This presentation was given to the European Business Transformation Conference, an event of the Business Transformation Academy (www.bta-online.com). The overall topic of the event was “Post-Merger Integration”, which is one of the main triggers for business transformation. The case study presented is the one of SAP's own integration of acquired BusinessObjects. The presenter was leading the worldwide PMO for the Day 1 PMI phase.

1. The Integration of BusinessObjects
BTA – Spring 2012
Nicolas Schobinger / SVP / SAP Services / Global Strategy & Business Development
May 11, 2012

2. © 2012 SAP AG. All rights reserved. 2
Objectives & Agenda
Objectives
Ÿ Share the experience integrating
BusinessObjects – one of the biggest
M&A in Tech
Ÿ Share how we dealt with not ideal
processes and situations
Ÿ Share how “bold” and “consequent” can
pay off – vs a “compromise” PMI
Agenda
Ÿ Context
Ÿ Chronicles of the BusinessObjects
acquisition
Ÿ Conclusions
BTA Spring 2012 Theme

3. © 2012 SAP AG. All rights reserved. 3
SAP is the world's leading business software company
SAP today
Ÿ #1 in key Software
segments
Ÿ 176’000 customers
Ÿ 24 Industries
Ÿ 120 countries
Ÿ 37 languages
Ÿ 59’400 employees
Ÿ 2’900 certified partners
Ÿ Revenues of €14b at 33%
operating margina
a for 2011, non-IFRS
Source: sap.com, investors relations
Services
Consumer
Industries
Trading
Industries
Financial
Services
Process
Manufacturing
Discrete
Manufacturing
Public
Services

4. © 2012 SAP AG. All rights reserved. 4
The BusinessObjects acquisition
BusinessObjects
Ÿ 6.0 bUSD / 3.8 bEUR price-tag
– Portfolio centered on Analytics
– By then, 3rd largest deal in SW
Ÿ Public Tender in FR and US
Ÿ Sizeable in all aspects for SAP
– Number of employees, locations, lines of
businesses, ...
– Installed base, revenues to protect,
channel
Ÿ BusinessObjects grew through M&A
SAP’s experience w/ M&A
Ÿ Typical SAP deal w/ avrg deal size
factors smaller
Ÿ Typical SAP deal used not to be a
public tender
– Squeeze-out process can pose
problems
Ÿ Typical SAP deal used to be narrow
in scope and IP driven
Ÿ Dedicated M&A-team, focused on
pre-deal and IP
– But PMI recognized as an important,
practice across SAP

5. © 2012 SAP AG. All rights reserved. 5
© 2011 SAP AG. All rights reserved. 1Internal
Business Transformation Management Methodology (BTM²)
BTM²: The big picture
Enablement
Program/Project
Management
Program
Planning and
Governance
Program &
Proj.-Integr.
Mgmt
Program &
Project Scope
Mgmt
Program &
Project Time
& Cost Mgmt
Program
Quality Mgmt
Program
Human
Resource
Mgmt
Program
Procurement
Mgmt
Risk
Management
360° Strategic
Risk
Assessment
Deep dives for
strategic risk
areas
Assess
transformation
business case
Define risk
strategy
Risk
Management
Execution
Risk
Monitoring
Identify
additional
improvement
Risk Mgmt. as
part of Board
Governance
Competence &
Training
Management
Competence
strategy
Training need
analysis
As-is analysis
Gap analysis
Curriculum
development
Training
preparation
Training
Evaluation &
improvement
Program
Reporting
Organizational
Change
Management
Set-up &
governance
Stakeholder
management
Change agent
network
Communicatio
n
management
Performance
management -
Project team
Performance
management -
Business
Change
readiness
assessment
Change
monitoring
Processes
Management
Determine
scope of
analysis
From template
to bespoke
inventory
Identify
improvements
/add attributes
Map selected
processes
Plan process
implementatio
n
Implement
processes
Evaluate
processes
Establish CIP
Value
Management
Baseline
analysis
Value
estimation
Detailed
business case
Agree
ownership for
realization
Plan benefit
realization
Execute
benefit
realization
Review and
evaluate
results
Establish
potentials for
further
benefits
Meta
Management
Orchestration of individual disciplines: Guidelines, Leadership, Culture, Values and Communication
IT
Transformation
Management
Business and
IT Capability
Assessment
To-be
analysis
Gap analysis
IT roadmap
plan
Solution
architecture
design
IT
Deployment
plan
IT Operations
& Service
Optimization
IT Lifecycle
Management
Strategy
Management
AS-ISData
Collection
Analysis of
needs &
maturity level
Design
business
vision
Design
Business
Model
Integrated
transformation
plan
Business
Case
Organizational
model
Risk analysis
Direction
© 2012 SAP AG. All rights reserved. 7
Source: Ernst & Young; Deloitte
Determinants of M&A success or failure
Three key determinants along the M&A value chain
Failure can occur anywhere in the process. Each phase of a M&A-Transaction
contains hidden risks, which must be reduced by active M&A management.
Pre-deal Deal Post-deal
! How to balance vision,
strategic orientation and
opportunistic behavior?
! How to ensure that the
integration can achieve the
increases in value which were
expected when the decision
was made?
right
candidate
Choosing the
1
Robust
justifications
Developing
2
the deal
Securing
3
Value creation
& growth
Ensuring
4
1 Consistency of the deal
with the overall strategic
purpose
3 Choice of integration
approach and ability to
integrate
! How to ensure that the decision-making
process leads to the "right" decision?
! How to develop meaningful acquisition
justifications despite pressures, un-
certainties and merger inherent limitations
(data, time, people involved ...)?
2 Quality of decision making
(content and process)
Central ‘Thesis’ out of the PMI of BusinessObjects
Maximize the probability of
achieving the desired
outcome”
Claim 1
” Process and Methods as
means to to deal with
ambiguity”
Claim 2
”
Ÿ Address Critical Success
Factors of M&A …
Ÿ … you went through, or
others identified …
Ÿ … in a bold an consequent
way
Ÿ Leverage Business
Transformation ....
Ÿ … skills and methods …
Ÿ … applied to a ‘different’
context

6. © 2012 SAP AG. All rights reserved. 6
BusinessObjects’ PMI chronicles
Overview
announcement cut-over
22 + 24 weeks
Oct 7th
14 weeks
day 1
Jan 21st Dec 31st
Ÿ Strategic
Rationale
Ÿ Business Case
Ÿ Integration
Approach
Ÿ Leadership,
Mgmt, high level
org
Ÿ Red flags
Ÿ Initiation &
Design
Ÿ Staffing
Ÿ Agenda setting
Ÿ $
Ÿ Operations
Ÿ Non-funding
Ÿ Topical coverage
Ÿ Scalability of
program &
methods
Ÿ Visibility &
relevancy
Ÿ Strict PMO-focus
on essential
matters (Top
100, $, culture)
Ÿ Handover to line
Ÿ Mid-term
planning &
Budgeting
Ÿ BTrafo platforms
and teams
Phase I Phase II

7. © 2012 SAP AG. All rights reserved. 7
BusinessObjects’ PMI chronicles
Key Topics
Ÿ Post-engineer Pre-Deal justification
– Integration Approach,
– Synergies
– Retention approach
Ÿ Product roadmap
Ÿ Agonsticity, Customer retention
Ÿ GTM
– Coverage & assignment of customer base, segregated GTM
– Offers
Ÿ Arms lengths (corporate laws, minority stakeholders, tax)
Ÿ PMI Logistics
– Thanks Giving, Christmas Field Kick-off, Quarter close; PaloAlto – Walldorf
– Capacity
– Measure readiness & risks
Phase I

8. © 2012 SAP AG. All rights reserved. 8
BusinessObjects’ PMI chronicles
Key Topics Phase
Ÿ Hand-over Phase I
– New leads
– New workstreams, delegate down, …
Ÿ Scale scope, methods, and accountability
– Maintain relevancy and visibility for decision making
– Workstream structure to allow for ‘business-led’ without slipping into business as usual
– TOP 100, Business Case & value tracking
Ÿ As usual – the unexpected and surprises
– Pricelist
– Forgotten customer segments/channels
– GTM defections
– Support models
– IT cutover
– P&L integration
Phase II

9. © 2012 SAP AG. All rights reserved. 9
Conclusion
© 2011 SAP AG. All rights reserved. 1Internal
Business Transformation Management Methodology (BTM²)
BTM²: The big picture
Enablement
Program/Project
Management
Program
Planning and
Governance
Program &
Proj.-Integr.
Mgmt
Program &
Project Scope
Mgmt
Program &
Project Time
& Cost Mgmt
Program
Quality Mgmt
Program
Human
Resource
Mgmt
Program
Procurement
Mgmt
Risk
Management
360° Strategic
Risk
Assessment
Deep dives for
strategic risk
areas
Assess
transformation
business case
Define risk
strategy
Risk
Management
Execution
Risk
Monitoring
Identify
additional
improvement
Risk Mgmt. as
part of Board
Governance
Competence &
Training
Management
Competence
strategy
Training need
analysis
As-is analysis
Gap analysis
Curriculum
development
Training
preparation
Training
Evaluation &
improvement
Program
Reporting
Organizational
Change
Management
Set-up &
governance
Stakeholder
management
Change agent
network
Communicatio
n
management
Performance
management -
Project team
Performance
management -
Business
Change
readiness
assessment
Change
monitoring
Processes
Management
Determine
scope of
analysis
From template
to bespoke
inventory
Identify
improvements
/add attributes
Map selected
processes
Plan process
implementatio
n
Implement
processes
Evaluate
processes
Establish CIP
Value
Management
Baseline
analysis
Value
estimation
Detailed
business case
Agree
ownership for
realization
Plan benefit
realization
Execute
benefit
realization
Review and
evaluate
results
Establish
potentials for
further
benefits
Meta
Management
Orchestration of individual disciplines: Guidelines, Leadership, Culture, Values and Communication
IT
Transformation
Management
Business and
IT Capability
Assessment
To-be
analysis
Gap analysis
IT roadmap
plan
Solution
architecture
design
IT
Deployment
plan
IT Operations
& Service
Optimization
IT Lifecycle
Management
Strategy
Management
AS-ISData
Collection
Analysis of
needs &
maturity level
Design
business
vision
Design
Business
Model
Integrated
transformation
plan
Business
Case
Organizational
model
Risk analysis
Direction
© 2012 SAP AG. All rights reserved. 7
Source: Ernst & Young; Deloitte
Determinants of M&A success or failure
Three key determinants along the M&A value chain
Failure can occur anywhere in the process. Each phase of a M&A-Transaction
contains hidden risks, which must be reduced by active M&A management.
Pre-deal Deal Post-deal
! How to balance vision,
strategic orientation and
opportunistic behavior?
! How to ensure that the
integration can achieve the
increases in value which were
expected when the decision
was made?
right
candidate
Choosing the
1
Robust
justifications
Developing
2
the deal
Securing
3
Value creation
& growth
Ensuring
4
1 Consistency of the deal
with the overall strategic
purpose
3 Choice of integration
approach and ability to
integrate
! How to ensure that the decision-making
process leads to the "right" decision?
! How to develop meaningful acquisition
justifications despite pressures, un-
certainties and merger inherent limitations
(data, time, people involved ...)?
2 Quality of decision making
(content and process)
Maximize the probability of
achieving the desired
outcome”
Claim 1
” Process and Methods as
means to to deal with
ambiguity”
Claim 2
”
operational PMI
community