Lords of May-hem, A Perspective
WMMM #065 - This week, I share my perspective on the magic of May at Oracle.
Jeff Keplar Newsletter May 18, 2024 4 min read
When you think of May, what comes to mind?
The Stanley Cup Playoffs?
Planting Mother's Day flowers?
Getting the backyard ready for summer BBQs?
The French Open?
Graduations and commencement speeches?
Getting the boat ready for Memorial Day weekend?
The Indy 500?
May 31st
I recently read an article in TheRegister.com, Lord's of May-hem - 7 Signs it is Oracle's year end.
I shared it with a former colleague who is still with Oracle.
May 31st is the last day of Oracle's fiscal year.
May was special for me for 20 years of my life.
The article was interesting, but I have a different perspective on much of it.
Forgive me.
I can't help myself.
In this week's edition of Win More, Make More, I provide my view.
80/20 Rule
It may be helpful to define the lens through which I remember May.
I was a people manager and a sales leader for my entire career with Oracle.
I was responsible for individual contributors, their managers, or their managers' managers.
Depending on the territory, one account or two hundred, an individual contributor may or may not have a deal closing at the end of the year.
That was not the case for me.
With a sales team, I always had people with deals in play over Memorial Day weekend.
Our domain was the enterprise space.
Enterprise meant Fortune 500 accounts with sales of approximately $5b to $500b annually.
Oracle's enterprise software found its most significant value propositions in this space.
As a result, these accounted for a disproportionate share of Oracle's revenues.
The 80/20 rule, also known as the Pareto Principle, states that eighty percent of the outcomes result from twenty percent of the causes.
The sales translation to the Pareto Principle is that 80% of the revenue comes from 20% of the accounts.
Another variation is that 80% of sales come from 20% of your salespeople.
With over 400,000 customers, 80,000 accounts amount to Oracle's 20%.
With Oracle, 80/20 is too generous.
I'd proffer that only 1% of the accounts generate 99% of Oracle's revenues.
The way Oracle organized its go-to-market provides a clue to this extreme.
I had several accounts that, by themselves, produced more revenue than several Oracle sales regions combined.
Oracle of 2024 versus my time there
I joined Oracle when it had $2b in annual revenues and left when it had reached $39b.
Growth has slowed considerably, which is to be expected.
Oracle is at $52b annually today.
I expect that today is similar to my experience with the large accounts, the ones that generate 99% of the revenue.
In any case, this was my world at Oracle, and it colored my view of May.
May means a frenzy of Oracle meeting requests and audit threats?
This appears to be the "Hollywood" version of what happens.
It does not match my experience.
In my world, if one waited until May to schedule an appointment to create a year-end deal, they were delusional.
Deals with enterprise accounts involved dozens of stakeholders and required multi-month sales cycles.
These accounts had many employees with management layers that had been with their employer for years.
They had long memories.
Threatening an audit was not a winning strategy and was unlikely to be used by anyone senior enough to work on these large Oracle clients.
Pressuring customers?
I'd like to know how one "pressures" an AT&T, JPMC, or Walmart into buying something if they don't want to.
Again, this is "Made for TV" hype in my world.
It is much more likely that the professional sourcing groups within these large enterprises will wait until any quarter-end, especially a fiscal year-end, with all of their vendors to introduce a new set of terms and conditions into an ongoing negotiation in an effort to extract a last-minute concession.
Threaten license compliance?
As described in an earlier edition, The Origin of the ULA, the Unlimited License Agreement (ULA) eliminated the account's exposure to miscounting license usage.
Most of the largest enterprises had ULAs within five years of its introduction.
In my experience, the customer and the Oracle sales team directed all their energy to determine the price for renewing their ULA and its attendant value.
Most of Oracle's big contracts expire
I did not have a beef with this statement.
In my experience, this had more to do with the customer than Oracle's sales force.
In fact, Oracle's sales leaders (and its stockholders) would prefer revenue spread evenly across all four quarters.
It is much easier to beat your YoY compare every quarter than having the hockey stick that came with Q4.
Experts warn that ULAs do not offer the best prices
I had a different experience with enterprise accounts.
If their business was expanding or their use of technology was growing, the ULA was by far the best value.
Especially those who have not met their quotas
If one reached May without a path to quota, little could be done in one month to change that.
All of the threats of audit, text messages, and phone calls in the world wouldn't get it done.
For those individuals who had performed for Oracle in the past and found themselves short of quota when the calendar flipped to May, the behavior was more reducing their efforts in preparation for making a run again "next year."
This behavior was desirable for Oracle, especially compared to the Hollywood script's description.
Oracle's sales support resources (legal, revrec, migrations, business practices) were already stretched to the limit every May.
We often had a bottleneck where the largest deals that had been worked on for months received priority with the limited resources.
If we added additional tasks to their plates from those who had no chance to close those transactions, it risked jeopardizing the deals that could close.
My experience was precisely the opposite of the article in TheRegister.com.
The highest volume of activity was generated by those who had made their quotas and were capitalizing on the Oracle Sales Incentive Comp Plan that accelerates commission rates once the quota is achieved.
Your boss gets calls
If we had not aligned our sales process and mapped the appropriate Oracle stakeholders to the account's buying process and stakeholders by May, then shame on us, and good luck with closing our deal.
We had multi-year relationships with these accounts and the employees within them.
I rarely saw what the article stated in the enterprise space.
Last Minute Drama?
Did we have last-minute drama with these large enterprises?
Of course, we did.
Murphy's Law was alive and well in my 20-year run.
The pressure to close those large transactions in a compressed time frame was almost unbearable.
It created many of the "stories" I share in this newsletter.
Lessons Learned
1) May was magic, but the work was done months before.
2) When you are in sales, you need thick skin.
3) Many think they know what goes on behind the scenes.
4) Pressure is a privilege.
Win More, Make More is taking next week off (making up for those 20 lost Memorial Day Weekends) and returns on June 1st.
Thank you for reading.
Jeff
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