MH is known for one thing; reducing employee costs. The symbolic opening of the "Class of Campus" in Austin with room for 10,000 workers is the sign of what is to come at Oracle.
https://www.builtinaustin.com/2018/03/23/oracle-new-austin-office
On Thursday night, Oracle hosted the grand opening of its spacious new southeast Austin office, which has room for up to 10,000 employees.
If Oracle reaches that number, the Redwood Shores, CA-based company would become one of the largest digital tech employers in Austin.
“Oracle is expanding in Austin to attract, hire and train the best talent to support the unprecedented growth of our cloud business,” said Oracle CEO Mark Hurd in a statement. “This campus will help enable our customers to accelerate their Oracle Cloud adoption and drive success.”
The picture shows LE and MH symbolically cutting the ribbon with the Oracle Logo Trade mark with a large pair of scissors. This picture is really important. Take a look.
https://cdn.builtinaustin.com/sites/www.builtinaustin.com/files/styles/ckeditor_optimize/public/inline-images/oracle%20fb.jpg
Its shows that LE has bought in full with MH and his philosophy, he and MH are holdingthe scizzors together as they make a deep cut. What is that philosophy? Replacing expensive "Mercenaries" professionals with high 6 figure salaries with low to mid 5 figure salaried college grads. The cutting of the ribbon for the new campus ushers in the final phase of cutting costs at Orac .. the "LE" just got cut off. All hail the new Orac. We saved also saved some ink on printing with the new name, as we are about to drop a huge number of seasoned employees.
Sales and customer experience will be the focal point of Oracle’s new Austin site, and feature a program that hires and trains recent college graduates called “Oracle Digital Class Of.”
The company will also locally launch its Next Generation Contact Center (NGCC), a customer experience initiative that automates administrative tasks to smooth out the sales process, as well as Oracle’s first U.S.-based Startup Cloud Accelerator program.
What is MH philosophy? What is the plan? Its simple. Lets look at the past. Hurd was CEO of NCR, then HP and now Oracle. What is his mode of operation?
At HP MH had a reputation for aggressive cost-cutting. He laid off 15,200 workers — 10% of the workforce — shortly after becoming CEO. Other cost-cutting includes reducing the IT department from 19,000 to 8,000, reducing the number of software applications that HP uses from 6,000 to 1,500, and consolidating HP's 85 data centers to 6. During the 2009 recession, MH imposed a temporary 5% pay cut on all employees and removed many benefits.
At Oracle he closed all but one of Sun's data centers and laid of the majority of the Sun development and sales staff earlier this fiscal year. Conservative reports on this site by "T.I." have the layoff total FY18 YTD at 8,680, and since 6/1/2016 18,680.
Do the math at HP:
We have a total of over 25,000 at HP. Another 10,000 were let go due to a plan MH put in place before he was fired by the HP Board.
Doing the math on Oracle:
The remaining 640 Million in cash payments at 57% of the layoff total with FY18 YTD at 8,680 we can expect the number of employees to be let go in FY18 to be 8,680/.57 = 15,228. From 6/1/2016 to FY18 we had about 10,000. That brings the total number of employees to 25,000 (10,000+15228) at Oracle as well.
If we combine the two companies MH is directly responsible for cutting 50,000 jobs at two major US companies in less than a decade.
The article below sums up MH his philosophy and turned out to be a very good predictor of what is happening now.
https://www.datamation.com/columns/article.php/3902836/Why-Mark-Hurd-is-a-Bad-Match-for-Oracle.htm
At both NCR (where Hurd was before HP) and HP, he cut expenses to extremes while working to increase his own income. This gets the financials in line and few acquiring companies look at morale as a unique problem and anticipate it in any case. Once the sale is done, the Hurd-like executive moves on to the next project and the lack of employee loyalty becomes someone else’s problem to solve. It is one of the most lucrative types of jobs in the industry but it takes a relatively heartless person to do it because of the adverse impact on employees.
NCR had been sold previously, and the result for the old AT&T was so bad that the acquisition was reversed. This means it would be difficult to sell again. And while it seemed likely that Dell at one point would buy them, that never happened.
HP wasn’t looking to be packaged for sale but Hurd packaged them anyway. He made the firm vastly more valuable to a buyer but stripped out much of HP’s R&D and employee loyalty to get it there. In effect to gain short-term advantages, which is consistent with a sale strategy, Hurd traded off long-term success. This showcased Hurd, after the fact, to be the wrong guy for a CEO job at a company that wasn’t planning to be sold.
The 10Q tells the real story of what is happening now, the biggest layoff in a decade at Oracle is coming this summer May 31 2018. @SjU3ajk nailed it.
The 10Q paints a true an accurate picture of the layoffs at Oracle reported to the federal government, specifically to the UNITED STATES SECURITIES AND EXCHANGE COMMISSION.
http://d18rn0p25nwr6d.cloudfront.net/CIK-0001341439/d68e7357-e1ab-40fe-88ba-56d6b1f79f76.pdf
On Page 16 in plain "English"... The "Cash Payments" column has to match the "Total Expected Program Costs" column. Accounting is pretty simple, in the end the debits and credits have to equal.
Look at the cash totals on Total restructuring plans (in millions) its $(22) adjustments plus $(452) or $(474) total cash pay out. Total Plan is 1114 Million. The total remaining is 1,114 - 474 = 640.
We have 640M in severance packages to be delivered by end of Q4 FY18. That date is May 31 2018. In simple terms 640M / 1114M = 57%. More than half the layoffs for the FY17 restructuring plan have yet to come. Everything combined that happened this fiscal year since May 31 2017 is less than half of what we will see in the next two months.
That 57% is the part that is getting cut by the end of Q4. If you would like to know what will happen at Oracle after all this takes place, then take a look at NCR and HP. They never recovered. The stock crashed. I'd expect the same. He has traded off long-term success for short term gains.
The Austin campus is the crown jewel of the short term MH philosophy. Hire college kids, give them 5 weeks of training and let go the seasoned people. Its happening right now. We have 640 million in severance packages to be paid out to those seasoned professionals before the fiscal year end of FY18 on May 31 2018.