10 Questions For Henning Kagermann

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Your training is in theoretical physics. Do you have time to keep up with developments while running europe's largest software firm? A little bit. Things have been very exciting the last 10 years in quantum physics, so I read a little bit, enough to follow the debate.

What's so great about mendocino? If something goes wrong, or you have analytical information that you want to move to Microsoft Excel, or you want to synchronize your Outlook calendar with your business calendar, Mendocino makes it much easier because you have everything on one desktop instead of two separate applications. You don't duplicate data entry. You can work in Office and have access to SAP, and the other way around. Today, people have to switch between the systems. As a user, Mendocino looks like one program.

So why not merge SAP and Microsoft's business products divisions? We compete in business solutions, but can cooperate in other areas. Our customers have urged SAP and Microsoft to bridge the gaps.

Why is There so much excitement about "next-generation" software? There's a lot of automation in the software. So if it runs smoothly according to the rules, the [programming] models can be changed by businesspeople. You don't need information technology [IT] experts. Now you can understand why I'm so excited.

What do you think of the German government's recent critique of capitalism? [Laughs] The discussion we have now is by some people who've never run a business and yet try to set guidelines to tell business how to behave, which I feel is a little strange. A market is a market, and a free market is a good market.

isn't SAP part of the problem, because automation leads to job losses? Automating routine work makes a society wealthy. The question is, is a society innovative enough to replace these with higher-level jobs? This is what we have to do. Without increased productivity, how can a country be wealthier and more successful?

The E.U. constitution could be in trouble. How does that affect business? If Europe wants to compete, we have to be unified. We can't compete if countries stand on their own. From our point of view, better than a constitution would be if an IT consultant could work tomorrow in France, Italy or the U.K. without restriction. But he can't. That has to change.

Your major competitor is Oracle. after Oracle's acquisitions of PeopleSoft and retek, Why are you sticking with partnerships? We have a completely different strategy. We believe that in the business world we're in, it's just faster and we're more flexible through partnerships. If you make an acquisition, you waste a lot of time and energy bringing products together that were never designed to be one product. Partnering with the best is better for customers and it creates a kind of healthy competition, like on a team. If you play in a rock band, the most successful ones are those where you have extremely good people who compete a little bit with each other. If you acquire a company, you just kill a lot of its innovation.

Speaking of rock bands, Is it true that you're a heavy metal fan? Yes, yes, but it's more progressive metal, like Dream Theater, Ayreon, Queensrÿche. They have a great album — Operation: Mindcrime — [15] songs connected into one story.

Like SAP? Yes, everything's integrated. It's very good.