Sep 24, 2014
Oracle Open World 2014 kicks off next week and promises to be like no other as, I’m sure everyone is well aware, last week the company’s CEO, Larry Ellison, announced he was turning the reigns over to the duo of Mark Hurd and Safra Catz. Ellison also announced he wasn’t leaving the company; rather, he would focus his energies on leading hardware and software engineering — when he wasn’t off sailing or buying islands. Hurd, coming off his stellar tenure as HP’s CEO, will run sales, service, and the global business units, while Catz will head up manufacturing, finance, and legal operations. The three of them had been running the company, but instead of having the Hurd/Catz combination report to Ellison, they will now report to the board. The idea is that by keeping the trinity together, there should be little disruption to the business.
Before I get into my thoughts regarding Oracle under the new structure, I do want to give credit where credit is due. Ellison has been a true visionary in the area of data center evolution. About five years ago, every company was on the software bandwagon and “hardware” had almost become a bad word. However, Ellison bucked the trend, rolling out the Exadata platform with the tagline of “Hardware, Software, Complete”. The basic idea was that stitching together the required underlying servers, storage, middleware, applications, and databases is far too complicated for most organizations. Instead, a better way of deploying data center infrastructure is to leverage the benefits of a fully integrated, validated, and tested design. There was so much value in this integration that the only man with an ego bigger than Larry Ellison, Tony Stark, chose to use Oracle as the building blocks of Iron Man (or, at least, that’s what this promo alludes to).
Today we find a number of these converged platforms available. VCE’s vBlock, EMC vSpex, and Avaya’s Pods are some examples of fully integrated, tested platforms that, in some ways, follow in the footsteps of Ellison’s vision of “Hardware, Software, Complete”. Ellison chose to push the value of hardware when hardware wasn’t cool — but now the market has come back around.
Moving forward, it still remains to be seen how effective this “new era” of leadership will be. Up until now, the company was effective because it was a dictatorship — what Ellison says, goes, since it’s his company and frankly he’s got the track record to back it up. It’s fair to say that the company was late to jump on the cloud bandwagon but the company has been one of the most dominant enterprise software vendors ever.
Given the fact that Ellison is still playing a significant role at Oracle – running engineering, it’s possible, almost likely that his voice will carry more weight than the co CEOs. I also think the co-CEOs are a recipe for disaster. It’s possible that the two can work together and run the company as a pair but what happens if the two have conflicting opinions? Then do they both appeal to Ellison and he becomes the tie breaker? In a succession plan from a CEO that has the industry stature of Larry Ellison, there needs to be a single person that has the backbone to push back on the former CEO and that’s not what Oracle has. Only time will tell if this will be successful but I see Ellison casting an awfully big shadow over the Hurd of Catz.
Zeus Kerravala is the founder and principal analyst with ZK Research. He provides a mix of tactical advice to help his clients in the current business climate and with long term strategic advice. Kerravala provides research and advice to the following constituents: End user IT and network managers, vendors of IT hardware, software and services and the financial community looking to invest in the companies that he covers.