SAP Software Solutions is Europe’s most valuable technology company with a market value of almost $130 billion and nearly 100,000 employees worldwide. If you think it’s a difficult task keeping all those workers relatively happy, enthusiastic and working together to achieve a common goal, you’d be right.
Yet the company is a regular honoree on Glassdoor’s Best Places to Work list – including coming in at number 27 in 2019, and the company’s CEO, Bill McDermott, has an astonishing 97 percent approval rating – from his own employees. To put that in perspective, among the more than 770,000 employers reviewed on Glassdoor, the average CEO approval rating is 69 percent.
So what’s his secret?
On February 5, McDermott sat down with Marianna Savoca, Assistant Vice President for Career Development & Experiential Education at Stony Brook, for a fireside chat in the Wang Center Theatre, giving students a first-person account of the inspirational journey that went from an Amityville, Long Island street corner to the corner office of a $130 billion global company.
The “street corner” was actually a corner convenience store, purchased with a $7,000 loan taken when he was just 16. It was there that McDermott says he quickly learned his first lessons in business: give the customers what they want, and don’t waste an opportunity.
McDermott leveraged that small corner store to help finance his undergraduate education at Dowling College, his MBA at Northwestern University and then the Executive Development Program at Wharton School of Business. Eventually his effort would leave him knocking on the door of his first dream job at Xerox. At that point, he discovered that a strong belief in yourself also comes in handy.
“There were dozens of young people, many from privileged backgrounds and big-name schools, all applying for the same position,” he says. “In that situation do you panic? Do you fold? The lesson was to just be you, and to trust yourself.”
The young McDermott withstood a grueling series of interviews only to find himself face-to-face with the company’s CEO. Channeling a fierce inner drive, he managed to persuade the leader of one of America’s biggest companies to give him a shot, and hasn’t looked back since.
“My superpower,” he says, “was that I wanted it more than they did.”
It’s a trait he very possibly inherited from his grandfather, Hall of Fame basketball player Bobby McDermott, who has been called “the greatest long-distance shooter in the history of the game” by his peers. And investor and employee alike would say that long-distance business vision happens to be another McDermott “superpower.”
“Have vision, be accountable, be transparent, and don’t be afraid to take risks,” said McDermott. “Reactionary leadership will never get the job done. It’s OK to make a mistake, just own it, and do your best to fix it.”
According to McDermott, there are two kinds of people: 1) those who will accept a challenge only on their own terms, and 2) those that embrace doing whatever it takes to serve the greater good.
“There’s leverage in taking the assignments no one else wants,” he says. “Just like with the convenience store, you have to be willing and able to do the things that others can’t or won’t do.”
To illustrate the point, McDermott described an opportunity early in his career to head up Xerox’s Puerto Rico office, which at the time was the lowest performing part of the company. It was a difficult assignment that many of his peers considered high-risk.
“I went down to Puerto Rico and the workers were expecting just another guy pushing his ideas on them,” he remembers. “But the first thing I did was talk to them and find out what the employees were thinking. Listen to the people, the people always know.”
After working to achieve employee buy-in, McDermott set about the daunting task of not only turning the office around, but making it the top-performing part of the company. Incredibly, he did exactly that within one year.
“It wasn’t just about being the best, it was about creating a lasting emotion, creating moments that people will remember,” says McDermott. “Be who you say you are, and do what you say you’re going to do. Your reputation will chase you around the world, and whether it’s good or bad it will catch up to you. Many years later the people who were involved in that turnaround would still tell me how proud they were to have been a part of it.”
After a series of business realignments, McDermott would eventually become CEO of SAP America in 2002, and eight years later become co-CEO of SAP AG. In 2014 McDermott was the first American to become CEO of the company, now known as SAP SE. Under his “people first” watch, SAP’s market cap has increased from $39 billion in 2010 to around $130 billion today.
The power of determination and a people-centric business approach were threads that McDermott continuously reinforced. Indeed, putting people first – both customers and employees – is a big reason SAPs Glassdoor rating is as high as it is. Giving back is another reason.
“SAP’s purpose is to help the world run better, help improve people’s lives, and give something back,” says McDermott. “We very much believe in gender equality, diversity, inclusion, and protecting the environment.”
After a textbook lesson on how to conduct business with integrity, McDermott’s takeaway for Stony Brook students was to never underestimate the power of your dreams. And when life knocks you down, as it did in 2015 when McDermott lost his left eye and nearly his life after a freak fall down a flight of stairs while carrying a glass of water, you “get up, get out, and get on with it.”
“When I had my accident there was a voice inside saying ‘stay down, you’ve had enough.’ But there was a much stronger voice saying ‘I’m not done here, my story is not going to end like this.’”
“We’re all going to get hit by a thunderbolt or two and you’re not going to know where it comes from,” he said. “Adversity doesn’t always build character, sometimes it just reveals it.”
After the fireside chat, McDermott greeted a line of several dozen students who waited for a chance to get their copy of his book signed and to share a few encouraging words.
“Don’t let anyone take your dreams away,” said McDermott. “I titled my book ‘Winners Dream’ and I very much believe in that. Sometimes all you have is your dream.”
“It was a delight to hear Bill tell his story, which was so inspiring for students who grew up just like him, having to work so hard for their success,” said host Savoca. “To see that hard work, determination, grit and resilience, coupled with big dreams, can make all the difference.”