Oracle's Mark Hurd: We Know CIOs
Responding to OpenWorld critics, Hurd makes the case for why customers need to put more of their eggs in the Oracle basket.
I got the sense that Oracle wanted to give Mark Hurd another crack at InformationWeek, offering me an interview with the company's co-president after recent columns by two of my colleagues--executive editor Doug Henschen and contributor and consultant Josh Greenbaum--criticized Hurd and Oracle for being less than visionary or inspiring at the recent Oracle OpenWorld.
Sitting down for an hour with Hurd at Oracle's Madison Avenue offices in New York, I found him to be relaxed though guarded, critical of the "press" as more eager to acquire sound bites than to give Oracle's strategy a fair hearing. I gave Hurd that fair hearing.
More Global CIO Insights
- The Untapped Potential of Mobile Apps for Commercial Customers
- Ovum Technology Analysis: Compelling Trends and Successful Strategies for Externalizing Your Enterprise Through APIs
- Effectively Controlling IT Change
- Always Open: Why the Performance of Online Insurance Matters More Than Ever
He started by recapping the four prongs of Oracle's strategy. First, it's focusing on being best of breed in every layer of the stack: hardware, operating system, database, horizontal and vertical applications. "We want all of those capabilities to be open and work well in heterogeneous environments," Hurd said, "and we're lined up from engineering through sales to make that happen."
Second, he said, Oracle wants to vertically integrate those pieces to deliver "extremely attractive performance, cost, and, in the end, TCO for customers." The first manifestation of that strategy was its Exadata database appliance, then its Exalogic middleware machine, and most recently its Exalytics in-memory business intelligence machine and Big Data Appliance. Hurd reiterated Oracle's claim that the highly tuned Exadata hardware-software combo yields 70x performance improvements--reports that took 70 minutes now take one minute, Hurd said. And those gains can be "dialed in as cost savings for our customers," he said. "The customer who says it cost me $7 million to do that job before, you can literally take 70x off that and it costs him $100,000."
I'm not so sure the math of that cost savings is so straightforward, but if customers can improve database application performance by anything close to 70x (or even 10x, as Oracle's Exadata product literature states), suffice it to say they got a good deal. (Competitors, most notably IBM, have taken Oracle to task for its benchmarks, saying they're baked.)
Third, it's building out its vertical industry expertise, hiring sales and technical support people to help customers in healthcare, retail, financial services, utilities, and other sectors solve their "most strategic and difficult business problems," Hurd said.
Fourth, it will deliver applications and infrastructure "any way the customer wants it," he said. That includes the public cloud--note its recent launch of the Oracle Public Cloud, infrastructure as a service for customers looking to develop Java apps or deploy Oracle Fusion apps in the public cloud. That strategy also includes software as a service, punctuated this week by Oracle's $1.5 billion deal to acquire RightNow, a leader in customer service SaaS. Oracle will help customers build out private and hybrid clouds as well, or, of course, it will work with them on premises. "You can use the same code base no matter which delivery vehicle you choose," he said. (Critics think Oracle's cloud strategy is all over the map. It's still evolving, for sure.)
Work In Progress
Hurd was quick to note that Oracle spent $4.5 billion on R&D last year and will spend about the same this year, much of it on product integration. It took Oracle six years--two years longer than it had promised--to get its Fusion suite out the door, integrating applications amassed from myriad acquisitions over the past decade, including Siebel and PeopleSoft/JD Edwards. Isn't that integration still a work in progress?
"The answer isn't yes or no, and there are different levels of integration," Hurd responded. "From an absolute perspective, it's not just binary. Of course, we have a strategy to leverage and to integrate our solutions. There are some companies that I give a lot of credit to that have kept their solutions siloed and have still maintained some market momentum out there. But it's not our strategy."
He gave the example of Phase Forward, a healthcare and life sciences app Oracle acquired last year.
"We've brought those solutions into Oracle and they're being rewritten on Fusion Middleware," Hurd said. "That is a big investment as we move to Fusion, which gives us the ability to bring things together architecturally. Have we got everything done? No. Are we in the process of doing that? Yes.
"When you look at Fusion, we're coming with a whole new code base. Take CRM--the most modern code in the CRM world today is Oracle CRM Fusion. Simultaneously, we are continuing our road map on Siebel, adding features to Siebel, yet you can take a module of Fusion CRM and add it to your Siebel infrastructure and grow that capability modularly. The same thing with HR. You can have PeopleSoft, yet you can take the talent management piece of Fusion and add it to the PeopleSoft environment.