Oracle, Oracle, Oracle. WHAT am I going to DO with you? On the one hand, you have certain parts of you that are very, very good. Word is (from a colleague or two who spends time talking to your customers) that your customers are generally content with you, though not ecstatic. All in all, you are a $35 billion company that has been a core part of the largest enterprises on the planet and are one of the largest enterprises on the planet in your own right.
Its all good, then, right?
Your mistakes occur at a magnitude that makes me gasp. They are the kind of mistakes that damage your public image, that belies even a veneer of customer friendly thinking and that can hurt you in the long run.
Not something that I want to or like to see.
That said you have done a lot right, especially in the world that I inhabit – which is, at least in the technology segment of it, the world of customer-facing traditional and social CRM(ish) applications. But we will get into that a bit later.
First things First…How to Understand Oracle
Several years ago, Oracle’s SVP of Global CRM and a thought leader in his own right, Anthony Lyetold me that he and Oracle were “fast followers.” What he meant was that Oracle wasn’t defining or disrupting markets, but improving on what was in the market. He told me that at the time that Oracle released their poorly named “Social CRM” sales force automation tools – including the very high risk Oracle Sales Prospector and the what I saw as quite clever at the time Sales Library among other products. So I pooh-poohed that and figured he was giving me the marketing spiel he was supposed – which, actually, is not his modus operandus. Anthony tends to be a very straight shooter and not beholden to any agendas but being a fair person. So this was weird.
I’m realizing now this is not weird at all. It’s entirely true. Oracle is not a disruptive company, theyare actually fast followers. Anthony was being entirely straightforward and reflecting not only his own outlook at Oracle (though he is a more innovative guy than much of the rest of the company, to tell you the truth) but Oracle’s outlook as a company.
Oracle doesn’t innovate. What it does do is to figure out how to incorporate other company’s or individual’s innovations into their thinking and improve on (and monetize) the platforms and products that the innovations have spawned. Best example of that is pretty much all the major announcements that Oracle made at the conference – at least those that interested me – the Exalytics server, the Oracle Public Cloud and the Oracle Enterprise Social Network. Not a single one of these is either a true innovation or even a marketing spin that makes it seem like an innovation. Even Fusion apps, finally in general release, are not innovation, just tightly integrated “best of” features, functions and processes. But really well done tightly integrated features functions and processes.
So, people here’s:
Takeaway #1 – Oracle is a fast following company – like Microsoft was in the previous century – though Microsoft rode its success more on the “slow follower” approach – remember Netscape? Word Perfect?
The next thing to consider is that, of the big 4 – Oracle, SAP, Microsoft and salesforce.com, Oracle is the geekiest of the companies – the one with the hardcore technical people – both employees and the customers that they appeal to. I’m talking the big database guys and the big box guys and the company that CIOs and CTOs are most interested in talking to because they think about reliability and efficiency of machines and programs, not better business outcomes. I’m not saying that Oracle doesn’t provide business outcomes, but that’s not how they think as a company. Larry Ellison shapes Oracle’s story and doesn’t really care that it may be the wrong public story that he’s shaping. He loves the geeky stuff and is willing to dig into the bits and bytes of the technology – which is where his passion lies. Plus he has all the money he needs in the world and really doesn’t find himself accountable to anyone or anything – or at least that’s how it seems to the world at large. I wish I was wrong and would love to be proven so, but I see no option there.
Takeaway # 2 – Oracle is geared to technical efficiency not business outcomes.
While Oracle is moving toward a public posture of “tighter integration of hardware and software”, their Sun acquisition seems to have skewed them toward hardware and their public posture seems to reflect that more than anytime in the past. This is a trend I and others noted at Open World for the past two years with the release of Exalogic, Exadata, and now Exalytics. But its their public messaging which seems to be putting hardware more in front than software at least in the eye of folks like me.
To be fair, I’m not a hardware guy and what Larry Ellison said about T4 and Sun SPARC and Exalytics boxes etc may be something that sent the hardware guys into an ecstatic state of consciousness. But the business public isn’t hardware either and not really even software. Oracle would be much smarter if they queried customers on the business outcomes they are looking for (as the CRM group at Oracle has done often enough) and made that their focus.
Takeaway #3 – Their focus is more hardware than software – and once again, not business outcomes.
Next and last.
Finally, to understand the framework of the company – it is so huge, with such a large portfolio that it has a hard time weaving a coherent message much less a good one and that was reflected at Open World 2011. There were a whole number of headscratching approaches to the messaging that made me wonder if it were even possible to evolve a visionary statement that would resonate – because that sure didn’t happen there. What we had instead was a two part keynote – one hardware heavy, the other cloud and software heavy – and they didn’t mesh or even seem terribly related. Just a laundry list of “things to talk about.” The tweet stream was vicious about Larry E’s keynotes as a result – just like last year when the same exact thing was done.
Takeaway #4 – Oracle is so big that it has difficulty in providing a balanced coherent message much less a visionary one. And there doesn’t seem to be great interest in doing so either.
OOW2011: The Conference
Apparently, if one is to believe what one hears at these things, there were close to 50,000 people at this, eclipsing salesforce.com’s 45,000 at Dreamforce less than a month before. I know it must be true because Sting came out on stage and said it was the biggest – in one of the worst read prepared statements I’ve ever heard – the guy sounded stiff as a board.
Unfortunately, this reflected the energy level of the conference.
As you may have seen in a previous post about Dreamforce, I made what I think is a significant point (and I may be the only one who thinks this – hope not) about the atmospherics at a major conference on the scale of an Open World, Dreamforce, Convergence or Sapphire. People tend to get caught up in the emotional environment that a conference paints. If the energy is high and it is exciting, the announcements become exciting, the parties become great, the interactions are dialed up a notch or two and the impression left after the conference is “wow.” Which, incidentally, remains in the mind of the prospects and customers who are at the conference long after the end of the event. Wow is their theme, not hardware integrated tightly with software. If I ask you (pardon the repeat here) what the theme of Open World was in 2009, could you tell me? What can you tell me about the conference that year? At most, an impression, a feeling like “I remember that I liked it” or “it was pretty good.” That’s what’s top of mind.
Well, Oracle, due to both the overall planning and a big mistake just fell on their face in this one – though of course, that’s not the end of the world. I’d say, if I have to rank conferences in order of who I think does the best jobs of the big 4 it would be this:
1. Salesforce.com Dreamforce
2. SAP Sapphire
3. Microsoft Convergence
4. Oracle Open World
That’s at least how I see it. Not sure of how others did.
Regardless, there was little energy at the conference – partly driven by the lack of vision coming from the keynotes;. partially because there doesn’t seem to be a concerted orchestration of the conference around the actual participants. Instead the conference is built from the perspective of an engineer – “build it, then show it, and they will come.” They did build it, showed it with the exaboxes in the hallways and nearly 50,000 of them did come. But the conference’s long term benefit is almost zero to Oracle because that perspective is tired at some point and starts losing its way and generates malaise rather than excitement. Not what you want to be remembered for – especially a company that’s been as successful as Oracle has in the past.
But let’s look at the anomalies now. Those good things and one exceptionally bad thing that stood out from the relatively joyless approach that the conference took.
The positives are the islands in the ocean of Oracle’s culture – the Blogger press program and the CRM Group.
The First Exception: Oracle Blogger/Press Program
To Oracle’s credit, they have what is among the best influencer programs in the business – at least in part via the blogger/press program run by superstar Susie Penner.
There is a bit of an overview necessary here.
Increasingly, the world of bloggers, press, analysts and others making an impact are beginning to morph or melt into a single world – the world of influencers. There are bloggers who do vendor analysis, analysts who blog, chameleons who blog, do analysis, strategy and even consult – like me – etc. Its hard to create a real line between them or even treat them differently. Oracle still has distinct programs for influencers – drawn between blogger/press and analysts – the latter who fall into the institutional analyst bucket more often than not. Interestingly, the word on the street about the analyst relations program is that it isn’t very good – though that is hearsay from other influencers. I’m tied into the blogger/press program (I vary from company to company as to where they put me) at Oracle and I’m glad I am. Susie Penner’s program does all that I could ask as an influencer. One on one meetings with key executives; events that are geared toward my kind of interests; making sure that I have what I need (as with all of the participants) etc. Of course, as the general nature of these kinds of programs, they covered my expenses for the conference too (which is my clever way of sneaking this in for disclaimer reasons). So I get to float in this little island of goodness at Oracle Open World and it allows me to see the whole too without reservation or blinking. This stands out from the rest of the conference and the lack of energy. Kudos to Susie for putting together and executing on the program.
Exception #2: Oracle’s CRM Organization
With superb leadership in place like Anthony Lye in CRM, ably supported by Melissa Boxer and Tara Roberts and with Steve Miranda at the helm of Fusion applications, I have little doubt about the quality of the products that are emerging from their product development cauldron – and this was in evidence at Oracle OpenWorld 2011. I also have little doubt about the visionary approach that the CRM team takes – unlike much of the rest of the organization. They have been at the forefront for years when it comes to understanding the business value of social CRM technologies and strategy, for that matter and have built some superb apps, some of which saw the light of day, some of which saw only demo level. For example, they built a great mobile loyalty related social CRM app for L’Oreal that I haven’t seen publicly released but they demoed a couple of years ago that integrated the ability to use points to buy product via a mobile device and at the same time be able to view both company product descriptions and social web reviews in addition to the product catalogs. Lovely execution. About a year or so ago, they demoed an ecommerce capability that used Siebel CRM metadata to identify “a person like me” for a customer to talk to about some item on the site that the prospective customer might have wanted to chat about. Still one of the best I’ve seen. Not a public product yet.
This year it was Anthony Lye who showed the native iPad apps that they had built for Oracle Fusion and other products. Whatever leading edge stuff they do on the software side, Anthony is in the thick of it.
One thing I have is NO qualms about this team. They are among the best in the entire industry and a credit to the company. Gems all in all. Their problem is that they, like every other group at this ginormous entity, have to fight for visibility, dollars and internal real estate. Which diminishes the power of what they could be doing in the marketplace.
Briefly, then, The Exa-stential Keynotes
Larry Ellison in another tour de force (in a bad way) opening keynote, focused heavily on the technical details of their big boxes and microprocessors – probably the influence of the Sun acquisition. In the second keynote that sandwiched the conference – he focused on the software.
All thatI can say is, John Chambers, guest speaker, CEO of Cisco, was great.
Larry Ellison wasn’t.
A keynote by the CEO of one of the largest companies in the world, needs to be inspirational. It needs to set the course of the company over the next two to five years and at the same time provide the audience of 50,000 with an idea that makes them say, THIS is why I want to be around Oracle for the next several years. This is why I think they have an outstanding leadership. This is why they are a company that I have faith in, not just a company I pay for products and maintenance. The employees of the company need to feel that they want to be in an exciting place to work. The opening keynote tends to paint the conference portrait.
This is precisely what didn’t happen in the keynote. Last year’s keynote announcing Exalogic and Exadata was the same in the weeds discussion of the technical architecture and the technical benefits of the machines, was excoriated on the social web and even in the traditional press. It didn’t matter one bit. This year was the same thing – with the only difference being that Exalogic was announced and that, during the partner portion of it, the 2010 horrible speech of HP’s Ann Livermore, was replaced by a decent speech by Joe Tucci, CEO of EMC. Larry droned on about the technical details of Exalytics (see my look at it below) and the benefits over the last year realized by Exadata and Exalogic, none of which was bad in itself. But the speech was devoid of vision and the passion he had was reserved, in effect, for the math.
The other thing that was irritating at least the influencers if not others (I don’t know if it was) was the constant use of the brand prefix “exa.” Because so few think this is a great brand notation anyway, the jokes were wild. My personal favorite was one that was an accidental CRM Playaz creation – Brent Leary came up with the name and me the statement.
“Today we are proud to announce the “Exastentialist Box” – “all of life’s questions on a single server.”
The second keynote was after his major gaffe so I’m going to briefly discuss that and then the second keynote which actually leads into the good things about what Oracle did, despite the keynote itself being nothing to write (home) about.
The BIG Mistake: Benioff KO’s Ellison in Round 2
This was arguably the worst move of the year made by any one associated with Oracle, much less the conference. For reasons that aren’t clear to anyone but have been massively speculated on, Larry Ellison cancelled salesforce CEO Marc Benioff’s speech at Open World at the last minute.
Just to clarify a few facts:
1. Marc kept calling this a “keynote” speech. It wasn’t that. It was a speech in a different venue near the Moscone Center that salesforce paid a million dollars to allow him to present.
2. It was cancelled the day before without any warning or explanation except “scheduling changes.” Salesforce was notified via a “no reply” email (See Michael Krigsman for all details on this one) – a disrespectful bush league move in itself.
The cancellation, which was announced with a tweet from Marc Benioff, professing surprise (which I believe was genuine, but I also think that the incredibly smart salesforce team handling this took the possibility into account and had a contingency plan.). This created a major anti-Oracle rage on Twitter, was picked up with wide-ranging coverage from the traditional media (big articles in the NY Times, Wall Street Journal, etc.) and was talked about for days.
Marc capitalized on it with a speech at the St. Regis Hotel that was packed and a VIP press conference that was likewise packed shortly thereafter. He was able to mock and poke and just go to town as an aggrieved person. He was candid too, which I’ve noticed about him lately. When asked at the press conference/VIP luncheon about what caused this he said (paraphrased) “In the heat of competition, I regretfully said something I shouldn’t have about Larry’s keynote. I sent him a personal note apologizing for that, but I guess I wasn’t forgiven.” He also noted in the press conference that, if he were Larry, he would have left this alone and not invited him back next year. Marc was right about how to handle it
There is no way in hell that this was coming out even. Marc had the upper hand and as a master of this stuff took full advantage of it and made the most of it for salesforce.
This was a bad screwup that hurt Oracle and the conference.
The Second Keynote
The second keynote was the “good stuff” when it comes to what interests me, but in all fairness to the hardware guys, probably bored them silly. Larry announced the Oracle Public Cloud and the Oracle Enterprise Social Network. More on that in second or two.
But what he also did was respond to Marc’ s speech the day before – another bad mistake. He attempted to be funny and pointedly polemical about the comparison of his Public Cloud and salesforce’s Cloud. He called it the Roach Motel of the cloud. He accused salesforce of vendor lock-in, and focused a lot on the proprietary nature of Apex.
That’s a dangerous argument to make because salesforce, in the cloud world, is not competing, by their own admission with Amazon or Microsoft Azure and by extension with Oracle Public Cloud (OPC) In the past, salesforce.com painted themselves as if they were up to this year when in May 2011 they announced at Cloudforce in DC that they were a platform as a service (PaaS) and didn’t compete with the Infrastructure as a Service (IaaS) companies like Amazon or Microsoft. So the vendor lock that Larry attacked as the core of his “roach motel” thinking comes from the use of their platform in the cloud, not as a cloud provider competing with OPC. That’s apples and oranges.
But his announcements were important and I want to go to them because they were perhaps the most important indicator as to where Oracle is going and why.
Time to look at what Oracle actually announced at Open World, which, while not earth shattering, is still an indicator of Oracle moving into a new phase. The three things that I thought were most important – Exalytics Server; Oracle Public Cloud (OPC) and Oracle Enterprise Social Network (OSN), all had the stamp of “fast follower” and all were key to Oracle’s present direction.
To put it simply, the Oracle Exalytics server is business intelligence in a box. It is part of the Oracle Engineered Systems initiative which works in conjunction with the “more tightly integrated hardware and software” mantra unveiled at the conference.
One of the key capabilities of Exalytics is that it is running their TimesTen in-memory database, which reflects an approach to computing that is rapidly becoming the cutting edge moving to mainstream standard for high volume and high complexity transactions. Ellison constantly set the bar as competitive with IBM and never mentioned SAP. Yet, its SAP that Oracle is fast following. SAP‘s HANA has been the leader in this nascent, evolving market. But what makes Oracle’s Exalytics an interesting value proposition is that it is an “appliance” rather than just an approach to memory use.
It also has a user interface appealing in a geeky, techy sort of way.
Oracle Public Cloud
This may have been the conference’s most significant announcement. For the past two years, Oracle has been emphatic about a private cloud – especially through its Exalogic box – and the benefits of a private cloud – and they remain bullish on that. However, the inexorable, unstoppable winds of technological change and value are forcing Oracle to something else that would have been unthinkable to say the least.
While, as I pointed out his comparisons to salesforce are unfair because of very different models, this model is one of a true cloud provider with a bit of a proprietary twist. They will compete with Amazon EC2 and Microsoft Azure (when the latter is fully available), not with salesforce.com. That’s not the twist. What makes the Oracle Public Cloud compelling is that it’s standards based and thus is focused on interoperability with Amazon EC2 for example. This gives OPC users the ability to store their data on OPC, on their own servers, on Amazon EC2 and still use the services and platform and infrastructure that OPC provides. That’s the twist. What makes it proprietary is that its only Oracle databases that can be moved in that way – though I can hardly blame them for that. This isn’t a democracy, it’s a company.
In a way, this is the answer that Oracle has to salesforce’s announcement of the Data Residency Option which allows field level interoperability for data though only in the salesforce multitenant environment or on the users servers. It’s not quite the same. More granular than Oracle’s, but less flexible than Oracle’s.
Larry spent a bit of time making a ridiculous attack on multi-tenancy tarring it with the “other customers can see your data” brush, which is just, as he well knows I’m sure , flat out untrue. I’m not going to discuss it any further than that. Just write it off if you hear that.
Despite those things, OPC is a significant announcement – once again, a fast following one. While not an innovation, it certainly should be of a great deal of interest to an Oracle customer and depending on how pricing is established et. al customers who don’t want Oracle but want to reside in the cloud.
It was a big deal. Seriously.
Oracle Enterprise Social Network
While this was an important announcement, it wasn’t really that much of an announcement. What do you mean, Greenberg? Cryptic, don’t you think?
Yep. But let me ‘splain. This was a branding, messaging thing. This gave a name to the absolutely deeply interwoven collaboration features offered by Fusion apps. This wasn’t a separate product. It was announced a year ago as part of the Fusion apps offering. For some reason, Oracle felt compelled to give it a separate branding. I’m not sure why.
Regardless, it was important because Oracle has these features – again in the footsteps of Socialtext and even Chatter to some degree – and they do them quite well. For example, they offer activity streams, collaboration on documents, video and web conferencing, analytics that are designed to improve employee interactions (e.g. here’s the best guy to contact on that issue); rankings, ratings, presence; and even a social activities timeline.
None of these features are missing in other social networks. What makes this top-flight is that it is thoroughly integrated into Fusion apps so that it just is THERE transparently rather than treated as a separate layer. Tightly interwoven is the watch phrase of the day – to Oracle’s great credit.
Brief Note on Fusion Apps
Note that the OSN is really just part of Fusion apps, particularly CRM at the moment. However, all of the 100+ Fusion apps are going into general availability according to Mr. Ellison, with the big boys, HCM,CRM and ecommerce now being used by 200 customers.
I’ve been a supporter of Fusion despite 4+1+1 again years it took to release. I found to my surprise that a fair amount of my fellow influencers don’t like them and that includes the interface – which I think is great. I’ve seen it and played with it and see it as easily navigable, clean and attractive. That means that it does provide the experience that a user would need for Fusion to be accessible. I don’t see that in something with this power that often. So I’m going to have to respectfully disagree with the analysts. These are Oracle’s software tickets to their future – if they have can realign their messaging and thinking.
CRM – What’s the Story There?
I need to address one last thing before we pull these disparate positives and negatives together into a conclusion that I hope is productive.
That would be CRM.
Every now and then, Oracle CRM – pre-Siebel and post-Siebel acquisition – would emerge from a mediocre period where it’s product line would fester and then just blow some door off with a really smart capability or a period where the products were solidifying and weren’t bad or even were good and but the market presence had been minimal.
For example, in the former, Oracle CRM in 2004 was a product that basically served a few verticals, especially public sector well, but not much else. Then in 2004, they put together a new version of Oracle CRM that incorporated, for the first time in a major CRM product, tools that would support a salesperson rather than just a sales manager (e.g. a quoting system). Blew the doors off and surged.
Then again, three years ago, they came out as the mindshare leaders for a vendor in Social CRM with a product set of three products (i.e. Sales Prospector, Sales Library, and Sales Campaign) and a social mobile app (see the demo for L’Oreal or Swedish Rail) that seemed to be setting the stage for a leadership role for a vendor in Social CRM as a company.
Then, dead. Just total withdrawal. Anthony was still out there plugging away with the social themes that he knows and loves and he kept the flame flickering but they withdrew from the spotlight in any way beyond that, not a good idea when competitors are moving into the spotlight as fast as they are.
Now, at Open World there are inklings that they are getting set to re-emerge though they weren’t obvious cues. Some of the things that indicated it:
1. Lots of talk about Oracle CRM applications on the iPad – fully native -and very sophisticated. These are done deals.
2. Improvements in the interfaces for Oracle CRM on Demand that make it more “compliant” with a 2.0 look and feel than its previous 1.0 look and feel.
3. Winds that were wafting about a major social push in CRM coming soon (No more that I can say here except they seem via hearsay to be significant).
4. A desire by the CRM team to participate more – once again – in the thought leadership space. This is always an important sign.
5. Finally, the position in the forefront of Oracle’s Fusion CRM – one of the two most emphasized in the conference.
Are these strong signs of a re-emergence? Alas, damsels and dudes, I wish they were but they aren’t. But it is promising to see a few hints more than existed at last year’s Open World.
But I do have concerns about it. Unlike Sage, who I think treats CRM as an afterthought, I think that CRM at Oracle, while considered important, has to fight for real estate in a mall that considers many areas important. And that means that they don’t get the due that they should. They have been, even with glitches a consistently successful element of Oracle’s portfolio in an industry that has only grown even in the darkest periods of the recession. My fear is that they will be lost in the vastness of the company. I hope that this isn’t true because they have a solid product portfolio for all market segments except the smaller ones and one of the best CRM teams in the entire industry.
However, we’ll have to wait and see how fiercely they are willing to be in the CRM market. My fingers are crossed.
Drawing a Conclusion
What can I say, I have some real doubts about the direction of the company but at the same time am very glad to see some of the things that they’ve come out with.
I have significant concerns about their messaging, their long term strategy and their approach to the public airways that customers are communicating in. This disturbs me, because, like all companies in the space that I earn my living in, I want all the companies to succeed and that includes Oracle. But for the messaging to improve – even to the very limited point of cohering with “more tightly integrated hardware and software” will mean that Larry Ellison will have to return to the very entertaining visionary he used to be when he for example, pushed “network computing” long before any of this was even a gleam in a geek’s eye. I’m not sure he cares to do that. He marches to the beat of only his own drum at this point.
But that doesn’t diminish that Oracle, the fast follower is beginning to release the products that are either improvements on or, minimally competitive with the more cutting edge moving to mainstream enterprise products out there now from cloud to social to analytics. The other thing is that not only are releasing these kinds of products, but their customers are apparently happy with what Oracle delivers in whatever format it is – the cloud, or on premise. Their hybrid strategy makes a lot of sense for a company of their size. Providing on premise, hosted, in the cloud as choices that their customers get to make rather than hanging their hat on a single option actually is a wise one and their customers are responding accordingly. So there is no reason to think that Oracle is some kind of immediate trouble – and, in fact, will likely continue to flourish – for awhile.
But all in all, my concerns are strong. They are up against a fast rising salesforce.com, a revamping and rejuvenating SAP and a retooling Microsoft at time when the market is changing dramatically and frequently. The companies willing to provide leadership, vision, a clear understanding of the voice of customer and the products/services portfolio to support all that will win the future. Oracle, at the moment, with the exception of the CRM team and a few others like Steve Miranda, are only providing the products/services portfolio without any of the other components and I think that’s a shame, because I truly think that they could provide it all if they just put the quality of effort into it that they use to build their products.