Is Former Hp Ceo Mark Hurd Fit to Lead Oracle?

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Is Former Hp Ceo Mark Hurd Fit to Lead Oracle?
By Thomas Lee

Silicon Valley is the land of second, third, fourth chances. Fail at one thing, simply do another.
Mark Hurd, however, doesn’t need multiple chances; one will do just nicely.

Four years after leaving Hewlett-Packard in disgrace over a sex scandal, Hurd remarkably and improbably finds himself CEO of another major technology giant. Last week, Oracle founder Larry Ellison resigned as CEO and named Hurd and Safra Catz as his successors.
  
Oracle Corp. CEO Larry Ellison, right, with his wife, Melanie Ellison, second from right, Oracle's co-Presidents Mark Hurd, left, and Safra Catz, listen during a keynote addressat Oracle World in San Francisco. Hurd is the former CEO of Hewlett-Packard Co. Photo: Paul Sakuma, AP

“It’s very rare that an ousted CEO gets a second chance,” said Anthony Bianco, author of “The Big Lie: Spying, Scandal, and Ethical Collapse at Hewlett Packard.” “People don’t change much in that short period of time.”

Let’s pause for a second and consider the magnitude of Hurd’s good fortune.

Hurd, if you recall, resigned from HP in August 2010 amid an investigation into claims that he sexually harassed contractor Jodie Fisher. Technically, the board cleared Hurd of sexual harassment but found that he improperly used shareholder money to pursue her.

Normally, someone like Hurd would be radioactive to the C-suite — at least for a couple of years. But Hurd is friends with Ellison, another idiosyncratic, dominant leader who’s no stranger to controversy. A month after Hurd quit HP, Oracle hired him as co-president.

Of course, Hurd is an experienced CEO who led a Fortune 500 company. So why wouldn’t Oracle hire him?

Hurd enjoys a reputation for financial management, an executive who can squeeze profits out of any business.

“He’s very good at it,” said Bill Kreher, an analyst with Edward Jones Investments in St. Louis. “He’s a very disciplined manager. He’s also good at communicating with Wall Street.”

Since Hurd joined Oracle, the company’s stock has risen about 75 percent, but “I don’t know if I want to give him that much credit,” Kreher said.

Oracle owes its improved performance to acquisitions and a rebound in the company’s core server business, Kreher said. And Hurd lacks a gift for innovation, which is exactly what Oracle needs to catch more nimble cloud players like Salesforce.com, analysts say.

The deeper question, however, is not necessarily whether Hurd is qualified to be Oracle CEO, but rather if he deserves to be.

A disgraced CEO could use some time off to reflect on his mistakes and repair his reputation. Once the controversy simmers down, he can resurface for the right opportunity.

Hurd, however, went to Oracle almost immediately after his exit from HP. Since then, Hurd has “kept a pretty low profile,” Bianco said. “He’s hidden himself away from the press.”

But staying quiet does not mean Hurd has grown as a leader.

“He lacked the moral character to run HP,” Bianco said. “Does he have the moral character to run Oracle?”

Bianco notes the sexual harassment case wasn’t Hurd’s only failing at HP.

Under his watch, the company hired private investigators to determine which member of the board was leaking confidential information to the news media. Those investigators tried to obtain phone records from directors and journalists at the New York Times and Wall Street Journal.

“Hurd never took ownership of his actions,” Bianco said. “He’s expressed angst at his exposure to the scandals, but I never heard anyone say he expressed contrition.”

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September 30, 2014 at 11:23 AM