Mergers and Acquisitions

Abstract

SAP followed different approaches to achieve its ambitious growth plans. The first approach was to enhance the product in an organic way by introducing breakthrough innovations and introducing continuous enhancements. Then SAP further complimented this successful organic growth strategy by expanding the partner ecosystem through co-innovation and strategic acquisitions. SAP followed the philosophy of mostly developing software in-house, instead of going through a cumbersome integration process. For several years, SAP proved that it could grow more than twice as fast as the rest of the market. SAP’s CEO Henning Kagermann has often said that the acquisition strategy of SAP is aimed at filling gaps in the product rather than acquiring market share or customers. Many of SAP Labs around the globe were started when SAP acquired other companies: SAP Labs Bulgaria came into existence when SAP acquired InQMy, a Java enterprise server company. Likewise SAP Labs Israel emerged from the acquisition of Ofek-Tech in 1998. SAP Labs India was also established together with SAP AG’s acquisition of Kiefer and Veittinger GmbH in 1998. To start with, SAP retained these locations, enhanced them with additional development projects and finally converted them into a complete lab.