IP Democracy: Memo to Top Yahoo! Execs: Don't Eat Peanut Butter

The blog crowd has descended upon a leaked internal memo by a Yahoo! SVP, Brad Garlinghouse, now known as “The Peanut Butter Manifesto.” In it, Garlinghouse boldly lays out what he calls “my plan” to overhaul Yahoo! because the company has, among other things, spread itself too thin. Yahoo!’s disparate and overlapping investments are like peanut butter, Garlinghouse points out, spread way too thin. “I hate peanut butter. We all should,” Garlinghouse writes.

He then goes on to spell out what he thinks the problems at Yahoo! are. Among them are a grab-bag of Dilbert-esque, standard MBA textbook issues such as “lack of clarity of ownership and accountability” and “lack of decisiveness.”

Garlinghouse, who’s clearly not among the top decision-makers at Yahoo!, has some solutions to the problem such as “focusing vision,” “blow up the matrix,” “kill the redundancies,” and blah, blah, blah.

Is it just me, or does Garlinghouse sound like your standard-issue, mid-level executive with delusions of grandeur looking to make a power grab at a particularly vulnerable time for the company? Except…Garlinghouse seems to be a bit more of a corporate nerd? ass? than usual.

For goodness sakes, the guy even writes that “I love Yahoo! I’m proud to admit that I bleed purple and yellow. I’m proud to admit that I shaved a Y in the back of my head.” Oh, give me a break. (My guess is that Garlinghouse is pointed out to new employees as “the guy who shaved the Y in the back of his head.”)

Moreover, this memo somehow landed in the press — the Wall Street Journal, for crying out loud, published it verbatim. I’d hoped that Garlinghouse on his own thought he’d shake things up by making public what he believes is his brilliant plan to turn things around (fits the M.O. of a guy who’s proud to say he bleeds purple and yellow).

But, according to a companion piece in the WSJ by Kevin Delaney, Garlinghouse’s memo has been embraced by higher-ups and he’s been given increased responsibility as a consequence. So, it’s possible that Yahoo!’s public relations people deliberately leaked the memo to signal the company’s determination to solve its problems, as some people believe.

The idea that Yahoo! would itself leak the memo fits with general consensus. Few others seem to find Garlinghouse’s memo to be the sign of an almost comically ambitious, overinflated corner-office-dweller. Most everybody else thinks his memo is a breath of fresh air, a welcome sign of self-awareness at the stumbling Internet giant.

Larry Dignan at ZDNet writes “Companies would be damn lucky to have executives like Garlinghouse around.” Fred Wilson says “Brad Garlinghouse’s memo is worth reading if you do business with Yahoo!, work for them, own their stock, or care about competition at the top of the Internet pyramid.”

Garlinghouse is right, of course. Yahoo! has been unfocused and lacks a coherent vision, which used to be considered one of the company’s strengths…that it doesn’t put all of its eggs in one basket. Now, however, the far-flung and sometimes seemingly chaotic Internet businesses that make up Yahoo! just look like a mess.

But this won’t be news to Yahoo!’s top tier of executives — it’s probably something that CEO Terry Semel and others have been trying to address for a while. Too bad they didn’t ask Garlinghouse for his opinion sooner. He could have fixed everything with one piece of advice, the final four words in his memo: “Stop eating peanut butter.”

Posted by Cynthia Brumfield on November 19, 2006 1:50 PM to IP Democracy