Oracle's New Support Czar Has Big Challenges
Oracle has tapped longtime executive Charles Rozwat to head up oversight of its support organization, a job that now takes on added complexity due to the hardware products gained by the company's purchase of Sun Microsystems.
Rozwat, who was not available for comment Thursday, will report to Oracle co-President Mark Hurd. He used to be executive vice president of product development at Oracle, but that role switched over to Thomas Kurian after Rozwat took a leave of absence last year to attend a graduate program at Harvard.
He enters the job at a time when some Oracle applications customers are not happy with the vendor's support service, according to an ongoing study by research firm Computer Economics.
Some 48 percent of E-Business Suite customers and 41 percent of PeopleSoft users among the roughly 100 respondents are dissatisfied with Oracle support. Moreover, 63 percent of E-Business Suite users and roughly half of PeopleSoft and JD Edwards customers complained that Oracle charges too much for support, according to the study, which is still accepting responses.
Many people who have answered the survey cited the length of time and number of calls it takes to support to get problems resolved, said Frank Scavo, president of Computer Economics.
Software support revenue is the lifeblood of companies such as Oracle, since that provides steady, high-margin income even as new license sales slow.
Therefore, the survey results would seem to predict a healthy future for companies like Rimini Street, which provides third-party software support for some Oracle applications at discounted prices.
However, three-quarters of respondents expect no change in Oracle's share of their IT spending three years from now. That figure could partly reflect the fact that Oracle is suing Rimini Street as well as former SAP subsidiary TomorrowNow, which provided similar services, claiming intellectual property violations. Both cases have yet to go to trial.
Meanwhile, Rozwat appears to be in a pretty good starting point to support Oracle's hardware customers, according to one observer.
"The interesting thing about both hardware and software support is the vast majority of the activities involved are effectively the same," said IDC analyst Matthew Healey, who specializes in vendor support services. That's because most of the hardware problems customers encounter are actually due to the software running on that machine, he said.
Of course, there are obvious differences with hardware support, namely the cost and operational logistics of providing part replacements, he said.
But Sun had a slew of executive-level and operational staff who were well-versed in these matters, and Oracle has retained many of them, Healey said. "[Rozwat's] got a pretty knowledgeable infrastructure in place. If he pays attention to them, he will do quite well."
Oracle faces less of a threat from third-party hardware maintenance companies because it has made a strategic decision not to compete in commodity servers, Healey added. Instead, Oracle is mostly pushing high-powered, engineered systems like Exadata and Exalogic, which combine software and hardware for data processing and application delivery.
"The third-party maintainer market in hardware is much more robust than it is in software," but primarily with regard to commodity machines, Healey said. These companies can thrive due to ample supplies of used replacement parts and experienced talent. In contrast, Oracle's integrated systems are relatively new, meaning third-party providers don't have the same advantages.
However, firms like remote database administration provider Pythian Group are set to play a role in supporting Oracle's specialized hardware. Pythian has already formed an Exadata practice and intends to do the same for Exalogic, said founder and executive chairman Paul Vall
The point of Pythian's practice is to help customers select such systems, convert applications to run on them, "and then manage the long-term operational support challenge," Vall
Even if it wanted to play such a role, there are some things Pythian simply can't offer customers, Vall
Overall, Rozwat has serious challenges ahead of him in "providing the internal cohesion that will deliver customers the value they expect for such systems," Vall
Rozwat's job might be made easier by Oracle's next-generation My Oracle Support portal. The system, which experienced some initial performance hiccups and subsequent user discontent, is supposed to improve customer satisfaction with features like proactive system "health checks" and patch recommendations.
Overall, Rozwat seems to have a good handle on what will be required to keep customers happy, said Healey, who recently met with Rozwat. He declined to provide specifics of their conversation, citing nondisclosure agreements.
One of the biggest problems in the support services world is vendor finger-pointing when problems crop up in a system involving multiple companies' products, Healey said.
"Support organizations have to be above the competition," Healey said. "Customer success must come first. It's fine for the salespeople to fight with each other. The support people cannot. ... I have a feeling he understands that."
Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris's e-mail address is Chris_Kanaracus@idg.com