Enterprise Software Giant SAP Has Other Plans For Emerging Startup Competitors Than Acquisition

What does the future hold for enterprise IT?

Are we in a huge paradigm shift where companies like Salesforce will emerge as leaders?

SAP co-CEO Bill McDermott says that the future of his industry is innovation-based and software-led.

"To the extent that you have the arsenal of assets in the private, the public, and the combination of those two clouds, and you can still deal with complex, large, multinational companies on premise, and do all these things, with the continuous flow of innovation, you've got a great chance of winning the game," McDermott said in an interview with Business Insider editor-in-chief Henry Blodget.

"If you are tethered to hardware, high value services that customers don't have an interested in, that cost too much money and take too much time, or you are just selling commodities and IT that people don't value because it doesn't move the needle, there is a very good chance that you might not be around in three to five years," he said.

Watch below McDermott explain how SAP is partnering with companies dabbling in enterprise IT projects to explore new paths for innovation.