The Indian-American businessman Renjen is to replace the SAP co-founder Plattner in the coming year at the top of the supervisory board.
(Photo: dpa)
Dusseldorf The balance of power at SAP has been presented to shareholders and photographers for years at the start of the general meeting: A belly-high logo of the software manufacturer serves as a prop, in front of which the chairman of the supervisory board, Hasso Plattner, shows himself with changing board spokesmen. At least if a pandemic doesn’t prevent it.
This Thursday, the picture documented the beginning of a new era: Punit Renjen entered the stage. The Indian-American businessman, head of the management consultancy Deloitte until the turn of the year, was up for election to the supervisory board. In a year, after an induction phase from Plattner, he is to take over the management of the committee.
The succession plan, which SAP communicated in February after a long period of uncertainty, was well received by shareholders, with Renjen receiving 99.2 percent of the votes. “Now we have an end to uncertainty – that’s very important,” said Jella Benner-Heinacher of the German Association for the Protection of Securities (DSW).
>> Read here: Interview with SAP chief supervisor Plattner about his successor
The changes that are pending at SAP should not only be visual. With Punit Renjen, a manager is at the top of the supervisory board who does not belong to the founding generation of the company, who neither knows the intricacies of a German stock corporation nor speaks German. For a long time, the latter was an exclusion criterion for the successor.
“Hasso Plattner is unique, an icon, a legend. The footprints he is leaving could not be bigger,” said Renjen. “So I want to make one thing clear: I’m not Hasso and I won’t try to be.” But he has the experience and passion to lead SAP into the future.
Punit Renjen: A storybook career at Deloitte
Renjen, who was born in India and went to the USA on a scholarship, has had a textbook career at Deloitte that has taken him to the top. For seven years he was the global boss of the consulting company, which currently has 415,000 employees at 150 locations.
During this time, the company increased sales from $35 to $59 billion. “I know firsthand what it takes to build a global community,” said the manager confidently.
He also knows the software business well as someone from the outside, emphasized Renjen. As a partner, he was responsible for projects for the introduction of SAP software for a long time. He knows about the possibilities of the technology – “but also where it is most likely to get stuck and where customers believe that SAP needs to do more”. In addition, as a consultant, he got to know a large number of companies and industries with all their complex problems.
CEO Christian Klein, Chairman of the Supervisory Board Hasso Plattner and his designated successor Punit Renjen (from left) posed together on the stage.
(Photo: dpa)
Shareholder representatives rated the nomination positively. A representative from outside at the top of the supervisory board is tantamount to a “revolution”, said Ingo Speich, fund manager at Deka – “but it may be exactly what SAP needs”. However, the training period of one year is very ambitious. “In any case, the undertaking also requires a great deal of time from you.”
Profitability “must improve significantly”
If Renjen becomes chief supervisor next year as planned, he should control a company that has largely managed the strategic realignment.
“Thanks to our very robust and sustainable business model, SAP is more resilient than ever,” said CEO Christian Klein in his speech.
Sales increased last year by 11 percent to 30.9 billion euros – largely due to the sale of cloud products, which management focuses on in development and sales.
However, profitability still leaves a lot to be desired, the operating margin fell to 15 percent.
SAP is currently trading at around 122 euros, more than 30 percent higher than a year ago. The software manufacturer’s share thus developed significantly better than the Dax and the industry index MSCI World Software.
SAP seems to have overcome the phase of weakness, praised Deka fund manager Speich, but called for an improvement in earning power. This is important in order to catch up with competitors like Salesforce. “Growth and earnings must improve significantly so that SAP can still play in the global league in the future.”
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