Academic journal article Journal of the International Academy for Case Studies

Larry Ellison and Oracle Corporation

Academic journal article Journal of the International Academy for Case Studies

Larry Ellison and Oracle Corporation

Article excerpt

CASE DESCRIPTION

This case makes a contribution to the field of entrepreneurship by focusing on one of the most successful entrepreneurs and companies of our generation. The case can be used in undergraduate entrepreneurship, small business management, or strategic management courses.

Students will find the case study informative for several reasons. They will learn about the personality and background of Larry Ellison. What were his motivations and experience before he became an entrepreneur? Students will also learn about how Ellison founded and grew Oracle Corporation. Finally, students will examine the current problems and opportunities that confront Oracle in 2011 and they will be required to make recommendations to Ellison and Oracle.

CASE SYNOPSIS

The case examines the background, personality and rise of Larry Ellison, one of the most prolific entrepreneurs of our generation. Ellison, who co-founded Oracle Corporation, was the third wealthiest man in the United States in 2011 with an estimated net worth of $33 billion. The case further documents the startup, growth and current problems and opportunities confronting Oracle Corporation, the world's largest multi-faceted software company.

Ellison got his start by working on a database project for the Central Intelligence Agency (CIA). Codename: Oracle. In 1977, Ellison went into the database business for himself and founded Oracle with Robert Miner and Edward Oates. Over the last 33 years the mogul grew Oracle into a dominant player in the database, software, and server industries. The current market cap was $150 billion and Ellison owns more than 20% of the company.

INSTRUCTOR'S NOTES

DISCUSSION QUESTIONS

1) Discuss the background and personality of Larry Ellison.

2) Perform Porter's Five Forces Model of Industry Analysis on Oracle. What distinctive competencies and resources does Oracle have?

3) Calculate the financial ratios (key profitability, liquidity, and asset management ratios) for Oracle using the financial statements in the case for Oracle over the past five year period. Based on the financial ratios, is Oracle financially healthy? Why or why not?

4) What were the major problems and/or opportunities facing Oracle Corporation in 2011?

5) What recommendations would you make to Larry Ellison and Oracle Corporation? Why?

DISCUSSION QUESTIONS WITH SUGGESTED ANSWERS

1) Discuss the background and personality of Larry Ellison.

Lawrence Joseph Ellison was born in the Bronx, New York on August 17, 1944 to a 19 year old unwed Jewish mother, Florence Spellman. Ellison's childhood began with a bout of pneumonia, at nine months of age, which drove his mother to relinquish custody to her aunt and uncle hoping to provide him with a better upbringing. Ellison was adopted by his great aunt Lillian and her husband Louis Ellison, who lived on the South Side of Chicago. Ellison did not know until he was 12 years old that he was adopted, and would not meet or reunite with his birth mother until he was 48 (Encyclopedia of World Biography, 2004).

As a boy, Larry Ellison showed an independent, rebellious streak and often clashed with his adoptive father, Louis Ellison (Academy of Achievement, 2010). His father had very little faith in Larry and saw failure around every corner for him. According to Ellison, "My father would regularly tell me that I would never amount to anything. Oh, it was a powerful motivation. I think my dad had a wonderful effect on me. If fire does not destroy you, you are tempered by it. Thanks, Dad" (Wilson, 2002). In high school Ellison was quiet and withdrawn, an average student, but very intelligent.

After high school, Ellison enrolled at the University of Illinois in Champaign-Urbana with aspirations of becoming a medical doctor. However, he was uninterested in the subjects and found math and science stimulating. …

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