For the past few quarters, many of us have sensed something of a malaise brewing inside Yahoo. (My first question to David Filo at Web 2, for example, was centered on Yahoo’s sliding image as an innovator, and how it’s languished compared to Google in terms of search and monetization). Now Paul Kedrosky has posted an internal memo (and WSJ does too) that puts that malaise into words. Written by SVP Brad Garlinghouse, it’s a pretty thrilling manifesto – the kind of internal document that gains power when it becomes public.
Now the question is, what will Semel do with it? The public airing of such a damming memo certainly demands some kind of response. Wow.
…all is not well. Last Thursday’s NY Times article was a blessing in the disguise of a painful public flogging. While it lacked accurate details, its conclusions rang true, and thus was a much needed wake up call. But also a call to action. A clear statement with which I, and far too many Yahoo’s, agreed. And thankfully a reminder. A reminder that the measure of any person is not in how many times he or she falls down – but rather the spirit and resolve used to get back up. The same is now true of our Company.
It’s time for us to get back up.
I believe we must embrace our problems and challenges and that we must take decisive action. We have the opportunity – in fact the invitation – to send a strong, clear and powerful message to our shareholders and Wall Street, to our advertisers and our partners, to our employees (both current and future), and to our users. They are all begging for a signal that we recognize and understand our problems, and that we are charting a course for fundamental change, Our current course and speed simply will not get us there. Short-term band-aids will not get us there.
Specific points Brad makes:
We lack clarity of ownership and accountability. The most painful manifestation of this is the massive redundancy that exists throughout the organization.
We lack decisiveness. Combine a lack of focus with unclear ownership, and the result is that decisions are either not made or are made when it is already too late.
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. We sit idly by while — at all levels — employees are enabled to “hang around”. Where is the accountability?
Garlinghouse goes on to make specific recommendations about how the company should be organized (way flatter), staffed (cut 15-20%) and run (kill redundant businesses, etc.).
I can only imagine the fire drill going on at Yahoo right now over this. But my two cents is this: Accept this criticism as heartfelt, and assuming the leak was not malicious, don’t go on a witch hunt. Don’t circle the wagons, and – this would be risky but right – if you truly believe that Garlinghouse has valid points, take the memo to heart and address the points it raises.
No one wants to see what happened to DEC, Xerox, IBM, or Microsoft happen to Yahoo. Maybe this is the wake up call it needed? (Of course, having the leak on the weekend before Thanksgiving does minimize the impact…)
Update: From the Journal: Chief Operating Officer Dan Rosensweig has asked Mr. Garlinghouse to head a group of Yahoo staff looking into the issues in the memo over two months, say people familiar with the matter.