Who Is Leo Apotheker And What Is His Channel Track Record?

So who is Leo Apotheker and what does his appointment as Hewlett-Packard's new CEO mean for HP channel partners?

The news Thursday that HP had picked the former SAP CEO to replace Mark Hurd left some people scratching their heads. Apotheker is about as far from a Silicon Valley insider as you can get -- he worked at SAP's Waldorf, Germany, headquarters -- and few outside of the SAP universe know much about him.

Apotheker worked at SAP for more than 20 years, serving in a number of posts, including president of SAP's Europe, Middle East and Africa operation, and president of global field operations and customer solutions.

Apotheker became deputy CEO in 2007 and in April 2008 was promoted to co-CEO with Henning Kagermann, putting him in line to become CEO when Kagermann retired in May 2009.

But Apotheker's brief reign as CEO, coming in the depths of the global recession, was a rocky one. SAP struggled to maintain profitability and sales growth, with sales falling 8 percent in fiscal 2009. The company's technology and product development operations also ran into problems, most notably the company's efforts to bring its Business ByDesign on-demand applications to market.

Next: Apotheker's Channel Track Record

On February 8 SAP's supervisory board announced that it had "reached a mutual agreement" with Apotheker "not to extend his contract" as a board member and that he would resign as CEO effective immediately. Bill McDermott and Jim Hagemann Snabe were named as co-CEOs to replace him.

Thursday SAP issued a statement portraying the announcement as good news for both SAP and HP. "SAP and HP are outstanding partners, HP is a great SAP customer, and this move only sets the stage for an even deeper relationship between our two companies," McDermott said in the statement. He added that Apotheker understands SAP's business model and can leverage the SAP-HP partnership for their joint customers.

As for the channel question, an SAP spokesman pointed out that SAP, which has long been known for emphasizing direct sales, took its first steps into the channel in the 2004-2005 timeframe when Apotheker was in charge of field operations. It was then that SAP began selling its BusinessOne and Business All-in-One software indirectly as part of the company's SME (small and midsize enterprise) organization.

But several SAP channel partners, asking they not be named, were critical of SAP's channel efforts under Apotheker. "Back then it was a nightmare," said one reseller, noting that SAP tried to use a hybrid direct-indirect sales model. Because most sales leads came into SAP, "having a hybrid model was a killer for the channel. And a lot of partners just disappeared."

"Under his reign, I don't think SAP was super-partner friendly," said another solution provider. Of Apotheker: "He was definitely old guard." When told of SAP's suggestion that Apotheker was instrumental in launching SAP's channel efforts, the partner was silent for a moment before saying: "Not really."