Business Management

SuiteWorld 2017: Oracle CEO promises to support NetSuite, not stymie

Oracle plans to leave NetSuite largely to its own devices post acquisition, and aims to provide the resources to support growth.

“We do not do acquisitions lightly,” said Oracle Co-CEO Mark Hurd at this year’s SuiteWorld conference in Las Vegas this week. “We didn't spend $9.3 billion [on NetSuite] to deinvest in business.”

“Quite the opposite. We spent that money to invest in it, to drive it harder, to drive it faster, as part of a grander strategy for Oracle to lead this transformation to the Cloud.”

Oracle acquired NetSuite for $9.3 billion last November, but plans to run the company as one of its Global Business Units - industry-focused semi-autonomous business groups which are run with their own organisational structures.

“Our tactic is to almost incubate NetSuite. Give NetSuite all the benefits of Oracle's scale and none of the encumbrances of Oracle's bureaucracy.”

Hurd said he is putting “Tons of very positive pressure” on NetSuite founder Evan Golderberg to expand as quickly as possible, and will give Jim McGeever, NetSuite Executive Vice President “the assets and resources he needs from Oralce” to further its globalisation plans.

“I think NetSuite did a good job in the United States, built a company primarily off of its performance in the US,” he said. “But it's hard to get out of the US. We're going to globalise the business just as fast as we can.”

Hurd also promised that as an Oracle Global Business Unit, NetSuite would be left largely to its own devices, and let the company make its own partnerships and decisions.

“I will not dictate to NetSuite,” he said. “This isn't about us saying, "Listen, we have a way of doing this, do it this way. This is a strategy about growth. We want to keep NetSuite's best practices; they have got a very clear way of doing things.”


Oracle ERP vs NetSuite?

Although Hurd promised that Oracle and NetSuite ERP products would co-exist “forever”, both companies were coy about the strategy for how the two will get along.

 He repeatedly said that he wanted to avoid “bright red lines” with regards to when companies might want to migrate from NetSuite to Oracle’s ERP products. He suggested that Oracle ERP will continue to be focused on larger enterprises, while NetSuite will carry on its historic focus on medium-sized companies. Although Hurd wants tighter integration between the two products so, for example, large enterprises could deploy Oracle in one location and NetSuite in a smaller subsidiary, there seemed to be no guidelines to prevent the two cannibalising each other.

In a press Q&A, Evan Goldberg, Executive Vice President of Development (NetSuite’s founder and former CTO) said that scale wouldn’t be a reason to switch, but rather certain functionality or feature requirements for certain verticals.

“Oracle came from a very different place where there is more need to mix and match technologies and very large divisions that are making independent decisions, they wanted something that was extremely modular.”

“NetSuite came from a different space. It was about these smaller, fast-growing hypergrowth businesses.”


Shade throwing

Wouldn’t be a NetSuite conference without some shade being thrown at rival companies. This year, Hurd said SAP investing in S4 HANA “a huge mistake” and he “would love to take them out”.

“We will do everything in our power short of illegal to take market share from them.”

NetSuite EVP Jim McGeever took the now de rigueur pot-shot at Sage, claiming stealing customers that had outgrown it were “low hanging fruit”. In his keynote he also said, “Microsoft and SAP have a problem spelling Cloud”, and “Germany is in desperate need of modern Cloud applications.”

Some things never change.


 Also read: 
Oracle and NetSuite deal set fair to make waves in ERP


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SuiteWorld 2017: NetSuite promises "business as usual" post Oracle acquisition »
Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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