Dorit Beric, Author at �鶹ԭ�� News Center

�鶹ԭ�� Flies High in the United Kingdom

Dorit Beric — Fri, 29 Apr 2022 10:15:57 +0000

In the 1990s, �鶹ԭ�� continued to fly high in the United Kingdom. The company faced many challenges — not least managing a burgeoning headcount. And although some employees took a career detour along the way, the majority navigated their way safely back to the �鶹ԭ�� world again.

Yet another training course is abruptly interrupted. Why? On the nearby runway at Heathrow Airport, a Concorde is preparing for take-off. “From the windows of our training rooms, we had a clear view of Concorde taking off,” says Peter Hunt. “And it wasn’t just the tremendous noise that caused the training sessions to be paused for several minutes at a time; basically, we all just wanted to witness this magnificent event.” Hunt joined �鶹ԭ�� as a consultant in 1995. Having previously worked at Siemens, he was initially unsure whether he had made the right decision moving from a large German company to a small German company. Now, following various jobs at other companies, he has returned to �鶹ԭ�� for the third time and works in Strategic Partner Management.

But Hunt’s story is not unique: It was said that when people left, many of them got their trouser braces caught in the door and were pulled back to �鶹ԭ�� again.

Peter Hunt is still proud today of �鶹ԭ��’s triumphant rise in the United Kingdom following the introduction of �鶹ԭ�� R/3 and the part he played in that success.

And speaking of reaching new heights, �鶹ԭ��’s rapid growth meant that, in 1995, another move became inevitable. And so it was that in May of the same year, �鶹ԭ�� UK relocated from Weybridge to Feltham, a large town in West London. “We used to joke that locations were chosen based on how difficult they were for German-speakers to pronounce,” recalls Russell Thomas, who at the time was based in Walldorf working on UK payroll.

At first, the subsidiary set up its offices in an impressive new building in New Square at Bedfont Lakes, close to Heathrow Airport, where IBM had already taken up residence. A few years later, the New Square building parking garage was used as a set in the James Bond movie “Tomorrow Never Dies.” Looking back, its location near the airport seems symbolic of �鶹ԭ�� UK’s success story even now. “�鶹ԭ��’s decision not to follow in the footsteps of many other tech companies and set up its offices in the Thames Valley along the M4 corridor that runs from Reading to Swindon was a pragmatic one, taken to make the journey to the subsidiary easier for senior managers flying in from Germany,” says Michael Longden, who joined �鶹ԭ�� from one of its customers in 1992.

A Growing Need for Training

The Bedfont Lakes location offered other benefits too: Kyla Fox, who has been working as a management assistant at �鶹ԭ�� for 28 years, remembers going for lunch at the IBM cafeteria, which served excellent food. “We simply swiped our cards and sauntered in past all the IBM employees lined up to pay for their food. �鶹ԭ�� has always had a culture of providing free meals for employees.” And across the other side of the airport, at the Nobel Drive Training Centre on Bath Road, alongside the runway, �鶹ԭ�� found sufficient space to meet its growing training needs. Alongside the center in Walldorf, it was one of the company’s largest training facilities at the time, with courses being held over four floors.

“Held in English, the courses attracted many participants from outside the UK too. As Head of Training, Jeremy White really had his hands full,” says Michael Longden.

“We were in the same boat as our customers,” recalls Peter Hunt. “A lot of the software, the help screens, and the documentation were still in German; and we were really also trying to convince ourselves when we asked our customers to trust us that there would be an English version soon.”

To meet the increased demand for consulting, �鶹ԭ�� set up a consulting academy at the Training Center in 1995. The plan was for a further 500 R/3 specialists every year to join the ranks of the nearly 1,000 consultants already helping customers implement �鶹ԭ��’s new ERP system.

The demand for support too, was keeping pace. In 1993, the designated support hotline set up two years previously for �鶹ԭ�� customers in the United Kingdom, for whom an �鶹ԭ�� information database was also available, was expanded to create the Customer Support Group UK, headed up by Terrie Creswell until 1999. She had joined �鶹ԭ�� in 1991, when R/2 was still the active product and when the way for R/3 was just about to be prepared. “I had started out in Training and spent a lot of time talking to our customers. So I knew that they were frustrated and wanted local support to meet the needs that centralized support in Walldorf couldn’t,” Terrie Creswell recalls. Ultimately, managing director Petra Frenzel tasked her with establishing a support group in London. “And so I was involved in setting up the global 24/7 customer service network. Working closely with colleagues around the world, we wrote the white paper that laid the groundwork for the future Customer Competence Centers.”

Close Ties with Headquarters

While �鶹ԭ�� UK continued to expand at every level, construction of an imposing new office building began right next to the company’s headquarters in 1997. “Whenever we drove past the huge building site, we thought how great it would be if this were to become the new home of �鶹ԭ�� UK,” recalls Peter Hunt.

The company was occupying more and more of the IBM building and it was clear that a larger headquarters was needed. Petra Frenzel and her leadership team were able to convince Executive Board member Henning Kagermann to acquire the new building. In the meantime, responsibility for �鶹ԭ�� UK had been handed back from �鶹ԭ�� International to �鶹ԭ�� AG in Walldorf. “With Clockhouse Place, we had our own landmark building – visible both from the air and the road,” says Martin Metcalf, who was then part of the management team and would later become managing director of �鶹ԭ�� UK.

Just as �鶹ԭ�� UK’s management team were in frequent contact with the senior management in Germany, employees in the UK valued having a close relationship with �鶹ԭ�� headquarters too. Sam Karbani, who joined �鶹ԭ�� in 1996 and today works in Globalization Services, recalls her first trip to Walldorf, “Whenever anyone went to Germany for the first time, we’d tell them to ‘touch the ball.’” Touching the rotating basalt sphere in the foyer at �鶹ԭ�� headquarters became a symbol for bonding with the parent company. “It was great to be able to work with the developers in Walldorf. I struggled a bit with the German cafeteria food, which back then was very meat-heavy, unlike in the UK, where there were already lots of vegetarians. But collaborating with our German colleagues was an experience I always relished.”

Fiona Walsh recalls how important it was, especially in Customer Support, to have a solid network in Walldorf: “That was the �鶹ԭ�� spirit: learning and sharing your knowledge – and being generous with your time in that respect.” She joined �鶹ԭ�� in 1992 and worked as an English-language assistant to �鶹ԭ�� Executive Board Members Hans Schlegel and Klaus Tschira. “The EVZ, or WDF01 as it is now known, with its exclusive customer center on the sixth floor, had just been built, and hanging in the foyer was the ‘R/3 clock,’ which counted down the days remaining until the launch of �鶹ԭ�� R/3.”

Expansion to Ireland

Following the official opening of the �鶹ԭ�� Service and Support Centre (Ireland), Ltd. (SSC Dublin) in early 1997 to create additional support capacity for �鶹ԭ��’s international �鶹ԭ�� R/3 customer base, the next logical step was to establish a dedicated sales office for Ireland. Until then, �鶹ԭ��’s Irish business had been conducted by a small team of salespeople and consultants based in London. Now, the new support unit was to report to Executive Board member Gerd Oswald and the sales unit to �鶹ԭ�� UK. Among the new employees in Ireland was Irish-born Fiona Walsh, who came highly recommended by co-founder Klaus Tschira. Having worked in Germany for six years, she then transferred to the new sales office at Dublin’s East Point Business Park, where she took on the role of customer support manager. “In those days, our Irish customers preferred to deal with Irish companies,” says Fiona Walsh. “Over the next few years, �鶹ԭ�� gained traction unbelievably quickly in the Irish market.”

Among those invited to the opening of the Dublin sales office were �鶹ԭ�� UK employees, “We celebrated the opening at the Clarence Hotel, a four-star establishment that had been bought and newly refurbished by U2 singer Bono and U2 guitarist The Edge, and opened in 1996,” recalls Michael Longden, who rejoined �鶹ԭ�� in 2008 following an almost 10-year break and today works as an �鶹ԭ�� S/4HANA expert in Public Cloud Presales.

A Change in Command

The success of �鶹ԭ�� in the UK and Ireland could have been Petra Frenzel’s ticket to a more senior role. But ultimately, her priority was to reduce her professional commitments. As is so often the case, it was easier for her to do this by leaving the company. “Henning Kagermann placed a great deal of trust in me when he gave me the opportunity to take on the role of managing director of �鶹ԭ�� UK,” she says. When Petra Frenzel returned to �鶹ԭ�� eight years later, she did so because she believed that she could best show her gratitude by once again being a highly committed member of the company.

Kevin Gibson, who had joined �鶹ԭ�� in 1991, took over from Petra Frenzel as managing director at the beginning of 1998. “Kevin was a great leader and it was exciting to be part of the Sales team at this time. There was a lot of work to do, but we were all so proud of our successes. There was a wonderful sense of teamwork,” recalls Katie Wall, who joined �鶹ԭ�� in 1996 as an executive assistant.

Fourteen months later, Kevin Gibson was to leave �鶹ԭ�� and join Ariba Technologies. �鶹ԭ�� management in Walldorf appointed Erwin (Ernie) Gunst as his successor. “And so there was another change, from a UK-focused to a more internationally aligned leadership style,” recalls Andrew Lack, who has been with �鶹ԭ�� since 1998 and now sells �鶹ԭ�� solutions for the consumer products industry. “It must have been quite a balancing act, on the one hand trying to stay close to the UK marketplace and on the other hand bridging the cultural gap to Walldorf and the rest of the �鶹ԭ�� world.” However, the focus of leadership changes was always on spreading experience across the globe “�鶹ԭ�� sent brilliant people on international assignments to really make a difference around the world,” says Hakan Yuksel, who was CFO and COO of �鶹ԭ�� UK & Ireland (UKI) when Erwin Gunst took over as managing director from Kevin Gibson in 1999.

Former Head of Training and Customer Service Director Jeremy White knows from experience that “�鶹ԭ�� UK offered an entrepreneurial working environment for self-starters. But it wasn’t for everyone. For some, it gave them a feeling of autonomy, while others perhaps felt they were left to their own devices. You had all the necessary ingredients to advance your career – you just had to get started and make it happen. However, a logical consequence of this was also that people often moved on and furthered their careers elsewhere.” Generally, however, they stayed in the �鶹ԭ�� fold. One such example is White himself, who left �鶹ԭ�� in 1998, but still works in the �鶹ԭ�� ecosystem today. Kevin Richardson, who joined �鶹ԭ�� in 1994 and now works at �鶹ԭ�� Australia puts it like this, “Sometimes ex-colleagues of ours ended up spending more time with us at the office when they worked for partners than when they worked for �鶹ԭ��.”

Meanwhile, there were 6,000 trained consultants in the UK and Ireland, of whom only five percent were �鶹ԭ�� employees, while the remaining 95% worked at partner companies. In 2001, around 1.6 million people on the British Isles were part of the �鶹ԭ�� ecosystem. Fiona Walsh is glad she still works within �鶹ԭ��’s partner network, “The footprint �鶹ԭ�� offers in the UK and Ireland has been really beneficial and a lot of people have made really good careers out of it. And this wonderful culture of partnership has been crucial to �鶹ԭ��’s success.”

No Growth Without Change

In 2000, �鶹ԭ�� UK & Ireland achieved a growth rate of 40%, with business from the new “my�鶹ԭ��.com” solution accounting for half of that increase. Some 50% of the subsidiary’s revenues came from new customers, whose number rose to around 800. The millennium also saw Ernie Gunst replaced as managing director by Hans-Peter Klaey. “Hans-Peter came to meetings armed with his now legendary folder. He documented everything in that folder – down to the very last detail,” recalls Peter Robertshaw, who was marketing director at �鶹ԭ�� UKI from 2000 until 2004. “That meant we had an accurate record of any objectives we discussed; it brought a new level of structure to our working practices.”

Under Klaey’s leadership, �鶹ԭ�� UK became the principal sponsor of London’s Donmar Warehouse theater. As well as making a difference in the community, the company wanted to raise public awareness of the �鶹ԭ�� brand in the United Kingdom. “The Donmar is a very avant-garde theater that attracts high-profile performers,” explains Melanie Waring, who joined �鶹ԭ�� from Oracle in 2000 and has worked in various marketing and corporate marketing roles over the years.

In the early 2000s, many functions – marketing included – that had previously been the UK subsidiary’s own responsibility became part of group-wide structures. This shift was at odds with the tight-knit atmosphere that was characteristic of �鶹ԭ�� UK in the early days and had fueled a strong sense of solidarity and friendship.

In September 2001, the world was turned upside down by the 9/11 terrorist attacks. “We’d all been at an offsite meeting in Windsor,” recalls Peter Robertshaw. “I remember seeing all the people in the pubs staring in shock at the TV.” Kevin Richardson was teaching at the Nobel Drive training centre and recalls how everyone stopped and gathered around the TV in the canteen. “Everyone will remember where they were on that day”, says Richardson. �鶹ԭ�� provided financial support to those affected. Meanwhile, it urged its employees around the world to manage their costs carefully. Barely four years later, London itself became the victim of terrorist attacks.

Turbulence

At �鶹ԭ�� UK, cost-saving measures led to lay-offs. With the subsidiary realigning its overall strategy to focus more on sales figures, employees who had not previously worked in sales bore the brunt of that shift. One of them was John Bannister, who, in 1988, had become �鶹ԭ�� UK’s tenth employee. “I was laid off overnight – after almost 14 years. That really pulled the rug from under my feet.” Nevertheless, and perhaps surprisingly, Bannister is still in touch with numerous �鶹ԭ�� alumni, follows �鶹ԭ��’s progress with keen interest, and enjoys reminiscing about his years at �鶹ԭ��. But: “However vital a realignment – and whatever the local notice periods are – there should be a rethink of the way in which employees are laid off, especially given the strong attachment they feel to �鶹ԭ��. Looking back, the nature of my departure from �鶹ԭ�� is something neither I nor the company can be proud of,” he says.

At the beginning of 2002, Martin Metcalf was appointed managing director. He had previously served as sales director, then chief operating officer, and had been on the management team for seven years. At that time, despite all the difficulties the IT market faced, �鶹ԭ�� was recognized as one of the top 15 employers in Britain.

Among �鶹ԭ��’s main competitors on the UK market was Oracle. “Back then, Oracle was the dominant supplier, particularly in the public sector, and it was initially difficult for us to gain a foothold,” says Martin Metcalf. The deal �鶹ԭ�� signed in 2002 with the Inland Revenue – now called HMRC and responsible for assessing and collecting UK taxation – opened the door to this sector and was a landmark event in Metcalf’s eyes, not least because it shone a light on the expertise and support coming from management in Walldorf. “CEO Henning Kagermann flew over from Germany for the final stage of negotiations. He undertook to do everything in his power to meet the customer’s requirements in full, even though we couldn’t do that 100% at the time the deal was signed. We had an incredibly visionary product and – although we did of course face some huge challenges initially – customers believed in us.”

Fiona Walsh attributes �鶹ԭ��’s success in large part to the high level of investment in the industries. “At presentations, our presales people were always able to impress with their extensive knowledge, and they talked about the real problems plaguing customers in their respective industries. That made their audiences feel like they were in safe hands.”

Learning Processes and Management Styles

“Change is part of the natural evolution of a rapidly growing company,” says Martin Metcalf. �鶹ԭ�� has been through all kinds of learning processes and different management styles and changes over the years, says Fiona Walsh. “But today’s whole movement into the cloud stems from the same ambition we had in the early days to help our customers be as successful as they can,” she adds.

For Martin Metcalf, who had been with the subsidiary in London since 1993 and accompanied its rapid growth for more than a decade, it was an honor being head of one of �鶹ԭ��’s leading subsidiaries and when he resigned from his post, which he held from 2002 to 2005, it was because he wanted to expand his leadership experience outside the �鶹ԭ�� world. But he has long since returned to the �鶹ԭ�� ecosystem and has fond memories of his career at �鶹ԭ��.

We heard similar stories from almost all of the 23 employees interviewed for this article. Many profess to having �鶹ԭ�� “in their blood” or “in their DNA.” And while Concorde touched down at Heathrow Airport – just a stone’s throw from �鶹ԭ�� UK’s offices – on its last ever landing on October 24, 2003, �鶹ԭ�� continued to fly high, accompanied by an ever-expanding partner ecosystem in which many �鶹ԭ�� alumni are still active.

�鶹ԭ�� West Balkans: Reliability as the Key to Normality

Dorit Beric — Fri, 22 Apr 2022 10:15:57 +0000

Faced with many challenges together with complex local requirements and dissatisfied customers, this is the story of how �鶹ԭ�� turned an inauspicious start in the West Balkan countries into a success.

“Patience, ingenuity, and a talent for improvisation were the qualities required to overcome the hurdles of being an ‘emerging country,’” says Dejan Banzić. He had already worked as a developer before joining �鶹ԭ�� West Balkans in 2007 as a consultant. Alongside a local sales team, there were about 30 consultants working in various centers of expertise known as “hubs.”

“I was assigned to the Defense and Security Hub and began by attending six weeks of training in Walldorf with eight other colleagues from the team and with tremendous help of our experienced mentors from Germany.” Today he works as a project manager in the public sector industry.

Dušan Radošević, who joined the local sales team in 2008 as a delivery manager, had previously worked for international companies and for �鶹ԭ�� partner S&T: “It was remarkable – and also a little strange – that only a few short years after the NATO bombing campaign, colleagues from Belgrade were working in an �鶹ԭ�� competence center for defense and security.” In his case, too, it was enthusiasm for �鶹ԭ�� software that had prompted him to make the move to �鶹ԭ�� West Balkans.

In the aftermath of the global financial crisis of 2007 and 2008, �鶹ԭ�� West Balkans hit a rough patch. An inter-company loan from �鶹ԭ�� AG to bridge the gap seemed the only option. So Tatjana Filipović traveled to Walldorf in 2008 and was given the green light for a cash injection aimed at getting the subsidiary back on track. The loan was repaid quickly.

“�鶹ԭ�� showed patience and continued to support our activities in the region, despite the fact that revenues were initially not what they should have been,” says Đorđe Talević, who was head of Marketing at the time.

�鶹ԭ�� as an Employer

Another problem was how to attract and retain employees. Wolfgang Kastenhofer recalls that it was difficult to recruit consultants in the early days. “We either had to train our local consultants ourselves or headhunt consultants from partners, which we obviously didn’t want to do, as that could have jeopardized our existing license business.”

In 2008, �鶹ԭ�� had to cut its workforce from 43 to 30. Wolfgang Runge says: “Even during the financial crisis, �鶹ԭ�� consulting business was booming and �鶹ԭ�� consulting partners were springing up all over the place. Many of the employees who acquired �鶹ԭ�� know-how while working for us made the jump to Western Europe and were welcomed with open arms in Germany and Europe, and in the United States as well.”

This meant that most of the consultants �鶹ԭ�� West Balkans had to let go in 2008, found new positions within �鶹ԭ��. “Having �鶹ԭ�� knowledge meant that you could find work in other �鶹ԭ�� locations or as a freelancer, which gave us consultants a feeling of security and flexibility that you simply didn’t have in other companies,” says Dubravka Živančev, now a senior project manager for Public Sector.

Headcount remained relatively stable in Serbia in the years that followed, though turnover continued to run at fairly high levels. “Of the 30 consultants who joined �鶹ԭ�� West Balkans when I did, only five are still there. Many transferred within �鶹ԭ��. But fortunately, as time went on, it became easier to recruit qualified and experienced people,” says Banzić.

“The CEE countries had excellent universities, and some of the applicants from them had received much better IT training than our young students from Germany, Austria, and Switzerland,” explains Runge.

He emphasizes �鶹ԭ��’s positive role, saying that there was nothing it could have done to halt high employee turnover: “Back then, it was simply the case that the other countries offered these skilled workers more opportunities.” As time went on, �鶹ԭ�� opened development centers in many locations and then had the structures in place to offer skilled IT personnel more interesting jobs in their own countries.

For Živančev, �鶹ԭ��’s international focus was not just reflected in the opportunities that were available to leave the region, but also in the business culture at local level: “My friends found it hard to believe in the early years when I told them I worked at the subsidiary of a German company, in close cooperation with Austria, had a Spanish manager who came to live in Belgrade, had team mates from Ukraine, and worked on projects in the U.K. or Slovenia. They thought I was telling fairytales when I said I started working with colleagues from Italy, India, Greece, Portugal, and other countries for a customer in Novi Sad – my hometown.”

Light at the End of the Tunnel

In 2008, the subsidiary moved to its new offices at 88 Omladinskih Brigada in “Airport City”, a state-of-the-art business park in Belgrade. The various areas of the company, which had previously been spread across the GTC Business Center and the Genex Tower on the other side of the city, could now come together.

Talević, originally a journalist based in Serbia, began organizing event and communications activities for �鶹ԭ�� West Balkans in 2008, while working as a PR consultant for a third-party company, and took over the role of marketing manager in September 2009. When it came to conquering the market, says Talević, events such as �鶹ԭ�� World Tour and �鶹ԭ�� Forum were crucial and they became recognized as key IT business events. “Particularly because they were attended by guests from the other Balkan regions. Our customers were not just from Serbia. After Serbia, for example, Bosnia and Herzegovina was the country with the second largest number of �鶹ԭ�� installations in the contractual territory.”

As �鶹ԭ�� expanded, its organizational structures also changed: �鶹ԭ�� West Balkans, by now assigned to the southern European business, became part of the Central and Eastern European (CEE) business region again in 2008. Vladimir Popović, who had previously overseen partner management in Southeast Europe out of �鶹ԭ�� Austria, became managing director of �鶹ԭ�� West Balkans in 2009, replacing Dragan Španović in that role.

For Belgrade-born Popović, this was an exciting challenge: “Despite all the difficulties, the important thing was always to focus on the big picture. Although, as a subsidiary, we clearly had to take a sales-oriented approach and quarterly figures were important, we could not afford to jeopardize long-term customer satisfaction. In short, we had to manage expectations, plan sensibly, and make realistic promises.”

After the failed start with oil and gas company NIS, it was important for �鶹ԭ�� to reestablish basic trust in the company and its products. “�鶹ԭ�� had the reputation of offering expensive software that didn’t actually work,” recalls Popović. “We had to tackle that view head on and highlight the basic strengths that characterize �鶹ԭ��: a great product that helps companies manage, analyze, and optimize their business effectively.”

An agreement was reached with NIS, which was sold to Russian energy company Gazprom in 2008. �鶹ԭ�� took onboard the mistakes it had made in the original project and the partner recognized that its own input and cooperation were just as important to the project’s success as �鶹ԭ��’s. “Little by little, we transformed what began as a failed project into a success story,” says Popović.

The Turnaround

The next key project success for �鶹ԭ�� West Balkans was in the public sector, where, with the support of Franz Zipp and �鶹ԭ�� Austria, it won the City of Belgrade as a customer. “This project was a prime example of how, when you do �鶹ԭ�� right, customer employees – at all levels of the company hierarchy – get to enjoy fantastic software,” says Popović.

Knowledge transfer from Austria was particularly crucial for this project, adds Živančev: “�鶹ԭ�� has really good people: Career starters can learn a great deal from them.”

As more and more big names from industry and business approached Popović voluntarily and gave him positive reports about their �鶹ԭ�� implementations, he knew that the tide would turn. “One of these influential managing directors said to me, ‘To begin with, I wasn’t sure whether I really needed �鶹ԭ��, but my company would not be what it is today if I hadn’t implemented it.’”

Popović remembers that, for one project, he asked the Austrian National Bank for a recommendation letter confirming that it had been a satisfied �鶹ԭ�� customer since 1987. “That was pretty special — which other company could point to a customer that had been satisfied for 20 years?” he says.

For �鶹ԭ�� West Balkans, it was important to have good managers and consultants on site who spoke the local language and were familiar with local customs and characteristics. But in the early days in particular, support from experienced �鶹ԭ�� managers like Franz Zipp was indispensable. “Franz was instrumental in �鶹ԭ��’s upward trajectory in the West Balkan countries for many years, in roles including consulting lead and regional CFO,” says Runge.

Company Culture Built on Normality

Popović sees �鶹ԭ��’s strength as its , one that allows creative freedom and the flexibility for employees to make decisions that harmonize the drive to do business with the need to take local and ad-hoc situations into account: “The people of the Balkans region are very grateful when someone behaves ‘normally.’ By that I mean according to basic human values and needs, such as keeping promises and being able to rely on commitments made, dealing with difficulties together, and benefiting jointly from successes. That was not a given during wartime or even in the period thereafter. In the business world, too, people had forgotten how to trust each other.”

In the years that followed, �鶹ԭ�� West Balkans managed to “change course.” Just five years after the global financial crisis, �鶹ԭ�� had firmly established its position as the market leader in Serbia and the region.

“When you look at the difficult situation from which it emerged, �鶹ԭ�� West Balkans’ progress is even more astonishing,” says Banzić. It is proof once again that personal commitment, cooperation, perseverance, and great leadership with the ability to wipe the strategic slate clean if necessary are the ingredients for success.

Today, there are some 50 employees at the head office in Belgrade and, following the acquisition of Callidus Cloud, the total workforce grew to almost 300 in October 2019. The Belgrade office of Callidus Cloud is one of the three largest in Europe. And, with it, �鶹ԭ�� West Balkans now has its own development department to add to its sales and consulting departments. After moving together into new, prestigious offices the colleagues will provide the foundation for the next chapter of the �鶹ԭ�� West Balkans success story.

�鶹ԭ��’s Journey to Dresden, East Germany’s Answer to Silicon Valley

Dorit Beric — Fri, 08 Apr 2022 10:15:57 +0000

After the fall of the Berlin Wall in 1989, Dresden became a key business location for �鶹ԭ�� in the former East Germany. Besides modernizing businesses there, �鶹ԭ�� offered something precious in those uncertain times: secure jobs.

After the Wall came down in November 1989, many West German companies, including �鶹ԭ��, rushed to open offices in Berlin. In 1990, the �鶹ԭ�� Executive Board in Walldorf decided that the fastest way to gain a foothold in East Germany would be a joint venture with ROBOTRON-Projekt Dresden (RPD), a leading software enterprise in the German Democratic Republic and, with the data and IT division of Siemens, already a strategic �鶹ԭ�� partner. It was not about turning a quick profit, though: Dresden would go on to become an important base for �鶹ԭ��’s business, and remains so today, 30 years after German reunification.

Before 1989

Dresden was home to a software industry before 1989. “RPD was founded in 1984 because East Germany had realized that software was vital to running enterprises successfully. This also paved the way for joint East-West IT projects,” says Hans-Jürgen Lodahl, who was managing director of RPD at the time, and who later became one of the three founding managers of the joint venture.

In 1985, RPD had begun building software for West German companies such as Siemens. “Under what was called import-export coordination, we would procure products from a partner company in the West, and it would order software from us,” says Lodahl. “That way, instead of paying for those products in precious hard currency, we provided software in return.”

�鶹ԭ�� appointed Wolfgang Kemna as managing director of the joint venture in 1990. Before the Wall came down, he was at Siemens in Munich and would receive delegations from East Germany: “It was the Cold War. We had to work out which computers we could sell them without breaking the U.S. embargo,” he recalls.

Though no-one at �鶹ԭ�� could possibly have anticipated how far the political changes in East Germany in 1989 would reach, the company had seen how this type of partnership worked before the Berlin Wall fell. “In September 1989, �鶹ԭ��’s Gerhard Oswald attended a meeting at Siemens in Munich, while Hasso Plattner was in Dresden to see the IT experts at RPD,” says Lodahl.

Then began a chain of events that would culminate in a reunited Germany.

Plans Firm Up

Back then, RPD was an East German software company that employed 1,200 people. It was part of Robotron, a state-owned electronics manufacturer with 68,000 employees. “When the Wall came down, we knew that Robotron had little chance of surviving as a whole. So we set about trying to save as many jobs as we could,” says Lodahl.

Joachim Singer, who after the Wall fell changed career to become HR director of RPD, recalls another problem: “In East Germany, we had tried to imitate as closely as we could the operating systems, database management systems, and mathematical programs of the West. We had essentially reproduced its software programs. So when the Wall came down, at RPD we were worried we’d face claims for royalties. It was clear that it could not continue to exist as it was.”

In mid-March 1990, �鶹ԭ�� exhibited at Leipzig’s spring trade fair. Due to the massive surge in the number of exhibitors from the West, there was no room left in the main arena so �鶹ԭ�� found itself in the over-spill hall.

With the fair only halfway through, �鶹ԭ��, RPD, and the Data and Information Technology division of Siemens AG announced their plan to set up SRS (Software- und Systemhaus Dresden). A few days later, at the CeBIT ‘90 computer fair in Hannover, West Germany, the �鶹ԭ�� Executive Board and RPD’s management continued their talks and firmed up their plans.

In those early days, there was no joint economic strategy for the two Germanys. �鶹ԭ�� had however, made certain assumptions about how East Germany’s economic system would change. It set them out in an internal position paper on doing business there, which forecast a real opportunity for �鶹ԭ�� R/2, the company’s standard software: “Splitting up the huge state enterprises into smaller, clearly defined businesses will result in an array of firms faced with the task of completely reorganizing and restructuring their operations.”

�鶹ԭ�� wanted to gain reference customers rapidly to be able to demonstrate the benefits of its software in the real world, and especially how it could help companies meet new legislation. The first pilot customer was a major steel plant on the border with Poland. It would run �鶹ԭ�� R/2 on Siemens C40 computers, with BS2000 as the operating system. At that time, the plant was one of many state enterprises being privatized following the collapse of communism, and in 1990 it became EKO Stahl. Today, it is owned by ArcelorMittal and is still an �鶹ԭ�� customer.

New Opportunities

In the meantime, news of the firms’ plans had reached staff at RPD. “My client came into the office brandishing an �鶹ԭ�� R/2 brochure and said: ‘You can stop what you are doing. We’ll be working on this software from now on,’” says Rainer Dittrich, who went on to lead the HR consulting unit at SRS and later at �鶹ԭ��.

SRS took on about 300 former RPD employees. Of them, 85 were put on �鶹ԭ�� projects. The person charged with getting the new joint venture off the ground on �鶹ԭ��’s behalf was Herbert Kramer. “He was very highly respected by everyone here for the work he did in getting the company up and running,” says Lodahl. “Unfortunately, ill-health meant he later had to hand over that part of his role to Heiner Göhlmann, his deputy.”

Joachim Singer, who became HR director of SRS, recalls that restructuring the business was not all plain sailing: “The managers from �鶹ԭ�� and Siemens-Nixdorf charged with setting up SRS had selected a number of Robotron employees to create a layer of management at departmental level. In some cases, the new structure reversed old roles, with former managers becoming employees, and vice versa. That caused some tension.”

After some initial difficulties, things soon settled down at SRS and the framework was in place for a new organizational structure. Petra Schletzke, who today works in �鶹ԭ�� Marketing, remembers her interview with one of the managers creating the new entity: “I was working in quality management and had two small children. The interviewers were amazed that I worked while looking after a young family. They gave me a job in the training department.”

Next Stop: �鶹ԭ�� Headquarters

Just before Easter in April 1990, Joachim Singer received a telex telling him that at 6:00 a.m. the following Wednesday a bus would be waiting in the Robotron car park in Dresden to take employees to Walldorf for training. Since Easter Monday had just been restored as a public holiday in East Germany, Singer had less than two working days’ notice.

“It wasn’t as simple as just telling staff; I knew I would have to persuade them to go. Hardly anyone here had heard of �鶹ԭ��. But we did have business dealings with Siemens, so many employees wanted to work for them. Besides, the operating system RPD’s workforce was used to, was more like that of Siemens,” says Singer.

Everyone had to decide more or less over Easter whether they wanted to spend the next three months on training courses in Walldorf. Many people at RPD had not yet been to West Germany on business. SRS offered an opportunity. Given that so much was up in the air at that time, it took a great deal of courage to commit to SRS. “When we got on the bus, all we knew was that we were heading to Walldorf. We arrived in a completely new world,” says Dittrich.

It was not just being in a new place that made people feel uneasy. “It was a very political time, and we couldn’t help but wonder whether someone in our group might have been a member of the East German communist party or the secret police. That’s why not all of us immediately felt at ease in the new order,” says Manfred Eilitz, who went on to build �鶹ԭ��’s hosting business in Dresden.

Looking back, Eva Rebitzer recalls how difficult it was for working mothers to drop everything to travel to Walldorf. She was in her mid-twenties and still in the early stages of her career after her apprenticeship at Robotron. “I was one of the few women who were able to come on the first bus. Others joined us later on the next two buses. We’d been told to dress smartly, so most of the men wore dark suits. When we arrived in Walldorf, people at �鶹ԭ�� must have thought we’d come for a funeral.”

Rainer Dittrich also remembers this well: “Oh, you were one of the people from the bus,” he has heard on many occasions since. He adds: “For a long time after we used to laugh about it with our developer colleagues in Walldorf, most of whom wore jeans and t-shirts. We ditched the suits pretty quickly.”

The new arrivals from the East were allocated particular subject matters. After a general course on business administration, they were sent off in small groups to learn from the developers working on their respective subjects. Rebitzer, who is still an HR consultant at �鶹ԭ��, recounts how, in the early days when everyone knew everyone in Walldorf, she first encountered co-founder Klaus Tschira: “’Who are you?’ he asked, ‘I haven’t seen you before.’ When I told him that I was part of the delegation from Dresden, he was surprised to learn that we were not all men in dark suits.”

From April 1990, every week for three months the RPD team would travel to Walldorf for training. “Everyone really welcomed the new arrivals from the East. They had the technical expertise. Now they needed to get up to speed on the latest advances in western IT,” says Wolfgang Kemna.

Trust in the Future

At that stage, the team from Dresden had only an assurance that they would be taken on. Right from the start, they had great faith in �鶹ԭ��. “Because we worked so closely with the colleagues in Walldorf, we built trust very quickly,” says Rainer Dittrich. “There were about 100 employees working on HR, who were joined by 10 new people from the East. Working together gave us a sense of security. We also met up after work, had round-table talks, and went sight-seeing. We learned fast what it really means to be an �鶹ԭ�� consultant, and we weren’t left on our own.”

When they first arrived in Walldorf, the team from Dresden were welcomed by �鶹ԭ�� Co-Founder Hans-Werner Hector, then in charge of training. In July 1990, their three months in Walldorf were over. To mark the end of their time there, co-founder and CEO Dietmar Hopp addressed them at a large farewell event. It was time to return home, he said, and wait for SRS to be founded.

“Dietmar Hopp turned to us and asked that anyone with the slightest doubt about the plans to found the new company raise their hand, and added that if anyone did, �鶹ԭ�� would set up its own subsidiary in Dresden. That was a clear signal and no one raised their hand,” Dittrich says.

East Meets West

In the fall of 1990, Wolfgang Kemna headed east. “They were crazy times. One day, I drove to Dresden and had one of the first cell phones with me, though most of the time there was no reception. It was a big adventure for someone like me who had grown up in the West German state of Hesse. Rather than stay in a hotel, I had deliberately chosen to lodge with a family, whose son had taken up an apprenticeship in the west. Staying with them meant I could ask my hosts everything I’d ever wanted to know about life in East Germany.”

SRS’s offices in Dresden were in the former Robotron facilities. They occupied three floors of the main building and a section of the data center, all of which would soon be renovated and re-equipped.

Around the same time, in October 1990, Siemens acquired Nixdorf, the struggling computer company. “SRS’s foundation was delayed, since we had to wait for the new Siemens-Nixdorf to come into being first,” says Joachim Singer. “And the Treuhand, the government agency overseeing East German privatization, still needed to give its go-ahead to Robotron-Projekt GmbH’s stake.”

Finally, on October 15, 1990, less than two weeks after German reunification, SRS was officially founded in Munich, and opened for business on November 1, 1990.

�鶹ԭ��’s Journey to Dresden

Hans-Jürgen Lodahl emphasizes the positive influence that Dieter Matheis, who served as CFO at �鶹ԭ�� until 2001, had on the commercial organization of SRS. The person tasked with establishing the joint venture on the Siemens-Nixdorf side was Peter Hutzelmann. He took responsibility for commercial management at SRS, would later become its managing direction, and had a decisive influence on the company’s evolution in the following six years.

“When the company was founded, 325 employment contracts had to be signed all at once. By the end, I wasn’t even sure I could write my name correctly,” remembers Hutzelmann. “And there were traffic jams in all directions on the freeways linking the two Germanys, because October 31 was Reformation Day – a public holiday in the east – and November 1 was All Saints’ Day in the west. The westerners were taking their first day trips to the east, while the easterners returned with their recently purchased used cars and their temporary plates.”

�鶹ԭ�� AG and SNI AG each held 45% in the joint company, which was launched with share capital of six million marks, while RPD GmbH held the remaining 10%. “We had originally planned to divide ownership equally, in thirds,” says Hutzelmann, who still has vivid memories of the meeting with Dietmar Hopp, “but RPD could only contribute 10% of the share capital, so our stake increased significantly as a result. I had to arrange that with the SNI board. But before I could even get a meeting there, Hopp had already clarified the share capital issue with �鶹ԭ��’s Supervisory Board.”

Pursuing the Goals Together

“By the end of 1990, half of the SRS share capital was exhausted, but then things improved steadily from there,” remembers Hutzelmann. “A major factor was the more than 50 C40 computers that Siemens-Nixdorf provided free of charge for pilot installations.”

�鶹ԭ�� did what it said it would do as part of its East Germany strategy: It primarily hired employees from the former German Democratic Republic. But as Joachim Singer tells it, it wasn’t easy at first for the SRS colleagues who were assigned as consultants on �鶹ԭ�� projects: “The companies didn’t like having Robotron employees advising them. The IT equipment in East Germany was never sufficient. It was allocated, not ordered, which is why the Robotron technicians who were known at the companies weren’t very highly regarded.”

This made it very important for the RPD consultants to have experienced �鶹ԭ�� lead consultants at their side. One of these lead consultants from Walldorf in the early days was Joachim Prawitz, responsible for the Human Resources area. Wolfgang Kemna remembers him with great respect: “The lead consultants from Walldorf helped to increase acceptance of the East German consultants. For SRS, it was much more important to have good, experienced �鶹ԭ�� consultants than good salespeople or developers. There wasn’t much to sell, after all; the projects were ordered and paid for in the west, while the technical expertise was in Dresden. It became clear how important it was for the East German consultants to have assignments on projects in West Germany to learn how projects are executed at �鶹ԭ�� and to build their own networks within the company.”

As Kemna tells it, Hans-Jürgen Lodahl was also an important success factor during this time. “He was one of the leading people in the east – and not only in Dresden – with regard to IT, hardware, and software, and had a huge network that helped us repeatedly. Sometimes we didn’t even know what strings he had pulled.”

The Dresden consultants had already gained their first insights into �鶹ԭ�� R/3 on training courses in Walldorf, but �鶹ԭ�� R/2 was initially planned for the mainframes in the GDR. “We established later that the mainframes in the east weren’t powerful enough to run �鶹ԭ�� R/2. It also became clear that the decisions concerning software implementation weren’t being made at the state-owned enterprises and combines in the east, but instead by the parent companies in the west that had acquired them,” says Kemna.

Machine manufacturer VEM Sachsenwerk GmbH Dresden was one of the first companies to start using the �鶹ԭ�� R/2 system in 1991, with the RP (Personnel) module, and was the first stock corporation established by the Treuhand in the GDR. The company was allocated to Horst Plaschna Management GmbH & Co Beteiligungs- und Verkaufs-KG Berlin in July 1992, however, and privatized and sold to the Merckle Group of Companies in Blaubeuren in 1997.

With the list of major East German companies that began using �鶹ԭ�� R/2 RP for payroll accounting in 1991, to comply with the new laws of the Federal Republic of Germany, the market potential for �鶹ԭ�� software in the former East Germany was exhausted for the time being.

Kemna explains how SRS managed to produce a profit from its first year in operation: “The majority of the initial consulting revenue in fact came from projects with customers in the west, since much of the industry in the east had been phased out. Nineteen ninety was too early for East German startups and even so, they would have been too small for our �鶹ԭ�� R/2 product.”

Nonetheless, �鶹ԭ�� customer numbers in the east grew steadily from 1991, primarily from government-funded orders. The municipal transport services in Dresden and Leipzig chose to implement �鶹ԭ�� software, for example, and have remained customers to this day.

SRS benefitted from the advantages of a joint venture: the contacts of all three investor companies and the possibility of offering the equipment, business software, and support from a single source.

Safe Haven

Employees like Rainer Dittrich recognized the opportunity, because rapid deindustrialization resulted in the loss of millions of jobs in the former East Germany. The government responded with job-creation schemes, cuts in working hours, and early retirement options, among other schemes: “The only contact we had with reduced working hours, which so many former GDR citizens were forced to endure after reunification, was a new development for our RP system – because reduced working hours were unheard of in the west in the 1990s.”

But SRS colleagues still faced a wide variety of career challenges. The working methods at the �鶹ԭ�� office were ahead of their time even then compared with West German standards at the time. The new colleagues in the East had to make this leap too, besides gaining expertise in �鶹ԭ�� products and processes and in general market economy topics.

Petra Röber, now a senior business support specialist at �鶹ԭ�� in Dresden, was Peter Hutzelmann’s assistant at the time. A young parent then, Röber was hired by RPD in 1990 and, after Hutzelmann left the company, she continued to work as an executive assistant at SRS before taking on new challenges at �鶹ԭ��. “In the 30 years that I’ve worked for SRS and then �鶹ԭ��, there wasn’t a single year that I didn’t learn an awful lot of new things or develop as a person,” Röber says.

At the same time, �鶹ԭ�� employees were used to dealing with one another as equals and with goals in mind. Arrogance has never been part of the �鶹ԭ�� culture, so after they got to know each other, both sides quickly transitioned into a productive working relationship. Joachim Singer remembers: “I was surprised that I could turn to my manager when I had problems with our IT initially, and he was very helpful and straightforward.” That’s why he sees his work together with his �鶹ԭ�� colleagues as the “best experience of the west” he had in post-reunification times. “When we visited Walldorf, we’d joke about how �鶹ԭ�� was the ideal that communism had always pretended to be: free lunch for the employees, company cars for everyone, playing tennis at work…”

They didn’t have much to do with the colleagues in Berlin, but there was still a kind of “noble rivalry” between the locations, recalls Kemna. It was important for �鶹ԭ�� that its Berlin operations were not tied to one particular hardware manufacturer so that, alongside the Dresden joint venture with Siemens, it could make sure it did not neglect business relations with other hardware manufacturers like Compaq, HP, and IBM.

Ultimately, the strategy of establishing two business hubs proved to be a sturdy foundation for business in the east. What’s more, �鶹ԭ�� offered former GDR experts in Berlin and Dresden a new place to live and work. This also meant that everything they had achieved in their careers before the Wall fell still counted, which was often not the case for people in eastern Germany.

What Happened Next?

SRS was privatized in 1993 and the Treuhand’s 10% share was distributed equally to �鶹ԭ�� and Siemens. Siemens-Nixdorf and �鶹ԭ�� justified this step during the approval procedures, arguing before Germany’s Federal Cartel Office that, “To date, RPD has not contributed any added value at SRS.” Joachim Singer explains, “Aside from the Robotron employees, who had been part of SRS for three years in the meantime, there were absolutely no connections with Robotron-Projekt. No products had been taken over; aside from the employees and their knowledge – which they had largely acquired from �鶹ԭ�� and Siemens, after all – Robotron-Projekt didn’t make any contribution at all.”

Ten years later, SRS had become one of the most important employers in the region. The �鶹ԭ�� share of SRS consulting business grew steadily. “�鶹ԭ�� experienced an amazing rise, while Siemens-Nixdorf faced its liquidation in 1998,” says Hutzelmann, who joined Siemens in 1996. “As a consequence, �鶹ԭ�� took over 100% of SRS.”

In 1997, SRS, �鶹ԭ�� System Integration (�鶹ԭ�� SI) in Alsbach-Hähnlein, and �鶹ԭ�� Solutions in Freiberg am Neckar were all merged to form the new �鶹ԭ�� SI. In this form, it was fully absorbed in the parent company in 2008 and moved into the new �鶹ԭ�� office building on Dresden’s Postplatz.

Today, Dresden is an important location in the �鶹ԭ�� universe – Hans-Matthias Fischer (see box) sees its broad portfolio as one of the key reasons: “The mix of consulting, sales, application management, customer support, IT support, global cloud services, and �鶹ԭ�� research makes Dresden strong and attractive. The entire region benefits from �鶹ԭ�� Dresden.”

The location will celebrate its 30th birthday in November – and has become an important part of �鶹ԭ��’s story. According to Fischer: “The development of SRS presented a huge opportunity to us, which we faced with courage and ability, and we are still very grateful today to have had that opportunity.”

Employee Spotlights

Bernhard Heininger:
The Workforce Grows

Among the RPD employees were 25 people who were working on �鶹ԭ�� software development projects when SRS was founded. Bernhard Heininger had joined �鶹ԭ�� in 1986. Though new to management, his expertise in mainframe computers and IBM assemblers meant he was put in charge of the development and project unit at SRS in the fall of 1990. RPD had used assemblers, and SRS wanted to draw on that knowledge. “By that time, Walldorf was working flat-out on �鶹ԭ�� R/3. The idea was to use the potential in Dresden also to reduce the development effort on �鶹ԭ�� R/2 in Walldorf.”

In the years that followed, Heininger expanded his team of developers in Dresden so that besides ABAP and assembler projects it could also get up to speed on new technology projects such as the early watch service and IT support. “I commuted between Walldorf and Dresden for four years. At first, I stayed in a hotel and flew home every week. But arriving at Dresden airport used to take forever, and made the journey extremely long. Later, I’d drive between my home and a second home near work every two weeks.”

The aim was for the team of developers in Dresden to become more autonomous with each project they took on. “My staff were mostly older colleagues who found my anti-authoritarian management style rather strange to begin with, since it was so different to what they had known before,” says Heininger. “After all, I was doing everything I could to make sure they could do their jobs without me as an external development manager.”

Heininger succeeded: By 1994, his work in Dresden was complete and he moved to California for the next chapter in his career. He retired in 2016 after 30 years at �鶹ԭ��.

Manfred Eilitz:
Hosting and Art in Dresden

As a Robotron employee, Manfred Eilitz was at the very first meeting with Siemens in Munich in 1989. “One of the people from Siemens told us that they had also brought along someone from �鶹ԭ��. It turned out to be Gerd Oswald. That was my first encounter with �鶹ԭ��.” After SRS was founded, Eilitz was placed in charge of the data center in Dresden. Hosting services were offered internally at first, and later to customers.

“By the end of 1991, we hosted about 10 internal �鶹ԭ�� R/2 systems. Once �鶹ԭ�� R/3 came on stream, we had about 30 �鶹ԭ�� systems. That number continued to grow as more systems were migrated to �鶹ԭ�� R/3 before �鶹ԭ�� R/2 was finally sunsetted.” The launch of �鶹ԭ�� R/3 saw Dresden become �鶹ԭ��’s first hosting business. Eilitz remained in charge until �鶹ԭ�� founded the �鶹ԭ�� Hosting subsidiary in 2000.

Early retirement offered Eilitz a complete change of direction, from IT expert to watercolor artist. His work was shown at �鶹ԭ��’s Dresden offices as part of the art’�鶹ԭ�� Dresden exhibition in 2016.

Hans-Matthias Fischer:
From Dresden to Saudi Arabia

Many SRS colleagues were not only assigned to �鶹ԭ�� consulting projects, but also to projects at Siemens. Hans-Matthias Fischer, who now leads the Technical Financial Management area at the Global Cloud Services organization of �鶹ԭ�� SE, started at RPD through an internship while he was still a student at TU Dresden. He and several RPD colleagues visited West Berlin in 1989, even before the border wall fell, to attend a Siemens BS2000 training course.

Immediately after SRS was founded, he was assigned to a Siemens project run from Munich and sent to Saudi Arabia, which was an important SRS market for a long time. “Saudi Arabia was a huge challenge for me, so soon after the border wall was opened and during the Second Gulf War.” Fischer found himself commuting between Dresden, Munich, and Riyadh for quite some time: “The consulting business in systems engineering isn’t easy, but the international aspect really appealed to me – it was a give and take and offered me a surprising number of opportunities in the post-reunification period. That shaped me, both personally and professionally, and I’m very grateful for it.”

Petra Schmidt and Bernd Friebe:
�鶹ԭ�� R/3 Support from Dresden

Another department at SRS, consisting of four employees, was tasked with setting up �鶹ԭ�� R/3 Support in Walldorf in early 1993. “In the early days, we processed inquiries about �鶹ԭ�� R/3 in the respective applications — such as MM, SD, HR, and more — that were fielded by a service line in the department office and forwarded to us. The support organization expanded steadily, the support database with the �鶹ԭ�� Notes and ticket system were established, and �鶹ԭ�� ultimately moved the department to Dresden,” remembers Bernd Friebe, who headed the Dresden Support Center.

“The close contact with �鶹ԭ�� R/3 Development was important to us, to drive future developments forward and to analyze and fix software errors. For us, that meant regular flights to Frankfurt over several years, to work in Walldorf or St. Leon-Rot during the week.” As things progressed, Friebe was given the green light to hire additional employees in Dresden in 1996.

That was the chance for Petra Schmidt. She had worked at Robotron after earning her degree in mathematics but didn’t find out about the 1990 �鶹ԭ�� training opportunities until it was too late. “My superior at the time was already concentrating on founding a different company and didn’t forward the information about the �鶹ԭ�� training to me at all. I was assigned to a six-week SINIX course at Siemens-Nixdorf Informationssysteme AG in Dresden, together with other employees. That was in September/October 1990.”

After a parental leave period, she rejoined SRS in a support role and attended the necessary �鶹ԭ�� courses one by one. She was thrilled when she was given the opportunity to join the new support department in 1996, where she advanced to senior support engineer before taking early retirement in 2016. That meant processing support tickets from customers around the world, analyzing ABAP programs, and training many new colleagues in Bangalore, Budapest, Dublin, and Vienna. Schmidt sees her career at SRS, then �鶹ԭ�� SI, and ultimately �鶹ԭ�� as a “huge piece of good fortune.”

In particular, helping create the Global Service Centers (GSCs) was an exciting time. “In the beginning, we helped set up the new support centers in Austria, Hungary, Ireland, and India – all from Dresden,” recalls Friebe, who also stayed with �鶹ԭ�� until his retirement three years ago.

�鶹ԭ��’s Journey to Dresden, East Germany’s Answer to Silicon Valley

Dorit Beric — Fri, 27 Nov 2020 13:15:43 +0000

After the Berlin Wall came down in November 1989, many West German companies, including �鶹ԭ��, rushed to open offices in Berlin.

In , the �鶹ԭ�� Executive Board decided that the fastest way to gain a foothold in East Germany would be a joint venture with ROBOTRON-Projekt Dresden (RPD), a leading software enterprise in the German Democratic Republic, and the data and IT division of Siemens, already a strategic �鶹ԭ�� partner.

It was not about turning a quick profit, though: Dresden would go on to become an important base for �鶹ԭ��’s business and remains so today, 30 years after German reunification.

Dresden was home to a software industry before 1989. “RPD was founded in 1984 because East Germany had realized that software was vital to running enterprises successfully. This also paved the way for joint East-West IT projects,” says Hans-Jürgen Lodahl, who was managing director of RPD at the time and later became one of the three founding managers of the joint venture.

In 1985, RPD had begun building software for West German companies, such as Siemens. “Under what was called import-export coordination, we would procure products from a partner company in the West, and it would order software from us,” says Lodahl. “That way, instead of paying for those products in precious hard currency, we provided software in return.”

Plans Firm Up

Joachim Singer, who after the Wall fell changed careers to become HR director of RPD, recalls another problem: “In East Germany, we had tried to imitate, as closely as we could, the operating systems, database management systems, and mathematical programs of the West. We had essentially reproduced its software programs. So, when the Wall came down, at RPD we were worried we’d face claims for royalties. It was clear that it could not continue to exist as it was.”

In mid-March 1990, �鶹ԭ��, RPD, and the Data and Information Technology division of Siemens AG announced their plan to set up SRS (Software-und Systemhaus Dresden). A few days later, in Hannover, West Germany, the �鶹ԭ�� Executive Board and RPD’s management continued their talks and firmed up their plans.

In those early days, there was no joint economic strategy for the two Germanys. �鶹ԭ�� had, however, made certain assumptions about how East Germany’s economic system would change. An internal position paper on doing business there forecasted a real opportunity for �鶹ԭ�� R/2, the company’s standard software: “Splitting up the huge state enterprises into smaller, clearly-defined businesses will result in an array of firms faced with the task of completely reorganizing and restructuring their operations.”

�鶹ԭ�� wanted to gain reference customers rapidly to be able to demonstrate the benefits of its software in the real world, and especially how it could help companies meet new legislation. The first pilot customer was a major steel plant on the border with Poland. At that time, the plant was one of many state enterprises being privatized following the collapse of communism, and in 1990 it became EKO Stahl. Today, it is owned by ArcelorMittal and is still an �鶹ԭ�� customer.

New Opportunities

In the meantime, news of the firms’ plans had reached staff at RPD. “My client came into the office brandishing an �鶹ԭ�� R/2 brochure and said, ‘You can stop what you are doing. We’ll be working on this software from now on,’” says Rainer Dittrich, who went on to lead the HR consulting unit at SRS and later at �鶹ԭ��.

SRS took on about 300 former RPD employees. Of them, 85 were put on �鶹ԭ�� projects. Singer recalls that restructuring the business was not all smooth sailing: “The managers from �鶹ԭ�� and Siemens-Nixdorf charged with setting up SRS had selected a number of Robotron employees to create a layer of management at the departmental level. In some cases, the new structure reversed old roles, with former managers becoming employees and vice versa. That caused some tension.”

After some initial difficulties, things soon settled down at SRS and the framework was in place for a new organizational structure.

Next Stop: �鶹ԭ�� Headquarters

Just before Easter in April 1990, Singer received a telex telling him that the following Wednesday morning a bus would be waiting in the Robotron car park in Dresden to take employees to Walldorf for training.

Many people at RPD had not yet been to West Germany on business, and SRS offered an opportunity. “When we got on the bus, all we knew was that we were heading to Walldorf. We arrived in a completely new world,” says Dittrich.

The new arrivals from the East were allocated to particular subject matters. After a general course on business administration, they were sent off in small groups to learn from the developers working on their respective subjects. Eva Rebitzer, who is still an HR consultant at �鶹ԭ��, recounts how, in the early days when everyone knew everyone in Walldorf, she first encountered co-founder Klaus Tschira: “‘Who are you?’ he asked, ‘I haven’t seen you before.’ When I told him that I was part of the delegation from Dresden, he was surprised to learn that we were not all men in dark suits.”

The RPD team traveled to Walldorf for training every week for three months. “Everyone really welcomed the new arrivals from the East. They had the technical expertise. Now they needed to get up to speed on the latest advances in western IT,” says Wolfgang Kemna, managing director of the joint venture.

Trust In the Future

Right from the start, the team from Dresden had great faith in �鶹ԭ��. “Because we worked so closely with the colleagues in Walldorf, we built trust very quickly,” says Dittrich. “There were about 100 employees working on HR, who were joined by 10 new people from the East. Working together gave us a sense of security. We also met up after work, had roundtable talks, and went sight-seeing. We learned fast what it really means to be an �鶹ԭ�� consultant, and we weren’t left on our own.”

In July 1990, their three months in Walldorf were over. To mark the end of their time there, co-founder and CEO Dietmar Hopp addressed them at a large farewell event. It was time to return home, he said, and wait for SRS to be founded. “Dietmar Hopp turned to us and asked that anyone with the slightest doubt about the plans to found the new company raise their hand, and added that if anyone did, �鶹ԭ�� would set up its own subsidiary in Dresden. That was a clear signal, and no one raised their hand,” Dittrich says.

East Meets West

Around the same time, in October 1990, Siemens acquired Nixdorf, the struggling computer company. “SRS’s founding was delayed, since we had to wait for the new Siemens-Nixdorf to come into being first,” says Singer. “And the Treuhand, the government agency overseeing East German privatization, still needed to give its go-ahead to Robotron-Projekt GmbH’s stake.”

Finally, on October 15, 1990, less than two weeks after German reunification, SRS was officially founded in Munich, and opened for business on November 1, 1990.

“When the company was founded, 325 employment contracts had to be signed all at once. By the end, I wasn’t even sure I could write my name correctly,” remembers Peter Hutzelmann, who was responsible for commercial management at SRS and later become its managing director.

Pursuing Goals Together

�鶹ԭ�� did what it said it would do as part of its East Germany strategy: It primarily hired employees from the former German Democratic Republic. But as Singer tells it, it wasn’t easy at first for the SRS colleagues who were assigned as consultants on �鶹ԭ�� projects: “The companies didn’t like having Robotron employees advising them. The IT equipment in East Germany was never sufficient. It was allocated or not ordered, which is why the Robotron technicians who were known at the companies weren’t very highly regarded.”

This made it very important for the RPD consultants to have experienced �鶹ԭ�� lead consultants by their side. One of these lead consultants from Walldorf in the early days was Joachim Prawitz, responsible for the human resources area.

Kemna remembers him with great respect: “The lead consultants from Walldorf helped to increase acceptance of the East German consultants. For SRS, it was much more important to have good, experienced �鶹ԭ�� consultants than good salespeople or developers. There wasn’t much to sell, after all; the projects were ordered and paid for in the West, while the technical expertise was in Dresden. It became clear how important it was for the East German consultants to have assignments on projects in West Germany to learn how projects are executed at �鶹ԭ�� and to build their own networks within the company.”

As Kemna tells it, Lodahl was also an important player during this time. “He was one of the leading people in the east – and not only in Dresden – with regard to IT, hardware, and software, and had a huge network that helped us repeatedly. Sometimes we didn’t even know what strings he had pulled.”

Kemna explains how SRS managed to produce a profit from its first year in operation: “The majority of the initial consulting revenue, in fact, came from projects with customers in the West since much of the industry in the East had been phased out. 1990 was too early for East German startups and, even so, they would have been too small for our R/2 product.”

Nonetheless, �鶹ԭ�� customer numbers in the East grew steadily from 1991, primarily from government-funded orders. The municipal transport services in Dresden and Leipzig chose to implement �鶹ԭ�� software, for example, and have remained customers to this day.

SRS benefited from the advantages of a joint venture: the contacts of all three investor companies and the possibility of offering the equipment, business software, and support from a single source.

Safe Haven

Employees like Dittrich recognized the opportunity at SRS, as rapid deindustrialization resulted in the loss of millions of jobs in the former East Germany. The government responded with job-creation schemes, cuts in working hours, and early retirement options, among other schemes.

“The only contact we had with reduced working hours, which so many former German Democratic Republic citizens were forced to endure after reunification, was a new development for our RP system – because reduced working hours were unheard of in the West in the 1990s,” Dittrich explains.

But SRS colleagues still faced a wide variety of career challenges. The working methods at the �鶹ԭ�� office were ahead of their time even compared with West German standards at the time. The new colleagues in the East had to make this leap too, in addition to gaining expertise in �鶹ԭ�� products and processes and in general market economy topics.

Petra Röber, now a senior business support specialist at �鶹ԭ�� in Dresden, was Hutzelmann’s assistant at the time. A young parent then, Röber was hired by RPD in 1990 and, after Hutzelmann left the company, she continued to work as an executive assistant at SRS before taking on new challenges at �鶹ԭ��. “In the 30 years that I’ve worked for SRS and then �鶹ԭ��, there wasn’t a single year that I didn’t learn an awful lot of new things or develop as a person,” Röber says.

At the same time, �鶹ԭ�� employees were used to dealing with one another as equals and with goals in mind. “I was surprised that I could turn to my manager when I had problems with our IT initially, and he was very helpful and straightforward,” Singer remembers.

Ultimately, the strategy of establishing two business hubs proved to be a sturdy foundation for business in the East. What’s more, �鶹ԭ�� offered former German Democratic Republic experts in Berlin and Dresden a new place to live and work. This also meant that everything they had achieved in their careers before the Wall fell still counted, which was often not the case for people in eastern Germany.

What Happened Next?

SRS was privatized in 1993 and the Treuhand’s 10% was distributed equally to �鶹ԭ�� and Siemens. Ten years later, SRS had become one of the most important employers in the region. The �鶹ԭ�� share of SRS consulting business grew steadily. “�鶹ԭ�� experienced an amazing rise, while Siemens-Nixdorf faced its liquidation in 1998,” says Hutzelmann, who joined Siemens in 1996. “As a consequence, �鶹ԭ�� took over 100% of SRS.”

Today, Dresden is an important location in the �鶹ԭ�� universe, and celebrates its 30th birthday this month. Hans-Matthias Fischer, Technical Financial Management lead in the Global Cloud Services organization of �鶹ԭ��, sees its broad portfolio as one of the key reasons: “The mix of consulting, sales, application management, customer support, IT support, global cloud services, and research makes Dresden strong and attractive. The entire region benefits from �鶹ԭ�� in Dresden.”

�鶹ԭ��’s Journey to Berlin

Dorit Beric — Fri, 02 Oct 2020 13:15:32 +0000

October 3, 2020, marks the 30th anniversary of German reunification. Among the challenges East Germany faced three decades ago was making the transition from a planned to a social market economy. �鶹ԭ�� played its part here, showing true pioneering spirit.

When the Berlin Wall fell on November 9, 1989, �鶹ԭ�� Co-Founders Hasso Plattner, Klaus Tschira, and Hans-Werner Hector were sitting in a conference room in Princeton, New Jersey, at the first-ever �鶹ԭ��PHIRE event. They were speaking with a large gathering of customers about their requirements for �鶹ԭ�� software. Fellow Co-Founder Dietmar Hopp was holding the fort back at company headquarters in Walldorf, Germany.

The momentous events in Berlin signaled the start of what Germans call the Wende, which literally means “transformation” and describes the period of change that began with the fall of the Wall. It came without warning.

“None of us, even in our wildest dreams, ever thought that the Berlin Wall would come down,” says Alfred Wenzel, who was to become one of the driving forces in �鶹ԭ��’s expansion eastward in the months and years after the historic event.

As unexpected as this sudden “broadening of horizons” was for �鶹ԭ�� — its workforce then numbered about 1,600 — its top managers spared no effort in seizing the opportunity to tap into new markets. In so doing, they made a significant contribution to unifying the “two Germanys” and their divergent economic systems.

�鶹ԭ��’s expansion in the former East Germany after reunification is an exciting chapter in the company’s history. The story, unsurprisingly, begins in Berlin.

Connecting with East and West

In early 1990, just weeks after the Wall fell, �鶹ԭ�� was looking to make Berlin a key hub for its new business operations in eastern Germany. But the demand for housing and office space far outstripped supply. �鶹ԭ�� was not the only company looking for premises in the city. Rents were astronomical, so �鶹ԭ�� initially set up a base at the Grand Hotel Berlin, now the Westin Grand Berlin.

“From the hotel, you had access to the East German telephone network, and you could also stay in contact with the West,” says Wenzel, then regional manager for the Eastern European economic area. The situation required equipment and technology that was by no means standard at the time. Wenzel set up a mobile office for himself with a portable fax machine and telephone. He needed the fax machine to exchange information with the Walldorf office and to send detailed contract proposals to potential customers.

“If a customer wanted to actually sign a contract, it had to send a telex message to Walldorf,” Walter Bachmann, consulting lead at �鶹ԭ��’s Berlin office, recalls. “Faxes were not legally binding documents.”

Search for the Right People

Wenzel appointed the three members of his core team for �鶹ԭ��’s East German business in early 1990. They were Bachmann along with Peter Philipps as consulting lead for logistics and Wolf-Dietrich Seidel as head of sales.

The first task awaiting the new management team in Berlin was recruiting staff for the new office there, which in itself was a real challenge. Bachmann had experience as a manager but was unfamiliar with what applications in East Germany looked like and what they contained. And he was unsure how to interpret the grades, certificates, and qualifications awarded in the German Democratic Republic.

Thomas Harnisch and two of his colleagues from Elektro-Apparate-Werke Berlin, an East German state-owned manufacturer of electrical appliances, were among the first applicants. They had read about �鶹ԭ�� in brochures their boss had brought back from the spring trade fair in Leipzig, Leipziger Frühjahrsmesse, in 1990.

Applications by the Bucketload

Ahead of its second hiring phase, �鶹ԭ�� placed a large job ad in East German newspapers Neues Deutschland and Berliner Zeitung. Response was huge. Among the 2,000 or so applications �鶹ԭ�� received was one from Heidelore Castro, now head of Practice Unit Banking EMEA. Atop her list of reasons for applying to be an �鶹ԭ�� consultant were the company’s “international focus and its unique software solutions for financial accounting and enterprise management.”

The management team waded through “applications by the bucketload” before finally selecting 100 candidates for interview. Looking back, Bachmann recalls feeling “an amazing sense of optimism; we were very aware that behind all those applications were real people, each with their own story.”

The subsequent interview round was on a scale never before experienced at �鶹ԭ��. “We interviewed right through from Friday afternoon until Sunday,” says Wenzel. “And everyone helped out, including the Executive Board. It was exhausting, but the fact that Dietmar Hopp was present was a sign of just how important this process was for �鶹ԭ��.”

Interviews were held in Walldorf, in the offices in Max-Planck-Strasse, then known as the MPS building and now Building 8. “On arrival, we reported to reception in the MPS,” says Harnisch. “Dietmar Hopp was there to welcome us and, on seeing our smart business attire, joked that �鶹ԭ�� had a more casual dress code.”

Ralf Michel was also one of the newbies and has happy memories of those early days. “�鶹ԭ�� placed immense trust in us,” he says. “There was a great feeling of solidarity. It was as if we were one big family. And we really did experience what Dietmar Hopp had said he wanted for his employees — namely, that they should share in the company’s success.”

Investing in People

In April of 1990, �鶹ԭ�� began renting an administrative office and a demo room at the Siemens subsidiary Sietec, located at Nonnendammallee 101, northwest of downtown Berlin. Initially, this location was little more than a formal address, because the new hires from East Germany spent the first six months attending back-to-back training courses in Walldorf. “We weren’t ready to start working productively from day one,” says Heidelore Castro, one of only six women among the 70 new hires. “�鶹ԭ�� invested a great deal in us to make sure that we would go on to give customers first-class support.”

�鶹ԭ�� lent its East German employees company cars so that they could travel to �鶹ԭ�� headquarters for their training. “One of my colleagues drove to Walldorf in a Trabi [the iconic East German-built car]. Dietmar Hopp asked if he could take a look at it in the lunch break because he’d never seen one close up before,” Harnisch shares. The second wave of new hires and those who followed after traveled to Walldorf for training on buses provided by �鶹ԭ��.

�鶹ԭ�� Raises Its Profile

The �鶹ԭ�� congress at the International Congress Center in Berlin in September 1990 was an “absolute sensation,” according to Wenzel. Entitled, “Integrated Standard Software for Enterprise Management in the GDR,” it did wonders to raise �鶹ԭ��’s profile in East Germany. “This three-day event covered all aspects of business and the entire �鶹ԭ�� portfolio, and it really focused on promoting our products.”

Hopp, Oswald, Paul Neugart, and many others were there to present �鶹ԭ�� and its software. “All the speakers were big names and, most important of all, they were the absolute experts in their field,” Wenzel says. Hopp, then �鶹ԭ�� CEO, made a particularly striking impression. Consulting lead Bachmann recalls: “Hopp was incredible. He had an authentic charisma that really resonated with East German managers. Which was crucial, because while many West German companies were just after East German companies’ money, Dietmar Hopp’s message was, ‘We can help you!’”

Word got around that �鶹ԭ�� offered something East German companies urgently needed: software that would help them transition from a centrally planned to a social market economy and, above all, implement the new legal requirements in human resources and enable their companies to compete in the new market.

“Our message to them was that they were buying business expertise as well as software,” Bachmann explains.

Springboard to Eastern Europe

With 70 new hires onboard, �鶹ԭ�� managers suddenly found themselves heading up a sizeable team. The new hires brought plenty of skills to the mix.

“Many of the colleagues recruited at that time had studied in the Soviet Union or at least spoke Russian very well,” says Harnisch. “You could see what the plan was: �鶹ԭ�� wanted to expand into more markets, such as the Union of Soviet Socialist Republics and other Eastern Bloc countries, and to do so out of the GDR and with the help of the East German employees.”

During the hiring process, Wenzel had focused on the candidates’ suitability to work on projects in other eastern European countries, especially the USSR. “We assigned these specialists to the relevant country-version development projects at an early stage, and long before giving them international assignments. This gave them time to prove themselves and acquire the skills they needed to go on and become part of the core team for the corresponding country.” .

For their part, the new hires were happy to have a job in the turbulent times that accompanied the Wende. And they were particularly happy when the �鶹ԭ�� office in Waldstrasse opened in early 1991, remembers Hans-Günter Heinel, who joined �鶹ԭ�� in September 1990 with the second wave of new hires.

Measuring about 43,000 square feet, the new office was on the second floor above a DIY store and provided space for a training center. This building remained �鶹ԭ��’s home in Berlin in a reunified Germany for more than 10 years – right up until the move to the new offices in Rosenthaler Strasse in 2003.