She’s also smart enough to know when she doesn’t know something. But there is a risk of Ellison’s trying to turn her into something that she’s not. Some people feel more comfortable and are more effective working behind the scenes. If Catz doesn’t want the limelight, Ellison shouldn’t push her into it. He must also guard against making her the main channel through which he deals with other senior executives. Amazingly, Catz hasn’t yet become an object of envy and mistrust in spite of her unique degree of access to Ellison, because people don’t see her manipulating the situation to her own advantage. But she’s nonetheless highly vulnerable to the backbiting and jealousy that exist in all organizations. She says, “People have been really nice to me. A number of folks appreciate that decisions can be made faster because I’ve done my homework. But you never really know what they think.”
• • •
One of the most frequent criticisms of Ellison is that even in an industry that lives on hype, he takes boasting and overpromising to new levels. It’s not only Tom Siebel who talks about “the lies of Larry Ellison,” it’s an article of faith for half the journalists who cover the software business that Ellison is an incorrigible liar who deliberately distorts the truth about both his professional and personal life. I frequently observed him stretching the truth to create a better impression, while his ebullient optimism routinely put him in the embarrassing situation of having to explain why something he had seemed certain of hadn’t happened.
Ellison says, “I piss people off because I’m quite willing to say what I think and I’m reckless enough to make public my predictions about the future—about Oracle and about the industry. As an old Chinese proverb says, ‘Predictions are very dangerous, especially when they pertain to the future.’ Sometimes I’m right, sometimes I’m wrong. I was right about relational database technology. I was wrong about the network computer. I was right about Internet architecture replacing client/server architecture. You don’t have to be right all the time to make a good living. When I was wrong, I was not lying, I was just wrong. When I say Oracle clusters can run real applications and DB2 clusters can’t, some people think I’m lying. I’m not. It’s a fact. When I say Oracle Java is faster than BEA Java, some people think I am lying. I’m not. It’s a fact. When I predict one of our products is going to come out on a certain date and it doesn’t, some people think I lied. I didn’t. I was just wrong. Give me a specific example of a lie I’ve told in business. There’s only one. In my early twenties, when I first came to California, I lied about having a college degree so I could get a job. Big fucking deal. That’s it.
“Being optimistic and exaggerating is another matter altogether. The entire history of the IT industry has been one of overpromising and underdelivering. Software executives routinely say that a product is going to be ready on a certain date, and then it turns out to be literally years late. It’s happened at Microsoft. It’s happened at Oracle. Software development is notoriously unpredictable. Maybe the only honest schedule is the one Michelangelo gave the pope when he was painting the Sistine Chapel: ‘It will be done when it’s done.’ Anything else is a guess, and sometimes we guess wrong. Most senior software executives don’t tell out-and-out lies about their products or their businesses.6 But optimism and exaggeration, those are the standard rules of engagement for combat in this industry.”
I suggest that maybe Ellison had done as much as anybody in the software industry to establish those rules of engagement and had both lived and thrived by them. He grins as if to say that’s all in the past. “Since I’ve got this notorious reputation for exaggeration, the press denies Oracle any leeway to exaggerate at all. I know that, so we make sure that all our advertising is one hundred percent fact-based and provable. Our current campaign is called ‘Just the Facts.’ We’re absolutely rigorous about making claims about our products. Any claim we make must be independently verifiable and provable. I believe in ads that list the cold, hard facts about your products and your competitors’ products—a side-by-side comparison of irrefutable facts.
“Unfortunately, just sticking to the facts doesn’t necessarily mean you’ll avoid criticism. When I said that GE Power runs the Oracle E-Business Suite, a front-page article in The Wall Street Journal took me to task for being intentionally misleading. They thought that I should have listed the names of the specific GE Power locations that were currently running the suite and identify exactly which parts of the suite each location was running. Give me a break. I never said that GE Power runs the E-Business Suite everywhere for everything. I never said that GE Power has no other software except Oracle software. I said that GE Power runs the E-Business Suite. Period. I suppose I could say that GE Power runs lots of parts of the E-Business Suite at lots of locations. That’s true too, and it’s a bit more specific, but it sounds strange. So I’ll just keep saying that GE Power runs the E-business Suite and leave it at that. That may not be precise for some, but it’s the truth.”
What about Ellison’s claim when the E-Business Suite came out that it was complete, wasn’t that an example of deliberate overclaiming that came close to lying? Ellison laughs. “Well, words like ‘complete’ and ‘unbreakable’ are relative, not absolute. Our E-Business Suite is much more complete than any other suite of applications. In the high-tech manufacturing industry the E-Business Suite is close enough to being complete to be called complete. In the insurance industry it’s less complete. Our database is so much more reliable and secure than any other database system that it’s okay for us to call it unbreakable. Tandem [the fault-tolerant computer company] called their computers ‘nonstop’ because they stopped much less frequently than other computers, not because Tandem computers never, ever stopped. I read that some analysts say that our claim that the 9i database is unbreakable is outrageous because everyone knows that nothing is truly unbreakable. Fine. If the earth falls into the sun, our database will break—that’s true, so I’m a liar. Whatever.” Ellison does, however, accept that he can sometimes push an argument or an idea just that little bit further than it can stand. “Once I believe in a new, important idea I get very enthusiastic and push it hard. Once I started believing in Internet architecture, I couldn’t say anything nice about client/server. Once I started believing in integrated applications suites, I had a hard time admitting that there was any value at all in any best-of-breed product. Once I’ve thought something through, there’s no intellectual uncertainty remaining. Once I enter a crusade, I cease being objective and I become a zealot.”
Another aspect of Ellison’s bravura style is equally calculated: leadership. “You cannot lead if you’re filled with uncertainty. Imagine two officers each leading a company of marines up a hill. The first one says, ‘Men, we’re going up this hill and we’re going to kill every fucking enemy solder on our way to the top. I’m going first, and you’re all going to make it to the top with me. I haven’t lost one of you yet. Follow me, men.’ Cool, competent, and confident. I’m ready to follow that guy. The second guy says, ‘Men, we’re going to try to take this hill. I have to admit that I don’t know how many enemy solders are on this hill. And I’ve never really done anything like this before. But I’m willing to go first if you’re willing to follow me. We might make it; we might not. There’s no way to know for certain. Even if we make it to the top, it’s highly likely that some of us will be killed. Follow me, men.’ Well, the second guy is impressively honest about his fears and uncertainties. Maybe he should become a psychotherapist. But there’s no way anyone is following that guy anywhere.”
• • •
Like a lot of people, I still find it hard to understand how someone with as many choices as Ellison, who for most of the last fifteen years has had more money than he could spend and who clearly has a low boredom threshold, can bring himself to keep on doing the same thing. He says, “My sister told me that whenever I got too close to a goal I’d raise the bar for fear of actually clearing it. We’re endlessly curious about our own limits. The process of self-d
iscovery is one of testing and retesting yourself. I won the Sydney-to-Hobart. Can I win the America’s Cup? I’ll find out. The software business is a more difficult test; it’s a much higher stakes game; there are more people playing this game; it’s a lot more interesting game; and it’s a lot more exciting. If I wasn’t doing this, I’m not sure what else I would be doing with my life.”7 It seemed like a far cry from Ellison’s original motivation of founding Oracle—to have enough control over his own life not to have to spend time with people he didn’t like or doing things he didn’t like. “We change as our circumstances change. Financial independence means you no longer need to trade time for money. But once you’ve been liberated, the freedom that comes afterwards can be difficult to manage. The good news is that suddenly you have all these choices; the bad news is that suddenly you have all these choices. So you’ve got to figure out what it is you really love to do, because there’s no other justification for doing it. And if you can’t find anything you love, you have to settle for doing something that’s merely important.”
Did Ellison still love his job when Oracle came close to self-destruction in 1991? He says simply, “It’s not like I had a choice then. I had to save Oracle to save myself.” What if he had been forced out? What if Don Lucas had denied him that chance? “I’d have done what Steve [Jobs] did [after being booted out of Apple]: I’d have started another company to try and prove it all over again, first and foremost to myself.” So he would have put at risk his entire fortune, at that stage around $150 million? “Without question. Oh, yes! It was my life that was at risk, not my money. It has nothing to do with courage; I just can’t accept defeat until I’ve been carried dead from the field. I’m one of those chess players who will stare at the board for as long as it takes to find a winning line of play. I have a lot of endurance: intellectual, emotional, physical. The clock in the software game is measured in years, not minutes. It took twelve years to make our bloody database-clustering technology work. But we knew if we could make it work we’d win. If we can make the E-Business Suite work, and I think we can, we’ll win again. I’m optimistic, but not irrationally so. We’re pretty good at coming up with winning strategies; the problem is, our strategies are technically very, very hard to implement. But difficult strategies, well executed, can lead to great victories. Hannibal crossed the Alps with elephants to beat the Romans at Canae. Napoleon crossed the Alps without elephants to beat the Austrians at Marengo. Database clustering was really hard—it required elephants. The E-Business Suite is just a march over the mountains. It’s a long way to the top, but we’ll make it.”
If the prospect of beating IBM or Microsoft is one of the things that gets Ellison up in the morning, there are other satisfactions. One is the straightforward pleasure that comes from solving a problem or making a piece of technology work. “Watching a cluster of eight Compaq PCs running faster and more reliably than a big-ass IBM mainframe is just so incredibly cool. It’s the same kind of thrill as when the Wright boys took off on Kitty Hawk. It’s off the ground! Oh my God, it actually flies! This changes everything. Database clustering is cold fusion that works—it works.”8
What Ellison hasn’t said is that he gets satisfaction from making the businesses of Oracle’s customers run better. It’s the kind of thing that politically correct CEOs are supposed to say. “GE is a wonderful company, but it’s not my company, it’s not the team I play on. I’m happy if General Electric is happy with our software because that means our software’s good and we’ll probably sell a lot of it. We work very hard to make our customers successful, because that’s how we make Oracle successful. When the Lakers win a basketball championship, they may say they did it for the fans, but I don’t really believe them. I think they did it for themselves. As a fan that doesn’t bother me at all. I’m just glad they won.
“I get a lot of satisfaction from my job. There’s the intellectual satisfaction that comes from solving a really hard problem. There’s the satisfaction of seeing our software help our customers, especially in health care and government, where good information can actually save lives. But it’s not altruism, and it’s certainly not the money. Maybe it’s just vanity that motivates me. You can never really be certain of anyone’s motives, including your own. You are better off measuring people on what they do rather than the unknowable ‘why?’ I don’t know why the Lakers played well, I’m just glad they did. I don’t know, can’t know, and don’t care what motivated Jonas Salk to try to make a polio vaccine, I’m just glad he did. If you want to understand why people do things, then take a course in evolutionary psychology. What we want to do with our lives is the most important question we all have to answer. So if I could do anything at all with my life, what would I do? I’d cure cancer.9 I’d much rather cure cancer than become the richest guy in the world. Why? Because I’d be a much happier person if I cured cancer. Why? Because I’d be loved. Why? Because people don’t want to suffer painful death. Why? You know why.”
Although Ellison talks about a life after Oracle in which, among other things, he would spend time working on his new passion, molecular biology, the level of success that he says that Oracle must achieve before he can leave is so daunting that he may never be able to escape. “I’m stuck here for the duration; there’s no way I can stop until I know how this story ends. I think even if I found out I was dying and I had a year to live, I wouldn’t change my life very much.”
* * *
1. LE writes: For a time I had regularly scheduled conference calls with POSCO (the world’s largest steel company) during the final phases of its implementation of the E-Business Suite. The calls started at 4 A.M. Pacific time.
2. LE writes: Our senior engineers don’t hesitate to argue with me when they think I’m wrong. And if I’m way wrong, they’ll cut me off midsentence. Ed Screven will blurt out, “No, that’s not right,” and rapid-fire the reasons why. Ron Wohl will let me finish my sentence and say in a considered tone, “Larry, I don’t agree with you.” Then he’ll carefully, point by point, explain where I’ve gone wrong. Andy Mendelsohn will let me finish what I’m saying, and then he’ll just stare at me for a while. Gradually, this pained look takes over his face and he’ll say, “I really just don’t understand what you’re saying.” That’s a bad one. I must have been totally wrong or completely incoherent. (Fortunately it’s not possible to be both.) But the worst is when Roger Bamford catches me saying something stupid. He just giggles. It makes him so happy.
3. LE writes: Actually, in retrospect, I do agree. I was an inexperienced and insecure CEO trying to establish my leadership. Very embarrassing.
4. LE writes: Gary’s right, I should do more one-on-ones. That said, I feel my time is more efficiently spent in larger meetings, where I can do a better job of gathering facts, debating, and communicating decisions. Harold Genin (the man who built ITT) defined management as “gathering facts and making decision.” He also said that the hardest thing for a manager to do is to “distinguish facts from true facts.” I can get at the true facts much more easily when a couple of layers of management are present at a meeting. The senior guys sometimes don’t know the facts, and occasionally they don’t want you to know the facts. Oracle’s current management team has a much better grasp of the facts than any previously, and they never try to hide things. That makes my job much easier these days.
5. LE writes: I don’t think it’s fair to describe Ray as an incompetent manager. It just seemed to me that Ray wasn’t very interested in the daily details of management, especially on the expense side of the business, so he delegated that responsibility to others. Ray thought that his time was better spent doing deals, so that’s what he did. Unfortunately, some of the people whom Ray relied on to manage expenses let them get way out of control.
6. LE writes: Every once in a while there’s even a kernel of truth in some of the things Tommy Siebel says. I don’t like Tommy very much. He says nasty things about me all the time. I hope he will have run his company out of busine
ss by the time this book is published. He appears to be working hard at it.
7. LE writes: I’m chairman of the board of Quark Biotech, a molecular biology research and drug company. If for any reason I left Oracle, I’d probably go to work for Quark full time. That prospect should scare the hell out of the guys at Quark.
8. LE writes: Okay. Maybe database clustering is not as cool as flight. But it’s close.
9. LE writes: Yes, I know that cancer is a collection of diseases and it is very unlikely that there will ever be a single cure. Still, my mother died of cancer and I want to cure cancer. That’s where most of my money and all of my time after Oracle are likely to go.
17
ALTERNATIVE STRESS
May 2001
Approaching Ventura Harbor by road from the little airport where Ellison has just landed his Citation, we can see the strange gunmetal gray sails from a mile or two away. The flat, featureless countryside and the low-rise buildings that straddle the slightly run-down little port offer no visual competition to the two tightly sculpted, towering airfoils that move balletically together as if directed by some hidden choreographer. The sails belong to the two boats that Ellison’s Oracle Racing team is using to train for the 2003 America’s Cup. Previously, they belonged to AmericaOne, the top-placing U.S. challenger in the 1999 series, and were purchased in August 2000 as part of a deal in which Oracle Racing beat rival Craig McCaw’s Seattle team to acquire AmericaOne’s physical assets and many of its key people—an invaluable foundation for a team that had not collectively competed for yachting’s most prestigious trophy before.
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