The redemption of Oracle’s Mark Hurd by Adam Lashinsky @FortuneMagazine June 8, 2015, 6:53 AM EDT E-mail Tweet Facebook Google Plus Linkedin Share icons Mark Hurd had a problem. It was 2012, some two years after he had executed one of the most dramatic escape acts in corporate history. Just weeks after giving up his powerful perch as CEO of computer maker Hewlett-Packard HPQ in the summer of 2010, Hurd landed nearly at the top of software giant Oracle ORCL , with a critical assist from its co-founder and chief executive, Larry Ellison. One moment Hurd was fending off mortifying allegations of sexual harassment and expense-account violations; the next he was safely ensconced in a job that would pay some $40 million in his first year alone, working for a man who didn’t give a fig what envelopes Hurd might have pushed—so long as he made his numbers. Now, though, Hurd faced a very modern conundrum: In the Internet Age, it’s nearly impossible to escape your past. For evidence, he had only to look at the results of a Google GOOG search of his name. High on the list was the website fuckyoumarkhurd.com, his reward for having methodically slashed costs at the famously hidebound HP during his five years at its helm. The site contained all manner of negative stories about him. Worse, search results persistently yielded photos of Hurd with Jodie Fisher, the reality-TV actress who’d helped him manage HP customer events around the world. Back in 2010, Fisher had hired the press-release-wielding lawyer Gloria Allred to allege that Hurd had harassed her, which set in motion the events that culminated in his departure from HP. Anyone would be upset. Hurd, with a finely tuned sense of self-image, was livid. “All he could talk about was how he was seething about what happened at HP,” says an executive who preceded Hurd at Oracle and has since left. To solve the problem, Hurd turned to a former investigative journalist named Glenn Bunting, who had repositioned his career as a media adviser for businesspeople with problems they wished would disappear. Bunting, who had held senior positions at the Los Angeles Times, had learned the black arts of crisis communications working for one of the field’s top practitioners, Mike Sitrick. It was through Sitrick that Hurd met Bunting, who shepherded the former CEO through the trying circumstances of his fall from grace. Hurd’s instruction was simple: Fix my Google results. So on Oracle’s dime, Bunting embarked on a campaign to gin up new content about Hurd that would displace the seamy and steamy material that turned up in an Internet search. A combination of Bunting’s efforts and the passage of time did the trick, and chatter about the circumstances of Hurd’s exit from HP finally receded. As that pall has lifted, a much sunnier picture is emerging: Hurd has thrived at Oracle, where he happily accepted the downward move of becoming co-president alongside Ellison’s longtime financial and operational consigliere, Safra Catz. Ellison rewarded both last September by naming Hurd and Catz joint CEOs of Oracle, bumping himself to executive chairman. Hurd with Safra Catz (left) and Larry Ellison (holding wineglass) at an Oracle event in September 2010, soon after Hurd joined the company.Photo: Tony Avelar—Bloomberg via Getty Images Suddenly Hurd is on top again. “A lot of people were skeptical of his ability to go from the limelight to the shadow,” says Tom Hogan, CEO of a mobile software company called Kony, who worked under Hurd at HP. “Now he’s emerging from the shadow with the co-CEO title. And it’s because he truly loves working for Larry.” The story of how Mark Hurd returned from tabloid fodder to Fortune 500 leader is an epic corporate comeback. It’s a good yarn, and one that Hurd, who has significantly increased his profile of late, appeared eager to tell. Bunting, who continues to serve as Hurd’s personal publicist, approached Fortune, proposing an article about his comeback. Then, concerned there would be too much focus on the past, Hurd decided not to participate after all. It’s a saga worth recounting nonetheless. And as Hurd knows full well, it’s not over by a long shot. He’s rising at a pivotal time for the 38-year-old company. Oracle is busily playing catch-up on an industry transition toward subscription-based, or “cloud,” computing that it badly missed. Moreover, Hurd has now positioned himself as the possible sole CEO of the future. Of course, potential heirs to the Oracle throne have traditionally lasted about as long as Ellison’s marriages (there have been four of the latter at last count). There’s also another contender or two for the top job. All of which is to say, Mark Hurd won’t be able to ease up anytime soon. Hurd is blunt and not shy about taking issue with almost anything. In a written statement, he dismissed the thesis of this article: “Redemption? While I appreciate the sentiment, I don’t think what I’m doing at Oracle has anything to do with redemption. I am thrilled to be at Oracle working with our team.” The statement doesn’t quite capture Hurd’s typical tone. He has vehemently denied any misbehavior at HP; to say he is unrepentant would be an understatement. (Hurd added, about his old company, “I don’t have much time to reflect on the past. I do have great memories of my time at HP, the fantastic results we achieved, and the people who made those results happen.”) HP didn’t view Hurd so rosily when he resigned. (Contrary to public perception, he was not fired.) The company concluded his behavior had been inappropriate—but cleared him of violating its harassment policy. Still, he suffered an irreparable rift with key board members, who felt he hadn’t been straightforward with them. It would be more than a year before details of an accusatory letter Allred wrote to Hurd became public. It contained a narrative of his alleged sexual advances to Fisher, including the claim that he once walked her to an ATM to show her the size of his account balance. Following a settlement of undisclosed terms, Fisher stated that Allred’s letter contained inaccuracies. But she never explained which parts were wrong. Precisely one month after the scandal broke, Ellison delivered a masterstroke. Comparing what he called the stupidity of HP’s board to Apple’s AAPL long-ago decision to fire his friend Steve Jobs, Ellison hired Hurd as president of Oracle, responsible for sales and marketing. Before sealing the deal, however, Hurd had to pass muster with Catz, a steely and powerful presence at Oracle who is fiercely protective of Ellison—and her relationship with him. “Safra spent six hours with Hurd before Oracle went public with the news that he was joining the company,” says someone with contacts at Oracle’s highest echelons. “She told him he wouldn’t live long enough to regret getting between Larry and herself or attempting to unseat Larry.” Oracle co-CEO Catz at the company’s recent media day.Photograph by Laura Morton—Getty Images for Fortune Oracle employees took the soap opera surrounding Hurd in stride. After all, Larry Ellison has often been linked to younger women, some of whom became his wives. And not long before Hurd’s arrival, the company witnessed the spectacle of the former girlfriend of his predecessor, Charles Phillips, plastering photos of the star-crossed couple on billboards in New York and other cities. “We got used to scandal and bad behavior,” says an Oracle veteran. Hurd has not only flourished at Oracle but succeeded in getting along with Catz as well as Ellison. “Mark has been deft at contributing without competing with or criticizing Larry or Safra,” says the same well-informed source. Hurd’s main job is to help his massive sales force close deals with the world’s biggest companies. Says this source: “He’s great at his role, which is bagging elephants.” Hurd and Oracle, it turns out, are ideally suited for each other. The 58-year-old spent more than two decades at tech equipment maker NCR NCR , rising through the sales-and-marketing ranks to become CEO before being recruited in 2005 to replace the recently fired CEO of HP, Carly Fiorina. Along the way he developed a reputation for directness, by-the-numbers analysis, and a zest for closing deals with customers and currying favor with investors. If Hurd didn’t always care for the niceties of making employees feel good, he always got results. In Oracle he found a rough-and-tumble environment known for its bruising sales and engineering cultures. A former Oracle executive describes the company’s people as driven yet pompous and territorial. Oracle has a reputation throughout the enterprise technology world for pushing around even its best customers, especially after they have installed technology that would be prohibitively expensive to remove. Oracle execs are known for their bombastic dismissal of competitors. Catz, who in addition to sharing the CEO title with Hurd is Oracle’s principal financial officer, once told a group of incredulous investors her company was going to kill upstart Workday WDAY , which sells subscription software for managing human resources departments, “before they get out of the crib.” (Now a decade old, Workday sports a decidedly grown-up $15 billion public market valuation and is a key competitor. Oracle declined to comment on Catz’s statement.) 2014 COMPANY PROFILE Rank in Fortune 500: 81 Revenues: $38.3 billion Profits: $11.0 billion Employees: 122,000 Total Return to Shareholders (2004-2014 Annual Rate): 13.2% Employees are quickly made to feel their place at Oracle. “I was there 20 years,” says another ex-executive. “The quality of people is very high. But you will never find Oracle on a list of the 50 best places to work. There are very few people in the spotlight, and the attitude is that everyone is replaceable.” For those who come in through acquisitions, the experience can be jarring. Before a deal closes, Oracle requires the to-be-acquired company to seek approval on any expenditure above $10,000. The company’s well-oiled M&A machine, which reports to Catz, has a template for a 100-day integration plan that explains to acquired employees exactly why Oracle is buying their company and whether they’ll still have a job. When Hurd arrived at Oracle there was considerable fear, given his reputation for cost cutting. He was reviled at HP for slashing its multibillion-dollar research budget, but he wasn’t wrong: HP’s vaunted labs hadn’t produced much innovation in years. Hurd streamlined a bloated company—and Wall Street loved him for it. Oracle, by contrast, was neither bloated nor broken. Catz had tightly maintained profit margins and made sure that acquisitions fit into the company’s financial plan. Oracle’s bigger problem was repositioning its product line toward subscription-based software as well as retraining its sales force to sell it. One of Hurd’s key initiatives has been to hire thousands of college students to conduct tele-sales for Oracle. The churn on the young recruits is as high as 50%, but the program achieved two objectives. It lowered Oracle’s selling costs for part of its sales effort and quickly freshened up the roster of salespeople. Meanwhile Hurd has reorganized the company’s sales force by product, buyer, and competitor, and doubled its size. Though that change hasn’t fully paid off yet, revenues are steadily climbing, and analysts are optimistic. Hurd slotted in peacefully with the small handful of peers at the apex of the corporation, but he retained his sharp-elbowed ways elsewhere. He quickly clashed with Oracle’s head of North American sales, Keith Block, whose derogatory instant messages about his new boss showed up in court documents as part of an Oracle legal dispute with HP that wasn’t related directly to Hurd’s departure. Block griped that Hurd avoided international travel, contending he should “be a fucking global president.” Block also suggested there “wasn’t enough room for us both” at Oracle. He was right about that part. Block left in 2012, shortly after the messages were disclosed. He has since become president of competitor Salesforce.com, where he has recruited heavily from Oracle. Ellison and Hurd watching tennis at Indian Wells, Calif., in 2011.Photo: Paul Buck—EPA Hurd is notoriously competitive, about sports as well as business. In 2013 he showed up dripping with sweat for a sales meeting at Ellison’s private golf course complex near Palm Springs, Calif. He explained to a group of customers and Oracle executives that he had been working out with a tennis pro in preparation for an upcoming match. “It’s not that he doesn’t have good instincts,” says one sales executive now at a competing software company. “But he was always so unpleasant. People aligned with his what, if not his how.” For all the attention on the three best-known Oracle executives—Ellison, Hurd, and Catz—the burden of helping Oracle make a critical and tricky technological transition rests on its younger, lower-profile president, Thomas Kurian. Oracle people refer to Kurian, who is 48 and has worked at Oracle for nearly 20 years, in reverential tones. He is the proverbial smartest person in the room and a demanding and workaholic manager who schedules meetings in increments of as little as 10 minutes. Promoted to president shortly after Hurd and Catz were named CEOs, Kurian is also widely regarded as Ellison’s most valued technical adviser. He is, says one top Oracle leader, “a pulsing giant brain that is most like Larry.” Kurian’s mission today is to shepherd Oracle’s shift from making traditional business software its customers own and keep installed on their own servers to pay-as-you-go subscriptions for software delivered over the Internet and stored in the cloud. By its own admission, Oracle got a late start on cloud computing. In a way, Ellison was ahead of the curve in the late 1990s with a mistimed product he called the “network computer.” But the Internet wasn’t far enough along for Ellison’s idea, so he shelved it even as he helped the next generation of companies focus on the trend. “Larry knew the cloud was coming,” says Andre Boisvert, a former top Oracle executive who went on to be president of software maker SAS Institute. “But he’d been burned by the network computer. He thought the market would wait for him. But it didn’t. Then he said, ‘Forget what I told you yesterday.’ He lost a bit of credibility.” Kurian, who speaks just louder than a whisper and refers to the Oracle executive chairman as “Mr. Ellison,” began reengineering all of Oracle’s products nearly a decade ago. But given that cloud software was still in its infancy, he moved cautiously. “Back in 2006, 2007, when we started the engineering effort,” Kurian says, “nobody thought that cloud was going to be so fundamentally important.” Actually, someone did: Competitors from Workday to Amazon Web Services AMZN were far more successful winning subscription business, especially among cost-conscious smaller companies. Oracle president Thomas Kurian at the company’s recent media day.Photograph by Laura Morton for Fortune Oracle didn’t debut its first cloud offerings until 2012, but it has since come on strong. “Now, on average on a daily basis, 62 million people log in and use our cloud for various things,” says Kurian. Although subscription-based software accounts for only about 5% of Oracle’s $38 billion annualized revenue, it dominates Oracle’s public commentary and is an all-hands-on-deck effort internally. Kurian oversees three-times-a-week engineering meetings that run from 2:30 to 7:00 p.m. He says Ellison attends every meeting when he is in town, which is most of the time. Oracle’s cloud pitch is a classic package deal: Buy everything from us rather than cobbling together programs from disparate vendors. It’s the same approach the company successfully used in an earlier era in which it consolidated the database-software industry through acquisitions. Its efforts seem to be paying off. “Oracle has the biggest number of features in the cloud world,” says Vinnie Mirchandani, an independent software analyst who has written extensively about Oracle competitor SAP SAP . “Not all of them sell well, and some aren’t the best, but they are the broadest. No question.” On the last day of April, Oracle hosted a handful of journalists in its offices for what it billed as its first-ever media day. The event signaled a new openness by Oracle, a company whose founder’s yachting, girlfriends, and real-estate-buying exploits receive more attention than its products. The event featured presentations by Oracle’s top three executives but not Ellison, giving a real-time view of the top contenders for his job. (Other than relinquishing his title, Ellison has said nothing about retiring.) Catz, who is 53 years old and almost never talks to the press, stated she won’t stick around at Oracle when the 70-year-old Ellison leaves. When “Larry drives off in one of his fancy cars,” she said, “I’ll be in the passenger seat.” Informed sources confirm that Catz has no designs on running Oracle alone. Indeed, it was Hurd’s idea that she be elevated alongside him, a recognition of her critical role. As well, those in the know say Kurian harbors a thinly veiled ambition to be Oracle’s boss. A well-placed source says Kurian has been assured he will get the position when Hurd and Catz’s time is over. For now, though, the job is Hurd’s to lose—assuming Ellison ever decides to bequeath it. After keeping a relatively low profile for his first several years, Hurd has raised his head of late. He appears on CNBC to talk up Oracle’s prospects—the company’s stock price has doubled during his tenure—and he gives frequent interviews to the press and makes prominent industry speeches. Hurd’s public comments tend to focus on Oracle’s complexity, with fulsome references to Ellison’s leadership and vision. In February, at an event in San Francisco hosted by industry pundit Mark Anderson, Hurd name-checked Steve Jobs, whom he knew when he was at HP. “Steve told me one time, ‘I don’t want to do your job. I don’t want to have to fly and go see customers. You actually go see customers and you talk to them, and they say mean things to you. It just doesn’t sound like fun to me. In my job, customers come to see me.’ ” The message: Enterprise technology is a tough business. In April, Hurd addressed a forum at Boston College’s business school on the subject of “Survive or Thrive? How Will You Modernize Your Business?” Hurd clearly prefers some publicity opportunities to others. In early May, after previously canceling an interview for this article, Hurd agreed, via Bunting, to speak. As the date approached, however, Hurd begged off again, this time citing what he said were instructions from Oracle’s general counsel. The so-called quiet period leading up to Oracle’s release of financial results prohibited an interview, Bunting said. The prohibition apparently didn’t apply to Kurian, the company’s president, because he was interviewed by Fortune during the same quiet period with the company’s blessing (with the caveat that because of the quiet period, Kurian wasn’t permitted to discuss financial matters). Hurd, through Bunting, then offered up a third plan for an interview—after the quiet period and after Fortune’s publication deadline. As this article went to press, Hurd was slated to give a “fireside chat” with a Harvard Business Review editor at a technology event called the Nantucket Conference. The event, attended by the news media, was scheduled to take place less than two weeks before Oracle reports its 2015 fiscal year results. No matter how high his profile is, one obstacle Hurd faces to becoming the sole boss at Oracle is that the company has always been run by a technologist, which he is not. “Mark is a great operator,” says Boisvert, the former Oracle executive who has known Hurd since his NCR days. “He has an uncanny ability to look at reams and reams of numbers and understand what’s going on. But he’s not necessarily a technology visionary. You give him a product, and he knows how to position it and go sell it. He’s not someone who wakes up and thinks about how to disrupt an industry.” The subject of succeeding Larry Ellison has been fraught for years. One person familiar with the company’s succession planning describes past pretenders to the throne as having entered the “Bermuda Triangle” of Oracle’s executive suite. What has tended to be the undoing of previous executives has been allowing their star to publicly outshine Ellison’s. Observes someone who has been in the Oracle orbit for years: “Larry is amused until he is annoyed.” For now, however, Hurd is on top. Ellison is said to be thrilled with his leadership, and those in the know say Hurd’s promotion to co-CEO was intended to fend off suitors who try to entice him with chief executive jobs elsewhere. By one measure, Hurd has one of the smallest portfolios of any major-company CEO. Despite having 95,000 employees reporting to him, he has responsibility neither for finance, legal, or human resources (Catz’s domain) nor engineering (Kurian’s). And he serves at the pleasure of one of the industry’s founding figures, and a mercurial one at that. Hurd has been redeemed, all right. Staying at Oracle will be his continuing challenge. A version of this article appears in the June 15, 2015 issue of Fortune magazine with the headline ‘The Redemption of Mark Hurd’.