– Ghost Dog: The way of the Samurai
It’s easy to see where Japanese culture buff Larry Ellison of Oracle takes his inspiration. His reflexive attempt to take PeopleSoft out of the ERP game, faced with the prospect that a combined PeopleSoft-JD Edwards would push Oracle into third place on the ERP league table, has all the appearance of samurai bravado. Elsewhere in the samurai code of behaviour (at least, in the version given in the movie Ghost Dog), it says decisions should be made in the space of seven breaths. It’s doubtful whether Ellison paused for even a couple.
The extraordinary thing about Oracle’s $US5.1 billion bid to buy PeopleSoft is the complete absence of an attempt to make PeopleSoft customers feel good about the deal. Ellison, multibillionaire that he is, is playing simply on the eagerness of PeopleSoft stockholders to cash in on his offer price of $US16 a share. But, like the rest of what he has had to say on the offer, it has been rebuffed: PeopleSoft’s share price rose to $US17.80 on news of the bid, while Oracle’s fell.
New Zealand’s biggest and most recent PeopleSoft customer, Air New Zealand, is understandably unimpressed by Ellison’s desire to convert it to Oracle’s application suite. Air New Zealand points out that it discarded the Oracle option in the course of choosing PeopleSoft.
Commentators diagnose Oracle’s kneejerk reaction to the PeopleSoft-JDE merger proposal as confirmation of the fix its database business is in. They will tell you that Oracle is struggling at present (as did Janet Perna, head of IBM’s database business, when in the country a month ago). Signs of this can be seen in SAP’s recent success at Oracle’s expense at Fonterra (see Oracle loses ground at Fonterra); and in sensitivity to Gartner database market share figures, which for the second year in a row give IBM the lead (Oracle says that’s based on unaudited IBM numbers).
This apparent decline in its core business is putting pressure on Oracle to remake itself as an enterprise suite seller. When Ellison was in Auckland to watch his Louis Vuitton Cup challenger ply the Hauraki Gulf, he hinted at the company’s change of tack at a customer session. But in what looks like another occasion when he didn’t get up to seven breaths before opening his mouth, he said: "There are too many databases -- you [the customers] have bought far too many." Having bought “too many”, it was time to simplify, by buying Oracle's e-business suite.
(It remains to be seen whether another of Ellison’s Auckland utterances – that he would like to build an R&D facililty in the Bay of Islands -- was a further case of the samurai speaking.) What also remains to be seen is how far he is willing to take his PeopleSoft bid. Little positive has been said about it -- certainly not by PeopleSoft, and nor by JDE. But if Ellison really is guided by the Way of the Samurai, that won’t deter him; in Ghost Dog, an awful lot of blood was spilt.
- Larry Ellison may be busy attempting to remake the ERP landscape, but Computerworld has been re-engineering itself. If you read the latest print publication, you'll see we’ve introduced several new sections. We’ve also started using sub-headings on stories. Both are responses to time-poor readers who requested we make it easier to tell at a glance what stories are about. We hope it works and would be glad to hear your impressions.