Of course the main challenge in this area stems from just how little this country invests in educational infrastructure, and that breeds a host of follow-on issues around attracting, retaining, and continuously improving the base of educators in the K-12 arena.

As Steve and I spoke, I told the story of my upbringing and my experience with the public school system where I grew up. It was a bad scene, not helped by the fact that the friends I chose were not exactly great role models. I told him a story about how I never did homework during my entire K-12 experience, and I furthermore told it with a great deal of pride. I thought that this must be what Steve is dealing with, but perhaps to an even greater degree.

It occurred to me that there was a single defining moment that I must have latched onto that changed me and set me on a less destructive and more prolific track. Oddly enough, the Hippie era came along, but for me it worked. You probably think of things like “dropping out”, “peace”, “love”, “drugs”, and “acid”, but there was something about this prototypical model to emulate that was a good thing, or at least better than what we have today.

Let’s think about this. The Hippie era came along and what did it mean to people like me, and to a good number of my peers across the country? The part we grasped onto was the intellectual dimension of the era. It was good to be smart, well read, and intellectual. My model wasn’t Ringo, but Lennon. It wasn’t The Beach Boys, but Dylan. We were reading books like Tom Wolf’s “Electric Kool-Aid Acid Test” and Ken Kesey. We spent time studying Kurt Vonnegut and modern philosophers like Herbert Marcuse, Theodor W. Adorno, Hanna Arendt, George Wilhelm Friedrich Hegel, and of course Nietzsche (a favorite of Carly Fiorina when asked what books she read – she obviously was forced to read this in college).

I wanted to study German just so I could read original works. I clearly remember when I picked up Emmanuel Kant’s “Critique of Pure Reason” in German. There’s a sentence on the first page (THE FIRST PAGE!) that’s 113 words long, containing 17 punctuation marks. Man – you had to be smart just to read it. (I don’t think I understood much but I tried damn hard).

I didn’t actually want to be these people – I just wanted to acquire their knowledge. What an inane and futile aspiration, but it was much loftier than being a brainless high school dropout. This is what must have really changed my life and turned me from a horrible K-12 delinquent with horrible grades and questionable behavior into someone who valued education and intellectual pursuit.

My role models were different than what I see today. Part of the problem is our lack of investment in our educational system, part must be due to parents’ general lack of ability to enforce discipline and foster regard for the value of education, but a bigger part has to do with today’s role models. Think about the role model comparison. Here are some of my role models:

I guess I wanted to be more than I was – but it’s probably better than being less. Now think about real significant role models of today. Here’s a couple from our last presidential election.

Now, to begin with, this guy is a moron – yes, a simple moron. How anyone might look at this guy as someone to model or emulate is one of those sweet mysteries of life. Do you think I’m kidding about this guy? Take a look at this:

Do you see the satirical juxtaposition of two images that couldn’t be more antithetical? It’s comparing the model of today to one of my models. Does this mean that were I a high school teen today that I would aspire to be Joe the Plumber? That is a depressing thought.

Take a look at some of our other modern role models: Peter Griffin, Patrick from Sponge Bob (Bob l’éponge in French), Homer Simpson, Cartman.


These guys are cool, and I’m sure there are many young people who’d like to be just like them. Well, to get off to a good start, just get stupid. Amazingly, the only intellectuals depicted in any of these shows are Stewie Griffin and Brian – an infant and a dog.

Even Peter’s son Chris is an idiot, but generously graced with an even more impoverished IQ.

Check out this role model – and I think he’s genuinely talented (I mean it): you’ll remember him from “That 70’s Show”:

We know his persona in the show is that of an airhead kid. Given that he’s such a cool and good looking kid it’s no wonder that he’s a role model. After all, if I’m in high school and I act like him, despite the fact that I’m basically not very attractive, it may help me meet girls. Therefore Ashton Kutcher is the model for me.

Take a look at the grown up Ashton in “No Strings Attached”. In one scene he brings his “no strings attached” girlfriend a balloon the morning after they have great sex, and in another scene he tries to impress her with a bouquet of carrots – you know this is cool.

So, even as we grow up it still makes sense to be semi dumb as long as it gets you what you want.

The question is what’s the incentive and motivation today to be smart? I don’t know. All of these idiots that I’m talking about, with the exception of Joe the Plumber, are all characters that I enjoy watching. I really liked “No Strings Attached”, and I have to admit that I watch Sponge Bob every morning before work and Family Guy every night. Fortunately for me, I’m not influenced by this nonsense – it’s just fun. However, I’m sure glad I was not impressed with such characters in my teens.

My VC friend Steve really has his work cut out for him. Unfortunately, I don’t think a few bucks given here and there to some much needed educational programs will work. The problem is far too deep. It has something to do with how brains are shaped. That’s a tough one.

I hope to blog again.

It depicts the classic abyss between first impression and actual performance. The project lead pitches a new development effort. Expectations are set high, but delivery is far below. An entrepreneur pitches the VC on a new business, describing market opportunity in the hundreds of billions, revenues of hundreds of millions a year, and liquidity of billions, only to find that after three years just staying alive is a challenge.

This is an old graph but it tells the story:

Do you see the red and green dots? These represent VC-funded investments. This is what happened pre- and post-dotcom bust. The green dots are IPOs and the red ones are VC-funded companies that went out of business. We all know that when these companies/ideas were pitched the representation was high as a kite. So what happened? The delta between initial representation and performance delivered.

Just for fun, let’s look at a couple more examples. Think about the new job. Pre job, you walk in with this dynamite resume that makes you out to be the king of all interview candidates – you’re perfect, ideal, and to top it off you’re good looking! You’re too good to be true and that’s why you’re getting hired. You start work, glad hand everyone, give a great first presentation at the company meeting or customer conference, and all are impressed. Your first month you work your ass off, everyone is in awe of your work ethics and results – you’re on top of the world. Six months go by and the truth begins to emerge: routinely late for work, missed meetings, missed deadlines, sick a lot, and poor deliverables resulting in some pissed off people. The implosion is just around the corner.

What about a romantic relationship? You think you’ve found the perfect partner. Attentive, caring, patient, and whatever else goes into making one an eHarmony commercial. Then the period of decline begins to emerge as your partner reveals himself with reality being far from the initial representation. Suddenly, the perfect partner is preceded by prefixes such as “un” and “in”, and eHarmony pulls their offer to have you appear on primetime TV.

This story isn’t really that extreme for everyone and everything it’s just meant to dramatize the Expectation Theory— a simple phenomenon that ultimately, in any given situation, we can’t avoid our innate behavior and help from migrating to our natural point of equilibrium. We just can’t help being ourselves no matter how hard we try. We can improve, but we can’t escape.

I really hope to blog again.

To really understand the Turducken analogy we need to look at an accurate diagram and draw the comparisons.  The diagram below is an accurate, real-life depiction of a Turducken one might prepare for Thanksgiving. Study this carefully.  It’s essential knowledge that may be leveraged outside the kitchen within the world of enterprise software, to properly design, architect, and build an elegantly engineered Business Intelligence (BI) solution.The next diagram, on the other hand, is a Turducken you may be preparing, as we speak, for your strategic, corporate BI solution:The similarities are astounding. The Complex Customer Requirements and Data are the Turkey. However, in this case, no one even knows what the Turkey looks like.  All that is known is that it’s palatial in size and infinite in its complexity. The natural inclination is to stuff it with something, but what? Well, let’s start with a BI Platform. We know a BI Platform in and of itself does nothing, but you have to get one – it’s simply a requirement. Once you get one no one really knows precisely how it works, but that’s a good thing, because it makes it easier to blame when things don’t turn out as planned. You know – it’s like Thanksgiving. You burn the turkey – what do you say? “That damn oven never works right! Damn it to hellalouya and curse the three wise guys!!!” What do you do? You throw out the oven and eat the turkey anyway. Why? Because it’s done, it’s there, you have nothing else to eat, and you’re hungry.

If you wanted it done right then you should have hired some help – and lots of it. And I mean lots. This is where the “Lavish Amounts of Rich Consulting Services” come into play. Let me put this in perspective. In the BI marketplace, when analysts talk about monetary dimensions, 65% of that market consists of these “Lavish Amounts of Rich Consulting Services”.  So the amount of help and stuffing actually required to construct this Turducken is much, much larger than it appears in the picture.

Now for the Duck – the Duck is obviously IT in this case.  They’re sitting inside, working to keep the delicate balance between supporting their users and supporting the needs of the business.  On top of all that, IT needs to support the de-boned BI platform, which is stuffed inside the complex customer requirements & bogged down with disparate data.  They are also “managing” these rich consulting services, often with a smaller IT team, where burden and responsibility comes without the required bandwidth to succeed. How anyone can manage all this stuff(ing) is beyond comprehension – it makes building the nav system on the Boeing 787 look like child’s play.  And I mean this – it is child’s play.

And look at what’s stuffed at the center of this Turducken BI solution – the unfortunate End User Chicken. They are precisely the reason why this entire Turducken BI solution was built, their needs represent the very core of the BI Solution, its meaning and its strategy, but yet are the last thing that gets attention and visibility. Nevertheless, they are stuffed in with the rest of the mess. And why does the well-protected, innocent End User Chicken so often get overlooked and forgotten? Because they’re the foundation, and for all intents and purposes the ones that started it all. They represent the center of gravity of this Turducken, but too often are overwhelmed by all the “stuffing”, so their needs are squashed and neglected.  But keep in mind – without End Users it would only be a Turduck – an incomplete, meaningless solution.

OK – so now let’s get to the cautionary advice. With respect to your BI solution, don’t make the mistake that so many companies make – DON’T OVERDO IT! DON’T OVERCOOK IT! DON’T OVER STUFF IT!!! The picture is clear – the more you mess with your BI solution the worse it gets. Before you know it, the whole thing blows up on you before you get a chance to eat it.

Take an example from the Turducken Blog. http://www.foxnews.com/story/0,2933,176174,00.html. The advice is clear, and I quote: “Seriously, do not deep-fry the Turducken. The inner birds – the chicken and the duck – will shoot out of the turkey and it’ll be like that really gross scene in Alien, except instead of extraterrestrial fetus blood, you’ll be covered in boiling hot oil, which is probably less fun.” Sound familiar?? Indeed it does. Deep-fry your Turducken BI Solution in oil, that is, take too long writing custom SQL, either by you or by the bottomless pit of consulting services, and before you know it your IT Duck as well as your End User Chicken will shoot out of the Expensive BI Platform, burn everyone in the area, and all the Complex Customer Requirements and Data will go up in flames along with everyone else.

There’s a clear lesson here: the Business Intelligence segment of the industry is the Turducken of Software. It’s one thing stuffed into another and then once again stuffed into something much bigger surrounded by a lot of hard work and complexity. It’s big, expensive and hard to swallow, and if you do it wrong, you get badly burned. So for this holiday season, if you’re thinking of big BI projects, Bon Appétit!

Click here to watch the Turducken debate.

I hope to Blog again.

But, enough of this – let’s have a little fun: Just some superficial, nonsensical impressions and observations before getting serious. This year OpenWorld spilled far out of Moscone – they even had JavaOne tents as far away as Union Square. The Sun people must have felt like Gulag prisoners. Then there were the multiple exhibit halls – those places were zoo-like, almost distasteful – “Sans-culottes“, as the French might say.

For example:

HP had a Magic show. One company was giving away a Tesla – I didn’t even notice this company’s name let alone what they were selling, but who cares?  I mean, how does software compare to a Tesla?

Accenture had a sign saying “high performance delivered” which I read as “high performance divorced” – most likely a Tiger Woods thing.

BlackBerry had a caption reading “Experience Oracle Applications on BlackBerry.” Fat chance unless they’ve recently announced iPhone emulation.  I can’t experience the web on my BB let alone Oracle Apps, and I can barely take a picture of the sign – this is my BB experience. Imagine what an Oracle App would look like!

KPMG went with the golf theme this year – don’t they read? Dell had a juice bar, Brocade had some guy spinning plates and juggling. Idhasoft was giving away a Lexus, but I just kept thinking they had some really cool potato app and wanted to see a demo. Best Software had an off road racer, and Groupware had a craps table. The only thing missing was Cirque du Soliel.

On the serious side, Oracle announced Fusion Apps for the fourth year in a row. This is massive and should be very cool – think about the undertaking: over $4 to $5 billion rebuilding more than 100 existing applications written on top of Oracle (BEA) middleware. That’s impressive. Existing EBS, PeopleSoft, and Siebel apps will still continue, so the customer can choose to go “old wave” or “new wave”.

The DB, Apps, and Middleware groups are the big bucks winners in this game, and the trailers are riding their coattails. On the business intelligence side, Fusion Apps are now “BI driven” and will include “Oracle Transaction BI” (OTBI), consisting of “BI View Objects” – this complements Oracle BI Apps. The BI View Objects are ADF (Oracle Application Development Framework) middleware components which in turn query the database – they are not DB views. The BI View Object component can be used by the BI Composer – a new ADF-based BI authoring tool – and can also be exposed to OBI Answers by integrating with the BI Server’s metadata repository (RPD). This may sound complex but keep in mind that Oracle relies on their customers to pull this together and make it work – it is the customer that has to ultimately make EVERYTHING work.

In any case, this doesn’t come out until 2011 so there’s plenty of time to implement the recently released Oracle BI Apps 7.9.6.2, but beware, the 7.9.6.x BI Apps won’t be integrated with Fusion Applications or even OBI EE 11g.  A new version of the BI Apps, called Oracle BI Apps 11g v1, is expected to support Fusion Apps and OBI EE 11g.  Strategically, customers would want to implement Oracle BI Apps 11g v1 since that is the go forward BI Apps code line, BUT Oracle BI Apps 11g won’t be integrated with the Applications Unlimited product lines (old wave) until Oracle releases Oracle BI Apps 11g Patchset 1 late 2011 / 2012.  There also doesn’t appear to be an automated upgrade path from Oracle BI Apps 7.9.6.2 to 11g.  11g utilizes a new data model and corresponding set of ETL maps that extract data through the BI View Objects.

This is very complex – so to do a short recap, OTBI only works with Fusion Apps and Oracle seems to not have a plan to offer a similar product for EBS customers.  In addition, Oracle is introducing another new version of Oracle BI Applications with Fusion Applications that won’t integrate EBS data until the end of 2011 or 2012, and existing Oracle BI Apps customers are apparently unable to migrate.  Customers are expected to re-implement the new Oracle BI Apps data warehouse.

Let’s take a look at our Oracle BI life history as far as I can discern it:

1999 – BIS
2001 – EDW
2003 – DBI
2006 – OBI EE & Oracle BI Apps
2010 – OBI EE 11g
2011 – Oracle BI Apps for Fusion

As a customer,

If you developed BI apps for BIS, you need to rewrite
If you developed BI apps for EDW, you need to rewrite
If you developed BI apps for DBI, you need to rewrite
If you developed BI apps for Discoverer, they’re in limbo and you need to migrate and rewrite
If you bought Oracle BI Apps for Oracle EBS you will need to re-implement when you upgrade to Fusion Applications or upgrade to Oracle BI Apps 11g
If you haven’t bought or implemented Oracle BI Apps 7.9.6.x you may want to consider waiting for Oracle BI Apps 11g PS1.

Let’s see what all this might look like graphically — you know, the big picture:

Like I said at the beginning, Oracle is a great company that I highly admire and respect, but the BI direction has been plagued with product HD-ED (High Definition – Evolution Dysfunction). Now new leadership has entered the picture and this is a good thing. There are solutions to this, and I am hoping that new leadership will take the opportunity to deliver what the customers want and need. As a customer you have to examine this and decide. This is not religion – you don’t have to believe to be successful.

As I said – this is very complex so I welcome your feedback and comments – particularly from those of you who attended the event. I am trying to get the facts straight so I look forward to writing another version or two of this. Oracle’s roadmap is fluid, and can change based on customer feedback.

I hope to blog again.

A while back Charles Phillips’ girlfriend put up a billboard in Times Square – a major embarrassment for Phillips, particularly since she picked Times Square – how touristy, pedestrian. Couldn’t she have picked the corner of Central Park South & 5^th or 82^nd & 5^th?  Then Phillips makes some tangential allusion to a $70 Billion acquisition budget, and the press calls it gospel. Next thing you know, Phillips is out, Hurd is in.  This is like a Greek play – a modern day “deus ex machina”, with Ellison as “machina”.

Phillips did a super job of building Oracle up from a ton of acquisitions. This was a monumental feat and done brilliantly. Poor IBM and Microsoft – they can’t pull this stuff off. Now Hurd steps in to make it all work and really shore up Oracle’s hardware business – another kick in the IBM ass, as well as to HP.

The real irony is still to come – the day when Oracle acquires HP, Hurd fires the HP board, HP general counsel is relegated to mailroom duty, and Oracle then sets its sights squarely on IBM. The problem for IBM is that they’re big, but they’re not so tough. Oracle however is tough! They have proven they can and will continue to kick ass.  Ellison is like the Clint Eastwood of Tech, but instead of a gun he packs cash and belligerence. This is the makeup of a winner – or a warrior.

So where does this leave HP (and IBM for that matter)? Well, I heard through the grapevine that Hurd told HP to put in place “Operation Nostradamus”, accompanied by the following revenue projection:

I hope to blog again.

Every manager and every company has a different way of dealing with performance issues. The most popular method is to simply pretend it’s not happening – you know, the denial thing. I mean after all this method is successfully employed in our daily lives with alcoholism, drug abuse, and a host of other behavioral problems, so why not apply this practice to poor performers in the workplace?

At IBM, in the early days, the method was promotion – yes – this is no typo – promotion. If someone was not doing a good job you simply promoted them to get them out of the way. This was a great system – and counter intuitively quite ingenious. Before long, some of the most inept individuals in the company quickly rose to the top, and ultimately it became quite a liability to your career if you held too high a title. In the late 80’s early 90’s an IBM VP wouldn’t have a chance in hell of getting a job outside the company.

Microsoft, during the Ballmer era, had a different method of dealing with performance issues that I observed. There was what I would call the “process” method and then there was the “Steve” method. By the way, this was just my observation and I don’t know if this was documented anywhere but I did observe it on enough occasions for it to make an impression on me.

The “process” method was based on former GE CEO Jack Welch’s book Straight from the Gut. I think Steve really liked this book and admired Jack. Jack was like the quintessential CEO. He was a really disciplined, process oriented guy, who laid out in tremendous detail how GE should be run, at every level, and executed flawlessly in my opinion (good thing he left prior to the big 2002/03 recession and 2008/09 great depression II). Jack imbued this mentality throughout the entire company and created a corporate culture around process-oriented thinking and execution. To me, Steve liked this concept, but unfortunately only one single property from Jack’s book was inherited and Steve applied it to the entire Microsoft culture. This property was – Get rid of the bottom 15%.

Damn right! This is the ticket to dealing with poor performers – you get rid of the bottom 15%. The problem is that this was the ONLY property Steve would carry over from Jack and GE. This is like saying, “I’m going to be a world famous physicist, and Einstein is going to be my model”. The problem is that I have never studied physics, am not good at math, and not very smart – so in lieu of these minor details, the property I choose to inherit from Einstein is simply his funny hair.

So the 15% thing is still commonly used in big business.  But Steve has another practice that I’d like to point out – the “Steve” method for dealing with poor performers. I recall a meeting Steve invited me to when he first became CEO. He wanted to get people’s opinions, to listen. I guess it’s “new job” behavior – you put on your best behavior for the first month or so to impress everyone and then ultimately migrate to your natural point of equilibrium – that’s where Steve probably is now, but I think it only took him about two days to get there.

What I noticed at this meeting had nothing to do with what we talked about. In fact, I don’t remember a word of the conversation – I didn’t remember it when I left his office. I’m not sure he even asked my opinion about anything. I did however notice two other things: first, what the hell was he doing in this dinky little office? I mean he’s the CEO of this massive company and he had an office the size of a small utility closet. Second, why did he keep yelling to his admin about how late the VP in the office next to his was?  After all, Steve was meeting with me and the fact that this VP was late was irrelevant.

I didn’t make a connection at the time, but a week later the VP was shot (spun as a retirement of course). Later, I noticed something else.  Steve moved to another building and shortly thereafter the EVP of Worldwide Sales and Services was shot. He was moved into one of those nondescript fofo jobs that don’t allow you to do any damage and gives you enough time to plan your “retirement”. The sad thing is that if you’re at all astute (and I just mean breathing), you don’t understand the intent of this “opportunity” and everyone around you is just depressed to talk to you. This story played out again to an EVP-level development exec.

As a joke I started to think that if Ballmer wanted to shoot someone he’d just move into the office next to them and execute. I think this was his conscious plan, and I think it’s a good plan – it’s bold and direct, no pussy footing around.  When Steve moves into the office next to you, put together your “retirement” plans immediately.

I mentioned this theory to a former high level Microsoft exec, whose name I’d prefer not to mention, (Paul Maritz), who also has a very small office, and he laughed, but then quickly turned to the person in the office next to his and shouted out a warning. This unnamed exec is very bright, but I don’t really know if he believed my theory or just wanted to give me the impression that he came up with the idea first and was demonstrating adroitness in the art.

So what about Steve? Check this out:

October 2009 – Newsweek “The Lost Decade: Why Steve Ballmer is no Bill Gates.”

May 2010 – The Economist “APPLE has overtaken Microsoft to become the world’s largest technology company by market capitalization.”

June 2010 – San Francisco Chronicle “Sorry, Steve. We think it’s getting to be time for you to move on.”

July 2010 – The Economist “Rumours persist that a coup is brewing to oust Steve Ballmer” “…Microsoft is behind… Should the firm fail to catch up fast, Mr. Ballmer will surely be tossed through a window.”

August 2010 – Seattle Post Intelligencer –”Is it time for Microsoft’s Steve Ballmer to go?”

The writing is not just on the wall – I think it’s dripped onto the floor. Steve has somehow gotten himself into the bottom 15%. What does a guy like this do? He can’t wait around for his board to give him the message.  Can we really expect all eight board members to move into the office next to him?

I hope to blog again.

P.S. on Steve. I don’t know Steve well. My interactions with him were few, but significant enough that if he saw me today, he would know who I am. Steve’s a brilliant guy, and, as I point out frequently to many people I speak with, managing a company the size of Microsoft is a daunting undertaking that few in the world could handle for a month let alone 20+ years. It is a human impossibility to wrap your brain around a challenge of this magnitude, and I accordingly have a high degree of respect and admiration for anyone in this position regardless of what I may think of them. In my blog I allude to Steve having sat in many offices over the years that have resulted in someone going out the door. There’s a good lesson and moral here: bad things happen to the best and most capable of individuals – even a person like Steve can get munched – it’s like Pac Man.

I wanted to say a few words about this. I thought the Oracle lawsuit had tremendous merit. My sense was that even if Oracle was 10% right about the allegations, SAP was screwed. I was just imagining all the depositions, the trial with a bunch of SAP witnesses, appearing one by one telling their story about allegation after allegation, having to concede to wrong doing upon wrong doing. What a mess!  And what a victory for Oracle. What an interesting setting for the jury to deliberate upon and a great set up for a huge hunk of the $1 billion Oracle claim. Imagine the jurors going for the full amount just on principal and of course, for the sport of it.

Well – SAP’s acceptance of liability was a brilliant move – it totally sucked the wind out of Larry Ellison’s sails. All the drama is over, just like that. No stream of witnesses testifying of wrong doing. No long drawn out endless diatribe of unwilling, extracted admissions of misconduct on the part of SAP.

It’s over – all there is to talk about now are the damages. Larry claims a billion, SAP claims tens of millions, and it’s up to Oracle to demonstrate damages. There’s no talk about “…corporate theft on a grand scale…” It’s just about damages, and Oracle will be hard pressed to demonstrate a billion in damages.

Great chess move SAP! However, you won’t be able to sit around dreaming that you’ll get away with a “tens of millions” slap on the wrist. My prediction in my last blog was that you’re in for a quarter billion dollar citation – so get the checkbook out.

I hope to blog again.

I’ve been meaning to write about this – SAP’s $5.8B acquisition of Sybase that is.  There’s been a good bit written about it – excellent and relevant comments as well. Look at the excerpts:

Forrester: “With Sybase Unwired, the mobile apps can be written once and deployed on multiple mobile platforms.” This “…gives SAP the opportunity to develop new types of business applications for mobile devices… .”

Yankee: “…the fusion of cloud computing, application mobility and social media to transform the enterprise mobility space.”

A Software Insider’s Point of View:  SAP “…also gains access to the financial services and public sector markets.  On the geographic front, Sybase has strong presence in the China market, an area where SAP sees future growth.”

Forbes: “Sybase is not enough to make SAP entirely relevant in scope and scale (and it goes without saying that in this land of giants, Sybase was not large enough to survive on its own). But it picks up a solid asset, with businesses in financial modeling and mobile databases that are essential for SAP to stay in the game.”

Good stuff – very relevant and right on the mark from my perspective.

I have another theory. I’m sure all of the above is true, but an interesting side thought occurred to me. I kept thinking about the Oracle lawsuit against SAP involving the alleged inappropriate downloading of Oracle proprietary data by SAP. I took a glance at the Oracle complaint. It’s amazing. Take a look at some of the allegations:

“This case is about corporate theft on a grand scale…”

“Oracle brings this lawsuit after discovering that SAP is engaged in systematic, illegal access to…Oracle’s computerized customer support systems.”

“Through this scheme, SAP has stolen thousands of proprietary, copyrighted software products and other confidential materials that Oracle developed to service its own support customers.”

“In late November 2006, there occurred unusually heavy download activity on Oracle’s password-protected customer support website. …The access and download activity Oracle observed on its systems…did not resemble the authorized, limited access to which its customers were entitled. …SAP employees using the log-in credentials of Oracle customers with expired or soon-to-expire rights had, in a matter of a few days or less, accessed and copied thousands of individual Software and Support Materials.”

“…using one customer’s credentials, SAP suddenly downloaded an average of over 1,800 items per day for four days straight (compared to that customer’s normal downloads averaging 20 per month.”

“Other purported customers hit the Oracle site and harvested Software and Support Materials after they had canceled all their support with Oracle in favor of SAP TN (TomorrowNow).”

“…a user on an SAP TN computer signed on as Oracle customer Honeywell International…to access Oracle’s support system and copy literally thousands of Oracle’s Software and Support Materials in virtually every product library in every line of business.”

“…Oracle to date has indentified more than 10,000 unauthorized downloads of Software and Support Materials relating to hundreds of different software programs.”

“…some users logged in with user names of “xx” “ss” “User” and “NULL”. Others used phony email addresses like test@testyomama.com…”

“…one user…appears to have logged in using the credentials of seven different customers in a span of just 15 days – all from SAP computers in Bryan, Texas. All of these customers whose IDs SAP appropriated had one critical fact in common: they were, or were just about to become, new customers of SAP TN – SAP AG’s and SAP America’s software support subsidiary whose sole purpose is to compete with Oracle.”

WOW! This is heavy duty. I’m not a lawyer. I don’t know if all or any of this is true or accurate, but it would seem that if there were even a small degree of accuracy, it would be a big problem for SAP. We do know however that as a result, SAP announced in mid 2008 that it would shut down its TomorrowNow division.

I find this really interesting. SAP requires access to Oracle products and code to develop their products. SAP is actually Oracle’s biggest ISV. SAP Business Apps drag a lot of Oracle DB along with it. So SAP needs access to the Oracle Database Technical Reference material to build its product. A division of SAP, Business Objects, needs access to Oracle Applications to build their products. You can’t build worthwhile SAP BusinessObjects Rapid Marts without knowing intimately, at a programmatic level, what the Oracle Application is doing.

Think about this as well. A year ago or so you could go to the Oracle Partner Network site and see SAP and Business Objects products listed. If you go to that site today you see products from other companies like Teradata and IBM/Cognos that compete with Oracle but you do not see SAP or Business Objects.

If you’re SAP and you’re dealing with a major lawsuit alleging inappropriate and illegal access to proprietary data and you need access to Oracle to build your products, what do you do? Well – perhaps two things:

Plan A) You work with Oracle and try to negotiate some limited access agreement. After all, Oracle does make a ton of money, probably close to a billion a year, from SAP apps customers that use the Oracle database.

Plan B) You have to have a Plan B and it better be better than plan A. Is it possible that Plan B is figuring out how to no longer rely on the Oracle database?  That’s what I’d be doing. You acquire Sybase. You embed it in your cloud offerings. It’s the store for mobile applications. You sell it to every new customer. You bundle it in SMB and mid-market channel sales. You try like hell to convert Oracle database customers (impossible for a ton of technical reasons, performance concerns, and the conversion expense mountain you have to overcome, but nonetheless a noble effort that will rest on the shoulders of some unknowing SAP sales exec who will get shot in less than 12 months.)

I think this $5.8B Sybase acquisition was a great idea. SAP needs this to survive, but it’s not enough to win. I also think it was worth paying the huge premium.

Total cost of the TomorrowNow acquisition: TomorrowNow acquisition cost + $5.8B for Sybase + $.25B to $1B to settle illegal access suit = about $6.2-$7B.

From that perspective what is the big deal in SAP spending a quarter billion to a billion or so to overcome this issue? The problem is gone.  They further cut, or limit, their reliance on Oracle, they access and open new markets and revenue streams, and most importantly they make themselves more attractive as an acquisition target to IBM, whose mutual mission in life is to kick Oracle’s ass. This is two mints in one – a great idea and a dream come true!

I hope to blog again…

…and, I would really like your thoughts on this theory.

PS:  My personal opinion of SAP:  SAP is a good company. They didn’t, and wouldn’t, engage in the activities alleged by Oracle. However, the company they acquired, TomorrowNow, would. Unfortunately for SAP, they own TN and the liability and potential consequences of the poor judgment on the part of TN.

This doesn’t just apply to software companies. Across the board there are bad ideas. It’s particularly prevalent amongst “smart” people. I know this first hand because I’m generally thought of as “smart” and I have a lot of bad ideas – it’s like there’s no end to them.

The smarter the people, the more bad ideas. Look at Microsoft’s Ballmer – he’s a damn genius who comes up with tons of bad ideas on a regular basis. The poor guy can’t even say a word in a meeting without having some dolt actually think what he’s saying is brilliant and executing on it before he even knows what’s happening.

This is a lesson I learned very early on in my career when I first became a manager at IBM. I saw this picture of a bunch of gears, progressively ranging from very large to very small. The big gear takes a barely noticeable, tiny turn at the top, and at the other end the smallest gear is spinning like crazy.

This is what it’s like at large companies: the big guy comes up with some bad idea and every Dilbert in the room takes it as gospel and does it.

Some advice: just because the exec has an idea, don’t assume it’s a good one – the likelihood is that it’s bad. Most ideas are bad, and even fewer are commercially viable, so just because someone in authority or with great credentials comes up with some invention or great idea or some excellent way of doing or creating something, don’t just assume it will fly. It probably won’t.

Let’s look at examples. Microsoft has over 40,000 SKUs and some 3,000 products. How many do you think make money? I’m sure we could count them on one hand. On April 12, 2010 Microsoft announced KIN, a Windows phone targeting a youthful market – the social generation.  Less than two months after the product launch, Microsoft killed it.

IBM has twice as many SKUs as Microsoft. How many do you think make money? Did you know that the IBM tape drive business headed up by Ambuj Goyal is huge? It’s bigger than most software and computer hardware companies in existence today. What the hell did this guy do to deserve a great job like this? Did you even know that people still use tape drives? I’ll tell you right now that Google would be hard pressed to find a tape drive source today. However, if you go to the IBM site and look under products you’ll see tape drives prominently displayed under “Tape Systems”. Imagine that – a multi-billion dollar business centered around a product that in today’s terms would be called a really bad idea.

Don’t be fooled. Most ideas are bad, but some really bad ideas are very good.

I hope to blog again.

NOTE:  These facts are intentionally obfuscated to preserve the spirit of this topic.