SAP CEO Bill McDermott has abruptly stepped down from that position and will be replaced by a pair of current SAP executive board members.

In a statement, SAP explained that McDermott “decided not to renew his contract.” McDermott, who has been at the company since 2002 and CEO for a decade, will remain in an advisory capacity through the end of the year. SAP’s supervisory board immediately named Jennifer Morgan and Christian Klein as co-CEOs.

Hasso Plattner, chairman of SAP’s supervisory board, in a statement thanked McDermott for his role in guiding the company toward a greater focus on the cloud.

“Bill made invaluable contributions to this company and he was a main driver of SAP’s transition to the cloud, which will fuel our growth for many years to come,” Plattner noted.

McDermott and Plattner shared the stage earlier this year at SAP’s annual Sapphire event, where its public cloud focus was on display.

“The public cloud is the way to go,” Plattner said early in his keynote address at the event, adding that “HANA is too good to lock inside of SAP databases.” HANA is SAP’s core database platform.

Plattner said that the company had tried several times over the past 20 years to integrate cloud access into its on-premises platforms, but those efforts never gained enough customer traction.

“I am an early adopter in the cloud and I failed,” Plattner said during a later questions-and-answer session. “Now the cloud in unavoidable.”

A recent GlobalData report had SAP ranked alongside rivals like Google, Amazon, and Microsoft in the second tier in its list of the market’s top “hybrid cloud theme” among cloud service providers. IBM, VMware, and F5 Networks were in the top tier of that list.

Plattner noted that the executive shakeup was done through the company’s “long-term succession plan.”

“Bill and I made the decision over a year ago to expand Jennifer and Christian’s roles as part of a long-term process to develop them as our next generation of leaders,” Plattner wrote. “We are confident in their vision and capabilities as we take SAP to its next phase of growth and innovation.”

The company's cloud focus is evident by the background of its new leaders.

Morgan joined SAP in 2004, and most recently served as president of the company’s Cloud Business Group. This includes its Qualtrics, SuccessFactors, Ariba, Fieldglass, Customer Experience, and Concur businesses.

Morgan earlier this year replaced Robert Enslin as head of SAP's Cloud Business Group. Enslin, who was a long-time executive at SAP, was quickly snapped up by Google, who named him president of global customer operations for its Google Cloud business.

Klein has been with SAP for 20 years, and most recently served as its COO where he oversaw the company’s flagship S/4HANA product.

SAP blurred the executive shakeup alongside the release of preliminary results for its third fiscal quarter. Those results were highlighted by a 37% year-over-year increase in cloud revenues and a 12% surge in cloud and software revenues.

The company noted that an unnamed “major partner” had signed a three-year deal that accounted for 17 percentage points of its new cloud bookings in Q3, with revenue recognition from that deal to begin in Q4.

SAP earlier this year launched a strategic review targeted at increasing the company’s focus on its cloud operations to drive margin growth.

Beyond the standard hyperbole attached to the review focus, SAP said it will “significantly increase” its investment in core business areas and push its leadership team to speed up their decision-making processes. One of the goals of the review process is to construct a path toward a 75% cloud gross margin by 2023.

McDermott told analysts at that time that moving its cloud business off of Oracle was one of the main drivers for its cloud margin growth plans. SAP has been increasing its work with other cloud providers, including a deal with Microsoft to deploy each others’ cloud solutions internally, and complimentary statements from McDermott about Enslin could hint at further partnerships with Google.

McDermott also explained that the move was not about cost reductions, but “about doing things better, smarter, and faster.”

“Coming out of our restructuring, this is about hiring intelligently lesser in quantity, but greater in quality,” he stated. “It will result in more investment where it counts, which is where our customers need SAP to invest for their success.”

The review plans came a month after the company announced that it would cut around 4,400 jobs company wide as part of a restructuring. However, preliminary Q3 numbers showed it has grown its employee base by nearly 5,000 workers during the past year.