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SAP Labs Bulgaria Turns 20: What’s Behind the Growth of the R&D Location in Sofia?

Maria Baumgartner, Speedinvest Heroes: “Wir bauen eine Coding-FH in Wien.”19. October 2020, 07:38

SAP, the largest European software company, needs little introduction. With over 440k enterprise clients and €27.6B in revenue for 2019, the headquartered in Germany provider of business operations and customer relations technology is no doubt one of the most impactful corporations on a global scale. Customers of SAP produce 77% of the world’s beer while SAP’s mobile platform delivers 1.8B text messages every day.

In order to continuously improve its wide portfolio of products, SAP has created a network of R&D locations situated in 20 high-tech clusters around the globe – SAP Labs.

This story is about one of them, the R&D center in Bulgaria, which this year celebrates its 20th anniversary on the local market. In the office in Sofia, engineers specialize mainly in cloud-related topics and work on advancing SAP’s products for developers. For example, many important components of SAP Cloud Platform are being built here, including SAP’s web frontend framework – SAP UI5 and Life cycle management tools and processes, which are the basis for many SAP cloud products.

From a small team to a strategically important hub

SAP Labs Bulgaria started back in 2000 when SAP acquired the Bulgarian branch of ProSyst, along with its 65 young IT professionals and part of its software. In its 20 year history, it has grown almost 20 times and today employs over 1000 people.

“Joining the SAP family was a pivoting experience for all of us. We switched from a small business to a big international corporation with well-established processes with a unique spirit. We felt welcome since day one, we learned from each other’s experience and expertise as we were building new products,” remembers Monika Kovachka-Dimitrova, Chief Project Expert at SAP Labs Bulgaria, who also came from ProSyst and has stayed at SAP since then.

Monika started her career as a software engineer and soon became the first woman to become a team lead and consequently a manager at SAP Labs in Bulgaria. She has turned into a key part of the local leadership team and is now an employee representative in SAP’s Supervisory Board.

One of the most decisive moments early in the history of SAP Labs Bulgaria came as an unhappy customer put the future of the entire Java application server into question.

“At one point, in the beginning, we faced an escalation with a client. Our colleagues in Germany had introduced standards for security and reliability, with which we were not that familiar yet. So, long story short, the client tested the software and realized it’s not as enterprise-ready as we all thought. It was a challenge that required quick reaction and quick results so all of us had to unite, it was one of the most fundamental times in the history of SAP Labs Bulgaria. In the end, through all this authentic teamwork, we created a really state-of-the-art software. We showed that we can deal with difficult situations and this was one of the reasons to continue to grow in the years to come,” shares Monika.

Since then, SAP Labs Bulgaria has continued on the right side of things and developed to a company that has generated over €56m in 2019. One of the most interesting things that grabbed the attention of Trending Topics’ team, though, is that many of the early employees who started back in the year 2000 are still in the organization.

Monika Kovachka-Dimitrova, Chief Project Expert at SAP Labs Bulgaria © SAP Labs Bulgaria

What makes people stay 20 years in the same company?

Over 30% of the employees at SAP Labs Bulgaria have been at the company for over 10 years, which presents a sharp contrast with the rest of the Bulgarian IT sector, often characterized by high rates of job-hopping. We learned there are two main reasons that might explain this positive trend.

First, people at SAP Labs Bulgaria have a lot of space to move between roles if they want to develop into a different area. They can join a very innovative environment at the beginning of a project, be in the middle where the focus is on scalability, or go closer to clients as a given product reaches customers and has to be maintained afterwards.

“Looking back, about every three years I made a serious change in my role and responsibilities. It gave me this diversity that really kept me in the company for so many years. It helped me quickly learn so many things,” says Monika who was writing code and documentation at the beginning of her SAP Labs career, and moved through several managerial positions before reaching her current cross-functional role in which she’s involved in decisions that influence the entire global company.

According to her, another important aspect to be considered when exploring the career longevity at the company is the family feeling, the feeling of being accepted, and the safe environment where one can learn from experience and mistakes. “If you make a mistake, you can correct yourself, nobody’s going to punish you. And, you can ask anyone for help. In our culture it is fine for every employee to reach out to any manager and even the CEO, and they will get the best support,” adds Monika.

The fact that SAP Labs Bulgaria is building its own products also seems to influence people’s loyalty towards the company. The Bulgarian startup and product ecosystem has awoken in the past few years, but previously the IT industry in the country was characterized mainly by outsourcing service providers.

Tell it like it is, listen and stay curious

Employee representation is not a very popular topic in Bulgaria yet, compared to, let’s say, Germany where there is a legal basis for the management team of an organization to consult with employees, especially when making major changes – acquisitions, layoffs. SAP Labs Bulgaria has also adopted a lot of that mentality.

“We listen to colleagues who give feedback – what is good, what is not good. Sometimes we try to expand the benefits of employees, give ideas on how to improve internal processes. The SAP board relies on us to tell them if they’re about to implement something that might not be well-received by the teams. So, they can make adjustments before the decision has been introduced. That’s how several years ago an employee stock option plan became available for all locations worldwide, not only for the ones that were planned at first,” explains Monika.

Next to the employee representation at SAP’s supervisory board, through various methods, SAP Labs Bulgaria is involving people and looking at different viewpoints in day-to-day operations as well as for everything from changes in team projects to improvements in the office environment.

Two other important elements of SAP’s culture are honesty and curiosity. “If there is any problem, we do not sweep it under the carpet, but we sit down and discuss it,” tells us Monika. And, the willingness to see change as an opportunity and pushing boundaries is of course important at an R&D location responsible for product innovation.

Adapting to the new remote reality

Fast forward to 2020, SAP Labs Bulgaria similarly to its sister locations around the world had to switch to a remote mode of operations. This hasn’t stopped the company from onboarding many new employees in the past few months.

Very quickly after SAP Labs Bulgaria started working remotely, equipment was delivered to the homes of the new team members. Overall, onboarding sessions and activities remained the same but virtual.

One interesting fact is that every new colleague has always received a buddy to help him/her in the first six months in the company. Usually, the buddy is someone from the team and there is a timeline with pre-defined steps of onboarding – with common information for all colleagues, as well as specific for every team. Now, a new virtual space has been introduced, where the new colleague, his/her manager and the buddy have access to all the information and can check how the onboarding is going.

“I was impressed by the fact that everyone is extremely friendly and I did not feel like a “newbie” even for a second. Everyone talked to me and from the very beginning helped me with all sorts of things that were new to me. Starting a job in a work environment like this definitely makes a great impression on you in the beginning, especially when you don’t know what to expect because you work from home,” shares Krasimir Shontov, one of the new team members at SAP Labs Bulgaria.

The next 20

“SAP Cloud Platform is at the heart of our customers’ digital transformation. Over 80% of our colleagues in Bulgaria work on this platform. In the future, we want to diversify the topics we work on in Bulgaria and to have an even greater contribution to SAP and the company’s customers. We want to supplement the portfolio we work on with more business applications and continue to grow every year,” shares Radoslav Nikolov, Managing Director at SAP Labs Bulgaria.

Another important area for the company will be people development, including new roles for Bulgaria such as Chief Product Owner or Chief Product Architect. This should show the long-term potential of the location and add fuel towards the long-term vision for the local office to become an Eastern European hub for SAP.