As Published In May 2007

Connecting with Customers

An Interview with President Safra Catz

Safra Catz' devotion to Oracle and its customers has been readily apparent during the years since she joined the company. Although her responsibilities at Oracle are broad, included is an executive sponsorship role that puts her in daily contact with customers all over the world.

Catz joined Oracle in 1999, has been president since 2004, and has served as CFO since 2005. She spoke with Profit about Oracle's relationships with its customers and how companies have to work with customers if they expect to succeed in a competitive environment.

PROFIT: Thirty years for a tech company is quite an accomplishment. Why do you think Oracle has prospered through the boom and bust?

CATZ: Oracle never rests on its laurels—never. It is always looking forward and trying to build better products for customers. It never takes anything for granted and it keeps improving.

PROFIT: Oracle has changed a lot in the past few years. How do you see Oracle's current position within the technology industry, both the way it's perceived and how it compares to other software companies?

CATZ: As the industry matures, and it's become clear that customers need better products, it has meant that customers have needed companies that can afford to invest wisely in R&D. Our No. 1 mission is to invest in development and products.

PROFIT: What's your philosophy about how a company like Oracle needs to interact with its customers?

CATZ: When people buy our products, they're not buying something that is disposable. It's really a commitment to the future. Buying our products is the beginning, not the end, of the relationship. A lot of companies look at their customers and say, "Once you pay me, the work is done." The view we take is that once you purchase a product from us, our responsibility increases dramatically and it is really our job to make you successful, because we can't be successful unless that happens. Maybe it's a cliché, but we shine in reflected glory only. Whatever it is that our customers need to be successful, we're going to try to make available to them.

PROFIT: Can you tell us a little about a customer that you're working with now?

CATZ: I am the executive sponsor for the U.K. government, and because I've been very involved with them and have taken the time to understand their needs, we were able to develop for them a very special and revolutionary program that allows different government entities throughout the U.K. to acquire products from us and to benefit from our best practices in streamlining and transforming all these different groups. That's one of the most unusual executive sponsorships, because it actually covers many, many groups. I work personally with the Department for Work and Pensions and the Foreign Office and a number of other groups that are using our technology to transform their organizations. I get personally involved in their implementations and I'm updated on the state of affairs. And to the extent that development needs to participate in something, I watch to make sure that it's going according to plan.

PROFIT: How often do you talk to any single customer?

CATZ: It all depends on what the customer needs and wants. It's not me calling every week or anything like that. It's really the idea that I'm always available, checking in once in a while, but available if they need something, whether it's looking into a support matter or making sure the right resources are in place for them when they need something unusual or special. It's entirely customer driven. They're all very busy themselves and it's a matter of being available when they need help or guidance.

PROFIT: How can executives train themselves to think this way about their customers?

CATZ: There's an expectation that when you become a senior executive that you got there in part because you're really listening. It's very, very important to listen to your customers. They're it. They're doing you a favor by telling you what they think and you can't get to this position without listening to the issues and engaging in creative problem solving, because that's what this is really about.

PROFIT: Is there a flip side to this kind of relationship? What happens when the customer asks for something that doesn't make sense for Oracle?

CATZ: I think it's very important that customers do share their issues—their concerns—but it's also important to understand that sometimes being a good partner does mean saying no. But what that really means is getting into the reasons behind a request, and understanding why the customer needs some particular thing. One of the most valuable pieces of information we can give our customers is that their request is completely unique. And so it's very likely that their request is going to end up being very expensive for them to maintain, and though we are willing to help them build it, they might want to benefit from the experience of others. So we tell them that, honestly, there are issues or processes in your organization that you may want to reconsider because others are doing the same basic accounting and aren't spending as much. Sometimes being a good partner is being honest even when it's not that pleasant.

PROFIT: Obviously this degree of involvement at your level is a huge benefit to the customer. Can you talk about what Oracle gains as well?

CATZ: Well, first of all, since our products are aimed at solving customer problems, it's very, very important to understand what those problems are. The more we know about what's going on with our customers, the better off we are as partners and as vendors. It ultimately translates into having better products, better consulting, and better service. For me, it brings a level of realism into the abstract world of just building products and sending them over the wall. So it's a real virtuous cycle, because the more you know about what your customers need, the better you are able to serve them.

PROFIT: As president of the company, people must love talking to you and getting face time with you, but how often do you need to escalate or divert questions and problems?

CATZ: Most customers really just want to know that you're watching what's going on for them. In fact, many don't actually even want to talk. They want to send you a quick note. Let's say there's some issue with a product and there's a bug. They know when they send a note to me that I'm not actually going to fix the bug. They don't want me to—I haven't programmed for 25 years. They want me to know there's an issue because they now have faith that if I know there's an issue, I'll check into it and find out how serious it is. Customers themselves aren't unreasonable, because they're all businesspeople and their expectations are set totally correctly. In fact, sometimes I'm upset that there's an issue I don't know about and the customer hasn't called me.

PROFIT: What kind of advice would you give to another executive who is dealing with a relationship that's about to go sour, a customer that's about to say, "Thanks but no thanks, I'm going to your competitor?"

CATZ: The first thing that's important is taking a step back, because often there's some dispute about 10 percent of the business, something perhaps not that important but it's being escalated because everybody got locked into positions that are literally intractable. You have to step back and look at the relationship as a whole, because what you often find is that there's actually a lot of good locked in there somewhere and it got lost. Often having that initial goodwill and having experience in the relationship and building trust over time on other issues will help you get over some of these small things.

Oftentimes, there can be a breakdown as a result of a negotiation on a contract. A contract is all about your rights if things go wrong. When that happens, you have to step back and say, "We've been together for X number of years" or "This is what I'm bringing to the party."

Sometimes you actually have to go ahead and take some risks on some of the issues, but have a very thorough discussion about what a particular issue means to you and what it means to the customer. They'll share their concerns with you—"This is what I'm afraid of." "Oh, is that what you are afraid of? We can fix that." But everyone has to be willing to have an honest dialogue about the issues. Sometimes you have to take some blame for something that's happened in the past and say, "I was wrong. That was a mistake." And maybe it's not you, but it's your company, which means you're responsible. I'll say, "Okay, if that's what we did, I'm sorry about that. Let me see how to make that right."

The most important thing is to understand the goals and issues of the customers and work through them. Often hard work can solve most problems as well as some real willingness to try. After all, something brought you together in the first place. For those of us who are charged with working with customers, it's a real win for us. It's a great experience to watch a customer benefit from our products, because we do believe that we can help them. And when they reap the benefits of the relationship, it's very satisfying.