Oracle hires former HP CEO Hurd as president
9/07/2010 10:36:00 AM
kenmouse
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As some had been expecting, Oracle announced Monday evening that it has hired former Hewlett-Packard CEO Mark Hurd to be its new company co-president as well as a member of its board of directors.Hurd will report directly to Oracle CEO Larry Ellison and alongside existing co-president Safra Catz. Charles Phillips, who had been serving as co-president with Catz, has resigned and given up his seat on the board, according to a separate announcement from Oracle Monday night.
The news is an interesting turn in what has been a rocky month or so for Hurd, who had been regarded as one of Silicon Valley's most successful executives. He was widely credited with steering HP back to steady growth and profitability following the tumult during the previous stewardship of Carly Fiorina, who he succeeded as chief executive.
But in August, Hurd resigned suddenly after the board of directors concluded that he had violated the company's code of business conduct in connection with his relationship with a former marketing contractor who worked with HP.
Ellison, at the time, lashed out against the HP board's decision to ask for his friend's resignation, saying it had "made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago."
In a statement Monday, Ellison said this of his new underling: "Mark did a brilliant job at HP and I expect he'll do even better at Oracle. There is no executive in the IT world with more relevant experience than Mark."
Hurd brings skills and experience Ellison likely covets. Before his controversial departure from HP, he was widely considered an operational guru. Under his watch, HP became the largest computer company in the world when measured by total revenue. He also managed a number of large acquisitions--not to mention bringing financial stability after the departure of Fiorina, now a Republican candidate for U.S. Senator in California.
Most importantly, few executives other than Hurd could claim experience running a company with large hardware, software, and consulting businesses. And that's exactly what Oracle needs now that it is busy integrating Silicon Valley icon Sun Microsystems, which it acquired last year. None of Oracle's management trio--Catz, Phillips, and Ellison--have any experience running a computer hardware business. Catz and Phillips were bankers prior to joining Oracle, and Ellison has, until acquiring Sun, studiously avoided hardware, which carries far lower sales margins than software and demands operational discipline.
Hurd and Ellison are reportedly buddies, living near each other and occasionally playing tennis together. Hurd's tough attitude will also play well inside Oracle, which many consider to have one of the most aggressive (some would say cutthroat) corporate cultures in Silicon Valley.
That said, Ellison has never been afraid to bring in high-profile executives. In the early 1990s, Oracle was on the ropes, and Ellison hired Ray Lane to be company president and to manage the day-to-day operations of company. Lane was credited with righting Oracle and helping to turn it into one of the largest software companies in the world. But he was forced out the of the company in 2000 by Ellison, and is now a partner at the famed venture capital firm Kleiner Perkins.
Phillips' departure from Oracle is perhaps the most surprising aspect of Monday night's news. A respected financial analyst who specialized in software at Morgan Stanley prior to joining the company in 2003, Phillips had become a public face for the company. His co-president Safra Catz (assumed to be Phillips' competition to succeed Ellison) was viewed as Ellison's enforcer, an internally-focused, financial strategist.
While Oracle said in a statement that Phillips was planning to leave the company before Hurd was hired, he likely would have been the odd man out with the former HP chief on board.
Hurd's quick appointment brings up intriguing questions for Oracle. To start, merely by joining the company he becomes heir apparent to replace Ellison as Oracle's chief executive. Ellison is now 66 and has interests outside of running the company he co-founded many would consider a full-time job, including running Oracle Racing, his yachting team that won the last America's Cup and is now vying to bring the next cup competition to San Francisco Bay, near Oracle's headquarters in Redwood Shores, Calif.
Also, Hurd's appointment makes clear just how much Oracle, once a specialist in database and enterprise software such as financial systems for multinational companies, has changed since it started on an acquisition spree seven years ago with bitterly contested acquisition of rival software maker PeopleSoft. Since then, Oracle has acquired more rivals, such as Siebel Systems, and partners, such as Sun. Now whoever runs Oracle must manage a massive portfolio of products, ranging from open source-based databases and wonky manufacturing management software to both high and low-end servers acquired with Sun.
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