Oracle announced yesterday that Larry Ellison will hand over the CEO reins to his lieutenants Mark Hurd and Safra Catz. I bet HP feels really stupid just about now for having said so many mean things about Hurd. Predictably, this set off a series of ancient clichés in the press and amongst Silicon Valley executives and bloggers. Headlines have declared this “the end of an era” and a “changing of the guard” which, of course, it’s not. In fact, unlike Elvis, Larry has not left the building. He doesn’t carry the CEO title anymore but he is now the new Executive Chairman (after demoting the Board Chair to Vice-chair) and CTO. That means that the Hurd and Catz will still be herding the cats at Oracle and Larry will still be the boss. Oh, they may have some more freedom with sales, marketing, and operations but Larry is still keeping his hands directly on the technology team and on them.
So, less than stepping down, Ellison is stepping up. This is decidedly not a retirement as has been suggested. Spending your days on your boat or, in Ellison’s case, giant yatch, is retirement. Focusing your full time attention on philanthropy the way Bill Gates has, is retirement (of a sort). I don’t call going to work everyday at the same company with the same team doing the same stuff retirement. Oracle is only slightly shuffling the deck chairs.
So why the shuffle? Well, there is the matter of narrowly missing financial analysts’ forecasts again. That has happened with a regularity that is probably worrisome to professional investors. That’s always a problem with megacompanies – pleasing large financial institutions become the focus. By appearing to relinquish control, Ellison appears to be taking responsibility for the disappointment among investors and passing the baton to others who can fix the perceived problems. Of course, the team has stayed the same so why anyone would think that radical change is on the way is beyond me.
And then there’s Ellison’s age. Silicon Valley has become youth obsessed and at 70, Ellison is two and a half times the age of the current technocrats like Mark Zuckerberg (age 30). Of course, if Larry and Mark were to battle it out in extreme sports, my money is on Larry. He’s in way better shape than most of the skinny nerds that pass for tech CEOs these days. Some news reports want to link the management changes to his age but that’s silly given the physical shape Ellison keeps himself in.
So if it’s not meaningful change that will make a difference for investors or in Ellison’s life and not age or infirmity, what then is the reason? My guess (and it’s only a guess) is that he needed to give more of the limelight to his team. With Ellison in the CEO driver’s seat, Hurd and Catz would always be in the back. This change will encourage Oracle to give more airtime to these two top executives and force the press and analysts to listen to them instead of Ellison.
And that will be a good thing. Oracle is a company with tons of depth in their bench. It will help them to highlight other executives even more and keep Oracle from becoming the Cult of Larry.
Note: In honor of the commentary on this subject, I have peppered this blog with a boatload of clichés. See if you can find them all. Tom P.