Transformation at Yahoo Foiled by Its Leader’s Inability to Bet the Farm

I actually would have been happy if Yahoo resurrected a web portal and built social search to address the failings of Google, but instead there was this weird unfocused acquisition spree.

But is there a good way to overcome this, and convince cautious, quantitative managers that an decision with no corresponding data is truly necessary, and could yield great returns?

It's easy to be a visionary with 3 years of hindsight.

I obviously can't speak for your experience in having these discussions, but I've found that the "debt" metaphor is extremely helpful in explaining this value to the business side (and, having worked in finance, it's actually more appropriately referred to as an unhedged call option which is much worse[1]).

1: http://higherorderlogic.com/2010/07/bad-code-isnt-technical-...

Agreed; though this is changing. More companies are starting to optimize their tech organizations for flexibility rather than low cost. The cost difference usually isn't that much (no more than 25%) but the focus is on building and maintaining a technical product development capability. All products today are technical products, and if non-technical companies don't develop a technical competency, they will wither and die (then their brands will be bought by whoever DOES have a technical competency).

This is a strategic move, and strategic moves shouldn't be based purely off of numbers. They should be backed up by numbers, but market positioning and brand play into it a lot more than financial projections.

In the end, ROI or metrics-based management approaches are mired in ideas that belong in businesses that resemble raw materials extraction (like, say, Exxon) or about as far away from a company like Apple or Google as you can imagine.

When was the last time your company did an metrics improvement or ROI study on the phone system? The office electrical grid? Email? How the hell would you even conduct such a study? Would the iPhone project, prior to its release, survived such a study?

You can't tell someone they're doing it wrong if what they're doing is making them money. That is the bottom line.

If my car is running fine, a mechanic telling me about my messed up gear alignment and replacing the clutch pressure plate thats 'about to die' isn't going to convince me to spend $3543 in parts and labor. That is what it sounds like to non-CS people.

You can educate yourself about one aspect of car, but unless you're actually a mechanic yourself its trivial for an expert in a field to bilk someone outside of that field.

As a developer, it would be super easy for me to make-up technical debt, talk about API complexity, brittle design and what not, but ultimately no manager is just going to allow a developer to go about changing the design for no perceived gain (to them). This is not necessarily a bad thing, as the vast majority of developers, are simply mediocre and are poor judges of what constitutes good design anyway.

Disclaimer: I was at Yahoo when she came and implemented this policy.

It irritates me to see uninformed people making such blanket comments. You have no idea what the policy was; I do. Let me explain it, in the hope that you (and others with this mindset) may learn something about it, and maybe even change their views.

There was a group of Yahoos ( < 200 ) who had a permanent work-from-home exemption (if you can call it that; there was never much of an enforced policy earlier). They never came in to an office (except for the occasional IT issue and package pickup). There were a couple of incidents where these remote workers were found to be moonlighting. So a study was done to see how many of these remote workers actually VPNed in. After a month or two, it turned out, a good number of them were actually working part-time. So a blanket ban was issued, with the caveat that if you could make a compelling case, you would still be allowed to WFH. In fact, a colleague of mine continued to work from home after this policy change. A number of strong people continued to WFH; a few were let go; and the rest had to hoof it to office.

Now, the mistake Marissa made wasn't with this policy; but it was in how she didn't go the next step: holding the managers of the shirkers responsible.

Which brings me to my thinking about why it's so hard to turn around Yahoo: the middle management. (Please do me a favor and read PG's excellent post http://www.paulgraham.com/yahoo.html after you're done reading this). Yahoo is filled with managers whose sole contribution is survival. There is no accountability for screwing up. Fucking up products badly has never gotten anyone fired.

Did you know Yahoo went through 3 different iterations of an attempt at a "social network"? Each and every time, sane minds pointed out that the concept was bad, the UX was bad, etc.; and yet the managers prevailed and it went down in flames, as predicted.

The joke in Yahoo used to be: throw everything into version 1.0, because you never know if there will be a version 1.1.

Marissa is failing not because she's a bad CEO (having seen Yahoo CEOs like Terry Semel, I can assure you she's the best they've had in the last 10 years); it's because she has no supporting cast. She trusts people too much. One manager once said to me (about her): meh, she'll be gone in a couple of years; I'll still be around. He had been there since 2001, and had no intention of moving anywhere. Collected fat paychecks by taking credit for others' work. And he was just one of many, many in there. Over the years I encountered so many people like him, where you had no idea what actually they contributed to the company.

/rant

You know how folks complain about open office plans? Because of the distracting noise and potential for interruptions? Well imagine an open office with coworkers who have no sense of social tact, cannot take care of themselves, and have a constant deep need for your attention. That's what it is like for a parent to work at home and parent their kids at the same time.

So when I hear that parents at Yahoo were using "work at home" as a substitute for childcare, I think that Yahoo did the right thing by cancelling the policy. That is pretty clear abuse of it.

She was given huge latitude by the board to make decisions and show that they were valid. In the end she created an environment that led to an exodus of top talent.

She's a good high-level executive but not really a CEO.

Those two properties in themselves could be a separate company or the backbone to the two big players in fantasy sports.

It's too bad that that can't be said about the rest of their products.

Is 500px really anything to write home about though?

Seems even more marginal and doomed to fail than Flickr.

But I'm amazed by how many people are willing to give Mayer a pass despite so many people from inside the company at the C and VP level leaving for reasons that include a confused strategy and mismanagement, specifically from Mayer, has undermined any attempts at a turnaround.

Here's an excerpt from a Forbes piece:

> But perhaps none of these incidents damaged morale more than Mayer’s reorganization of Yahoo’s product teams. When Mayer launched the effort last fall, everyone agreed the existing structure had outlived its usefulness—for instance, mobile products was partitioned from other groups. But Mayer embarked on the process without laying out a grand vision for it. Instead, she began sketching out different scenarios in one-on-one meetings with various executives, floating one plan by one exec and a different by another. Unable to make up her mind, the process dragged on for months. “She went through 20 different permutations,” says an executive with knowledge of the process. “The product guys were twisting in the wind, not knowing what they were going to run.”

> Product releases slowed to a trickle, and a turf war brewed as executives became concerned with their futures. Jon McCormack, a star executive who had joined Yahoo in January from Amazon and was promised a broad engineering portfolio covering critical areas like mobile, landed in the vacuum created by Mayer’s indecision. He was gone by the end of February and now works for Google. When Mayer announced the new structure in April, it was too late. “That was the beginning of everyone losing faith,” says another senior executive. “That’s when people started to look for other jobs.”

The thing that always struck me when I looked through tumblr is that essentially all of the "comments" are just the equivalent of likes or retweets and less actual comment threads. Always seemed like sort of a waste but I guess people use it more like a "richer" version of Twitter without the character limit and with easier embedding of media.