Larry Ellison: Why it pays to be a jerk
The success of Larry Ellison, and what it says about leadership.
On the battlefield of Silicon Valley, it takes a lot to distinguish oneself as more bloodthirsty than the rest. But in recent months, Oracle CEO and founder Larry Ellison reminded observers why, even in an industry dominated by barbarians, he has earned a reputation as a first-class SOB.
In early August, Ellison launched a public attack on Hewlett-Packard, throwing what had for decades been an amicable business relationship into jeopardy with a few choice words. Following the ousting of CEO Mark Hurd, who was forced to step down after a sexual harassment inquiry, Ellison lashed out at HP in an email to The New York Times. "The HP board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago," he wrote, invoking one of the most infamous board blunders in tech industry lore. Ellison argued that the company's decision to make public the sexual harassment claims, which had been proven "utterly false," constituted "cowardly corporate political correctness." And if there's one thing Ellison can't abide, it's pansy-picking ninnies interfering with genius at work.
His assault on HP continued through September, when he hired Hurd, a close personal friend, as co-president of Oracle (a title he'll share with Safra Catz, who has been Ellison's second-in-command since 2004.) The move prompted HP to launch a lawsuit over concerns about the protection of its trade secrets. The legal dispute was quickly resolved, with both firms pledging to mend fences, but it wasn't long before Ellison went about tearing them down again. When HP tapped Léo Apotheker, the former CEO of SAP, Oracle's archrival in business-application programs, as its new commander-in-chief, Ellison charged HP with "[picking] a guy who was recently fired because he did such a bad job of running SAP," and called for the board's immediate, "en masse" resignation. All of which, onlookers agree, is classic Ellison. Bloomberg Businessweek described the outbursts as a return to his "old strategy of ridiculing the competition"; the Associated Press, meanwhile, noted that he "thrives on insulting rivals in public."
Since co-founding the Redwood Shores, Calif.-based Oracle in 1977, Ellison's antics, which have included everything from hiring a private investigator to snooping through Microsoft's garbage to unceremoniously punting a series of would-be successors to his throne, have earned him the distinction of Silicon Valley's consummate meanie. "Ellison," observes Karen Southwick in her unauthorized 2003 biography Everyone Else Must Fail, "is like a modern-day Genghis Khan who has elevated ruthlessness in business to a carefully cultivated art form. His weapons are not the marauding hordes but his company's possession of a key technology platform, his willingness to exploit it, and his disdain for anyone who gets in his way."
The incredible success that he has enjoyed is a marvel to anyone familiar with the accepted literature on what it takes to make a great leader, qualities like empathy, mediation skills and humility. By all accounts, he is a bad listener and a big talker, whose brash, take-no-prisoners approach tends to alienate employees and customers alike. Yet, in the past 35 years, the jet-flying, sailboat-racing renegade has built Oracle into one of the most important tech firms on the planet, with annual revenues of $27 billion — about a billion dollars shy of his personal fortune. (All figures are in U.S. dollars.) While many of his contemporaries have moved to arms-length positions or other projects, Ellison remains the driving force behind the computing juggernaut, continuing to fashion it according to his own design. After acquiring more than 65 tech firms in the past five years, the mercurial CEO announced in September that he would be "buying chip companies," suggesting that Oracle is positioning itself for what Bill Tatham, head of Toronto-based enterprise software firm NexJ Systems, describes as "another level of world domination."
But while it may be tempting to single out Ellison as the ruthless villain of high technology, "none of these guys are nice," says Jeffrey Pfeffer, a business professor at Stanford University and author of Power: Why Some People Have It — And Others Don't. Before his ousting from Apple, Steve Jobs is said to have become increasingly difficult to work with, refusing to acknowledge that sales were tumbling; since his return, he has often been criticized for his obsessive secrecy, and ruling the company with an iron fist. Meanwhile, it was Bill Gates's attempt to snuff out the competition that led to antitrust allegations — and sent Ellison rooting through Microsoft's trash. "It's very unpopular to say in today's world, where we have these Kumbaya theories of leadership," says Pfeffer, "but it actually doesn't work well." If anything, Ellison is merely the poster boy for what it takes to thrive in an increasingly ruthless environment. His rare combination of hubris and self-awareness enables him to skid recklessly to the edge, stopping just short of the cliff. And his stunning trajectory offers a valuable lesson: In the cutthroat arena of big business, sometimes it pays to be a jerk.
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