Larry Ellison Tightens Grip at Oracle: Should His Protege Benioff Be Worried?

The founder of Oracle, Larry Ellison, has increased the number of company employees who report to him – despite leaving his official role of CEO back in 2014. Ellison will now oversee approximately 64,000 workers, accounting for around 40% of Oracle’s workforce, according to Bloomberg.

While many who reach the age of 81 would usually be long retired by now, the mastermind behind the tech giant is tightening his grip more than he is loosening it. Oracle recently turned some heads on Wall Street after forecasting 70% year-over-year (YoY) growth, with financial upturn that would make it one of the leading cloud providers across the next few years.

As Oracle enters one of its most important periods to date, where it now has to deliver on promised numbers, is Ellison’s renewed control a necessary leadership step, or a sign he doesn’t trust the next generation to deliver?

Why Ellison’s Move Matters

On the surface, this recent move may look like standard corporate restructuring. Mike Sicilia, one of Ellison’s two new Co-CEOs this September, heads the division that includes the majority of Oracle’s workforce, accounting for 84,000 employees, compared to the 20,000 employees overseen by the other new addition, Clay Magouryk.

But looking closer, Ellison now has more direct oversight on some of the most important aspects of Oracle’s business, including finance, HR, and NetSuite. All three departments represent the very products that Oracle sells to customers, enabling Ellison to align the company’s internal operations with its core business strategy.

The reshuffling also meant a step-down in operational power for Safra Catz, who transitioned from Co-CEO to Executive Vice-Chair of the Board. 

Catz served as Oracle’s CEO for 11 years, so the reshuffling and redistribution of power came as a surprise, especially given Ellison’s age. The question of succession – glamorized recently by the hit TV series Succession – feels front and center here, and it suggests that Oracle’s founder isn’t quite ready to pass the torch.

At the same time, Oracle is entering perhaps the most pivotal period in its history. The company is now in a position to challenge Salesforce’s dominance in CRM by pairing a robust AI infrastructure with its SaaS offerings, which is a combination few can match. With $500B in booked future cloud contracts and $144B in projected growth, the company’s prospects have never looked stronger. 

In that light, it’s easy to see why Ellison wants a front-row seat. Still, his decision to take on so much responsibility while moving the next generation slightly aside is striking – especially from the man who once dismissed cloud computing as “marketing hype”.

Does This Impact Salesforce?

Oracle’s new AI offerings pit them directly against long-standing competitor Salesforce, with the two companies having a history that goes back to Salesforce’s emergence in the late 90s. Salesforce founder and CEO Benioff was once the protege of Ellison, with the 81-year-old a previous investor in Salesforce’s early days. 

Oracle arguably failed to adapt, as Salesforce quickly became a primary cloud offering while Oracle became a “legacy player” in tech. Reluctant to change, Ellison stepped down as CEO in 2014 to focus on areas of the business that he preferred, namely engineering, strategy, and technology development.

Now that Oracle has changed direction, the landscape of this battle has changed. Salesforce is, of course, quickly advancing its own AI capabilities – but it’s no secret that many are skeptical about the CRM giant’s current offerings. 

Doubts are mounting against Agentforce, and there’s added pressure given how fast how current competitors (ServiceNow, Microsoft, and Oracle) are progressing and what they’re forecasting financially. They are now a viable option for a greenfield market that could take away Salesforce’s future potential customers.

If we were to look at this from a narrative scope, it feels as though Ellison may be re-entering the field just to see Oracle potentially take on Salesforce once again, shaking the legacy title and delivering a shinier, more adaptable product for CRM customers.

Final Thoughts 

As Ellison takes on more control of his company, eyes are still on Oracle to deliver on its huge promises over the coming years. 

The upside is potentially humongous, but it’s clear that a leadership pivot has been necessary to make that work.

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