Oracle Trumps Microsoft, IBM

For several years now, the only question about the VARBusiness Annual Report Card for Data and Information Management Software was whether IBM or Microsoft would come out on top. The two have been swapping first and second place for some time--last year it was IBM's turn to wear the crown. Oracle, by most accounts the database market share leader, perennially lagged its competitors with low scores in product innovation, support, partnership and loyalty.

Last year, after Oracle scored 63 to IBM's 73 and Microsoft's 69, Rauline Ochs, senior vice president for Oracle's North America Alliance and Channels organization, collected managers from the company's product development, channel, and product and corporate marketing organizations in one room to lay plans to turn things around. Ochs, who joined Oracle in 2003 and had already engineered some major changes in Oracle's channel strategy, accelerated those efforts with new sales support, partner enablement, and marketing and demand generation initiatives.

It's paid off. This year Oracle came out on top with a score of 67, beating out Microsoft and IBM, whose scores declined to 65 and 63, respectively. It's quite a change for Oracle, which is known for its aggressive direct-sales efforts--sometimes at the expense of its channel partners.

"All the stuff that was lip service for a long time isn't lip service anymore," said Ron Zapar, CEO of Re-Quest, a Naperville, Ill.-based Oracle reseller, referring to earlier Oracle promises to become more channel-friendly. "The paradigm shift that's been promised for years is happening now."

Oracle has always been known as a technology leader, so it's no surprise the vendor outscored IBM and Microsoft in every criteria in the product innovation category. Oracle scored 81 in richness of product features/functionality to Microsoft's 72 and IBM's 65, for example, and 77 in quality and reliability to Microsoft's 71 and IBM's 68.

Oracle's information management, business intelligence and middleware products "are very leading edge," said Rich Niemiec, CEO of Oracle reseller TUSC. He cites the database's high-availability and performance-monitoring capabilities and ability to handle huge data sets. TUSC was a beta tester for the new Oracle Database 11g release, which Niemiec called "one of the cleanest beta [products] we've ever seen," and he cited the software's Total Recall tool as particularly innovative.

But as Zapar put it: "The problem has never been the product. The problem has always been the relationship. And that's where they've made the most progress." The ARC scores bear that out: Oracle's grades of 64 for support and 62 for partnership were only a bit better, or tied with, Microsoft and IBM. But compared with the 53 Oracle earned last year in support and partnership, it's a big step up.

Ochs began changing Oracle's approach to the channel three years ago by developing guidelines for how the company's sales force should work with resellers. Some of the initiatives hatched in last year's packed-room meeting include the Accelerate program, under which resellers can pick application modules from Oracle's multiple application product lines and assemble them into solutions for SMBs in vertical markets, and the All Partner Territories strategy that gives resellers first crack at selling to new customers in designated geographic areas.

Resellers credit Ochs, who was recently named Channel Executive of the Year by the CMP Channel Group, with driving the changes. "She's hearing us and she's been able to get senior management to support the channel," Zapar said of the channel chief. Niemiec seconds that: "She's a sincere advocate for the partners."

Ochs credits resellers with helping Oracle's sales force see the benefits of a channel strategy. "The partners' own contribution played a big role in changing the culture," she said.