Oracle Explains 'Acquired Innovation' Strategy

Oracle (ORCL) has taken over the Moscone Center and cordoned off streets this week in San Francisco for the annual gathering of its tribe. Last night CEO Larry Ellison celebrated the 30th anniversary of the company he founded, with “Saturday Night Live” member Darrell Hammond doing an Ellison imitation. Ellison then talked about starting the company with a CIA government contract and how he found Oracle’s first CFO, an accounting major at the University of California, Berkeley, who was delivering pizzas part-time.

This morning Ellison’s number 2, President Charles Phillips took the stage to address the 43,000 OpenWorld attendees. He was preceded by the “Star Spangled Banner” and a salute to veterans on this Veteran’s Day in the U.S. Phillips is a former Marine officer and comes from three generations of soldiers, he said.

Phillips described the company’s product family, and then launched into the heart of Oracle’s strategy, which is embodied in 41 acquisitions in 45 months. He came up with a new term for Oracle’s acquisition strategy–”acquired innovation.” It’s an extension of Oracle’s research and development arm, he said. “We have become the IPO market for the enterprise software industry….for every one we do there are 100 that we don’t do,” Phillips said.

Oracle’s strategy is to be more complete, better integrated and open and standards-based, he explained. In other words, Oracle delivers a complete, pre-integrated suite that is also open. “We include connections to third-party applications made in Germany if that’s what’s needed,” Phillips said referencing rival SAP. “It’s a big job and big ambition but we have enough scale and vision to get there,” he added.

Phillips outlined key announcements for the week, and Oracle development chief Chuck Rozwat showed off the new products. Continuing to challenge Red Hat, Oracle has developed its own version of virtualization on Linux.

In addition, he announced process integration packs as part of the Oracle Application Integration Architecture, a platform for integrating applications from Oracle and third parties together. An integration pack can manage the interface between Oracle’s Siebel CRM or Agile PLM and SAP’s ERP applications, for example. Next year, Oracle plans to deliver pre-built Process Integration Packs for supporting scenarios such as for consumer packaged goods, process and manufacturing industries.

Oracle LogicalApps Active Governance is a new application for actively enforcing compliance policies, and Oracle Agile PLM is the company’s new application for product lifecycle management.