Yahoo’s 15 Bullets of Pain – Can You Feel Them Too?

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Today I read a memo published in the Wall Street Journal and TechCrunch from Yahoo’s Brad Garlinghouse on problems Yahoo faces, and his suggestions to improve.

What struck me about this memo is it describes a situation that is not unique to Yahoo. Show this post or his memo to smart friends at large companies and their heads will start to nod.

I’ve organized key statements Brad made in his “Recognizing Our Problem” section and other sections. I reordered a few of them, because in the right order I think it tells a story.

Read through these 15 statements, and say “Therefore” in front of every bold (*) statement. You can start to see how large, entrepreneurial companies lacking strong leadership or vision can spiral into lower performance, and what appear as problems are really symptoms.

  1. We lack a focused, cohesive vision for our company.
  2. We want to do everything and be everything — to everyone.
  3. We’ve known this for years, talk about it incessantly, but do nothing to fundamentally address it. We are scared to be left out. We are reactive instead of charting an unwavering course.
  4. Our inclination and proclivity to repeatedly hire leaders from outside the company results in disparate visions of what winning looks like — rather than a leadership team rallying around a single cohesive strategy.
  5. *We are separated into silos that far too frequently don’t talk to each other.
  6. And when we do talk, it isn’t to collaborate on a clearly focused strategy, but rather to argue and fight about ownership, strategies and tactics.
  7. I’ve heard our strategy described as spreading peanut butter across the myriad opportunities that continue to evolve in the online world.
  8. The result: a thin layer of investment spread across everything we do and thus we focus on nothing in particular.
  9. *We lack clarity of ownership and accountability. The most painful manifestation of this is the massive redundancy that exists throughout the organization. For far too many employees, there is another person with dramatically similar and overlapping responsibilities. This slows us down and burdens the company with unnecessary costs.
  10. Without a clear and focused vision, and without complete clarity of ownership, we lack a macro perspective to guide our decisions and visibility into who should make those decisions.
  11. We end up with competing (or redundant) initiatives and synergistic opportunities living in the different silos of our company.
  12. *We are repeatedly stymied by challenging and hairy decisions. We are held hostage by our analysis paralysis.
  13. *Our compensation systems don’t align to our overall success. Weak performers that have been around for years are rewarded. And many of our top performers aren’t adequately recognized for their efforts.
  14. *We have lost our passion to win. Far too many employees are “phoning” it in, lacking the passion and commitment to be a part of the solution.
  15. *…The employees that we really need to stay (leaders, risk-takers, innovators, passionate) become discouraged and leave.

#15 is the ultimate symptom, since good companies are created and maintained by good people. It’s usually at this point that a company must do something beyond bandaging other symptoms.

This “Jerry Maguire meets Web 2.0” memo may accomplish its goal of throwing down a lightning rod of change. Unfortunately, the organizational outcome for Jerry Maguire is not a happy story. But there is another possible outcome…the Apple story.

Apple faced a situation in the late 90s. The best way to describe their situation is to reflect on the Performa Macintosh. You may ask which one, because there were too many models to remember. It was line and model explosion, and lack of focus internally. So, goodbye Gil Amelio. Hello Steve Jobs. A friend of mine was VP of Marketer at Apple during this time and he told me that Jobs’ manifesto was ‘either you’re working on the iMac or you’re not working at Apple.’ Even financial decisions were focused — any PO over $10k had to be approved by Jobs. The company had laserbeam focus and worked upstream to improve products.

So, to summarize:

Jerry Maguire Outcome: Comments are applauded, but no changes are made. There is organizational fallout (read: layoffs) from this memo, mostly high performing change leaders who will grab their fish, another good employee, and won’t look back.

Apple Outcome: Leadership is ignited to make some hard calls and focus the company to meet primal market opportunities. This may mean good people leave, but for the right reasons.

Can you guess which outcome will help Yahoo become a more successful company? Or better yet, which outcome will help your company become successful?

4 Responses

  1. Good post. You are right that you could take these statements and apply them to a large number of businesses – I’ve heard all of these before, but putting the plan together to rectify them (and working that plan) are the tough calls. Will watch Yahoo with added interest for a while…

  2. Weekly Linkage [11-24-06]

    Quick Hits
    The Dark Side of Second Life [BusinessWeek]
    The Six Biggest New Ideas In Chat [TechCrunch]
    What We Talk About When We Talk About Brands [New York Times]
    Yahoos 15 Bullets of Pain – Can You Feel Them Too? [Decker Marketing]
    Amazon an…

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