Hasso Plattner, the SAP SE owner, has recently been offering voluntary leaves and early retirement packages to around 4400 staff members. He even pushed out an executive board member Bernd Leukert, because of his track record, which did not satisfy Plattner.
SAP has been a stable employer for decades now, and suddenly it is throwing out people? WHY?
Plattner started SAP in 1972 when he did not even have a computer to write codes. He and his team used to work secretively on the screens of their first client when they found nobody to be around. It took him four decades to turn SAP into Europe’s most valuable technology company.
SAP has around 100,000 employees, which use the leisure provided by SAP. The workers enjoy free lunches, even take the lunch home in containers, generous bonuses, regulated work hours along with many more amenities.
Plattner has been eying on showing the exit route to these ‘expensive’ old members of the company, which once played a crucial role in the upliftment of the company towards the early success which it received. The dispute is, the older employees deserve a career perspective.
The reason is simple. No entrepreneur would like to invest in employees which bring in inadequate results, or we say have lost their potential. Just that they have helped the company gain success at some point of time, does not mean the company will have to bear the burden for a lifetime, if the employee is not worthy enough.
The operating profit margins slumped from 42 percent in 2011 to 30 percent in 2017. This is because the company is not able to keep up with emerging startups. SAP seeks to improve its margins through 2023 by 1 percentage point a year.
Plattner sees great potential in the younger employees that would help the company to grow. But this kind of transition causes disruption and takes time to settle.