Yang's Departure Reflects How Yahoo Was Broken

The news that Jerry Yang is stepping down as CEO of Yahoo! filled me with a mixture of delight and sadness.  Delight, because anyone who drove their company's value into the ground like Yang did deserves to be removed (and, in truth, should quickly remove themselves); sadness because I remember how high my hopes were when I joined Yahoo! In 2006 -- and how frustrating it was to have everyone there care so much and work so hard -- only to have top management unable to be effective and make the right calls.

My two years at Yahoo! were a window into multiple changes of direction, resets and re-focusings unmatched by any other company I have worked at (including AOL).  When I came in, Dan Rosensweig was saying connecting people was the key and everyone was scrambling to integrate profiles they didn't have. Midway, it was advertising tools and self-serve that was going to be the core value, and then, later, it turned into being the front door and portal for the world. In between, each of these morphed 47 times, leading to divisions and business lines being shuttled between executives, people being laid off and then offered new positions, and a drift, that once I left the company, 10 months ago, seemed chronic and persistent.

To my mind, both Yang and the culture he created are responsible for this. All along, as bright people left or were failed to be given useful new jobs and were moved out, the senior execs kept saying everything was fine. But in truth, employees were being given new managers who -- inevitably -- left, and then reassigned to more new managers, many of whom, in most divisions (Tapan Bhat's excepted), left again. The disconnect between the happy face of the Yahoo! senior team and the major wandering in the desert of the lacking a strategy troops comes from the same lack of grounding in reality that Yang demonstrated in hiring Sue Decker as his Number 2 (no operations background? Puh-leeze!).

So, now Yang's departure offers some interesting scenarios:

• Does the board demonstrate their complacency and hire someone from his executive circle at Yahoo! ?
• Or do they hire someone who can ready Big Purple for sale (and cut and cut as they do so)?
• Or do they hire someone with the guts to manage the long, slow work of rebuilding what was once a set of premium assets?

In my opinion, if they are smart, they will go for #2 -- but that will be Yahoo's loss -- and something that happened entirely on Jerry Yang's watch.

Comments

[User 301467:]

Hopefully Yang's departure will trigger a chain of events that results in Yahoo Search Marketing being fixed. With the 2009 ad spend forecasts I've been seeing, I don't understand how a company in as much trouble as Yahoo can afford to sacrifice advertisers.

2008 Nov 19 11:10 AM

[BigGameHua:]

I agree that Yahoo really needs to focus on a single static vision for the future of its company and Jerry Yang's departure was inevitable. Hiring a CEO from within would be self-defeating. Being complacent with resources that are quickly becoming more and more irrelevant is not a formula for success. Realistically, Yahoo's board of directors has two options now: Groom the company for takeover, or hire a CEO with the balls to out-innovate Yahoo's competitors. Either way, they'll need an exciting, new, and most importantly, static vision, whether it's from a new management group after being acquired, or a chief executive officer with foresight.

2008 Nov 19 04:16 PM

[Tom B:]

Good to hear from an ex-insider. Yahoo is a decent company. Not a superb company, but they deserve better than to be bought by the likes of MSFT. As a customer, that would induce me to lose ALL confidence in Yahoo. Look what MSFT did to HoTMaiL--- they can't even manage something as simpe as that.

Yahoo's biggest problems seem to have NOTHING to do with Yang. It appears they have a "herd of cats" as a BoD, some of them ornery, self-serving sell-and-cash-my-optio... cats. The economy sucks; Yahoo is FAR from being the only stock in the toilet. Yahoo is "innovating" too fast (rather than too slowly, IMHO) and getting sloppy. Every time I click on a news story these days, either of my two browsers crashes, and I got a VERY unsatisfactory answer about that from their support people. Too much Adobe flash, I suspect. On the plus side, My Yahoo Mail, "My Yahoo", Yahoo Notes, and, the crown jewels, Flickr, are excellent-- and I'd like to seem them STAY that way.

2008 Nov 20 11:01 AM

[Boulderbiker:]

Jerrys's a dumb jerk. Thanks for blowing off Microsoft you moron. Loved watching my holdings diminish.

2008 Nov 20 02:50 PM

[MrBuzz:]

It's nice to hear the voice of someone who has been working for Yahoo. As a customer since before they were public. I have strong ties to the company as my provider to everything online. I use so many Yahoo services and products. I want the company to be Yahoo. Not some division of some mega company with no heart.

Does heart have anything to do with business? Many like the rader would say no. But, I think we forget that the American Dream and American business component that foreigners do not and will never understand is: "Business is Personal" when it is it also has passion. Passion creates businesses that defy logic sometimes and have made the USA the success it has become.

So send me to Yahoo....save it, build it, respect the staff, give them clear goals and direction. Have fun - Make money and server the customer. How I wish they would listen to me....but,

2008 Nov 20 03:51 PM