BOSTON—Oracle President Mark Hurd says the incoming generation of consumers—the Millennials—are not going to be like those of his generation, who grew up in an age when the power in a business relationship oftentimes rested with the vendor.
Instead, the new generation—which currently represents 18 percent of the United States' $17 trillion in gross domestic product (GDP), a percentage that will rise rapidly over the next few years—has more power and more knowledge, thanks in large part to the technology products like smartphones they can now leverage.
These consumers are less loyal to companies, less patient with bad service, more sophisticated, more mobile and more picky, according to Hurd. And if vendors of any size want to continue to stay in business, they will need to be able to navigate this changing business environment and meet the demands of the Millennials.
Hurd, speaking at the first Oracle Industry Connect event here March 25, said people of his generation—many of whom are helping to run these businesses—are used to poor service from vendors, from waiting on the phone for 20 minutes to deal with a company's call center to getting their call dropped.
"Now, when I get great service, it's a treat," he said during his keynote address. "Not my kids. When they get bad service, they leave. … You're chasing a much more sophisticated, mobile consumer. "
Technology is driving a lot of changing dynamics that are giving new shape and definition to the changing vendor-consumer relationship—as well as the evolving employer-employee relationship—and technology also can be leveraged by businesses to help them thrive in the new business environment, Hurd said. That includes everything from the cloud to big data analytics to the Internet of things, and industry-specific applications that can help organizations in these segments address their particular issues.
That last part is the focus of Oracle's two-day event here. The giant enterprise application vendor over the past several years has built up a business that focuses on several individual industries, including retail, utilities, communications, financial services and health sciences. The individual business units within the industry-focused strategy have their own consulting and sales staffs—more than 20,000 Oracle employees work in the industry units—and their own R&D budgets, and develop software to address industry-specific challenges.
Oracle is working on a two-pronged business model, Hurd said. The company continues to sell its database and other enterprise solutions to any organization that wants to buy them. However, by also focusing resources on individual industries, the company can develop specific solutions that can be replicated many times over throughout an industry. And if, for example, Oracle can solve a particular problem at a bank, it benefits all of Oracle, he said.
Oracle is doing this through both organic development and acquisitions of companies that develop industry-specific technology solutions.
The results have been good, according to Hurd: Since 2010, revenues in the industries have tripled.
"The commitment by us is huge," he said. "We've bet on this with our wallet. You will see us pick up the pace to take leadership [positions] in key industries. … The good news for us so far is that it's worked."