President Mark Hurd explains Oracle’s strategy on cloud, marketing, innovation, and people pesky startup rivals.

Mark Hurd showed up 10 minutes early for our scheduled 9:00 to 9:30 a.m. interview, which we conducted earlier this month in a shut-down bar off the lobby of Manhattan’s Palace Hotel. Hurd, one in every of Oracle’s two co-presidents, was on the town partly to handle the invitation-only Chief Marketing Officer Leadership Forum later that morning. i used to be pleased to get 40 minutes to speak with Hurd about Oracle, in addition to industry and customer trends, as something of a primer for the on-stage keynote Q&A the 2 folks should be doing on the InformationWeek Conference in Las Vegas on April 1.

The previous time I had sat down with Hurd was also in Long island, in October 2011. It was a year after CEO Larry Ellison had brought within the no-nonsense former HP CEO to guide Oracle’s sales and marketing efforts while the opposite co-president, Safra Catz, continued to supervise financial matters, including mergers and acquisitions.

Hurd at the moment stated the smartphone revolution, which he characterized as putting the ability of the old VAX minicomputer into the hands of billions of mobile customers and employees, they all eager to “bang on” petabytes and finally exabytes and zettabytes of information and expecting a trendy, “consumer” experience. This was all happening while the company world tried to make do with applications that were 20 to twenty-five years old. It’s exertions for firms to uproot and realign their legacy applications for contemporary processes, business models, and customer expectations, Hurd noted on the time, especially when IT budgets are flat.

In 2014, is that also the No. 1 challenge keeping Oracle’s customers up at night? What’s different today?

“Everything you said — or said that I said — are still true,” Hurd replied. “But you’ve had a sharpening of it within the sense that the tools have continued to mature and demographics have continued to adapt. There is a stat: Roughly speaking within the next eight or nine years 40% of american citizens can retire. When those people retire and are replaced by the subsequent generation, those people become our customers, and their familiarity with it’s very different from the generation that’s retiring. The folk retiring now are from the computer generation. The folk entering the workforce are from the Facebook generation. The manner they convey, the manner they talk, the style they reference could be very different from what I did. You are able to go down the identical track at the employee side. Now you simply get on social media and say, ‘Hey, can anyone tell me anything about this?’ and also you get 1000 inputs. The transparency we’re seeing on the market is unlike anything we have seen before.”

So how do those trends translate to the manner that Oracle must approach its customers?

“There are two really big things happening concurrently,” Hurd said. “They might seem against one another, but i truly do not believe so.

“i do not know many CEOs telling their people in IT: ‘Your budget is limitless.’ Most folks have a set set of cash, and that they ought to get an awful lot done with roughly what they have got. So our customers, generally speaking, are searhing for the right way to save cash. And that suggests simplification — doing away with complexity — consolidation where appropriate… That’s one of many reasons you notice this secular move to cloud and to engineered systems. The No. 1 driver of it really is simplicity.

“At the other side of here’s this large drive for innovation, particularly round the customer: How do i am getting better at connecting to the shopper? You are going to see this ripple through, industry by industry. Retailers, as a segment, are obsessed on easy methods to connect better to customers. What i really like about retailers as an industry is they have very thin margins — their whole business is ready getting the correct product into the correct place on the right time. Their differentiation is that inventory location and their relationship with you. In order that they are likely to innovate. The corporate which will hook up with me, that could engage with me, which could transact with me the best way i would like, where i would like, once I want, and offer me the best services goes to get my business and that i think the following generation of buyers. And that technical capability will change markets.

“At Oracle, our job is to aid customers do either one of those things concurrently: innovate and save cash.”

Outside of retail, I asked Hurd, which industries does he see driving true “digital business” innovation and competitive advantage?

“Today within the banking segment, all it takes is for one company to nail it for everyone to follow,” he said. “Same thing in telecommunications service providers. Once one company nails it and gets in front, they begin to realize share and it has a ripple effect within the entire segment.”

I asked Hurd in regards to the changing role of the CIO and the emergence of the “chief digital officer” to drive digital innovation, often outside the IT organization. I also asked him in regards to the movement of IT budget dollars outside of IT organizations and into marketing and other departments. Is the CIO role being marginalized?

“You catch me one hour before i will keynote a marketing conference,” Hurd replied. “To start with, i feel being a CIO is an exceptionally hard job. By definition, you may never please everybody. There’ll always be functional organizations who say, ‘Yeah, he doesn’t give me what i would like.’ But i believe it depends on the function, the corporate, and the industry… CEOs traditionally are hired and fired in accordance with their ability to accomplish. And usually revenue drives that. They usually feel like their marketing department has a chance to modify the emblem, so you will see more IT projects in marketing than you’ve seen before.

“But i believe subsequently you are looking for corporations to have a cohesive IT strategy. Sooner or later such things as security… are still too important.”

Now that Oracle is within the thick of selling automation with its $810 million acquisition of Eloqua and $1.5 billion acquisition of Responsys, do you notice CMOs making their very own IT spending decisions independent of the IT organization?

“The app is usually owned by the functional leader, [who’s answerable for] the influence of the choice if not the full decision. The flexibility making sure that the answer meets corporate standards, reminiscent of security, has to fall to IT.”

I asked Hurd how Oracle’s cloud strategy has evolved during the last two years. In that point, some of the company’s 20 or so acquisitions were cloud-based, including RightNow (CRM software), Taleo (talent management software), Eloqua (marketing automation), Responsys (campaign management), Nimbula (infrastructure), and Corente (application delivery). Meantime, Oracle has also introduced Oracle Fusion applications, designed for cloud delivery in addition to on-premises deployment.

“In SaaS, we’re really the single company out there today with a set of applications,” Hurd said, regarding HR, financial, sales automation, marketing, etc., and noting Oracle’s 35% growth in SaaS bookings last quarter. “We feel fantastic in regards to the depth and breadth of our portfolio. We made the change in our company a year and a half ago, where we lined up our sales force against secular competitors, by function, by product.

“We’re within the early days. We will get nothing but better and higher and higher. Our sales force goes to get nothing but better and higher and higher.”