Appeasement does not win wars

 

In 1938, Sir Neville Chamberlain, British Prime Minister, together with Edouard Daladier, French Premier, met with Adolf Hitler and Benito Mussolini in Munich, to discuss upon German demands prior to what later would become World War II. The agreement they came up with after a few days was reported by the British politician as “The Peace of Our Time”.

Basically, what the two Western representatives had done was giving in to every demand from the Germans. The main issue at the stake was the partition of Czechoslovakia, and, shamefully enough, the Czech representatives were not even allowed to participate in the meetings.

Sir Neville came back with a feeling of triumph that was as well backed by the majority of Great Britain. He was in fact welcome as almost a hero. The savior of peace.

you can read appeasement in his face…

Chamberlain’s future successor, Sir Winston Churchill, knew better. In a speech in the House of Commons, he regarded the agreement as a total defeat: “We have suffered a total and unmitigated defeat”, said he. He foresaw the consequences of the agreement. Most Historians actually cite the Munich Pact as the peak in the disastrous Appeasement Policy led by British and French governments. About one year after it had been signed, the world was at war.

Today it has been announced that SAP has agreed to pay for legal costs after the TomorrowNow trial. We talk of $120 million, which is not a small quantity just for legal expenses and fees. Consistent with SAP’s non-contest position, it could be imagined that SAP attorneys are trying to show goodwill after they admitted formally long ago they played inappropriate practices. As a side effect, they may be seeking to placate the beast they have in front of them, Big Mouth Larry, Pontifex Maximus from the oracle, and eventually get a better conclusion at the end of the trial.

Because it has to be well understood that these $120 million are just that: Legal costs. Nothing to do with the $2 billion the Pontifex demands upon business damages. That is precisely what the trial is about. And, at the moment, the Pontifex has not given in an inch in that demand, despite taking the $120 million, of course, like Germany did not change its plans after having got the Western approval for annexing the Sudetenland in 1938.

We will see on Friday, when the Pontifex is supposed to step in full majesty and glory into Court. Incidentally we should mention that he will as well have the advantage of having known about a theoretical deposition by Apotheker on previous Thursday. We are not sure about the benefits of not appearing personally.

We are not sure that SAP and Apotheker are 100% aware of what is going on. Appeasement might work when the ultimate objective of both parties is to prevent war, when war is more a threat than a really likely possibility. And as far as we know, we truly believe the oracle has set for aggressive war. Consciously giving in, as the Russians did in 1812 against Napoleon and 200 years later against the Germans, does only make sense if you simultaneously devastate the territory you give up. Certainly appeasement won’t help at all if your way of appeasement includes a $120 million cheque.

Appeasers do not win wars.

Technorati Tags: apotheker,SAP,tomorrownow,larry ellison,phyllis Hamilton,trial,management,court,copyright,oracle,pontifex maximus,appeasement,hp,hp ceo,oracle ceo,neville chamberlain,edouard daladier,munich agreement,munich pact

The Chosen One is coming…

 

Well, well, well… The Chosen One will come, stand up and eventually fight.

Oh, yes… The One chosen by the Pontifex Maximus at the oracle, Big Mouth Larry, will finally step in and face the challenge from the Oracle.

Now, it is not yet known if The guy will appear personally, honoring the well known advertising campaign by HP, “Personal Again”, or if he will leverage new technologies and appear through video playback.

Accepting the challenge from the Pontifex Maximus is already a good step forward, and we sincerely hope he will appear personally. This would add to his credibility, and certainly impress jurors positively. As well, he would have the chance to answer any evidence against him the Pontifex has announced everywhere he has.

He has been personally attacked, and his appearance would give him an opportunity to turn the trial on his benefit.

Coming up in video screen, on the contrary, would give a poor impression, and would eventually look as if he just wanted to prove he is not a crook (with the permission of Richard Nixon) but ultimately refuses further defense. He would not be able to stand to any questioning, and the oracle’s lawyers would be in a strong position to eventually use the tape against him. They will, should they be given the slightest chance. Video would weaken his position, and strengthen the oracle’s claim for his cowardice. All the benefit of stepping up would be offset by the video.

We will see.

Still, Apotheker, the Pharmacist, the Potion-Maker, the Sorcerer whose reputation and credibility are at the stake, should have additional interest in going to Court. So far, it appears the SAP lawyers have not really made a good start, and like the other Sorcerer we all have seen in Fantasia (Disney), will have to clean up all the mess his theoretical defendants have made. These guys, full of good intentions like Apprentice Mickey Mouse, may have really lost control of the situation from the beginning, we are afraid.

 

Technorati Tags: Phyllis Hamilton,Larry Ellison,Mark Hurd,Leo Apotheker,SAP,Oracle,HP,Management,Trial,lawsuit,personal again,marketing,advertising,potion,ray lane,pharmacist,sorcerer,tomorrownow

The Good Thief at Judgment Day

 

For those readers who have had traditional Christian education the character of Saint Dismas should not be unfamiliar. This Saint is as well known as The Good Thief. He was a thief who was crucified beside Christ, and before both of them died, he repented (last minute call indeed!) from his sins and previous life, and Jesus granted him a place in Heaven.

Despite having in front of them nothing less than Pontifex Maximus at the Oracle, playing the Good Thief does not seem the wisest strategy for the lawyers at SAP. At the moment, they have played quite a smart strategy, tying with the Oracle before the trial started, in our opinion, which could be considered a major achievement given they have admitted guilt about “inappropriate behavior” against the oracle.

As the trial is set to determine how much SAP should pay to Pontifex Maximus Big Mouth Larry, the fact that SAP started admitting $40 million in damages “because of their subsidiary’s ultimate failure to lure many customers from Oracle” is a piece of cake to the lethal lawyers that work for the oracle.

For God’s sake! Attempting to minimize damages by saying that as a thief you were doing a bad job does not minimize guilt at all. It basically means admitting that not only you have been a thief, but a stupid one. The potential damages, the intention after the theft, the plans remain the same. Only for this jurors should grant the oracle anything they ask for!. No wonder that in parallel as well SAP has offered another $120 million in concept of attorneys fees and costs. By the way, SAP is reported as having already accrued for as much as precisely $160 million for this trial. (Running out of batteries, SAP?)

Judgment Day has started… but let’s understand clearly that Judge Phyllis Hamilton is not God, and definitely it is not the moment to play the Good Thief role. (We may leave the Pontifex Maximus playing the role of Caiaphas, though, well escorted by Annas Hurd…)

Footnote: Hermione, this one’s for you too… you know why, don’t you?

Technorati Tags: Phyllis Hamilton,Larry Ellison,Mark Hurd,SAP,Leo apotheker,HP,trial,oracle,ray lane,tomorrownow,sap

Utterly unfair

 

People like money. People want money. In the name of money, crime has flourished here and there. So who would be surprised to read that people want “their” money back? This is applicable to HP employees, and to anybody else in the world, whether they are employees, self entrepreneurs of retirees.

It seems quite obvious a conclusion. Still, it deserves some comments, as the way this has been written looks a bit too simple a view.

We think they deserve it. We agree with the conclusions at the end of the article, but not for the same simplistic rationale. The reference article just says that since economical results for HP have recovered, salaries should be restored and that’s it.As well, the article generalizes too much.

If we look to the official memo to employees at HP, we see a couple of items that have not been explained much in detail in the online report:

First: Salary reductions were not applied to total earnings by employees with variable salary. Just to base pay. What means that the cut was smaller than it looked.

Second: As these cuts have to be compliant with local regulations should there be any, in many countries in the world these reductions are simply non-effective, as local legislation protects salaries in a way that they cannot be reduced even if the consent of the employee is granted.

We are not going to discuss that cutting salaries was not a technically correct measure. It was one of the valid choices HP had to address the economical situation of the time. Indeed it was. And, as long as it complied with local regulations, it was legal to use it.

Now, having said this, we will try to go beyond, and imagine the ultimate target. The guys deciding to take this option (reduce salaries) were guys whose total earning from HP mainly came not via their own base salaries, but proportional to the value of shares. So increasing the value of the shares was their primary target. Not, as presented to the employees, was it about competitiveness and so forth.

There is only one way to increase share value significantly in the short term: Increasing profits. To increase profits, there are only to ways to do it: Either increasing revenue beyond expectations keeping costs in check, or to reduce costs significantly. From these two possibilities, it is kind of obvious that the second one is the easiest.

We believe this was the ultimate intention of the board. Just make sure the market understood they were slashing costs, and therefore increase shares value. Nothing else.

We base our opinion on the wording of the communication to HP’s rank and file employees. Messy, at some point, and potentially unclear for the average employee, who has by no means the slightest individual influence in results, and gets the explanations under the apparent “share-of-the-pain” by managers, who pretend their salaries’ cuts are even bigger than theirs.

Average employees might get lost in all the technical explanations, but what they know is that their cost of living is not paid with percentages. The greengrocer’s, the butcher’s, utilities’, insurance, schooling for kids and a long list of daily expenses are not paid on percentages, but on counting dollars. And though a 20% cut on Top execs base salary may sound big, if (this is a big “if” indeed) shares value performance means a massive payment to them, the ultimate impact is ridiculous in top exec’s earnings. As documented before, a 20% cut in former HP CEO Hurd’s earnings in 2009 roughly meant $290,000 out of more than $42,000,000, what basically proves the point. Who would care for 20% of base salary, or even 100%, if shares value can mean 30 times as much?

Not elegant at all. It simply cannot be imagined that such execs dare that much to add insult to injury. At the end, it could be even thought that they are making their millions not at the expense of competition, or by fair play in the market. They were making their earnings out of employees that supposedly are always declared to be “the most important asset” in the company whatsoever. But nothing different should have been expected, we’d say if we review recent posts from ours too.

The good news for HP? Léo Apotheker could not have found a better opportunity in the beginning of his tenure to gain a solid support basis from his more than 300,000 troops.

The skeptical view? Léo Apotheker’s income is based on shares value as much as Hurd’s was. What basically means he could be driving HP the same way as Hurd did.

The bad news? If things went bad for HP, it would behave like any other company does when targets are not met: “The most valuable assets” are sold out.

Technorati Tags: leo apotheker,hp,hp way,mark hurd,management,employee

A matter of faith

 

We have just been aware of the first commercial delivered by Microsoft to promote its Windows Phone 7 smartphone.

Really: The new advertising campaign by MS, on behalf of its WP7 operating system for smartphones.

When we watched it, the first impression we got was that it could not be a better match for Microsoft’s image. They have taken a lot of money to produce a technically correct ad, and have compressed to many things to try to deliver a simple message.

Typical from Microsoft: Too much complication to express something simple, too many taglines to deliver a theoretical breakthrough.

The message was much simpler: In theory, WP7 will deliver a user experience that will avoid situations like the ones depicted in the commercial.

The communication: Complicated, difficult to understand, and really needs time and many replays to get the message through.

The tagline: As in every Microsoft product, 90% of it is redundant and/or useless, 5% could be useful or valid, and the remaining 5% is to pay for the campaigns that will try to justify the previous two. Take a look to any Apple commercial: Simple, concise, and to the point. See samples here, and here, and here.

Now, having said this, the next thing that pops in our minds is: If WP7 is going to be so different that it will fade away other already proven and well established alternatives, why and how is it going to make that shift in the market happen?

The communication miserably fails to achieve this. It is a matter of faith in them what this add is asking customers to make, just because it is Microsoft.

We have all seen situations like the ones describes in the add. And many of us have even starred them, we must admit. It is not, however, because of the phone itself. It’s not because of its operating system. Curiously enough, the add targets mainly Blackberries for some reason, and we’ll come back to this later. It is the contents what matters, it is about all the things we now can do or access to just by having a smartphone. And from a content perspective, and from a features point of view that Microsoft pathetically challenges the faith they are demanding from their fans, if there are any left. Too late, too featureless for a bride in a wedding, we said a few days ago.

Back to Blackberries… what is Microsoft’s fixation with these guys? No iPhones, no Symbians, no Androids. Just Blackberries. But all of them are really blocking the door to the WP7s. It could be that Steve Ballmer does not want to be like George Bernard Shaw inviting Winston Churchill to one of his grand openings once. Mr. Shaw sent two tickets to sir Winston with a note that said “I am presenting a new play, and I would be very glad to have your attendance. I am sending two tickets so you may come with a friend, should you have any.” To what sir Winton elegantly replied: “I appreciate the honor, but state matter make it impossible for me to attend,. I shall gladly attend a second performance, in case there is any.”

 

We could imagine Apple, Google or Nokia execs receiving notes from Steve Ballmer with sample units of WP7 and notes saying something like “We would appreciate your feedback and opinion about the new operating system WP7, as this is going to make people forget about their current phones. We send several units in case you would like to request a friend to help you using them, in case you have any.” To what Jobs, Elop and Eric Schmidt could easily reply: “Too busy counting revenue and profits from our smartphone divisions; impossible to care for WP7 right now, but we will gladly review version 2.0 should it ever exist.”

 

Technorati Tags: steve jobs,eric schmidt,elop,steve ballmer,bill gates,ios4,blackberry,nokia,android,google,smartphone,IOS4,microsoft

Clausewitz, Sun-Tzu and…

It has recently been published in the press that Germany has just finished paying World War I reparations.

In 1919, the Treaty of Versailles, which ended that war, left Germany into actual bankruptcy, its mainland violently severed, virtually no Armed Forces, no colonies, no heavy industry. About 20 years later, Germany was able to defeat France, the greatest of the victors, in just four weeks, turning continental France is basically a virtual colony for Germany until it was liberated by Anglo-American forces in 1944.

In May 1940, France had the mightiest Army in the world. It was apparently safe behind the Maginot Line (a masterpiece of military technology of the time) set along the border with Germany, from Switzerland to Belgium. Still, the German Flag was unfurled on top of the Eiffel Tower before the end of the month, and stayed there for four long years.

What had happened in a devastated and ruined Germany that made it possible for she to dominate Europe from France to Poland, from the Mediterranean coast to Cape North in Norway?

First: Overall general feeling of having been unfairly treated. That was a common feeling in the German peoples after World War I, who felt betrayed.

Second: A determinant change of leadership with a clear plan to be strictly followed in the years to come. In 1933, Adolf Hitler became Reichskanzler, and in 1934, after the death of General Hindenburg, he became Head of State too.

Third: Focus on niche strengths. Since 1933, Germany’s industrial and economic potential was fully concentrated in rearming the nation towards the ultimate objective of conquering Europe: Ultramodern and powerful tanks, vessels and, especially aircraft. Germany reached levels of product excellence almost unknown to the rest of the world.

Fourth: Selective cooperation from former enemy powers. Since 1933, Western World financers and Soviet military were swiftly used by Germany to structure its preparations for war in the coming years.

Fifth: A carefully planned set of small degree conquests, annexations and political alliances with two targets: To position Germany strategically in the best way to develop its war plans and to add technological and industrial capacity to support future war. The Rhineland, Austria, the Czech republic were invaded and integrated into Germany’s Empire; Balkans and Italy were political allies. Even the Soviet Union initially cooperated with Germany when Poland was invaded.

Sixth: An overall passiveness and appeasement policy played by the old victorious powers of World War I, who basically left the filed unopposed to Germany.

Seventh: A revolutionary set of tactics that changed the military rules of warfare as it was known until then. It was the Blitzkrieg, the super-innovative way of fighting war, based in cooperation between tanks and aviation to be followed by traditional infantry.

Eighth: Surprise effect. Germany always attacked in the most unimaginable place and time, following careful plans that had been designed from scratch specifically for the situation of the moment.

Ninth: Complete autonomy and freedom to act to leading generals and strategists. Many of them are well known in the military circles for their military achievements.

Tenth: Absolute faith in themselves, in their ability to execute their plans, and absolute convincement of what they were doing.

We have recently read about what has been described as The Greatest Comeback Story of all Time, and we are amazed.

First:The dramatic situation of Apple in the 1990s generated the feeling of unfair treatment in the current and former employees of Apple, including Steve Jobs himself.

Second: In 1997, after several years of exile outside of Apple, Steve Jobs was elected interim CEO of Apple, just a few years from being elected absolute CEO (2000). He, too, had a precise plan to be executed systematically in the years to come.

Third: Focus on niche strengths, such as Mac OS, iTunes, iPod. Apple led in those product segments, almost unknown to the rest of the world.

Fourth: Selective cooperation from former enemy powers. The cooperation from rival Microsoft was determinant to support Apples recovery in the late 1990s. Both from a financial and infrastructural perspective.

Fifth: A careful planned set of apparently smaller degree conquests: NeXT, Pixar are just the best known of a series of many, which, apparently look somewhat innocent, but have been strengthening Apple once and again.

Sixth: Dominant brands in all the market segments Apple has stepped into have underestimated them. In PCs, in Operating Systems, in music player devices, as well disregarded have been Apple’s inventions or creations, like iTunes, who now everybody tries to copy, as they have set market models and standards.

Seventh: Apple’s own blitzkrieg, developed through tools like iTunes or AppStores, have revolutionized the market rules, and were based in cooperation of all the aspects of product life cycle, from product specifications to packaging, delivery and support.

Eighth: Surprise effect. Apple strikes when and where they want, turn the market upside down, and maximize results during all the time it takes for competition to catch up.

Ninth: All management levels were given autonomy for operational decisions on the spot. Similar to Sun-Tzu’s third maxim, if you want, “the commander in the field is not always bound to his sovereign’s orders”. 

Tenth: Absolute faith in themselves, in their ability to execute their plans, and absolute convincement about what they were doing. No wonder Steve Jobs detractors even say from him that he lives in a reality distortion field…

The German War Flag stood in the heart of Paris for four years. Apple’s Flag is in the heart of Paris too… and will stay for longer, we believe. Apple Store at Opéra, Paris.

Sun Tzu and Carl von Clausewitz are known for having been military theoreticians and strategists whose works, still in print, have influenced many world leaders in politics, philosophy, history and ultimately business and economics. Their texts are thoroughly read, studied and ultimately learnt in all business schools around the world.

We think the third philosopher, the third strategist, the third theoretician, whose job and works match the level of the formers, is, precisely, Jobs.

 

Footnote: This post is dedicated to one of our best friends, who patiently enough cared to take us to our first visit to the Eiffel Tower, and showed us how beautiful Paris can be, and not only in springtime, as the song said… 

 

Technorati Tags: Sun Tzu,Carl von Clausewitz,Steve Jobs,Apple,ipad,ipod,iphone,imac,strategy,management

Mark Hurd’s blank cheque

 

We have already written about the fondness that the Pontifex Maximus at the oracle has of Chinese philosopher Sun-Tzu and his works “The Art of War”.

There is a wonderful episode describing the three maxims Sun applied for the new style of war at that time, almost 3,000 years ago.

Sun was looking for a job from the King of Wu, Ho-Lu, who requested Sun to demo his theories… using women for a change.

180 concubines were ordered into the room where the King and Sun were. Sun divided them in two groups, appointed the King’s two favorites as officers and explained all that about “left face”, “right face”, and so forth. He barked an order, and… nothing happened.

Calmly turning back to the sovereign, who was probably amused with the show, Sun said: “If instructions are not clear, it is the commander who is at fault”.

Sun explained the stuff all over again. And barked his orders for the second time. Once more, nothing happened.

Calmly turning back to the sovereign, who was starting to get a bit puzzled about what was going on, Sun sated: “If orders are clear, but not carried out, it is the officers fault.” And he ordered the concubine-officers’ heads off.

Then the King started protesting, to what Sun gave his third maxim: “A commander in the field is not always bound by his sovereign’s orders”. And the heads were effectively off.

Sun appointed then new officers, and this time the concubines formations worked like a Swiss watch.

Sun got the job…If we recall the last job given by the Pontifex Maximus at the oracle, Mark Hurd has probably got a sort of blank cheque. After all, he already proved at HP he knew how to tame flocks, herds or crowds, did he not?

Incidentally, for those who recall the oracle’s hardware proposition, we think that “Tzu” does not mean “Microsystems” in Chinese.

Technorati Tags: mark hurd,larry ellison,hewlett-packard,hp,oracle,management,sun microsystems,sun-tzu,the art of war

Running on quicksand

 

Probably not used to getting a “no” as an answer, The Pontifex Maximus as the oracle must be feeling a little frustrated this weekend. No delay in the trial, as much as no gag order.

Symbolic victory, this denial of silence requested by SAP lawyers indeed, as the Pontifex has already circulated all the baffling he has been able to devise. Still a victory, however, and it’s likely he will try to maximize this. We think we will still hear from him.

Phyllis Hamilton, the judge in charge of this affair, has been very clear. Denying both requests, gag order from SAP and trial delay from the oracle, is just stating that in the courtroom, she is the boss, and she will not tolerate any interference with procedures and formalities. Despite the way any of the parties want to see the case, facts just show that this case is several years old, and all the buzz around Mark Hurd being dismissed by HP and afterwards being hired by the oracle, and the noise about Léo Apotheker being appointed new CEO at HP has nothing to do with the real dispute between the Oracle and the German SAP AG. And this is particularly true given the latter already admitted guilt about improper behavior, and accepted paying compensation to the former.

As a matter of fact, the trial is not about guilt or innocence, but more on determining the real reach of the damage made to the oracle, despite the efforts of the Pontifex Maximus to tweak the case and turn it into a personal evaluation of Léo Apotheker.

SAP has nothing to lose, but a one timer hit in their financials that they probably have already accrued for. And the oracle’s frustration comes mainly from not having the opportunity to get side-benefit from discrediting people at management positions in their business rivals. which is not the best way to reinforce the so much leading position the oracle is looking for in the enterprise business world.

So still tied they are we believe. Oracle 2 – SAP 2 as of now, in our opinion.

Good start for Justice.

And while Justice determines the outcome of this trial, still there could be a winner out of this tie. No Oracle, no SAP, but HP, who will manage to remain out of this story, and eventually might get some reinforcement in what could be a somewhat natural alliance with SAP. Ironically, this could ultimately depend on the oracle, as the reinforcement would be directly proportional to the level of aggressiveness and hostility in the oracle’s approach to the case.

Get the money and silently run, Pontifex. Every time you open that big mouth of yours you put the dollars at risk, and you push one more inch closer SAP and HP. Beating SAP is more about customers, revenue, added value and superior products. Your mouth delivers words, not dollars. Winning the America’s Cup with the fastest boat does not mean you can win a race on quicksand.

Technorati Tags: sap,oracle,management,sap trial,phyllis hamilton,hp,leo apotheker,mark hurd,larry ellison

You can’t hurry love

 

Michael Dell belongs to a generation where many admirers of Phil Collins come from. So probably he will recall Phil’s remake of a classic theme first sung by The Supremes, “You can’t hurry love”.

Indeed he should have taken this into account when launching his new advertising campaign, following the announcement of spending a lot of money in revamping their products.

judge by yourself…

We are not going to judge the little sample we have seen, but we certainly applaud Dell’s effort to look at themselves through the eyes of consumers. In fact, the sort of product they are putting there is more likely to be accepted in the market via the consumer segment. Following this communication approach, it looks clear they are following the steps from the master, Steve Jobs at Apple.

Now, we hope these guys realize it is not just a matter of doing nice ads. It takes more than a 30 seconds clip to win customers hearts. “Love don’t come easy”, the song said. “It’s a game of give and take”, and for the moment, Dell’s perception in the consumer market has been much more of a take than a give.

“You’ll just have to wait”, and in the meantime, make sure your message goes through, and is backed by superior customer experience and even better service and support. and these has not been your best.

So take it easy, and don’t give up. Otherwise, you will not be having “Another day in Paradise”…

timeless classic…

 

Play wise, play fast

Some time ago we suggested Léo to speed up in one of his most powerful, though still would-be, weapons.

Every day counts. The barrier the oracle was planning to put in front of Herr Apotheker with the upcoming trial on the TomorrowNow affair has been smartly, elegantly and swiftly overcome by SAP’s lawyers.

It looks that Léo left good friends at SAP… what, indirectly, can have a hidden meaning: Nothing less that a tighter liaison in the coming future between HP and SAP.

The Acid Edge already anticipated this possible move, when talking about “Stepping Ahead, Please” (did you notice the initials S-A-P at that time?).

We still think both actions should develop fast and sound: Hurrying with WebOS in one front, and engaging closer to SAP to counter the Oracle’s hostility. And we start to find some similar views around.

Math and numbers, however, set the odds against HP, at least in what relates to storage, which could be the third move. 3Par and Palm acquisitions do not seem to be profitable in any near future.

But more than the mere cold numbers, it is more about confidence what HP should deal with. The ultimate value of the company will rely more on the confidence and expectations it creates than the actual math in a given point in time.

If HP demonstrates strength quickly enough, shares will come up sooner than later:

First: By speeding up smartphones and tablets. That’s a matter of WebOS. The company is showing boldness there by hiring external proven expertise and reorganizing its Palm Division.

Second: By speeding up integration of 3Par and quickly delivering results. More than actual profitability, it needs to show solid trends.

Third: By closing ranks with SAP. A solid covenant to stand against the oracle. Depends much on SAP, but the two could make a formidable rival to the oracle, despite not having nice Armani suits nor having won America Cup.

Fourth: Playing the Russian military tactics…

You could have some aces in your sleeve, HP. Play wise, but play fast.

 

Oracle 1 – SAP 1

 

About 200 years ago, Napoleon Bonaparte invaded Russia in his attempt of world domination. A mighty army, La Grande Armée, the flagship of the French Grandeur, marched in.

Russians soldiers were no match. Should they have stood to the French, they would have been severely defeated, and Napoleon would have returned victoriously.

So the Russian commanders, in a brilliant move, applied the best strategy they could think of. Taking advantage of the huge and vast territory behind them, they retreated systematically, leaving unopposed fields and land to the French, but making sure first their foe would not find anything (supplies, food, shelter…) that could be of any use.

All the way to Moscow, Russia was devastated before the French advances. Even Moscow itself was set on fire.

Winter arrived, and the comfortable time they planned to spend in Moscow turned into the coldest and hardest winter ever.

Out of supplies that should have been obtained on their victorious march to the capital city, weather conditions and unpreparedness of the Grande Armée made the rest. Very few of those invincible soldiers made it back to France. Very, very few. Hardly 58,000 men out of 700,000.

Germany made a similar mistake in 1941.

The oracle’s well known for his admiration of Sun Tzu’s (The Art of War). But he might want to add some History to his strategy masterbook, and instead of going 3,000 years back in time, read something about Russian History in the last 200 years.

Like Napoleon in 1812, he is preparing himself to attack the Russian SAP, and while making the most of that (up to $2 bn, nothing less), collaterally damage other enemies, namely HP. And, like Napoleon, he’s being caught in the same no-show reply from his enemy.

SAP seems to have sized up the situation, and given they already admitted guilt in the TomorrowNow affair, they are not willing to be plundered and participate in the party that the oracle is trying to set up: “No, thank you!”, they have replied. And they (SAP) plan to shorten the trial as much as they can’t, by arguing there is no point beyond sizing up the amount they might have to pay the oracle.

The oracle has erupted in rage: As important for them as the money SAP would have to pay the oracle, the actual harassment to Léo Apotheker as former SAP CEO as much as incoming HP CEO was important to Big Mouth Larry. Big Mouth’s reaction proves it.

Sorry, kid. Despite historical examples that could not possibly appear in Sun Tzu’s, at the moment SAP’s given you the finger. No party, no fun. You are just going to get dollars, an nothing else. No party, no fun, no sacrificial victim to offer to your hordes of admirers.

The Oracle: 1 – SAP: 1

A tribute to the oracle (II)

 

Well, a reader/friend suggested additional music to add to the oracle’s playlist...

Yachts, fancy parties, illegal liaisons, private jets… and underworld spies. About perfect!

not that Carly either, kid…

just in case, here you got the lyrics…

You walked into the party like you were walking onto a yacht
Your hat strategically dipped below one eye
Your scarf it was apricot
You had one eye in the mirror as you watched yourself gavotte
And all the girls dreamed that they'd be your partner
They'd be your partner, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you?
You had me several years ago when I was still quite naive
Well you said that we made such a pretty pair
And that you would never leave
But you gave away the things you loved and one of them was me
I had some dreams, they were clouds in my coffee
Clouds in my coffee, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you? don't you?
I had some dreams they were clouds in my coffee
Clouds in my coffee, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you?
Well I hear you went up to Saratoga and your horse naturally won
Then you flew your Lear Jet up to Nova Scotia
To see the total eclipse of the sun
Well you're where you should be all the time
And when you're not you're with
Some underworld spy or the wife of a close friend
Wife of a close friend, and...
You're so vain, you probably think this song is about you
You're so vain, I'll bet you think this song is about you
Don't you? don't you? don't you?

A tribute to the oracle

 

Well, yesterday we recommended a little relax to the oracle. Though he is known for being a serious fan of Sun Tzu’s, maybe he is precisely falling into one of his traps. The Chinese philosopher advises to make you enemy more choleric if he is choleric in a given point in time, as this will lead him to irrational behavior, and will drive him to more mistakes. So, Big Mouth Larry, cool off a bit, won’t you?

All this story about theft and espionage, however, reminds us of the classic James Bond movies, doesn’t it? Super-villains to hate, super-heroes to love… Music sometimes helps relaxation.

So here we offer you, Big Mouth, a little musical suggestion that might suit you (sorry for the word, but with all these suing around, we couldn’t help it).

Not the same Carly you’d hate, is she? And tell your tennis colleague she’s not fishy, would you?

 

For those who want a transcript of the lyrics, there you go…

Nobody does it better
Makes me feel sad for the rest
Nobody does it half as good as you
Baby you're the best.
I wasn't lookin'
But somehow you found me
I tried to hide from your love light
But like heaven above me
The spy who loved me
Is keepin' all me secrets safe to night
And nobody does it better
Though sometimes I wish someone could
Nobody does it quite the way you do
Why'd you have to be so good.
The way that you hold me
Whenever you hold me
There's some kind of magic inside you
That keeps me from runnin'
But just keep it comin'
How'd you learn to do the things you do
And nobody does it better
Makes me feel sad for the rest
Nobody does it half as good as you
Baby
baby
darlin' you're the best
Baby you're the best
baby you're the best

Reading or playing at the oracle

 

Quick appendix to our previous post…

Apparently Léo Apotheker, by the way, is going to be traveling around the world meeting customers and HP teams as a good start for his new position at HP.

A secondary objective might probably be irritating the oracle (yukyuk).

So here is our little contribution to cool the oracle down a bit. Maybe he should relax a bit reading, playing games other than tennis, or both things!

Soooo obvious, that we’d better apologize in advance.

Note: Sorry kid, but this one’s Nintendo… no oracle software there… (hihihihihihihihihi)

Armani-labeled suits…

 

So here we go…Today the news is reproducing almost everywhere an email submitted by the oracle regarding the case of TomorrowNow’s, scheduled for the first day in November. There are even quite funny references to that (not saying the content is not serious).

But as we go through these references, we miss a certain link that explains why the outbursts from the oracle are coming these days, before the trial actually starts.

After all the mess about certain article published in NYT, a few days ago SAP formally asked for a gag order against the oracle.

And we think that this is probably one of the reasons why the oracle has actually exploded and certainly has done it before the trial started.

Should the gag order come effective, all the information and media influence about it would remain within the courtroom. So in certain way, this email from Big Mouth Larry is one more attempt to influence jurors before he must shut up publicly. it would be consistent with his style, as we recall his declarations about Mark Hurd’s ousting, and many other examples of his particular verbosity.

And trying to understand what he means in this email, we wonder what the need or purpose of sending it is .

First: He is not addressing that much the case itself, but more the fact of Léo Apotheker, former SAP CEO and currently HP CEO, attending the trial should he be called or not. His main point is this one. It is Léo Apotheker’s presence. The German exec is just one more witness in a longer list. SAP, the offender company, is hardly mentioned but incidentally, as the previous employer of Léo Apotheker.

Second: If he does have evidence about any wrongdoing by Léo Apotheker, then he indeed has a won case, and naturally Justice will grant him his demands. But it is up to the jurors to decide the verdict, not general public, and certainly not journalists. The case will be settled in a courtroom, not in parallel trials online.

Third: He boldly dares to guess HP’s plans of keeping Léo Apotheker away from the US in order to avoid having to attend the trial. Who is Big Mouth Larry to suggest cowardice of others?

We think that some explanation to the previous items lies in the hypothetical rationale in Big Mouth Larry’s feverish mind. If you want, the situation looks very much like crime investigation: The first suspects are usually those thought by investigators to get some kind of benefit from the crime.

One: By distracting its CEO, the oracle hits directly HP top managers. He would delay the effective start date at HP of Apotheker, and would have as well HP’s top managers sort of “distracted” too.

Two: All the energy and resources that Léo has and will have to dedicate to this issue won’t be therefore devoted to HP.

Three: HP’s reputation will be damaged. HP has already been too much in the news in the news because of legal matters: HP Board being sued by shareholder groups, HP suing Mark Hurd for lack of ethics, more shareholders suing HP for how the Hurd ouster was managed… not to mention earlier (and not so old) suit that cost the job to former chairwoman Patricia Dunn and so forth.

Four: Driving attention to Léo Apotheker in particular, and to HP and SAP at a broader level, effectively removes it from Mark Hurd primarily and Charles Phillips secondarily, much more tied to the oracle than to HP or SAP. This guys badly need it.

Five: Particularly related to Mark Hurd, this is a big favor from big-brother Larry… We could imagine, right after his ouster, Mark Hurd running out of tears to his tennis dear friend: “Larry, Larry, look at what they did to me; Larry, would you please stand for me?…”

Six: The self-assigned myth of invincibility and being above Good and Evil for Larry himself. Blinded by self-pride, the guy probably feels the need to prove himself and incidentally the rest of the world that his word is law… And a particularly sensitive community within the “rest of the world” is made up from the ranks at the oracle precisely. We would not be surprised if Big Mouth Larry expects his employees to fall down to their knees and surrender to the power of their Leader, like all those Ford-worshippers in George Orwell’s 1984.

It is said that Larry Ellison dresses in Armani suits. Being as rich as him, it is something that we could expect…Probably there are many Armani suits in the meetings and forums Larry attends.

   

Now, what we should not expect is to see are Armani suits in slum bullies brawling.

Elegance is more than just paying thousands of dollars for perfectly tailored suits, and ranking 6th in the list of wealthiest people in the globe…

If you’d follow me, it is not the suit: It is more the way you use and wear the suit. Armani, by the way, is just a label.

 

Ferrari is red

 

We are entering into the final steps of the Formula 1 world championship. We’ve got Red Bulls, Ferraris, McLaren-Mercedes topping chances to win, and many others.

All of these teams manage quite a lot of money, don’t they? Well paid managers and pilots, lots of PR and press around… Quite a numbers of sponsors who invest little fortunes that could solve our lives for several generations to come. Lots of glamour, lots of technology as well.

There is no clear dominant team, and the difference between one and the other is measured in milliseconds! Huh, quite detailed and precise measurements have to be in place to differentiate a winner from a loser.

When we see each of these teams performing, whether in qualifying sessions or in the actual Grand Prize race, each parameter is measured, verified, checked, and calculated. We do not know the throughputs in their computers, but must be big… and reliable. And this is just putting into practice hours and hours of background engineering work at the same detail level and requirement.

At the end, the difference between two of these teams can be summarized in a single word: Details. As many as you want, as technical as you like. But details, at the end of the day. Just details.

And these details will mean, at the end of the season, that several of the teams that race this year will not be there in the next season, and their place will be taken by new upstarts who will have to face the challenge of the details to survive.

In the race for dominating the PC industry we can see as well great teams around: The Apples, the HPs, the Dells, the Acers, the Sonys… and trailing Fujitsus, clone brands and others…

Any of these do manage quite a lot of money… And have well paid CEOs and managers; lots of PR around, and quite a number of partners who invest little fortunes that could solve our lives for several generations to come. Lots of glamour as well (fishy CEO events perhaps, or sailing oracles, or HP, Acer, Intel and AMD sponsoring high speed cars).. and, yes, we were forgetting: Lots of technology as well.

There is no clear dominant team, and the difference between one and the other is measured in basic points in share performance at Wall Street! Huh, quite detailed and precise measurements have to be in place to differentiate a winner from a loser.

When we see these guys performing, whether in Consumer market or in big Enterprise business, each parameter is measured, verified, checked and calculated, with as well lots of time, energy, money and resources invested in background tasks, hidden to the external observers.

At the end, the difference between two of these teams can be summarized in a single word: Details. Just details, that make or break success.

From what we have read in the news recently, it seems that Ferrari is the likeliest one to get a pilot winning the championship. If you want details, Ferrari’s leading pilot walks slowly all the length of each racing track a few hours before the actual race to see closely every detail in the circuit and leverage that when driving. Ferrari is red. The best apples in America, are red too.

Curiously enough, the second likeliest team to place a winning pilot is Red Bull. Well, the only “red” they have is in the name.

Incidentally, Renault, who already quit its chances to win anything after two years of glory some time ago, is sponsored by a certain HP.

Testosterone and medicine

 

It has been repeated in many different media that Larry Ellison (66), Pontifex Maximus at The Oracle finds IBM as its ultimate foe, or, more politically correct, its number one competitor.

That very same Pontifex Maximus, in a questionable move, recently hired a certain Mark Hurd (53), former CEO at HP, to join its board of directors, and serve as President for Sales and Marketing.

Hurd’s hiring started a controversial action from its former employer that involved a lawsuit filed against him on the grounds of potential disclosure of HP’s confidential information, which was finally settled for a bunch of dollars in stock, in our opinion. In the meantime, Larry Ellison, contrary to what could have been expected from his reputation, kept what could be thought of as a prudent silence, yet quite eloquent for our taste.

This last move was made at the expense of Charles Phillips (50), who has to leave his comfortable armchair to Ellison’s tennis buddy.

Charles Phillips, as we have mentioned in an earlier post to this blog, showed some habits that made Mr Hurd a natural replacement for him, by the way…

Funny enough, the now well known emulator of Tiger Woods has been appointed CEO at Infor, Not as important as the Oracle, still relevant in direct competition to Larry’s company.

Well, curiously enough, guess which are Infor’s strategic partners… Do you find the explicit references to something big and blue?

We have no idea of the details in Charles Phillips severance package from the Oracle, if any, nor we know anything about potential lawsuits against him from The Oracle in the name of Ethics or anything like that. We do not know if the Pontifex Maximus will be able to hold his mouth and prevents his tongue to be unleashed. We do not know either if Phillips plays tennis with Infor execs… But you would need to agree with me that the story is too good to keep it unwritten.

While the Pontifex Maximus tastes his own medicine, we will wonder what happens to men when they reach their fifties… is it a sudden unbalance in their testosterone index what happens at that age?

And, frankly, to those who still believe in Father Christmas and the ability of powerful public people to keep private life separate from professional life, now do you feel comfortable about having Charles Phillips advising President Obama about economic recovery? (Please note who sponsors the news)

 

Sirens’ songs and sirens’ screams

 

In times of economical slowdown and scary unemployment rates, there still can be found people that don’t seem to be lacking work for some time. It could be a good thing to see this if it were from the distance. Not for the HP Board guys, we believe, that are (again) getting stuck in legal stuff. This time it is Saginaw Police and Fire Pension Fund who claims justice, according to Bloomberg’s

Not at all good for the company they lead, as legal issues do not usually add value to shareholders, do they? Can HP afford losing more time, energy, resources and ultimately its reputation?

It may be argued that the main target here is (again) Mark Hurd, CEO at HP for the matter of this lawsuit. Still some names from the HP Board are being included there. But yet, the issue with finger-pointing Hurd is that he is just the main face standing for HP before court.

Will this impact Oracle too? We believe the impact in Oracle will not be significant. After all, Hurd has two strong execs to back him up at home, Larry Ellison as CEO and Safra-Katz as co-president. They will be able to manage, as they would even in the case that Hurd could be 100% on board. Still the guy’s reputation will be stained once more.

Time will let us know what goes on with this story, but we cannot help a compassionate smile after how fishy the guy is getting by the day: Trapped by Fisher-woman, haunted by the siren chants from the Oracle, chased by the siren screams from the Police and Fire Depts at Saginaw, Michigan.

We wonder how the guy would answer an invitation for dinner in a seafood restaurant…

 

.

They might hear…

 

Many times in their lives, in many different aspects of it, people have gone through having an idea, having a contribution to make to someone else, trying to improve things, attempting to feel valuable for themselves.

In those few cases where an eloquent and awkward, yet devastating silence is not the easy answer of those who already have made their minds up, it is not uncommon to get a polite smile back together with nice sounding words: “I hear you, but…”

These words are usually just a standard introduction to enumerating all the reasons that person has to let you know in front of everybody in the room how stupid you have been for attempting to speak up, and to make sure you understand your opinion will be treated with kingly disregard. The real plain translation is more about “I already made my mind up; I have been magnanimous enough to let you know about my thoughts.Now shut up, and do as you are told”.

Someone said that courage is what it takes to stand up and speak; courage is as well what it takes to sit down and listen; he was awarded a Nobel Prize, by the way.

How many times will we still miss a reply starting with “I listen to you, and…”

The Greater Evil

 

In an obvious reference to justifying an open alliance with Iosif Stalin, Sir Winston Churchill dared to publicly state that “If Hitler invaded hell I would make at least a favorable reference to the devil in the House of Commons”.

Quite a bold statement, indeed, for it was pretty much inconceivable at that time that the British people would find themselves friends with the arch-enemy, Bolshevik Soviet Union.

If we review Winston Churchill’s memories, we can even find traces of personal friendship (at least to Sir Winston’s perception) at the same level of the one the author declares for Franklin D. Roosevelt.

Of course, the situation in Europe and the rest of the world at that time more than justified such strange friendship, beyond a simple political and military alliance, and what Sir Winston really meant was that if Stalin was bad, Hitler and Nazism was even worse. He was choosing to oppose the Greater Evil.

However, we are not so unfamiliar to seeing weird friendships every now and them in areas such as war or politics, aren’t we? And, should we accept the thesis that business is not much different of war and politics, we should be used to seeing strange partnerships at different levels in this environment too. Like the case of the HP merger with Compaq, or the sudden reconcilement of Dell and EMC.

Furthermore, sometimes strange friendships in business go beyond mergers or alliances and reach individuals. The most recent case we have learned about has to do with Mark Hurd’s hiring by Oracle.

One of the most frequent reasons quoted to justify or explain Hurd’s acceptance of a job below the ranking of a CEO was that Oracle CEO Larry Ellison and Mark are friends, buddies, pals and other synonyms, besides the fact of playing tennis together every now and then.

Leaving aside that tennis matches by these two individuals would probably be similar to watching a Jane Fonda’s remake of one of her honeymoons (Ellison being 66 and Hurd being 53 is no sophomore match despite how gallant their sports style was thirty years ago), their so-called friendship still has a lot to go through to be understood or simply trusted. 

After all, Hurd was still leading the HP armies when Larry Ellison started a de-facto war by stepping into the hardware business after having purchased Sun Microsystems. A Sun in the Twilight was no match to Hurd’s hordes, of course, but backed by the power of the Oracle, it could quickly turn into a serious threat.

In such situation, it could not possibly be a part of the Oracles’ wildest dreams to get Hurd on board…but then mysterious Fate in the form of a non-sophomoric (Jodie Fisher is 50) scandal struck the industry, forced Hurd’s way out of HP, and opened the opportunity for the Oracle, who simply ignored everything after Hurd’s ouster and quickly got him into the ranks.

Hurd did probably not hesitate much, and soon was presented as co-President of the Oracle, reporting to Larry Ellison, in hail and praise. He succeeded Charles Phillips, who, by the way, was not precisely candidate to sainthood himself.

From bitter foes to intimate friends in a matter of days? Difficult to believe, despite whatever business HP and the Oracle might have done in the past, and despite how many “alliances” they formed.

Was not Ellison “making at least a favorable reference to Hurd in front of his own particular House of Commons”? We believe he did. And then, naturally, the next question is sort of obvious: Who is then the Greater Evil? Well, we think that Ellison is so proud of himself that he could eventually believe himself a sort of Hercules fighting against an Hydra or IBMs, SAPs, HPs and a portion of the rest of the Universe.

Going forward, we as well see deeper parallelism with Sir Winston’s case, if we look to the personal level of this weird friendship. As in the Churchill-Stalin case, there is probably a love-hate and fear-attraction mutual feeling between the two. In our opinion, Hurd wants to become CEO again, and should Oracle get to the dominant position Ellison wants it to be, hitting the CEO job by then would be a more than acceptable settlement for him to cool down his testosterone…

On the other hand, Ellison would crave the execution ability that Hurd demonstrated at HP, and keeping Safra Katz as the gatekeeper, just in case, at least while Hurd proved he would not screw up again, and returned part of his cost in results for the Oracle.

Forced equilibrium in any case between these two heavy weights (and heavy egos) that we do not really believe will last for ever and will potentially end up in a burst similar to the breaking of Stalin and the Western Powers at the dawn of the Cold War.

Both of them, Ellison and Hurd, will have to pay a price for it should it happen… Being the 6th richest man in the world would allow Ellison to afford it. In the case of Hurd, lets hope this time he goes for more mature toys, and does not pay the Fisher-Price.