SAP & Waste Management: The $500 Million Battle
These days, it’s tough for SAP to do anything without making the news. Though to be fair, this tidbit from last week is very much headline-worthy: Waste Management is seeking $500 million from SAP for an allegedly failed ERP implementation.
At the beginning of last week, the ERP giant announced they’d be moving back to a co-CEO model, and that Léo Apotheker would be stepping down from SAP’s executive board and as CEO. Naturally, Apotheker may not have been entirely to blame for the recent course of events for SAP, but his resignation is a sign of the company’s willingness to progress—most probably with SaaS ERP products to the mid-market, which is where they’d struggled before.
Alas, no matter what practices they employ to move forward, SAP will still have to answer for the past. In this case, Waste Management is alleging that SAP used “fake” and “rigged” software demonstrations when pitching to the company, and then after a couple years the ERP deployment was not satisfactory. SAP denies any wrongdoing and states that Waste Management was in breach of contract by not providing SAP with accurate business requirements.
The case is expected to go to trial in May, and both parties have been disputing evidence for months.
SAP is a large company that caters to other large companies, so there’s little doubt as to whether they can handle this case. We are curious, however, to see what the outcome of the case is, as it does seem rather unlikely that such an established company would purposely mislead a company like Waste Management.