Oracle Corporation, Taleo Corp. - M&A Call

Oracle Corporation (ORCL)

April 26, 2012 12:00 pm ET

Executives

Mark V. Hurd - President and Director

Steve Miranda - Senior Vice President of Applications Development

Jason Blessing - Executive Vice President of Products and Technology

Neil Hudspith - Chief Customer officer and Executive Vice President

Presentation

Mark V. Hurd

Well, welcome, and thank you for joining our webcast. We announced the close of the Taleo acquisition earlier this month, so a special welcome to all of our Taleo customers.

This acquisition is particularly important to us because we're adding the leader in cloud recruiting and talent management to our Fusion HCM cloud. Taleo's cloud manages 15% of all the hires in the U.S. and is one of the world's largest cloud deployments, with nearly 16 billion transactions per year. Oracle is now the only vendor that can offer a complete suite of core HR systems, combined with recruiting, talent management and analytics, on-premise and in the cloud. Together, we'll help companies drive exceptional organizational performance.

Strategic talent management is no longer a nice-to-have investment. It's a key driver of business success and financial performance. In fact, it's the #1 issue for CEOs today. Many companies know more about their laptops than they do their people.

Talent management is one of the last major business functions that has to be automated. HR typically doesn't have the tools to provide the management information or the data to be able to benchmark results. Only 25% of organizations today have HR-related KPIs, or key performance indicators. Companies that can make data-driven decisions deliver as much as 40% higher profitability per employee. So this is a big deal. Oracle Fusion HCM with Taleo will now provide the applications and the analytics to help companies improve performance, drive growth and to become more competitive.

Let me give you a couple of scenarios, in fact, I'll give you 3. Hiring and recruiting. First scenario, we're hiring aggressively to grow our sales force. It's important to hire the right people the first time around, because every bad hire can cost you $500,000. Simple math, 10 poor hiring decisions cost you $5 million. And I've got to get them on board and productive as quickly as I possibly can. Positions not filled have a direct impact on my liability to deliver on my sales targets.

Scenario 2, identifying and retaining top talent. 80% of companies can't even identify the top performers who are a flight risk, and they don't know if career plans are in place for those employees. As a leader, I've got to decide if I invest more in retention or recruiting for each function, big decision. Do I retain what I have? Do I recruit more? I need data. What's the tenure of employees in certain positions? Is their compensation right? Is there opportunity for them to advance?

Scenario 3, how much of a focal or increase should I plan and pay for this year? I look at my goals, attrition rates and benchmark our compensation against the industry. I need to understand the impact of choosing a 3% or a 4% increase. Should it be the same for every geography? Should it be the same for every job category, every function in the organization?

With Taleo, Oracle expects to help human resources teams elevate their strategic contribution to the business to allow HR organizations to effectively consult, advise and lead companies on how to address the issues that I've described, full suite of solutions, simplify HCM and talent management through cloud delivery and mobile access to those capabilities, powerful analytics and data that drives leadership strategy and talent productivity.

Now here to give you some more details are Steve Miranda. Steve is Senior Vice President of Oracle Development; Jason Blessing, who's Taleo's EVP of Product Development; and Neil Hudspith, Taleo's Chief Customer Officer. And I'm pleased to announce that both Jason and Neil have accepted leadership positions at Oracle. It ensures continuity of relationships with Taleo customers, maintains vision and expertise for the Taleo products, and I'm thrilled they could join us today as well.

So with that, let me hand it off to Steve.

Steve Miranda

Great. Thank you, Mark, and thank you for joining us, everyone. As Mark mentioned, the way we work has changed. Not only is the competition for top talent really increased, increased globally, our access to information, the number of devices we consume information has dramatically increased and changed, and really, the added importance of finding, recruiting, retaining and then effectively making the top talent effective has become very, very critical to the companies, not only as the Chief HR Officer, the head of recruiting in a company but really every manager throughout the enterprise.

So as these changes take place in organizations, what are we doing or what are the trends that we see within HCM or, really, the future of HCM? And they come into a couple of different areas. The first is really simplifying the HCM product, not only from delivery quickly to be able to deliver in a very agile methodology in cloud and then to have that delivery across multiple different channels, including, and especially, mobile as it becomes much more pervasive throughout the enterprise.

And in addition to simplify, you need a much more connected process to -- full life cycle from finding the top talent, retaining the top talent, training the top talent and then having that life cycle of data feedback so that you will have a virtuous cycle, if you will, of data to help you improve that process throughout, to simplify HCM and make HCM and every manager enterprise more effective.

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