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Success Through Standardization and Simplicity
By Miriam Moss, DISA Corporate Communications

Safra Catz is president and chief financial officer of Oracle Corp., and she is listed by Forbes magazine as one of the most powerful women in the world. In her presentation to the conference participants on Wednesday, May 7, she challenged the audience to be logical, to be willing to change, to measure the right things, and to keep "it" simple while unified in order to meet mission requirements.

When Catz began working for Oracle in 1999, she noted something was wrong with the way the company was doing business. Oracle was growing quickly, but there was no standardization or sharing within the company. The various parts of Oracle worldwide were each self-optimized. Catz viewed this way of conducting business as lacking logic and skewed.

"Somehow we had decided that instead of being one powerful force, we were going to be 70, 80, or 90 forces around the world, each one doing things slightly differently," said Catz. "We thought we were huge, global, operating in more than 100 countries, but if you actually looked at us, you would see that we were a hundred little companies"

"We had no idea how many people worked at Oracle in 1999," said Catz. "At the time, Oracle had 70 human resources systems. Many people were included in more than one system, and [CEO] Larry Ellison was in all of them."

Company supervisors and subordinates were in different countries from one another and were using different systems, with different processes, and different user-access names for a single person to access the various systems to complete tasks.

"We'd fragmented our business and our information so broadly that it would be truly secure, because not only could no one from the outside find out what was going on, but we ourselves had no idea," said Catz.

Catz compared the way Oracle processed things to Burger King's old tagline, "Have it your way." According to Catz, in 1999 the company was conducting its daily operations in a stovepipe manner, with each part of the organization conducting business its own way. Catz along with other top Oracle management realized that this way of conducting business had to change.

As a result of the transformation, Oracle has moved from an operating margin of 22 percent to 43 percent and saved $1.2 billion in the first year.

"[The company] reduced the price of every product in our product line. We reduced the cost of support, and we reduced the cost of running our enterprise dramatically," said Catz.

"Technology was required, like a nervous system in a body, but what really had to change was the process within our company.

"The reality is that this is not an issue of technology. It's an issue of sociology. People as much as they say they love change, they actually hate change," said Catz.

"They hated those processes and yet held on to them," said Catz.

"To overcome this resistance, we pulled together a coalition of the willing," she said.

"We took our group, and we said, 'You guys get new stuff, and by the way, you're going to do things in a best practices way. You're going to collaborate among yourselves, and you're going to decide what's the best way,'" said Catz.

"When given the choice to get from point A to point B, we're going to keep it simple. So when given the choice, we're going to do it the easy way. And yes, that may mean we do things differently, and we may lose some things we thought were important."

The company had recently learned that it was keeping track of data that was useless to process or product improvement. In some cases, the data that was being collected was not real data, but rather "guesstimations" from customers, according to Catz. The company needed a way to see exactly what was happening within the various parts of the organization.

"We decided we were going to do everything with an enormous amount of sunshine on it," Catz said. "We were going to let everyone know how everyone else was doing. It would be extremely transparent. If you were going to succeed, you were going to succeed in public; if you were going to fail, you were going to fail in public. And we made sure we were measuring everything that needed measuring and not measuring the wrong things. Because when you measure the wrong things, you get the wrong behavior."

For example, when she arrived at Oracle, she discovered that the call center staff was told to limit the number of rings after the initial ring. This sounded good in theory, but not in practice. Call center staff answered the first ring and then put the caller on hold. The company was collecting data on the number of rings prior to a pick-up, but not on whether or not the costumer received the service he or she needed in a timely manner. As a result, the metrics looked good, but the customer service was poor.

"When a customer needs our help — that's our fault," said Catz. "When a customer has to spend a moment calling us — if installation is hard, if the document is not clear — that's development's problem too." So, make folks accountable for what they do or influence. But the corollary is: don't hold people accountable for decisions in which they had no part, she said.

Oracle had to rethink its views about customer service and put into place processes that would foster the customer-provider relationship, according to Catz.

"It shouldn't be your job [the customer's job] to finish our job," said Catz.

"The issue we were trying to address early-on… [was the issue] of us sending to all of you [the customers] the lots of little pieces of things and then saying, 'Good luck, try and make this work. Hire system integrators; hire everyone to just sew all of this stuff together; and as you know, we sent no instructions.'"

According to Catz, Oracle had to reassess who it was, what it was doing, and how it was doing things. She emphasized that any organization, whether it is federal or private, needs to assess itself. This is the only way the organization will operate in a logical manner, successfully implement change as needed, measure the right things, and keep processes simple while remaining unified in order to meet mission requirements.

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