Yahoo!’s embattled CEO Terry Semel has been given the boot, a development that is somehow as shocking as it was predictable. He’ll serve as non-executive Chairman of the company while co-founder Jerry Yang steps into the CEO role and Sue Decker, long-time CFO and recently EVP and head of the advertiser and publisher group, moves up to President.
But don’t look for things to get better. For one thing, Yahoo’s press release announcing this set of developments is symptomatic of a company out of touch with reality. The way Yahoo! is spinning the unsatisfactory executive shuffle: “Yang and Decker to Focus on Realizing Yahoo!’s Strategic Vision by Accelerating Execution, Further Strengthening Leadership and Fostering a Culture of Winning .”
Say what? They can’t spin their way out of this one by pretending that Semel’s ouster and Yang’s elevation will “further strengthen leadership.” I had to laugh, and then got a little insulted, when I read this ludicrous happy-happy talk. Valleywag had the same reaction:
This attempt to spin, in the most desperate of situations, isn’t clever; it’s pathetic, and emblematic of a company still in deep denial about its defeat by Google. Further strengthening leadership? Well, maybe, if the Sunnyvale internet company had a great chief exec hire to announce.
Not only does Yahoo!’s strangely confident-sounding press release fail to reassure, it actually raises doubts in my mind about the company’s ability to survive. What Yahoo! is doing is engaging in “as-if” behavior, one classic sign of a dysfunctional group, whether it be a family or a huge corporation. Apparently Yahoo! thinks that if it can just pretend “as if” this were a good thing, we’d all buy it.
Now, most companies are inherently hotbeds of dysfunction, with internal politics and constant one-upmanship turning the collective group of people into one big unhappy family. But Yahoo! seems to be particularly bad off, as evidenced by not only this recent development but also by a damning “manifesto” written by a Yahoo! SVP last year, which was leaked to the press. This infamous “peanut butter” memo accused the company of lacking focus, vision, clarity of ownership and accountablity, decisiveness and a passion to win.
Clearly, in addition to these flaws, Yahoo! also now suffers from either denial or a belief that it can pull the wool over everybody’s eyes. Over the past two years the company has undergone two major reorganizations that resulted in the loss of many top executives, including the company’s long-time COO.
Last summer Yahoo! shook up Wall Street by warning that its revenue growth had gone soft. The company’s controversial Project Panama, Yahoo!’s new saving-grace ad platform, was subject to repeated delays.
All the while Yahoo! (and Semel) were lambasted by the press and rejected by investors. I’d say it’s going to take a corporate management genius to turn things around at Yahoo! but instead Jerry Yang (who was quite happy in his previous hands-off position, or so I recall reading) is running the show, for now anyway.
All of these things are huge indicators that Yahoo! is beset by serious, potentially fatal problems. You’d think that some official acknowledgment of Yahoo!’s desperate need of a turn-around would show up in the official pronouncements. That nod toward reality, however oblique, would have given folks at least some reassurance that Yahoo! is dealing with its problems.
About six months ago I wondered if Yahoo! isn’t too “mature” to survive the rough and tumble new Internet business. Now I wonder if Yahoo! isn’t too dysfunctional to survive much longer.
Cynthia Brumfield at 7:19 PM|Comments(0)
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