Global CIO: Oracle's Phillips Says Standardizing On Oracle Is The IT Cure

"And then we have people who are building private clouds in their own organizations and that forces them, even without us being there, to think about standardization because now they have to do some of the things we have to do in terms of service continuity, provision a lot more quickly, and when they think about that and the value of letting the users provision their own resources, they know that to make that happen we can't have all this diversity on the back end, which is what we've been telling them all along. And so I think we can kinda leapfrog and push people toward virtualization and clouds."

Tradeoffs. Is any vendor -- Hewlett-Packard, IBM, SAP, Microsoft, Oracle -- good enough these days to get you to change the metrics in your comfort zone about how much of any one vendor is too much?

That's a tough question, and it might be one you can't answer right now. But one thing you do know right now with great clarity is that the old approach isn't good enough anymore. Is Oracle's approach the right one? Maybe, maybe not -- but you know most other approaches have not helped you attack the 80/20 IT-budget monster that sucks up 80% of your dollars for keeping the lights on and leaves only a fraction for new growth projects and innovation.

"That's one of the reason we're taking this new approach about managing because the reason you're spending so much on maintenance is because you have such a complex infrastructure to begin with and all the diversity is part of that cost and trying to maintain all the different flavors and configurations and integrations and customizations -- you've created something so complex and customized that it's unique to you -- you've become a technology company because what you've created is so unique," Phillips said.

"But you don't want to be unique, not when it comes to your technology architecture -- where you want to be unique is in your strategy and the way you configure our technology to support your strategy and not the actual technology underneath it -- that's the only way you're gonna lower your cost.

"So we've been preaching standardization, and now we have enough throw-weight with the stack to drive standardization. And the second thing we tell people is, 'We know you like having 15 suppliers for everything -- but there's a cost to that.' One way you can lower that maintenance cost is take the products you already own and consolidate -- replace what you're using," Phillips said.

"It makes no sense, for instance, to have a license from three different companies for the same function, and you're paying your support on that. So if you're an Oracle shop -- and if you're talking to us, you probably are -- let's replace all that stuff. You already own the licenses -- let's consolidate. And so a lot of times what we do with our Insight program, which is where we go in and benchmark them, is say, 'Do you know you're doing this five different ways in five different locations with 10 different instances -- you already own the licenses and some technology with Oracle, so why don't we just replace all that?'

"So [customers] get more value without doing anything other than consolidating. So there are ways to cut through and look at why that 80% is 80%, and usually it comes down to the same two or three things: have fewer instances, consolidate, and have fewer configurations. All that stuff is pretty predictable, and so our job is to make that more doable: how do I get from where I am, to there? And we can carve off chunks of that and tell you how to get there over time.

"But until you accept that that's the way to do it, and you're still trying to do it the old way, it's gonna be 80%."

Forget for a moment that Charles Phillips is president of Oracle and that he gets paid to promote and sell Oracle's products and approaches and strategies, because this is an issue bigger than Oracle and isn't really even about Oracle: it's about you and your own approaches and strategies, and your various rules and policies about what you will do and won't do.

Some -- perhaps many or most -- of those policies are terrific and have been a big part of your success. But it's also possible that some of them are outdated and counterproductive and need to be scrapped with relation to how deeply and broadly you'll let SAP or VMware or Cisco or HP into your enterprise.

Does Phillips have a point -- even a small one -- about the tradeoffs between standardization and lower costs, versus standardization and vendor lock-in? It says here that you'd be crazy not to give it at least some careful thought.

Bob Evans is senior VP and director of InformationWeek's Global CIO unit.

To find out more about Bob Evans, please visit his page.

For more Global CIO perspectives, check out Global CIO, or write to Bob at [email protected].

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