Reviving Yahoo! - Strategies that Turned Around the Leading Internet Portal|Business Strategy|Case Study|Case Studies

Reviving Yahoo! - Strategies that Turned Around the Leading Internet Portal

            
 
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Case Details:

Case Code : BSTR064
Case Length : 13 Pages
Period : 2001 - 2003
Organization : Yahoo
Pub Date : 2003
Teaching Note :Not Available
Countries : Japan
Industry : IT

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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EXCERPTS

The Problems

Analysts felt that the major problems at Yahoo were 'infighting within the top management' and 'consensus based culture' that delayed decision making. Rich Rygg, a former Yahoo manager commented on the company's culture, "This was Yahoo's most fundamental problem.

It was always management by persuasion, not management by dictation." According to a source in the company, Yahoo's President Jeffrey Mallett (Mallett) who was in charge of running daily operations fancied the CEO position. Those who went against Mallett were reportedly removed from important posts. As a result, friction heightened between Mallett and Koogle.

Even Koogle was reportedly becoming increasingly unpopular at Yahoo because of his consensus-style of management and lack of involvement. According to a former executive at Yahoo, employees were disgruntled with Koogle, and their displeasure slowed down the decision making process considerably...

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Semel's Turnaround Plan

Semel faced the challenge of bringing Yahoo back to profits and significantly improving its revenues. The task was even more difficult since Yahoo's major source of revenues - online advertisements sales - had fallen sharply.

Semel also had to rebuild Yahoo's top management since several executives had left the company in a very short period. He faced a tough task of bringing seriousness in Yahoo's relaxed culture, building discipline and a sense of urgency among Yahoo's existing employees while ensuring their loyalty.

REMAKING THE CULTURE

Unlike Koogle, who promoted an informal culture at Yahoo, Semel made efforts on building a more serious, performance oriented culture at the company. Semel disliked Yahoo's 'cubicles only' policy and resisted being social with employees, a trend contrary to the informal culture prevalent in most of the software and dotcom companies...

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