After years of battling organizational difficulties, hack attacks, stagnant investment acquisitions and the sore defeat to its younger competitors such as Google and Facebook, news broke out that Yahoo is finally acquired. The telco giant, Verizon, acquired Yahoo’s major business parts and renamed it Altaba. This has been an anticipated move for Yahoo but it seems like there’s another business strategy that’s more controversial than Yahoo’s lamentable descend.
Apparently, its former CEO Marissa Mayer has been drawing attention more than the tech icon’s downfall. Since her rise to fame as the new Yahoo CEO in 2012, Silicon Valley has been divided between those who are skeptic and those who are hopeful for her promised overhaul of the ailing company. Her previous victorious interviews fueled optimistic assessments and tyrannical satire at the same time. This time around, her fate in the company is stirring up yet another round of squabble in the tech world. While Mayer walks away with a $23 million pay check, which strengthens her critiques’ antagonizing stand for her role in the company’s developments under her leadership, we can perhaps observe the top 3 business strategies from it.
Fame Does Add Value — a Temporary Value
As a stylish geek and Google’s employee #20, Mayer’s reputation was a hot commodity. Most are impressed and some are curious with the combination of her experience, skills and glamour — making her a rare find in Silicon Valley. She commands attention from everyone in the tech industry; colleagues, media and most of all, the investors. This makes her essentially a celebrity and she would have pulled it off better if she was in reality TV.
Her fame and the attention it brings did rubbed off on Yahoo. It brought more attention and speculations to the company for some time and it would have been a great opportunity for her to showcase advancements in Yahoo, prove her critiques wrong, demonstrate her abilities and bring her promised business strategy to fruition. After spending 5 years as Yahoo’s CEO, there were changes seen in the company but not as big as her interviews have projected for. And unfortunately, most businesses including Yahoo, are not solely hinged on fame. Yahoo employees, users, investors and ultimately, its customers dictated the company’s destiny while the business value from Mayer’s fame slowly wore off.
Focusing on Strategy Rather than Skills
There’s no doubt that Mayer have the skills, the drive to succeed and the intellectual edge. However, some of her controversial decisions may show her lack of an appropriate business strategy. Richard Branson, CEO of Virgin Group described her decision to end the work-from-home option for her employees as “a backwards step.” Mayer also exercised 3 acquihires amounting to $10 million bringing in 16 employees and most of them have already left the company. She’s also facing gender-biased discrimination from firing Scott Ard, Yahoo editorial director in 2015 and WARN (Worker Adjustment and Retraining Notification) Act violation from firing Gregory Anderson in 2014.
Another one of her debatable moves is perhaps her approach in competing with Facebook which is to buy Tumblr. The blogging and social networking site was bought for $1.1 billion and then 3 years later, devalued at around $230 million according to Yahoo’s announcement in February last year.
Mayer is an intellectual, skillful and seasoned personality in the industry who has proven herself repeatedly in managing numerous Google products. With her skills and given that Yahoo has been around far longer than Google, focusing on an appropriate business strategy would have saved the company and even surpass its competitors. After all, leaders ought to be highly strategic more than anything else.
Hire the Right People for the Job
At the time when Marissa Mayer was hired, Yahoo was struggling to compete with Google and Facebook (and continues to do so, unfortunately). These are young and revolutionary organisations composed of intellectually advanced individuals who are driven to create something new, useful and fun. As one of the top honchos of Google, perhaps Mayer was a good candidate for the job.
But there must have been a missing business strategy — she must have needed help from the right people as well. She did hire a few ones which costs the company millions in the process but most of them left. And the existing Yahoo employees at that time have low morale and lack faith in Mayer as reported by the New York Times last year. Perhaps Mayer do have the key bells and whistles but Yahoo needed a leader who can transform an organisation and not just scare people in it.
Marissa Mayer worked on improving Yahoo within her 5-year tenure. In her goodbye letter to Yahoo employees, she cited a list of impressive developments that benefited users, employers, advertisers and shareholders. Whether all of it is 100% true or not, Yahoo’s status when she left can only be the judge of her leadership, skills and business strategy as the CEO of the company. We see this type of scenario happen in all industries at a varying scale and our biggest takeaway is to develop and focus on a custom business strategy that matters most to a company.