Larry Ellison, who’s been the chief at Oracle Corp for 37 years, resigned Thursday, and will be replaced by two CEOs (that’s how big he was) Safra Catz and Mark Hurd, Reuters reported. Good luck with the co-CEO thing, it’s worked well everywhere throughout history…
Everyone involved – that’s Ellison, Catz and Hurd – kept saying nothing would change under the new management structure, especially since Ellison is not going away, he’s staying on as executive chairman and chief technology officer.
It’s a little like Putin being prime minister a few years, then president, then prime minister again.
Here’s where things ain’t staying unchanged: Oracle shares fell 2 percent to $40.70 in after-hours trading after the management “restructuring.” Also, profits have been falling at Oracle, mostly due to weak hardware sales, according to Reuters.
Jeffrey Sonnenfeld, a professor at Yale School of Management, told Reuters: “In almost all cases, these co-CEO configurations are a jerry-rigged solution to a political problem.”
But it’s not really a political problem, it’s more biological. Larry Ellison is 70. He’s been at the helm since 1977. It doesn’t take a genius professor of management to figure this one out.
Daniel Ives, an analyst at FBR Capital Markets, told Reuters “investors have a mixed view of Safra and especially Hurd as co-CEOs given the missteps we have seen from the company over the past few years.”
On a conference call with analysts, Ellison said: “I’m going to continue doing what I’ve been doing over the last several years. They’re going to continue what they’ve been doing over the last several years.”
Hurd is 57, Catz is 52. I suppose Much of what they’ve been doing is not be 70.
Ellison made Oracle one of Silicon Valley’s most successful companies. He took it public in 1986, same year as Microsoft, with revenue of $55 million. This year revenues should be more than $40 billion.
But over the past decade, Ellison started making mistakes. He bought Sun Microsystems in 2010 for $7.4 billion, just when sales of Sun servers and other equipment were starting to dwindle.
And in 2008 Ellison mocked cloud computing as “complete gibberish.” Cloud computing has by now become a driving force in enterprise software, and Oracle is stumbling behind everybody else, trying catch up.