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Keith Block and Oracle Culture 101

The news that Keith Block is leaving Oracle (voluntarily or otherwise) was not surprising considering the current legal battle over Itanium support. Billions of dollars hang in the balance and his instant messages are part of the smoking gun. Reporting on the perilous comments seems focused on personalities and corporate strategies, including the Sun acquisition and cloud computing. To me, the far more interesting dynamic within the instant messages is what I consider to be a primer in Oracle sales culture.

First, Oracle revolves around alpha dog technology (i.e., database) sales reps, of which Block is was the top. Oracle field sales is equal parts kill Piggy and you can’t handle the truth. It is also intensely rank and file: if Keith Block feels this way, then his reports, and their reports, and their reports, etc., probably agree or will soon. I doubt that his departure represents a change in DNA. He delivered sales results for many years, and that keeps you employed at Oracle above all else (apart from the unfortunate public broadcast of steamy instant messages amid high-profile litigation.)

Second, Oracle is a software company, and Exa is a software product sold by software-minded people. The hardware portion of the deal only serves to delay and complicate this dynamic. Reps put up with it because they can make their numbers with all the Enterprise software, extra-cost options and ULAs that big Exa deals drive. I live on both sides of hardware vs. software and the two proclivities rarely exist within the same human. It seems Keith knew this and wasn’t trying to pretend that his software reps would ever care or know how to sell general purpose SPARC gear.

Third, Oracle is not a channel-friendly company, hence the comments about the channel stealing revenue from the direct sales force. Oracle could change this dynamic by making its channel programs compensation neutral, i.e., not subtracting reseller and distributor margins from sales reps’ quota retirement. If Oracle wants to compete in general purpose hardware, then it will have to compete for the hearts and minds of reseller reps, who are paid on profit, not revenue. Hopefully Oracle will make this change for its hardware business and keep software sold separately.

Finally, Mark Hurd felt out of place to Block for good reason. It doesn’t seem that Larry can abide sharing the limelight for too long and we can all look forward to fire works at the top in the future. Doubters may want to revisit this article from 2000 regarding Ray Lane’s departure.

In other words, Keith Block’s instant messages are a business case for how Oracle has operated for decades, and its hard to imagine it any other way. Nor do I think this culture should change. Safra Catz mentioned on the FY12 financial webcast that Oracle has $30.7B in cash and securities, generated $13.1B in free cash flow and expects free cash flow to grow 20 per cent year over year. Buy the stock.

5 pings

  1. Don’t Expect a Kinder, Gentler Oracle After Sales Executive’s Departure | Fix-Singh - Computer Repairs LeicesterFix-Singh – Computer Repairs Leicester

    [...] “Oracle revolves around alpha dog technology (i.e., database) sales reps, of which Block is/was the top,” said Eric Guyer, a consultant who advises clients on deal negotiations with the vendor, in ablog post this week. [...]

  2. Don’t Expect a Kinder, Gentler Oracle After Sales Executive’s Departure | Geeklin

    [...] « Oracle revolves around alpha dog technology (i.e., database) sales reps, of which Block is/was the top, » said Eric Guyer, a consultant who advises clients on deal negotiations with the vendor, in ablog post this week. [...]

  3. Don’t expect a kinder, gentler Oracle after sales exec’s departure | molecular studios

    [...] “Oracle revolves around alpha dog technology (i.e., database) sales reps, of which Block is/was the top,” said Eric Guyer, a consultant who advises clients on deal negotiations with the vendor, in ablog post this week. [...]

  4. 11 Ways to Gauge Your Next Employer’s Culture « PATRICK LOVELY BRAIN

    [...] an internal tug-of-war? Google operates as an engineer’s paradise; Oracle, by contrast, regards sales as the driver that makes everything go. For that matter, think of Steve Jobs fixating on Apple’s product [...]

  5. 11 Ways to Gauge Your Next Employer’s Culture | financeatiitstuart

    [...] an internal tug-of-war? Google operates as anengineer’s paradise; Oracle, by contrast, regards sales as the driver that makes everything go. For that matter, think of Steve Jobs fixating on Apple’s product [...]

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