of staff performance). However, according to him, one cannot do without assessing the results of work, so companies need to be careful not to splash out with the water and the baby.

2015: SAP announces 3% staff cuts

On March 6, 2015, SAP announced 2,250 job cuts as part of a strategy to shift the German company's business focus toward cloud solutions. However, the total staff size should not ultimately decrease, since the manufacturer of corporate software intends to hire the same number of new employees.^[9]

According to the statement, SAP will lay off 2,250 employees, which corresponds to 3% of the total staff of the vendor. As of the end of 2014, the company employed about 74 thousand people.

SAP announced a 3% reduction in staff

As the head of the SAP human resources department, Stefan Ries, explained, the new personnel reorganization is not aimed at reducing costs, but at reorienting the company's business in accordance with market changes. According to the representative of the PR service of the German manufacturer, by the end of 2014 it is planned to create about 2,200 additional jobs in divisions responsible for growing areas, such as the cloud business, the SAP HANA platform and SAP Concur. SAP hired the same number of new workers in 2014, Rice recalled.

Those SAP employees who have come under a new wave of cuts will be able to count on the company's help in finding jobs. Some employees will be offered voluntary termination and early retirement with compensation. No enforcement measures will be applied, assured in SAP.

The reorganization of SAP personnel is taking place as the company gradually moves from the traditional distribution model software to the cloud. In 2014, the manufacturer earned more than 1 billion euros from cloud services and related support services, which is 56% more than a year earlier. At the same time, the implementation of traditional software, which provides the lion's share of revenues, rose by 6%.

2008: 43.8 thousand employees

In 2008, SAP had about 43.8 thousand employees.

2007: Growth in headcount over 20 years

1972: Five IBM employees set up company in Mannheim

SAP was created in 1972 by five former IBM employees (Klaus Tschira, Dietmar Hopp and Hasso Plattner, Claus Wellenreuther, Hans-Werner Hector) from the company's German office in Weingame. The SAP name was based on the first letters of the full name: "Systeme, Anwendungen und Produkte in der Datenverarbeitung "/" Systems, Applications and Products in Data Processing." The first office of the company was located in Mannheim (Germany). Development and launch of RF-System (SAP R/1) product.

Notes