Diagnosing Yahoo’s Stagnation

Today I read an article in the New York Times titled Even Under New Captain, Yahoo Seems Adrift. And while it’s been a few years since I worked there, I feel like I’ve seen this scenario before. But before I spew my 2 cents on the issue, let me pose a very simple question.

Name one good thing that Yahoo! does better than any other large web site and it generally recognized for doing well.

Think about it for a minute or two if you need to. I’ll wait.

Really, don’t rush.

Ok, got it? Not yet? Hm. Perhaps that’s a really big part of the problem.

But really, that just illustrates the obvious problem. The less obvious problem is a deeper cultural issue. It’s an institutionalized lack of accountability that makes it easy to blame others (upper management, other product teams, “market forces”, and so on) for things that don’t happen.

The reality is that the bright spots in the company were bright because they managed to succeed despite having the option of blaming others and not taking the risks necessary for success. They were also comfortable not trying to please everyone all the time.

Now I don’t talk to many Yahoos these days, but I have a hard time believing that this particular aspect of Yahoo has changed that much.

I believe you can fix this by bringing in the right CEO. But that means finding someone who really “gets” this business that Yahoo is in. It has to be someone with a strong vision and the guts to tell people what they’re screwing up and hold them accountable. From everything I’ve read, I get the sense that Bartz has the guts but not the vision. That means she’s relying on the advice of folks who have a vested interest in doing it the same old way.

If Yahoo were to suddenly find and strong CEO with a real vision for its products (and building things that users cannot live without), the company would be difficult to stop–especially now that it’s not spending untold dollars in a hopeless attempt to catch up to Google in the search business. I’m talking about the kind of vision that doesn’t come from a marketing team or a committee. I’m talking about the kind that comes from a passionate leader who really gets what the Internet is about and wants to make it better.

My advice to Carol (or the board): don’t believe everything you hear. Definitely don’t compromise. That’s a large part of what got Yahoo into this mess. And please find someone with the vision that Yahoo needs.

(Oh, and please don’t think you can acquire your way to building truly great products. That has been tried too many times already.)

About Jeremy Zawodny

I'm a software engineer and pilot. I work at craigslist by day, hacking on various bits of back-end software and data systems. As a pilot, I fly a Flight Design CTSW and high performance gliders in the northern California and Nevada area. I'm also the original author of "High Performance MySQL" published by O'Reilly Media. I still speak at conferences and user groups on occasion.
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19 Responses to Diagnosing Yahoo’s Stagnation

  1. jr conlin says:

    I always thought that Yahoo’s focus was to try and copy other websites, AOL, Google, Facebook, etc.

    They’re the Silly Putty of the internet.

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  3. Jeffrey says:

    My post has some thoughts on this but I thought I’d reiterate that “you can’t acquire your way to greatness” is demonstrably false. Companies like Cisco do it. It’s just that Yahoo hasn’t been successful at it, maybe because of its underlying cultural problems.

  4. JR: Yeah, I remember several management types telling us that Yahoo was a “fast follower” instead of being an innovator.

    Sad times.

    • Jeffrey says:

      Being a fast follower can work, too, you just have to be actually fast. Microsoft was like this in the 90s and it worked well for them.

  5. Jeffrey:

    Good point. Perhaps I should have said, “Yahoo: YOU cannot acquire your way…”

  6. Anonymous says:

    I think there’s more to it than just “blaming others” that’s the issue. It’s the fact that we promote leaders who fail. Look at any number of the people who’ve been promoted into the upper ranks over the past 5+ years and then ask yourself “has the projects they worked on succeeded?”. Predominately speaking, you won’t be able to answer “yes” to that very basic question, which is in my mind the biggest problem facing Yahoo! today.

    It gets even more comical when those said people are “recognized” on sites like TechCrunch as a “loss” for Yahoo! when they depart. Honestly I feel at least half of the upper management, if not more, that’s departed in the past several years is a good thing for the company as nothing they have done here has made any noticeable positive impact (let alone be successful).

  7. Sam says:

    “It’s an institutionalized lack of accountability” … that just about captures it in a nutshell.

    If there’s one constant in Yahoo, it’s this: the incompetent continue to rise; the doers are pushed out. Every reorg we see the absolutely inept rise to acquire more and more powers. As engineers leave, more managers are hired.

    And then everyone wonders why things are broken.

  8. Ash says:

    Here are the things that yahoo does really well.

    1. Yahoo! Finance, I dont use any other source except yahoo for this.
    2. Display Advertising, I think we are still the biggest in this market.
    3. Yahoo! Mail. Really beautiful interface
    4. Yahoo! News. Still pretty cool.

  9. Bill says:

    Ash beat me to Finance & News — those were the two that quickly came to my mind. I disagree on 2 & 3, but I’m biased these days.

    I’m not going to disagree that a top-down vision, if the right one & one they execute on, would be a huge boon to the company, but 1) I doubt that’s going to happen, and 2) it’s needed.

    Since going Google, I’ve been surprised how well the “Chaos by design” approach can work. Sure, like any system, it’s not perfect, but I certainly prefer it over other systems I’ve been in, and it’s made me significantly reevaluate value a manager brings to the table & how they help the team be effective.

  10. Bill says:

    Shoot — somehow I managed to delete a paragraph in my reply, making it somewhat incoherent. Anyway, the missing part was that I believed Yahoo still had a lot of great engineering talent who do get it. They can provide the vision. The best thing (imho) would be to empower them, but with it, also hold them accountable.

  11. Flickr is a good example of acquiring greatness :-) I don’t think it has any real competition and don’t see someone challenging it in the near future.

    I don’t think I use any other Yahoo services though unlike 10 years ago.

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  13. Tom says:

    Yahoo use to have that really well organized category listing of websites. Unfortunately they gave up maintaining that long ago. That was what brought me to yahoo. While I stayed for other stuff like their free email and games.

    Their games site, use to have the best online chess. But that new “upgrade” a few years ago destroyed that. Now it is clunky and slow and you can’t play any kind of speed chess on it b/c it takes a whole minute for you to move a piece.

    Having a leader with a vision will help. However I think they first need to start doing well the things that they’re already doing . Then we can talk about the vision thing and where to go next.

  14. perilun says:

    I used Yahoo a bit (5 years ago) but it felt like another spin on AOL, so when iGoogle came along I consolidated there. YUI might be the only (Small) leadership area … but just for the developer crowd.

  15. Annoyed says:

    I’m moving on from my job with [big corp] despite just launching a major product under them. It’s a big success, rave reviews, sales staff all smiling. But I’m not happy, do these symptoms sound familar?:

    Managers would obstruct me at every turn. If I talk to them, they block me, if I don’t talk to them, then I have an implicit yes. So I avoided them, did it my way, then let them take the credit (shockingly my way turns out to be a good way… but only in hindsight it seems).

    I’d design and code features that tackle 90% of everyones wishes, an imperfect compromise, but the best possible with conflicting requirements. But there was always managers that wanted *THEIR* 100% even if it means losing 40% of another teams wishes. So managers would fight over their last 10%’s, whoever wins claims the prize of ‘their’ success at the expense of the end product.

    I even had one ass**** team leader who introduced a crash into his code to force the spec the way he wanted it. He did this just as we’re releasing the final candidate too. Other team leaders caved, and features were changed to fit his wishes.

    To top it off, I have a weak middle manager, that reflects all problems onto his own team to avoid confrontation with the 20 other managers. I couldn’t think of one occasion where he’d backed my choices in the 4+ years, but could think of 50 when he’d claimed credit for something I’d driven through against his wishes.

    In the next version, the managers are designing the product without me, well I guess it puts them back in charge, but since I coded and designed the bulk of their only recent success story this is just stupid.

    I imagine Yahoo is very similar, over time it would accumulate b*llsh*tters, those bs’ers would hang on, while the good ones would move onto better jobs. Tall poppies would be cut down, team managers would divide and conquer to stay in their jobs. Eventually inertia becomes the name of the game.

    Then when a competitor does something new, it’s ass covering mode, they rush to copy it, be the first to claim they wanted that all along….

    Yahoo probably needs a damn good cleanout of management. I bet it isn’t new talent it needs, it just needs to get rid of the ‘obstacles’ in the company.

    IMHO, Local search is where Yahoo can still excel, I should be able to plug a GPS location into their search, and get every point of interest, restaurant, shop, bus, taxi, transport, a map, everything, all available without restriction for free. Flickr images based on location, funded by picture ads etc. And none of this ‘api key’ stuff either, open it up, fund it with ads.

    But then I’m biased since I’m writing a GPS phone app now that I’m moving on and find a gaping big hole in Google’s/Yahoo search.

  16. Moschops says:

    I used Yahoo from almost day one and still has a five letter-only @yahoo.com email address but haven’t actually used it for anything in many years except occasionally moderating some posts in legacy Yahoo groups. So yes I agree with your summary – there’s not one thing they do (that I know of) that isn’t done better by others. Unfortunately even the sum of things they do is also done better by others, it’s not just search Google has beaten them on, its everything, and for those that don’t do email as such (many kids these days don’t have actual email addresses they use actively any more) Facebook also offers a compelling online eco-system to live in. So aren’t you basically saying they need to ditch everything and start from scratch… question is do they have any bright people still there? Most of the good ones have surely fled by now, the remained are inherently just hanging on enjoying job security while they can. As far as I can see it’s only a matter of time before Yahoo gets acquired (for real this time), along with AOL and a bunch of other legacy online eco-systems.

  17. Internerd says:

    Whats depressing is when technical stuff at yahoo fails – at my job we work with them – their stuff goes down no one really cares to fix it. Where’s the geek ego like in xkcd.com/705 over there? Maybe left the building a while ago. Its sad to see them languish. Oh how the might have sat down.

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