Commentary
4/23/2010
08:14 AM
Bob Evans
Bob Evans
Commentary

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

Phillips says the mix-and-match approach is killing IT organizations, and the only salvation is standardization (on Oracle, of course).



Life is all about tradeoffs. Time with kids or answer a few more emails? Grab that airport cheeseburger or much on some carrots? Follow the Pittsburgh Pirates or decide to root for a real major-league team?

We assess our needs, evaluate our options, make decisions, and realize that some of those decisions are much more difficult and complex than others.

Well, in that category of difficult decisions, I've got a doozy: You know you're spending too much on infrastructure and maintenance versus growth projects and innovation, and you are committed to changing that. You know your current roster of global systems could serve as an archeological technology museum showcasing every type of hardware, software, and network, and you're determined to update all that. And you also know that all CIOs take a sacred oath vowing to love the one-stop-shop IT vendor in theory but to avoid it like the bubonic plague in practice.

And then you hear Oracle president Charles Phillips make a cogent and persuasive argument that provides the answer to all of your problems, including your overly strained budget, your brittle systems, your inability to get out ahead of the busywork, your aging and mismatched applications, and most of all your inability to meet the CEO's expectation that you become a full-time driver of growth and innovation.

Under Phillips' plan, your cost of internal operations plummet, your integration headaches vanish, your performance problems disappear, and your CEO views you as a business leader who's taken on and overcome a massive and seemingly intractable problem.

But here's the tradeoff: to get all that, you have to standardize on Oracle. The whole stack. Storage to applications. The thing you swore in blood you'd never do.

Phillips' solutions sound almost too good to be true and perhaps they are. Then again, Oracle's strategy and Oracle's technology are unlike anything else in the IT industry today due to their breadth and ability to extend from systems to storage to middleware to OLTP to databases and ERP and vertical-market expertise.

And yes, I realize that whole perceived asset can be logically flipped into a crushing liability by invoking the lock-in theory: by standardizing so extensively, you no longer run the relationship -- instead, Oracle runs you.

Tradeoffs -- they can be brutal. But before dismissing the idea out of hand, check out some of Phillips' perspectives below. As I've noted above and in other columns, Oracle's made itself into a company quite unlike any other IT vendor and maybe, just maybe -- depending on your situation and your needs -- you might decide that what he's recommending isn't as crazy as it sounds.

"What CIOs are struggling with right now," said Phillips in an interview Thursday in Manhattan, "is trying to find a way to get the opportunity and ability to manage the entire stack with a single management tool that's predictive about how that stack's going to behave, how the change-management around it is more prescriptive and planned and where they really know how to upgrade and patch the entire stack.

"All the dependencies between these layers -- the middleware, database, storage, software, systems -- they're all related but unpredictable," Phillips said. "And that's the cycle they're trying to get out of -- all that need to constantly provision and manage -- it's a huge cost and it's kinda boring and takes lots of people to do it and it's risky."

In New York for an Oracle CIO advisory board meeting and to introduce a broad new set of management tools, Phillips pressed the point that the industry has tried the mix-and-match for decades as a means of trying to keep vendors honest but the cost of running all that different stuff is turning out to be much greater than avoiding overdependency on any one IT company.

"The entertainment value or intellectual stimulation you get from tweaking every little thing up and down that stack is not the same as what it once was -- they're kind of bored with doing that. And the expense of doing that is apparent now -- and after going through the last two years of downturn, it kind of helped us in a way because people said, 'I've gotta find a way to change what I'm doing -- this is not working,' " Phillips said.

Global CIO
Global CIOs: A Site Just For You
Visit InformationWeek's Global CIO -- our new online community and information resource for CIOs operating in the global economy.
"They're under pressure to reduce costs like everybody else, and the luxury of having unlimited flexibility and unlimited configuration and unlimited choice -- well, it's expensive. So I tell them, 'We know you like that unlimited choice -- that's kinda how we all grew up -- but it just doesn't make any engineering sense anymore, and if you're gonna keep doing it that way, your costs are gonna always be higher than someone who doesn't do that, and if you want to be successful and keep your job, you're gonna have to do things differently and just accept that the industry's becoming more standardized.

"You don't need 18 different vendors and 2,000 configurations to have competition -- you've got to limit it some. And I think we've convinced people that makes sense and beyond that we think the whole industry's just moving in that direction. And we can accelerate that by standardizing that entire stack and showing people how it's done -- people like that 'iPod for the enterprise' analogy" (my emphasis).

Too crazy to even think about? Well, what if you're also trying to lock down your long-term strategy for private clouds? Here's Phillips' view:

"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].

We welcome your comments on this topic on our social media channels, or [contact us directly] with questions about the site.
Comment  | 
Email This  | 
Print  | 
RSS
More Insights
Copyright © 2021 UBM Electronics, A UBM company, All rights reserved. Privacy Policy | Terms of Service