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Oracle’s $28 Billion Acquisition: A Rocky Road with Cerner’s Workforce Morale on the Line

Oracle’s behemoth $28 billion acquisition of healthcare IT heavyweight Cerner has been a tumultuous journey, according to insiders. Since the deal closed in June, Oracle’s restructuring strategies have been met with rising discontent among Cerner’s workforce.

Sources reveal that Oracle has shown the door to over 3,000 of the initial 28,000 Cerner employees. Couple that with a halt in raises and promotions, and a notice that employees shouldn’t expect any until 2023, and it’s clear why spirits are low. Job cuts have been broad and ruthless, touching teams from marketing to product, engineering, legal, and accounting.

Company restructuring post-acquisition isn’t unheard of. But Oracle’s moves, including selling off Cerner’s buildings in Kansas City — a historical hub of employment for Cerner — have left the workforce morale in a reportedly “terrible” state.

Leadership hasn’t been immune to the turbulence. Dr. David Feinberg, previously picked to helm Cerner, now finds himself in a largely symbolic role, according to insiders. Feinberg’s LinkedIn states he left the CEO position in September and is now the “chairman” of Oracle Health.

The plot thickened when Oracle Cloud Infrastructure’s former boss, Don Johnson, was brought in by Oracle’s cofounder, Larry Ellison, to head engineering for Oracle Health and AI. Johnson’s tenure was short-lived, as he exited in January.

With Johnson’s departure, Oracle realigned data and artificial intelligence under its cloud business. Oracle’s VP of AI and Data-Science Services, Elad Ziklik, reassured in an email that healthcare remains a top priority.

As things stand, the face of the unit seems to be Oracle Health General Manager, Travis Dalton, who has been leading all-hands meetings.

Cerner marks Oracle’s most significant acquisition to date, with Ellison envisioning a transformative health data system in the cloud, enabling providers and public health officials to access patient data across organizations.

However, this grand vision is already facing hurdles. Oracle Health is overseeing a multi-billion dollar contract to revamp the US Department of Veterans Affairs’ information systems. The rollout, which has been moving at a snail’s pace since 2020, was paused last month to rectify issues at the five sites already using the system. Time will tell if these teething problems can be overcome and the big vision realized.