Former Sybase chief credited with turning the firm around says he has successfully integrated Sybase into SAP
John Chen, formerly Sybase CEO and president
The president and CEO of Sybase, which SAP acquired for $5.8bn in May 2010, announced he is leaving the firm with immediate effect. Of course it's likely that John Chen had agreed contractually to stay for two years to help SAP integrate the two companies, and those two years are clearly now up.
"After 15 years of leading Sybase, I want to take on a new challenge," Chen said. "The integration of Sybase into SAP is complete and the business is in great shape. Combining the organisations made sense and I am pleased with the direction of the mobile and database business of Sybase within SAP. The Sybase assets are contributing significantly to SAP's success and benefitting from technology such as SAP HANA as well as the global reach of the company. I leave knowing that what we built is in good hands."
Chen is credited as having rescued Sybase from oblivion. In the late nineties it looked like Sybase had had its day, having lost the database wars and seen patchy financials. It was an obscure executive from Siemens Nixdorf, Chen, who got the firm back on an even keel with a honed strategy and a return to growth.
Having teetered literally on the brink of irrelevance and financial implosion, Sybase's chairman, CEO and president steered the company back into a position of thought-leadership and renewed relevance to enterprise IT. Within a few years of Chen taking the reins, analysts ranked Sybase as the number one in mobile middleware, the number one for mobile databases and the number one in mobile device management.
Go back to 1998 and Sybase was anything but a picture of health. The company may have posted sales of $872m, but it also posted a net loss of $93m, with a restructuring charge alone costing it $74m. Few would have placed bets on the company achieving a successful turnaround, let alone it regaining a position of thought-leadership.
"John is a pioneer who contributed greatly to the enterprise mobility and database markets, and I am incredibly proud of what we have done together," said Dr. Vishal Sikka, member of the SAP Executive Board, Technology & Innovation. "We have brought massive scale to mobile and breakthrough innovation to the database market with SAP HANA and Sybase. With the best team in the world, we will continue to bring non-disruptive innovation and deliver the next generation of enterprise software."
"We thank John for his extraordinary leadership over the past few years," said SAP Co-CEOs Bill McDermott and Jim Hagemann Snabe. "The acquisition and integration of Sybase is a best practice for driving growth and innovation. Together with John, we have expanded the Sybase business significantly since the acquisition. Today we are the market leader in mobility and the fastest growing database company in the industry. We respect John's decision, we know that he will remain a friend of SAP and we wish him all the best for the future."
In an interview with me in 2005, Chen explained what he had had to do to get Sybase back onto an even keel: "I want to maintain my number one position as the software technology provider for extending the data centre to the edge. The first thing I needed to do when I joined was restore the confidence of the people. I needed to restore confidence that you have a theme and can execute. I didn't want to wander off too far from our core competencies any more."
"A lot of our businesses were very inefficient," he told me. "I was asking, 'why are you doing this?' You know we had an SAP consulting business - what for? We had a product that competed with Microsoft Visual Basic - what for? I had to get rid of some bits and pieces."
Chen's mantra was that the company must be good in every market it operated in. If it wasn't, he either redoubles its efforts or gets out of that space. "I want to make money and have a good business in everything we touch," he explained. "I don't do anything that loses money. That saved us from the dot-com bubble. I don't believe in loss leaders. That means the leaders have lost."
"Then it is up to your ability to execute," Chen continued. "I broke the company down into smaller pieces - there used to be just one P&L. But now we have embedded, the database, tools, analytics and application server. I believe that fosters more of a fast-acting culture, which is more important. And now our execution is better than most."
Read my analysis of Chen's Sybase turnaround and why SAP bought the firm, written in 2010, here.