Case Study: SAP and the American CEO of a German Multinational - Principles of Management

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1. What are some of the sources of McDermott’s excellence at managing cross-cultural differences? How did his experience managing a deli store at a young age help him develop cross-cultural management skills?

McDermott’s experience in managing cross-cultural differences stems from his early exposure to diverse customer bases. Running a deli on Long Island, a melting pot of immigrants, gave him firsthand experience in understanding and respecting diverse cultural expectations and communication styles. He developed a keen ability to adapt his approach based on individual needs, learning to interact empathetically with people from various backgrounds. This foundational skill allowed him to approach SAP’s diverse global workforce and customer base with adaptability and cultural sensitivity.

2. What are some of the cross-cultural differences he discovered? Using your knowledge of culture, explain some of these differences.

McDermott noticed that American customers preferred fast-paced, engaging sales presentations that quickly highlighted the product’s value, reflecting the U.S. culture’s emphasis on efficiency and results. In contrast, German audiences valued detail-oriented, fact-based presentations, showing a preference for precision and thorough analysis common in German business culture. Additionally, U.S. companies are driven by quarterly performance and short-term profits, while German companies, including SAP, are often more focused on long-term growth and stability, which mirrors Germany’s culture of structured, sustainable development.

3. What is your assessment of his lessons for cross-cultural managers? Relate these lessons to the GLOBE findings of the effective global leader.

McDermott’s lessons underscore the importance of respect for cultural differences, a shared organizational vision, a focus on customer experience, empathy, and humility—all crucial traits identified by the GLOBE study for effective global leaders. The GLOBE study highlights that leaders who exhibit adaptability, vision, and integrity are more successful in cross-cultural settings. McDermott’s emphasis on a shared vision allows for unity and alignment across SAP’s global workforce, while his empathy and humility resonate with GLOBE’s findings that culturally sensitive leaders who respect local customs are more effective in diverse environments. His customer-focused approach further strengthens his leadership by prioritizing the needs and experiences of all stakeholders, a quality also valued in global leadership models.


Sources: Geoff Colvin, “ A CEO’s plan to defy disruption,” Fortune, November 2014, pp. 36; Michal Lev-Ram, “Inside SAP’s radical make-over,” Fortune, April 9th, 2012, Issue 5, pp. 35-38; Bill McDermott, “SAP’s CEO on being the American head of a German multinational,” Harvard Business Review, 2016, November, https://hbr.org/2016/11/saps-ceo-on-being-the-american-head-of-a-german-multinational; SAP Corporate Website https://www.sap.com/index.html.

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