SAP Spain is a growth engine and an innovator with a social conscience. Here, Managing Director João Paulo shares the secret of the company’s success – even in challenging times.
When SAP Spain opened its doors in 1987, it only had five employees. This year, 730 colleagues celebrated their 30-year anniversary in the Barcelona and Madrid offices. And while this is an opportune moment to look back and reflect, SAP Spain certainly isn’t resting on its laurels. Especially in the last three to four years, the company has achieved enormous growth despite of tough political and economic conditions.
Q: SAP Spain’s sales have doubled in the past 10 years, the workforce has increased – what’s the secret?
A: That’s right, and the revenue growth is even more impressive if you consider the economic background. Our revenue dropped significantly between 2009 and 2013, and then we grew enormously in the four years that followed. We’ve also grown the software business by more than 90 percent in the last three years, which means we are growing faster than most of the countries across EMEA. This is proof that our team has achieved something very special.
There are two secrets behind this. Firstly, it’s the people – none of this would have happened without the talent we brought on board. We have promoted the best talents to higher positions and brought new talents to complement our knowledge. I believe this enables us to fuel strong growth and create a “virtuous cycle”.
As for the second secret, SAP has made a strong shift in terms of innovation. This was the perfect excuse to go and visit our customers, and alter perceptions.
How do you alter the perceptions of the Spanish market?
When we started out, we were seen as the ERP company in Spain, and frankly, it’s taken a while to change this. I therefore made it one of my top priorities to really promote our innovation story. We launched a “Lighthouse” initiative two and half years ago, focused entirely on innovation. We selected customers to participate in three-to-four-week projects exploring the new technologies, including Machine Learning, Blockchain initiatives, and IoT scenarios. Some of our customers referred to these projects as the “Star Wars” of SAP.
One example is a prototype we developed with the oil and gas provider CEPSA to improve their mobile experience by leveraging Apple IOS SDK. It simplifies employees’ and customers’ experience of consuming data from different sources through a rich user experience via iWatch, iPad or iPhone. They transformed processes that integrate enterprise partners, customers and employees at the 1,700 service stations network which supply more than 1 million customers and their vehicles every day.
During the first wave of the Lighthouse projects, we focused on moving customers from the traditional on-premise business to a full Cloud subscription model. Today, Meliá Hotels International runs their full ERP landscape in the cloud. Others have since followed, including Mercadona Group, a retail leader in Spain, which is now one of the biggest SAP customers worldwide to have a full cloud subscription mode.
What makes SAP Spain unique?
It’s not just about the numbers. I always tell my team: We need to leave a fingerprint. Obviously, the growth and the revenue need to be there. Secondly, we need to think about the market and our ecosystem. The acceleration factor of SAP in the Spanish economy is substantial. For every job we create, there are twenty jobs created in the ecosystem, so SAP is a strong multiplier of business.
The third dimension is our people. You see colleagues that started out as young talents and they’re now developing rapidly. Others have been promoted to different jobs and they feel excited about it, and are now replicating the same dynamic within their teams.
For me, these three dimensions are very important.
How is SAP Spain involved in Corporate Social Responsibility?
We are very privileged to be a part of the SAP culture, and we have the obligation to give back to society. That’s why we are investing in different areas, mostly within education, as well as programs in science and technology, as well as robotics.
We also work with elderly and disabled people. One of our customers is one of the main organizations in Europe which supports the disabled. Originally, their focus was supporting blind people. The overall unemployment rate in Spain is approximately 17 percent, however the unemployment rate among blind people is only 6 percent. That’s just one example of what we can achieve if we engage in Corporate Social Responsibility.
What about the political environment? How does the situation in Catalonia affect SAP’s business?
Of course, we have been monitoring the situation very closely. In Spain, we have two legal entities; one was in Madrid and the other in Barcelona, and many employees working in Barcelona were concerned about what would happen to their work contracts. For this reason, we were one of the companies who decided to move that legal entity to Madrid to prevent any potential legal difficulties.
We are seeing some slowdown in the business because of the political tension. Some decisions are being delayed, and we’re seeing this in the numbers. However, I think history has taught us that in many moments there are tensions, but then things calm down and settle. I believe the political discussion dominated for a long period of time, and now we’re finally seeing that the private sector is raising the economic discussion, which will bring common sense into play.
We have a multicultural and very diverse organization in Spain with 25 different nationalities. The most important thing that I saw was how everybody showed respect towards others during this time. Everybody is entitled to express their opinion, but in a respectful way, and I saw this among my SAP colleagues. I’m very proud of that.
You mention 25 different nationalities. How do customers feel about that?
Personally, I really value diversity, and so do the customers. Customers want talent, they’re not interested in where people come from. Whenever you create barriers or constraints, the quality suffers. Mercadona Group made it clear to me that they wanted the best SAP talent in the world. Customers are willing to deal with language or cultural barriers – talent is the number one rule for this game.
Your credo is transformational leadership. What does that mean exactly?
I believe that we either grow or we decline. There cannot be a flat moment, because if you plan for flat you will die. If you plan for growth or to disrupt, you may grow. I always think if we start to become stable, this is the moment to change. We need to constantly motivate our teams, change the ground rules, challenge them, or even bring a disruptor into the team.
But I also believe that everyone needs to be open for change, from the bottom to the top. That’s why we have created a culture of openness, mentorship and retro-mentoring. I sit down with young talents, and I ask them to mentor me. I encourage them to tell me how they think, what they dislike about the company, how they invest in the stock market, how they use social media. If you’re open to this kind of dialogue, both sides gain.
What are your most important goals going forward?
We want to become the number one cloud company in Spain, Portugal and Israel. We also want to be the main disruptor in the database market. This is an area which we have not sufficiently exploited. We only have a very small income in that segment but there is huge market potential. Our 2020 plan is in place, and I hope I’ll be talking to you again in a couple of years telling you that we’ve grown by another 90 percent.
What keeps you awake at night?
Q4 is a big time for us, and we want to deliver a strong year. I ask myself how we can achieve this, and also prepare the groundwork for a strong, or perhaps even stronger 2018.
I also ask myself how we can share some of this success within society. The vision we have for the company is a very beautiful one: “Help the world run better and improve people’s lives.” It is a very strong statement.
I want to deliver a strong result, prepare for the next year, and share our success with society – I wouldn’t say it keeps me awake, but it’s always on my mind.
Five Questions for João
João Paulo da Silva joined SAP in 1996. He has held the general manager position in Spain since 2013 and currently manages SAP in Portugal and Israel, as well. Previously, he held the position of Emerging Markets VP of SAP’s Ecosystems and Channel organization. He has also held several local and regional Sales and Marketing positions.
- How would you describe yourself? I’m a people person. And I’m also a very logical, fact-based person.
- Are you ambitious? Ambitious only in the sense that I want to prove that we can do things we haven’t been able to in the past. I don’t want to be there just for the sake of being there, but to prove that we can accomplish bigger things.
- Are you an optimist? Always.
- Your biggest personal success recently? Personal success is always relative. Our success is also a consequence of who we work for. There is a strong organization and workforce behind us that allows us to be successful. We should not forget that.
- What do you enjoy most about being an MD? In the past, I always led areas of the business, but I didn’t lead the overall business. Now I can take a more comprehensive view – how I can impact the company economically, how I can impact the customers and ecosystem, how I can impact the people growth. It makes me proud when I see success in these three dimensions.