SAP's Chief Software Architect Calls it Quits

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SAP (Quote) announced yesterday that its supervisory board has accepted the resignation of chief software architect Shai Agassi, who said he is leaving in order to devote himself to environmental issues.

Agassi’s resignation is effective April 1, but he will continue to serve as an outside consultant and keep an office in Palo Alto, Calif., next door to SAP chairman Hasso Plattner.

The departure is seen as a blow to SAP. Industry observers who know the company gave Agassi credit for driving SAP’s platform strategy, such as NetWeaver.

His decision may have been indirectly precipitated by SAP’s decision to launch a new product line, code-named A1S, aimed at the mid-market where SAP is not established, and for which he had no direct responsibility.

During a conference call with reporters today, Plattner noted that he had asked CEO Henning Kagermann, whose term as CEO was to expire at the end of 2007, to remain in his position until mid-2009 in order to help shepherd in the new product line. Plattner would have named Agassi co-CEO, putting him in line to take over full leadership responsibilities upon Kagermann’s retirement. However, during private discussions, Agassi informed Plattner that two years was too long for him to wait for the top post, and that he wanted to get on with his life.

“I said to him, ‘I can’t understand this,'” Plattner said. But he said he respected Agassi’s decision and that the two “will stay good friends.”

Plattner also denied that Agassi’s departure is in any way connected to the suit filed by Oracle (Quote) last week against SAP for “massive theft” of corporate secrets and intellectual property. He said the board meeting’s agenda to discuss the departure were sent before Oracle “launched its broad attack.”

Plattner and Kagermann, who was also present during the call, insisted that Agassi’s departure would not derail ongoing projects at SAP. “Strategic direction is set by the CEO and the board,” said Kagermann.

He said that A1S will remain under the aegis of executive board member Peter Zenke, while the governance, risk and compliance (GRC) business, midwifed by Agassi, will become the responsibility of Doug Merritt.

Merritt, who was already heavily involved with GRC, was named a corporate officer and will lead the development of software for the business user. Klaus Kreplin will continue to lead SAP NetWeaver technology. The company also announced that Leo Apotheker, president of the customer solutions and operations group, will become Deputy CEO of SAP.

Plattner repudiated speculation that Agassi’s departure was the result of strong disagreements with Apotheker, long seen by analysts as Agassi’s main rival for the top leadership post in the post-Kagermann era. He said he had asked both men about a possible rift between them and concluded that “there might have been differences in interpretation [about timing of new product releases] but I couldn’t find a major difference in long-term strategy.”

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