March Layoffs at SAP — Will it Impact SRM?

Last week, SAP initiated a layoff process that is impacting hundreds -- potentially as high as 3,500 according to one source -- of employees. The rumor is that SAP was generous with packages for its employees, especially relative to other tech companies in the downturn. If this is true, kudos to them, as we all know how challenging the market environment can be at the moment. My quick view is that we should not read into this any more than yet another company -- regardless of industry -- taking actions it must because of an overall downturn in customer spending. I also don't believe that this cut has anything to do with SRM challenges in particular (in fact, I'm betting that overall SAP procurement related sales will be up this year factoring in spend analysis, sourcing, etc.)

But will this round of layoffs impact SRM development, product management and marketing? Chances are it will have some impact longer term, as SAP is known for pursuing layoffs and workforce re-balancing in a manner is that is relatively equal across business lines and product areas. I suspect, though, that we needn't worry about near-term release impacts. SAP knows they can't miss committed deadlines for SRM 7.0 given what happened to 6.0 (7.0 is currently in ramp-up and many expect it to go G/A this spring or early summer; 6.0 never emerged from ramp-up). As a final aside, if anyone was impacted on the SRM development or consulting side by these layoffs, send me your resume or background details (jbusch (at) spendmatters (dot) com). I might be able to point you in the direction of implementation firms or companies looking for SAP SRM talent (both full-time and contractor candidates) this year.

Jason Busch

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