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Sapphire: McDermott's all-American attitude

ORLANDO, Fla. -- SAP America CEO Bill McDermott tells that Americans are falling in love with SAP as a brand and a company. At the company's annual U.S. user conference, McDermott says SAP is sitting pretty while its competitors are locked in ugly squabbles.

How difficult is it for you to communicate the messages of a German company to American customers? People ask me...

this all the time. It's so easy. Let's step back for a minute. Let's think about the American consumer. What does the American consumer want? They love brands. They're very brand conscious. SAP is the marquis brand in this space, not dissimilar to certain German cars that Americans absolutely rave about. Secondly, Americans are extremely astute about going with a winner. This company generates $8 billion in revenue, has 20,000 customers around the world, more than 60,000 installations in 120 countries. Americans are innovative, and they like the best in technology. So customers are benefiting from the best practices that have been instituted in several thousand instances, meaning it's a low-risk equation.

But, moreover, they're interested in innovations. SAP has been at this for 30 years. In some industries, that's a young company, but in this industry, it's an established company. And I think Americans connect with that.


Read more of our question-and-answer interview with Bill McDermott tomorrow.

Check out our Special Event at Sapphire 03' Orlando.

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Read more stories by News Editor Eric B. Parizo.

Why does it make more sense for Oracle than SAP to do that?
For our business, we don't need to buy customers. And we don't need to buy market share. It's not our goal to do that. We are always interested in increasing and expanding our capabilities to better serve customers. So if we were in a position to acquire increased capabilities -- from a technology standpoint -- to better serve customers, we would talk about that, as we always have. So it's no change in philosophy for us. Is this effort putting a strain on your consulting or customer service organizations?
It's a high-class problem. So if there are many customers who wish to take us up on this, we have ways of load balancing and utilizing our consulting organization pretty efficiently.

If it were really taxing, there would be plenty of partners who would be willing to help us. So I'm not viewing that as a negative. I'm viewing that as a positive problem. In a partner presentation earlier this week, you said that CRM sales are expected to generate 40% of the company's U.S. sales in 2003. Is that too ambitious?
Everything we do is ambitious, but not unrealistic. If it's not going to be 40%, then it'll be 35%, or 33%. It's going to be a very high percentage of the overall revenue of SAP America. MySAP CRM 4.0 is a major product for the company, from the user interface to the ease of adoption, and, of course, the business-process point of view.

We have enabled CRM not only to be a great product, but we're also enabling it through the [reseller] channel. We've hired a leader from McKinsey to run our CRM practice. We have built a representative structure in each of the [four U.S. sales] regions to enable CRM conversations with our customers. We've retrained the whole sales force on CRM, and I personally am a pretty big advocate of being successful at CRM. My foot is on the accelerator at all times, but I think I'm being very realistic in thinking that it's going to be the biggest product in our portfolio this year. Why do you believe Oracle is making a bid to take over PeopleSoft?
In terms of the applications space, it's their desire to grow their customer base and also to be associated with the maintenance of PeopleSoft installations. They were probably viewing the opportunity as the only way to compete with SAP. SAP's strategy is not to grow its customer base via acquisitions.

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