Heading the charge

SAP Arabia's CEO Essam Enany has been at the company's helm for 13 years and has seen a lot of change in the region's software market during that time. Andrew White speaks to the chief executive about the company's achievements and what the future holds

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By  Andrew White Published  January 25, 2007

A Pioneer? "No!" Essam Enany laughs, shaking his head. "I'm part of a machine that is driving change." ‘Change' is an important word to Enany. Moreover, the CEO of business software firm SAP Arabia has shown himself to be an expert at acclimatising to the constantly evolving needs of a market as dynamic as that of the Middle East. He has headed SAP Arabia since the company's inception in 1994, and as such has played an important role at the very forefront of the region's IT expansion.

"Historically SAP was targeted towards large businesses, but over the last four years the company has transformed and put out products that cater to the SME (small and medium-sized enterprise) business," Enany explains. "Globally, the split is roughly 60% towards the SME business. In our region, that's a little bit lower because we're still driving larger customers, but I would say still 40% of our business is SME."

SAP Arabia now operates from six regional offices, and offers industry-specific software solutions across around 30 vertical industries.

"If you look at the region over the last few years, there are several drivers that have pushed companies into the need for modernisation and looking for solutions such as SAP. Drivers such as economic growth, competition and privatisation are pushing these companies to be more efficient, and so driven, the need for such products up," Enany continues. "The average growth in the market now is about 16% in the whole region, year on year, so we have a substantially healthy market that is growing because of demand from companies that are looking for solutions to enable them to go public, or to become more efficient, and to compete far more effectively."

Such ambition from companies within the Middle East is an encouraging trend, and a tangible indicator of the region's confidence and steady economic growth.

"Companies are much more aware than they were a few years ago of their requirements," says Enany. "ERP, financial systems, human resource systems, portals, production planning, CRM packages - these are all basic needs for these companies, and products like SAP drive the companies to come forward and say ‘yes, we need the product'. "Year on year, we're seeing a doubling of the number of customers," he continues. "In Saudi Arabia, for example, in 2005, the latest available figures, we had 46% market share in absolute terms. In our peer group, we had a 65% market share in Saudi Arabia alone. Saudi is one of the largest markets for us, and has the strongest market share for us."

The regional market is, Enany says, one a world away from what it was when he first formed the company. "In the early 90s, the drive for change within the region was not very well established," he explains. "There was a lack of privatisation, there were monopolies in a lot of sectors, and there was a lack of competition because of closed markets. These were drivers that were only pushing very large international countries to adapt and change.

"However, as we went forward in time, these elements started to change," he continues. "Economically, at a government level and a competition level, companies realised that once they reached a certain size, things became too complex to handle on a manual level. That started to change, and drove customers towards products such as SAP."

"Different regions and different countries have different flavours too. Doing business in Egypt is different to doing business in Saudi Arabia, which is in turn different to doing business in the UAE, for example," adds Enany. "That has represented a considerable challenge over the last decade - when you move into a new area, or launch a new product, it's always a new challenge."

So does Enany harbour any regrets? Are there any challenges he would have liked to have handled differently over the last 13 years? "You can always look back and think there is something you could have done differently, and if you don't do that then you're not reviewing how you've done things, and so you cannot adapt to the future," he says.

"But you can't just spend your time looking back on what you've done - you review it, take what you've learned from it, and move forward."

Enany's time at the helm has been characterised by significantly more successes than failures, yet asked to pick a decision he would change if he could, he is refreshingly candid. "I think one of the biggest challenges that I would perhaps have approached differently if I could do it again would be the introduction of a localised, Arabised version, and the timing of it," he reveals. "That had a major effect on the business, and I definitely would have preferred to get that out earlier. We launched it in 2003, and I personally think that launching it earlier would have allowed us to make a bigger impact on the market."

So much for the past. Looking forward, Enany is determined to break new ground and to pitch SAP to customers previously out of reach of the company. "We've a product that has a very rich, very well-established, and proven methodology and functionality. When we take it to the smaller customers, the challenge is to grow through channel business," he explains. "We're looking for effective partners that can deliver such a product in a short time frame, and do so at a competitive price. We have launched products that are pre-packaged solutions, for smaller businesses, and looked for channels to get to potential customers.

"This has effectively changed how our organisation is running. It changes your mentality, the way you are reaching the customer, and that is something we are focusing on heavily in 2007," continues the chief executive. "One of the key things for us is to grow our partner network effectively. As you grow and spread over multiple countries, and take on more customers and smaller firms, you have to adapt and change your structure," he adds. "The market changes dramatically, constantly, and over the last couple of years the market we are addressing is heading down the pyramid, and going into the SME market."

In Enany's mind, the future is bright for Saudi Arabia, for the Enany Group, and for SAP Arabia. "I look at Saudi Arabia and the Enany Group during the next few years as having a fantastic opportunity, because the country itself is going through a transformation and modernisation that involves companies such as SAP - the development of cities, of economic areas, the deregulation of financial sectors, the growth of the real estate business, and so on," he says. "I see this as a fantastic time for the group to take the opportunities that are presented to it. In whichever sector that we're involved in, I see a growth that is being driven primarily by the vision that is being implemented within Saudi Arabia."

SAP: Software giant

SAP is one of the largest software companies in the world in terms of market capitalisation. SAP’s products focus on enterprise resource planning (ERP), which it helped to pioneer. The company also offers a new technology platform entitled SAP NetWeaver. While its original products are typically used by Fortune 500 companies, SAP is now also actively targeting small and medium sized enterprises (SMEs) with its SAP Business One and SAP All-in-One products.

Reportedly, there are over 100,000 SAP installations at more than 28,000 companies, while over 12 million people in more than 120 countries use SAP products.

SAP was founded in 1972 as ‘Systemanalyse und Programmentwicklung’ by five former IBM engineers in Mannheim, Germany. The acronym was later changed to stand for ‘Systeme, Anwendungen und Produkte in der Datenverarbeitung’ (‘Systems, Applications And Products in Data Processing’) and at the 2005 annual general meeting the company’s official name was finally confirmed as just SAP AG.

“I think one of the biggest challenges that I would perhaps have approached differently if I could do it again, would be the introduction of a localised, Arabised version...”

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