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Oracle CEO Mark Hurd On Strategy: Be 'Somewhat Boring'

Oracle

ATLANTA—Speaking at an event honoring Georgia’s best CIOs, Oracle CEO Mark Hurd shared his own framework for executive leadership, built around the three pillars of strategy, operating model, and people. And Hurd tied that framework back to one of the biggest strategic decisions facing CIOs: how to guide their companies through this once-in-a-generation shift to cloud computing.

Hurd spoke here at the Georgia CIO Leadership Association’s annual awards breakfast, where 20 finalists and five award winners were honored at a packed ballroom. Former Georgia Pacific CIO and Senior Vice President James Dallas was honored with a lifetime achievement award.

Hurd rattled off the challenges facing IT leaders, such as CEOs cutting IT costs to grow earnings amid stagnant revenue, and companies using decades-old applications that aren’t ready for today’s mobile-, web-, and social-minded collaborative workforces.

“And I’m here to motivate you,” Hurd said, to laughs from the crowd of IT leaders. “If you’re CIO of the year and you can operate in this environment, you have my admiration. This is really, really hard.”

That environment is why Hurd makes the case for cloud systems—to move the time and labor cost of integration, security, and innovation off a company’s IT budgets and onto the R&D budgets of IT vendors. As CIOs lead that cloud shift at their companies, they will have to master the three pillars of executive leadership that Hurd shared:

1. Strategy: Be ‘Somewhat Boring’

The role of strategy is to communicate a clear direction to employees, investors, customers, and other constituencies. "My objective with strategy is to be very repetitive, to be somewhat boring, to allow people to coalesce behind a common direction,” Hurd said.

Oracle CEOs Safra Catz and Hurd are leading Oracle through its own transformation, as the technology industry makes one of its historic shifts, this time to the cloud from the old model of licensed, on-premises software, platforms, and infrastructure. Oracle has spent the past 10 years rewriting its entire portfolio of enterprise applications as cloud services; developing platform services based on its database, integration, and analytics tools; and building compute, storage, and other infrastructure services.

Strategy’s role is to help employees—about 140,000 of them in Oracle’s case—stay lined up behind a goal amid intense short-term economic pressures.

“By the way, the strategies where, because you heard a new idea, every 15 minutes you changed your strategy? Really bad plan,” Hurd said.

2. Operating Model: The Fewest Rocks on Employees’ Backs

“I have to put people in the right spot so that if they execute, we win,” Hurd said about how he thinks of a company’s operating model.

Hurd zeroes in on what people do each day. Does the organization remove barriers to getting work done or create obstacles through bureaucracy? Hurd likens it to making sure talented employees "have the least rocks on their backs to go out and execute the strategy I give them."

Hurd warns against layers of management, since it gets harder with each layer to communicate that clear strategy. Hurd suggests listing all the people between the CEO and, say, a salesperson.

“In these layers of management, who can decide? Other than me, who’s in charge? At what layer does the decision get made?” Hurd said. “Please think of it that way—I want to know how many people have to touch a decision.”

3. People: Best People, At the Lowest Cost, Completely Engaged

Hurd said he wants the best people, at the lowest cost, with the lowest attrition, completely engaged, and delivering the best performance.

It always stirs some controversy, Hurd said, when he talks about having the best people at the lowest cost, but he contrasts it to the alternative. “I really don’t want the best people at the highest cost,” he said.

Getting people to deliver their best performance and stay with the company comes down to a leader getting employees excited about what they can accomplish. “They have to believe they’re at a company that’s going to win,” Hurd said.

He called the CIO role one the toughest jobs, if not the toughest job, in the C-suite, as the cloud changes the strategy, operating model, and people needs of an IT organization.

As an example of the kind of disruptive change CIOs must lead, he pointed to an estimated 30% of worldwide enterprise IT spending that goes to development and testing. That’s about $300 billion worldwide, and Hurd contends that 80% of this money is wasted—spent on non-development work such as buying, setting up, and configuring test environments. Harnessing that wasted $240 billion is the reason Hurd predicts that all dev-test—100%—will move to the cloud over the next 10 years.

“This is not a technical issue,” Hurd said. “This is actually a complete business model shift.”

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