Oracle sees its cofounder and CEO step down

On September 18, 2014, Oracle (ORCL) announced its 1Q15 results. But it wasn’t the quarterly results that created the buzz. It was the stepping down of Larry Ellison from Oracle’s CEO position that made the news across the world. Larry Ellison will be continuing with Oracle as an executive chairman and the chief technology officer.

Oracle announces management changes along with its 1Q15 results
New positions being filled

Jeff Henley was appointed Oracle’s vice chairman of the board. He has served as Oracle’s chairman for the last ten years. Safra Catz and Mark Hurd, who currently holds Oracle’s president designation, will jointly hold the CEO position of the company. Safra Catz is trained in law and has been a key person in many of Oracle’s acquisitions. Mark Hurd was the CEO of HP (HPQ) before joining Oracle. Both Catz and Hurd will be reporting to Oracle’s board.

Oracle’s vision diversified under Larry Ellison

Larry Ellison started Oracle as Software Development Laboratories (or SDL) along with Ed Oates and Bob Miner. SDL became Oracle in 1986, the same year Microsoft (MSFT) went public. Oracle went on to become one of the most successful technology companies whose databases are considered the technology backbones of the world’s largest corporations.

Through multiple acquisitions spanning business software and technology, Ellison widened Oracle’s portfolio to include tools for customer service, human resources, and business intelligence. The company paid billions of dollars to acquire PeopleSoft, Siebel Systems, Sun Microsystems, and other tech companies.

As cloud computing has started spreading its tentacles into the enterprise software market, Oracle too has to shift to the cloud. Currently, the industry shift towards subscription or cloud offerings has forced Oracle to shift its software licensing business model towards subscription based offerings.

Oracle acknowledges the increased adoption of SMAC

The increasing penetration and adoption of “SMAC”—social, mobile, analytics, and cloud—presents plenty of opportunities to several industries. As the above presentation graphic shows, Oracle intends to bring these technologies to healthcare, telecommunications, utilities, retail, and other industries. To learn more about SMAC, please click here.

According to Ellison, SAP AG (SAP) and Salesforce.com (CRM) are the two companies that pose a significant threat to Oracle.

It remains to be seen if co-CEO structures at Oracle will bring about the transition the company needs badly or whether the criticism against the co-CEO arrangements prove warranted.

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