Creating an Environment of Innovation- Pixar Style!

Hats off to business-application software market leader SAP’s chairman, Hasso Plattner, for his innovative approach to new product development. HANA, SAP’s new real-time business in-memory technology, will process complex business calculations in seconds that previously took hours or days. The Wall Street Journal reported that Mr. Plattner hopes to put his main competitor, Oracle Corp., on the defensive. When HANA was announced in 2010, Oracle CEO Larry Ellison called it “wacko” and said he wanted to know the name of SAP’s “pharmacist.”

In 2010, SAP launched the HANA pilot program and has pledged to grow to over $25 billion in revenue by 2015 on the back of HANA. In 2011, SAP posted revenues over $18 billion, up 14%. SAP’s 2011 profit of over $1.5 billion is more than double the net profit in 2010. Today, Mr. Ellison may indeed be searching for the name of SAP’s pharmacist!

In my opinion, the real story is not the technical details of this new software…it’s in the approach SAP co-founder and chairman, Mr. Plattner, used to develop HANA. Rather than calling on his army of in-house research-and-development engineers, he recruited a group of university students from Germany. In 2006, he formed a team comprised of three doctoral and a handful of undergraduate students to study in-memory technology. In a city outside of Berlin, he converted an abandoned railway building into “the villa” with red couches, flat screen TV and a foosball table. Mr. Plattner sketched a diagram of the new database model on a white board and told the team to build it. By 2007, they were ready to unveil their prototype, and by 2009, they had a working model.

The lessons we can learn from Mr. Plattner’s approach at SAP parallel the ones we write about in Innovate the Pixar Way:

· Become a prototype junky

· Develop your own “skunk works”

· Dream Big

· Use a planning center

· Find a customer or supplier to help test and refine your product (SAP tested their prototype in partnership with P&G)

· Support innovation in schools

Each year, Mr. Plattner continues to recruit a group of 6-8 students to conduct research. Kudos to Mr. Plattner and his innovative approach to new product development!

By Bill Capodagli