SAP AG anointed Leo Apotheker as its new leader Wednesday and appointed a chief operating officer for the first time as the business software maker tries to fend off stiffer competition while digesting the biggest acquisition in its history.

Apotheker's promotion to co-chief executive with Henning Kagermann isn't a surprise. He has been considered to be Kagermann's likely successor since another potential candidate, Shai Agassi, left SAP a year ago. When Agassi resigned, SAP elevated Apotheker to deputy CEO.

By having Apotheker share the top job with Kagermann for the next year, SAP is hoping the change in command will go even more smoothly.

While Kagermann will remain co-CEO until his contract expires in May 2009, Apotheker will begin making most of SAP's major decisions during the second half of this year, the executives said during a Wednesday conference call.

Kagermann, 60, had planned to step down at the end of 2007, but SAP asked him to stay on longer. Like Apotheker, Kagermann first served as SAP's co-CEO before taking on the job by himself in 2003.

Apotheker, 54, has been working for SAP for 20 years.

Besides promoting Apotheker, SAP also named another longtime executive, Erwin Gunst, as the first chief operating officer in the company's 36-year history. Gunst had been overseeing SAP's operations in Europe, the Middle East and Africa.

SAP is reshuffling its management as it grapples with longtime nemesis Oracle Corp., as well as up-and-coming rivals like Salesforce.com Inc. and NetSuite Inc. that lease software services over Internet connections.

SAP last year spent nearly $7 billion to buy Business Objects SA, which makes software that helps companies map out their strategy. The acquisition marks a radical departure for SAP, which traditionally shied away from buying large chunks of technology from outsiders.

But Oracle's success cobbling together software snapped up from dozens of rivals during the past three years appears to have helped change SAP's thinking.

Oracle's expansion, which has cost more than $30 billion so far, has narrowed SAP's lead in business applications software - programs that automate a wide range of administrative tasks.

While Oracle's revenue rose 25 percent to $18 billion during its most recent fiscal year, SAP's revenue climbed 9 percent in 2007 to $15 billion.

Oracle still makes most of its money from database software, a product SAP doesn't offer.