Yahoo Under The Mayer Regime

by , Nov 7, 2013, 10:50 AM
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OK, it has a new logo. The mail interface has been redesigned. But according to a recent New York Timespiece, Yahoo still doesn’t know what it wants to be when it grows up. Marissa Mayer seems to be busy, with a robust hiring spree, eight new acquisitions, 15 new product updates, a nice 20% bump in traffic and a stock price that’s been consistently heading north. But all this activity hasn’t seemed to coalesce into a discernible strategy -- from the outside, anyway.

It’s probably because Mayer is busy rebuilding the guts of the organization. Cultures are notoriously difficult things to change. In any organization where a major change in direction is required, you will have to deal with several layers of inertia -- and, even more challenging, momentum heading the wrong way.  In the blog post, design guru Don Norman agrees, ““The major changes she has made are not what the logo looks like or a new Yahoo Mail. The major changes are what the company looks like internally. She’s revitalizing the inside of the company, and what everyone sees on the surface are just little ripples.”

To be fair, Yahoo has been an organization lacking a clear direction for a long, long time. I remember speaking at the Sunnyvale campus years ago, when Yahoo was still being remade into a media property, under the direction of Terry Semel. There were entire departments (including the core search team) that felt cut adrift. Since then, the strategic direction of Yahoo has resembled that of a Roomba vacuum, plowing forward until it senses an obstacle, then heading off in an entirely new direction.

What was interesting about the recent Times post was the marked contrast to the rumors and kvetching coming from Mayer’s old digs: Google. There, the big news seems to be the ultra-secret party barge anchored in San Francisco bay. And a Quora thread entitled “What’s the Worst Part about Working at Google?” paints a picture of a frat house that has yet to wake up and realize the party’s over:

  • Overqualified people working at menial jobs.
  • Frustration at not being able to contribute anything meaningful in an increasingly bureaucratic environment.
  • Engineers with egos outstripping their skills.
  • Bottlenecks preventing promotion,
  • A permanent “party” atmosphere that makes it difficult to get any actual work done.

But perhaps the most telling comment came from someone who spent seven years at Google, who said that all the meaningful innovation comes from an exceedingly small group, headed by Larry and Sergey. The rest of the Googlers are just along for the ride: Here's something to ponder.  The only meaningful organic products to come out of Google were Search and then AdSense.  (Android -- awesome, purchased.  YouTube -- awesome, purchased, etc. Larry and/or Sergey were obviously intimately involved in both.  Maps - awesome, purchased. Google Plus is a flop for all non-Googlers globally, Chrome browser is great, but no direct monetization (indirectly protects search), the world has passed the Chrome OS by... etc. ) Fast-forward 14 years, and the next big thing from Google, I bet, will be Google Glass, and guess who PMd it.  Sergey Brin.  Tiny number of wave creators, huge number of surfers.

So we have Google, still surfing a wave that started 15 years ago, and Yahoo struggling to get in position to catch the next one. For both, the challenge is a fundamental one: How do you effect change in a massive organization and get thousands of employees contributing in a meaningful way? Ironically, it may turn out that Marissa Mayer has significant advantage here. If you’re bright, ambitious and looking to do something meaningful with your career, what would be more appealing: trying to shoehorn your way into an already overcrowded house party, or the opportunity to roll up your sleeves and resurrect one of the Web’s great brands?

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