Few Fortune 100 executives can be pinned down to a “common demographic”. In August 2013 Forbes published a breakdown of the then current leadership of the Fortune 100 CEOs and you can see a lot of diversity in the demographics with three notable exceptions: over 90% of the list members are white, and over 90% of them (not necessarily the same group) are male, and their ages tend to fall around 57.
Glancing through the infographic in that article, some notable differences stand out. For example, the highest-ranked CEOs don’t make the most money (Warren Buffett stands out, of course). There is a group of very low-ranked CEOs who make more money than most of the top members of the list.
Relatively few of the CEOs come from the classic Ivy League schools (Brown, Columbia, Cornell, Dartmouth, Harvard, U Penn, Princeton and Yale). In fact, 60% (or 60) of them come from relatively smaller or less well-known schools than those 40 who came from the 16 most common schools in the report. The combined list of2013 list membershave earned only 65 graduate degrees. And there are relatively few veterans among them.
The bias against military service among the Fortune 100 CEOs probably reflects career choices more than anything else. The most capable military leaders tend to develop their careers there before moving into private industry; by then it may be too late to get on a career track that leads to the Fortune 100.
Another study earlier this year by the Harvard Business Review looks at changes in the makeup of the Fortune 100 top executives over the31 years from 1980 to 2011. One article covering the study noted that state university graduates now dominate the list that was once seen as the purview of Ivy League graduates.
Other notable changes in the makeup of the list include shorter career paths to the top seat in a major company as well as fewer executives working their way to the top in the same company. Fewer than 1/3 of Fortune 100 CEOs have now reached the top by coming up through the ranks. Such is the price of aggressive economic competition in a global and digital economy.
But these changes in trends may explain why Mark Vincent Hurd, who was recently named Co-CEO of Oracle Corporation (along with Safra A. Catz), is now in the position he has reached. Among US business leaders Hurd stands out from the crowd for several reasons. For one thing, he has held President/CEO positions at two Fortune 100 companies (Hewlett-Packard and Oracle) and also at a third Fortune 500 company (NCR). Hurd also reached his position at NCR (2003-2005) by being a “company man”. He worked at NCR for 25 years.
Like many of today’s Fortune 100 executives Mark Hurd graduated from a respectable but less well-known alma mater (Baylor University) in 1980. He went right into sales for NCR with a Bachelor of Business Administration and eventually moved into management positions, going up through Operations. At Oracle Hurd oversees sales, marketing, and customer relationships – a position for which he is eminently qualified based on past experience.
What may bode well for Oracle and other companies – if they can bring back the “corporate man” career track – is that 20 of the Fortune 100 companies were on the list in both 1980 and 2011; and these companies favored the career track approach, according to one blogger. If a company makes decisions that encourage stability across decades then it should do well over time.
Mark Hurd worked hard to turn Hewlett-Packard around after it was destabilized by Carly Fiorina’s aggressive growth strategy (she engineered the controversial and very heated buyout of Compaq Computers, for example). His experience at having gone through the AT&T years with NCR almost certainly enlightened the hard decisions he had to make for HP. It is highly doubtful he took any pleasure in laying off 10% of the company’s workforce, but he broke with Fiorina’s management style and strategy almost immediately, consolidating responsibility and authority in the hands of the executives who were in charge of HP’s business units.
What Mark Hurd could do for Oracle was not so obvious since the company was not in distress like Hewlett-Packard. His friend and business supporter Larry Ellison spoke out for Hurd during troubled times and when an opportunity came to bring him into the Oracle Corporation’s management team Ellison did not hesitate to leap at the chance.
Although he has his critics, Mark Hurd’s track record as a chief executive is exemplary for investors. He took NCR’s stock price from less than $5 a share to more than $18 in about two years. During the 5 years he was at HP he doubled the company’s stock price, a remarkable feat given that many people doubted HP would survive the catastrophic changes of the Fiorina era.
But Oracle is facing a tough business atmosphere today. Larry Ellison’s company started out making database software. He oversaw a buyout of Sun Microsystems, a mini- and mainframe computer manufacturer known wide and far as the best platform maker for high end UNIX systems. Oracle now competes for enterprise software and hardware clients, but it is moving into offering Cloud-based services.
Cloud computing is not new. In fact, cloud operating systems and applications have been around since the 1990s. But over the past 4-5 years the Cloud has changed the infrastructure of the Internet (despite some occasional massive failures). The day of the single, dedicated server is far from over but cloud-based enterprise systems are popping up across corporate America and in Web data centers. The advantages of cloud-based systems (greater fault-tolerance and more stable up-time) outweigh the disadvantages (interconnected dependencies and sometimes slower performance) in the eyes of many business decision-makers.
At the 2014 OracleWorld trade show (attended by over 140,000 people across five days) Mark Hurd pushed Oracle’s initiatives in cloud services. People remain skeptical about Oracle and the cloud because Larry Ellison once criticized the confusion over what cloud computing is supposed to be (listen to this video on YouTube). His reluctance to embrace the cloud way means that Oracle is coming late to the game after Amazon, Google, IBM, Rackspace, and dozens of smaller companies. With Hurd leading the sales and marketing operation there is no doubt that Oracle will overtake the smaller players in the market; but what does the future bring for Oracle’s current product offerings?
But in that role Mark Hurd faces two external perception issues and one internal one: customers don’t consider the company’s product to be “best of breed” (a claim that Oracle often makes on its own behalf in typical marketing fashion), investors are still tentative about trusting Oracle’s commitment to the cloud, and Hurd himself believes that the company releases too many products each year. It’s rare for someone in sales and marketing to call for a cutback in things to sell. After all, when you’re pitching solutions for complex organizations just one product may not work. You may need a whole range of integrated products that (hopefully) work together seamlessly.
But if anyone can cut the fat from Oracle’s product line it should be Mark Hurd. Safra Catz and Larry Ellison both say they have a great working relationship with him. It is hard to believe that Mark Hurd would have floated his concerns about the depth of Oracle’s product line in a press conference without having discussed his concerns with Ellison and Catz. And maybe they brought the concern to his attention. Whatever the case, investors should keep an eye on Oracle for the future because changes are already occurring there on a massive scale. Oracle does not have to commit to the cloud; the cloud is sweeping away the old Oracle. The die is cast and no one will be able to change the course of this company for a long time to come.
If anyone can engineer a change in course for a large corporation Mark Hurd seems to fit that category nicely. He has two strong and capable executive partners whose buyin for change is completely necessary. Maybe Hurd and Catz spent the last three years persuading Ellison to find a coherent strategy for the cloud. Maybe it just dawned on them all that the cloud isn’t going away after all. Whatever the reason, Mark Hurd’s message is loud an clear: Oracle is moving into the cloud. The fact the stock price didn’t move much based on this declaration makes investment in the company now more of a bargain than a risk.
